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February 22, 2005
Blockbuster's getting sued for false advertising claims (from Adrants):
Blockbuster has been caught with its pants down regarding its new "No More Late Fees" ad campaign. Unbeknownst to most, the video rental company's largest campaign to date amounts to a lie... New Jersey Attorney General Peter Harvey filed a lawsuit last Friday claiming Blockbuster did not disclose the reality of its new program.
While it's all in the fine print, Blockbuster's program does not do away with late fees. It simply recategorizes them into a "sale" on the eighth day. If, after 30 days, the video is returned, the charge is credited but then the company imposes the well known, "we'll do anything for a buck" trick and charges a restocking fee.
Ouch. Talk about a great way to destroy brand reputation. One of the tenets of the BrandShift philosophy is authenticity. I think the folks at TrueTalk have done a great job in defining a few key terms related to authentic conversation (go there for more):
- Honesty: We mean what we say.
- Transparency: We don't pretend or hide our true motives.
If this lawsuit has merit, then Blockbuster fails on these two items. I've seen the Blockbuster billboards: "No more late fees." They're trying to compete with NetFlix without changing the way they operate. Somehow they think that changing the label from "late fees" to "sale" changes the meaning of the transaction. Great example of putting lipstick on a pig.
I believe that all companies should start asking themselves the question, "Will this activity build or betray trust with our customers?"
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