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12/05/2004
Public need more protection from doorstep sales: OFT
Doorstep selling legislation needs to be updated to close legal loopholes and combat the psychological tactics employed by salespeople, according to the Office of Fair Trading (OFT).
An OFT study into doorstep selling published today found that consumers can "make inappropriate purchases which they later regret" – as a result of sales tactics used by the salesman.
Nearly 40% of consumers have bought goods or services in the home – but while 70% of those were satisfied, a significant minority of 30% experienced problems. At least 15,000 complaints a year are made to trading standards departments regarding doorstep sales, the OFT said.
Current legislation gives consumers who are cold-called a seven-day period in which to cancel a contract – but this does not apply to consumers who asked for the visit.
Also, 94% of consumers are unaware of these cancellation rights, and find it difficult to distinguish between a solicited and unsolicited visit, the OFT said.
The OFT has called on the government to close this loophole and give cancellation rights to both solicited visits as well as unsolicited. However, even with cancellation rights there are problems – as unscrupulous sellers can install goods before the cooling-off period expires. The OFT also recommended that the government bans work and/or payment within the cooling-off period except in circumstances where it is "genuinely needed urgently by the consumer".
Penny Boys, OFT Executive Director, said: "Doorstep selling can be a convenient form of shopping, often just as a time saver for busy people, and is of particular value for house bound consumers. However the unique setting the home provides also means that high pressure selling and psychological tactics can persuade them to make purchases they don't really want. It is therefore vital that consumers have adequate protection and are able to cancel contracts they later regret."
Six psychological influencing principles were identified:
(gmcg)
An OFT study into doorstep selling published today found that consumers can "make inappropriate purchases which they later regret" – as a result of sales tactics used by the salesman.
Nearly 40% of consumers have bought goods or services in the home – but while 70% of those were satisfied, a significant minority of 30% experienced problems. At least 15,000 complaints a year are made to trading standards departments regarding doorstep sales, the OFT said.
Current legislation gives consumers who are cold-called a seven-day period in which to cancel a contract – but this does not apply to consumers who asked for the visit.
Also, 94% of consumers are unaware of these cancellation rights, and find it difficult to distinguish between a solicited and unsolicited visit, the OFT said.
The OFT has called on the government to close this loophole and give cancellation rights to both solicited visits as well as unsolicited. However, even with cancellation rights there are problems – as unscrupulous sellers can install goods before the cooling-off period expires. The OFT also recommended that the government bans work and/or payment within the cooling-off period except in circumstances where it is "genuinely needed urgently by the consumer".
Penny Boys, OFT Executive Director, said: "Doorstep selling can be a convenient form of shopping, often just as a time saver for busy people, and is of particular value for house bound consumers. However the unique setting the home provides also means that high pressure selling and psychological tactics can persuade them to make purchases they don't really want. It is therefore vital that consumers have adequate protection and are able to cancel contracts they later regret."
Six psychological influencing principles were identified:
- reciprocity – creating in the consumer a feeling of indebtedness to the salesperson
- consistency and commitment – building up the consumer's commitment to the product so that a decision not to purchase looks inconsistent
- scarcity and anticipated regret – generating a sense of urgency and of loss if a purchase is not made
- social proof – making the consumer feel they are like everyone else who bought the product
- liking and similarity – gaining information about a consumer's likes and dislikes in order to identify with them, build a rapport and gain their trust
- authority and expert endorsement – working on the principle that people will defer to expert opinion.
(gmcg)
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