A couple weeks ago, Lenovo advertised their Y410p and Z510 model laptops in a “doorbuster” sale for $279 and $255. They regularly retail for $1389 and $1099, respectively. Many of my friends jumped on the bandwagon, ordering several units for themselves and their families. I didn’t bother. The deal seemed too good to be true. Long story short, orders were cancelled by Lenovo which set off the online firestorm #lenovogate. I wasn’t surprised. In fact, I’ve been burned by Lenovo before.
Lenovo advertised the sale of two mice for nearly 90% off back in 2011. Each mouse, which regularly retail for around $80-90, were available for $6 and $20. I quickly made my order online and promptly received a confirmation email indicating a successful transaction had occurred. A day later, I received another email indicating that there was a price error for both mice; Lenovo cancelled the order.
In 2012, Lenovo advertised their high end laptop ThinkPad X220, retailing around $1500, for $350. That time, orders went through, cards were charged and laptops were shipped – only to have Lenovo intercept the packages and reroute them all back. To add insult to injury, it took a couple weeks for consumers to get their refund.
Lenovo has offered $100 off the future purchase of a laptop until August 3, 2014 as a gesture of goodwill for cancelling the Y410p and Z510 orders but with a history of pricing bumbles, the effort is too little too late. Rather than appeasing potential customers, Lenovo is effectively allowing the brand to be associated with pricing errors and disappointment. It’s understandable for companies not to honour pricing errors and consumers technically aren’t owed anything if money has not changed hands. Lenovo may not be required to fulfill the orders but from the looks of it, they’ll lose out on several future orders.
At what point should companies honour their price errors?
If they price it at $350 even if it was their error, they should suck it up and honour it.
What’s a few thousand dollars in losses compared to the loss of precious goodwill that can’t be recuperated, and was built over a period of time?
Admit to the mistake, ask people if they would be willing to pay the real price and suck it up.
20 years to build a reputation, 20 minutes to destroy it. — Buffett
Seriously. They don’t owe anyone anything, but it comes at their own expense. I think honouring one per successful order where money was exchanged rights the ship and staves off the hoarders who order 100 units for kicks. Practically speaking, stop making the sweeping errors to begin with!
I think companies should always have to honour price errors, no matter what the difference is. It would place more importance on making sure prices are accurate. There was a news story last year about people who got some really, really good flight deals because a system glitch caused incorrect pricing. Not sure what the conclusion was but hopefully they got the discounted price
I did hear about that; it was Delta at the end of 2013. $400 flights going for like $25. The difference here is that US transportation regulation requires airlines to honour their pricing mistakes. The good PR happened to work in their favour. If only we could get some consumer protection like that! We haven’t heard anything, but we suspect but I suspect our $479 round trip tickets to Korea next year may have been a price error 😉
Here’s the difference (imo) is that Lenovo are debiting cards before the person has the product. I recently bought a rival brand, and I’m pretty sure the full charge didn’t come through (cleared) on my card til delivery, likewise the invoice. Which in a way also seems fair – what if it got damaged in transit? IMO, that’s the vendor’s fault, but it’s mine if I drop it on the way to the car from the store.
I agree they should honour it – sounds like they might just be selling these items at cost price EVERY time they stuff up. Might slow down the stuff ups too! That being said, I think there’s a way they could perk people better – you know, I like ‘have it at that price and seeing we stuffed up here’s $100 off any product in the future’. Why? Well it says more that they gave it at cost price but it also potentially lures loyal customers… At the moment, they’ve stung EVERYONE for retracting the offer. Just a thought…
In a world where the likes of RFD and slickdeals didn’t exist, then I’d say that the companies should own up to their price errors and take the financial loss. However, with deal sites and forums running rampant with people just waiting for these slip ups to occur, the losses become severely magnified very quickly even if you are only honouring the price on one unit per order.
If one unit per order was a known policy, soon people would be gaming that restriction too and making sure orders got split up properly so they could still get multiple units.
Don’t get me wrong, I like a good price error and I like companies manning up to their mistakes because they should check this stuff over carefully … but it’s still a tough pill to swallow when so many people are trying to take advantage of the system.
I’m probably not one to talk here, as I’m sure I’ve crossed the murky grey line on more than one occasion of what is being a smart consumer and outright taking advantage of a company.