Bait And Switch Meaning Scam Example Psychology

Bait and Switch Meaning

Bait and Switch is common in industries like real estate, automobiles, electronics, recruitment, etc. The mode of the deceiving advertisement can be print (newspaper), broadcast (radio and television), electronic (email and social media channels), etc. Its practice is illegal in almost all countries across the globe.

Bait and Switch Scam Explained

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Key Takeaways

Bait and switch (B&S) is a fraudulent marketing practice followed by the seller to earn increased profits. This practice is illegal in almost all countries.In the Bait and Switch policy, the customer is attracted to an advertised product (bait) and made to switch to a pricier alternative (switch) with the persuasive skills of the salesperson.It is not followed when the seller tells the customer beforehand that the advertised product is available in a limited quantity.To protect oneself from the Bait and Switch trap, be vigilant, purchase from authorized sellers, compare the price of the advertised product with the market price, etc.

The bait and switch policy is practiced when both the given tasks have been followed:

The seller gives bait to the buyer by showing a misleading advertisement of a product that claims to have a high quality and reasonable price.The seller makes the buyer switch to an alternative product that has a higher price or inferior quality compared to the advertised product.

Precisely, the bait and switch psychology works as follows:

The seller advertises a product or service using a medium of their choice. The aim is to attract that segment of the market which believes in saving money. The advertised product promises several tempting offers and discounts. This serves as bait that attracts customers.The attracted customer goes to the store fully convinced to buy the advertised product. The seller declares that the advertised product is no longer available due to certain reasons. These reasons include, the entire stock has been sold out, the stock was available for a limited time period, the advertised product was meant for display only, the advertised product was flawed or has been damaged, etc.The customer is disappointed to see that the seller is not selling the advertised product. Consequently, the salesperson tries to push the customer towards an alternative product that is either similarly priced and has low quality or is high-priced. In both cases, the seller has the advantage of selling the alternative product.Once the buyer is convinced that the alternative product outperforms the advertised product, he/she makes a purchase decision. Hence, the persuasive skills of the salesperson make the customer switch to an entirely new product. So, the seller is said to have followed the Bait and Switch policy wherein they advertised a product they never intended to sell.

The bait and switch scam is prohibited in the United States, Canada, Australia, United Kingdom, etc. The seller is punishable if they have deliberately followed this policy with an intention to deceive the customer.

Further, the seller who indulges in bait and switch advertising can be sued by either the deceived customer or the manufacturer whose products have been used as bait. However, action is taken only if the seller’s tactic is proved in court.

Exceptions to the Bait and Switch Practice

This tactic is not said to have been followed in the following cases:

If the seller initially tells the customer that the advertised product is available for a limited time period or until stocks lastIf the seller is able to sell the advertised productIf the seller is capable of selling the advertised product, though, they are aggressively pushing a more expensive product

In the preceding cases, no action can be taken against the seller as the Bait and Switch practice is not proved.

Example

Let us consider a bait and switch example for a better understanding of the concept.

In May 2022, Tiffani, a resident of Idaho, USA, wants to purchase a car for which she visits some websites. The pandemic has impacted the supply chainSupply ChainA supply chain refers to a process beginning with the procurement of raw materials and the production of finished goods and ending with their distribution and sale.read more of cars due to which the inventory maintained at the dealer outlet has reduced. Moreover, the inventory is not updated with each sale. This is the reason the websites continue to show out-of-date inventory. The outcomes are listed as follows:

Tiffani visits several car dealers each day. The car shown on the website (bait) is no longer available at the outlet. Consequently, the salespersons take her through a list of cars (switch) that are scheduled to arrive at the outlet. Therefore, these car dealers follow a Bait and Switch tactic.The car dealers now stock only 20 days of inventoryDays Of InventoryDays Inventory Outstanding refers to the financial ratio that calculates the average number of days of inventory held by the company before selling it to the customers, providing a clear picture of the cost of holding and potential reasons for the delay in the inventory sale.read more which was 60-90 days before the pandemic. This crunch has limited the number of colors and models available in every car brand. Hence, to make online shopping of cars more reliable, it is essential to link the website with the actual production schedules.

How to Protect Yourself?

The ways by which a customer can protect himself/herself from Bait and Switch traps are listed as follows:

Be an informed customer who is aware of the Bait and Switch policies.Compare the price of the advertised product with its market priceMarket PriceMarket price refers to the current price prevailing in the market at which goods, services, or assets are purchased or sold. The price point at which the supply of a commodity matches its demand in the market becomes its market price.read more. If the relative price of the advertised product is too low, one can sense that something is wrong.Purchase the product from an authorized seller or dealer. This way, one can seek protection from malpractices to some extent.Verify that the location of the outlet shown in the advertisement is correct. This will suggest whether the advertisement is reliable or not.Ask the seller if the advertised product will be available after some time in case it is currently out of stock. This will help know whether the seller actually intends to sell the advertised product or not.Check the reviews of similar products on the net. This will help ascertain whether the advertised product actually exists or not.Try not to fall for those advertisements which show products with heavy discounts. Every time one visits an outlet persuaded by an advertisement, he/she is deemed to have “accepted the bait.”