Blockbuster Inc. will write a check for $140,000 to the state of New Jersey, settling charges by the state Attorney General’s office that its “no late fees” ad campaign was incomplete and misleading. The state will refund about $90,000 of the money to 75,000 Blockbuster customers who paid “video restocking fees” – which was the retailer’s euphemism for “late fees.”
Early last year, New Jersey officials raised objections to a new Blockbuster ad campaign that claimed it would no longer charge late fees. However, what was not as well publicized was the company’s policy of charging consumers’ credit cards a purchase price if they kept a movie too long, and then, if the movie eventually were returned, refund the purchase price less a $1.25 restocking fee.
Blockbuster reportedly agreed to the settlement as long as if it didn’t have to admit any guilt.
Early last year, New Jersey officials raised objections to a new Blockbuster ad campaign that claimed it would no longer charge late fees. However, what was not as well publicized was the company’s policy of charging consumers’ credit cards a purchase price if they kept a movie too long, and then, if the movie eventually were returned, refund the purchase price less a $1.25 restocking fee.
Blockbuster reportedly agreed to the settlement as long as if it didn’t have to admit any guilt.
- KC's View:
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The guys at Blockbuster can deny guilt until hell freezes over. The fact is that the company was guilty of trying to fool consumers, of trying to obfuscate the fact that Netflix was competing with it to a great deal of success, of being disingenuous about its real policies and intent.
Trying to deceive consumers isn’t just wrong. It’s stupid.
In the 21st century, nothing replaces good old-fashioned transparency.
This is a lesson that every retailer should take seriously.
