Consumers are feeling pretty beat up these days.
They have endured four years of a bruising housing crash and its aftermath. The white-knuckle stock market has left its mark. And the scars from unemployment will run deep for years.
That's why the high-profile retreats on price hikes and other changes by Bank of America and Netflix — after an outcry by customers — are cause for Americans to rejoice. Jane Consumer can look herself in the mirror, put on some lipstick and see a person who's still got it — influence, that is.
Consumers may be down and out (a recent survey showed more than 60 percent expect financial conditions to worsen), but their clout is only growing stronger.
And companies are taking notice.
"After years of people being squeezed on both sides of their wallet, it's triggering people to take action and to take more action than they did three years ago," said Jean-Manuel Izaret, a partner at The Boston Consulting Group who specializes in pricing strategy.
This week, Bank of America became the last of the big banks to drop a new $5 fee for account holders who rely on their debit cards to pay for everything from a cup of coffee to their weekly grocery bills.
BOA could no longer justify its lonely position to charge the fee simply because it wanted to make up for other charges that were no longer allowed by regulators.
Anger over the fee swelled in consumers until it exploded in a series of petitions, bank withdrawals and social media thrashings that put the bank against the ropes.
Last month, Netflix canned its plan to launch Qwikster, a company it wanted to spin off to handle its DVD-via-mail business while Internet streaming became Netflix's core operation.
Customers were already riled by big price increases the company had just announced and resented being forced to go through two different companies for DVD and streaming services they were already getting through one.
Netflix's stock price took a beating and some 800,000 subscribers canceled in reaction to the price increases (which remain in place) and attempt to spin off the DVD business.
Just weeks after its introduction, Qwikster was history. It was a complete about-face given that Netflix executives had extolled what they said were the many benefits of the spin-off.
BOA and Netflix both made big mistakes. They tried to push price increases in a very high-profile way without providing a good rationale behind them.
Customers can typically accept price increases that result from rising production costs or other tangible factors. But across-the-board increases just to pad profits don't fly.
"I don't stop and think, 'Oh, the poor banks, interest rates are so low and they're not making much profit,'" said University of Florida economist Dave Denslow. "All I think is, 'They're ripping me off.'"
That's all a lot of people think about. And for good reason. It only makes sense that consumers are more outraged by price increases when they are also grappling with unemployment and lost equity in their homes.
Such corporate reversals are not a completely new phenomenon.
In 1999, for example, the chief executive of Coca-Cola said he wanted to start charging more for ice-cold Cokes on scorching summer days. Vending machines would be equipped with thermostats that could raise or lower drink prices according to temperature.
Reaction was severe and Coke dropped the idea before it ever got started.
But the economic doldrums have made people even more sensitive to price and the advent of social media has provided a megaphone. As a result, consumers can feel a little more empowered.
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