How Companies Use Manipulative Tactics to Exploits Customers

How Companies Use Manipulative Tactics to Exploit Consumers

In today's consumer-driven world, companies constantly innovate to maximize profits. However, some of these tactics are not as ethical as they appear. From planned obsolescence to price discrimination and shrinkflation, businesses employ various strategies to squeeze more money from unsuspecting consumers. This article sheds light on some of the most common and deceptive ways companies exploit their customers.

1. Surge Pricing Manipulation: The Hidden Trap

One of the most controversial tactics used by ride-hailing services like Uber and Ola is surge pricing. While companies justify it as supply-demand balancing, studies suggest a more manipulative approach.

A 2023 study in Belgium found that ride fares increased when a user's phone battery was low. The logic is simple—if a user's battery is about to die, they are more desperate to get a ride and may pay a higher price.

Similarly, ticket-booking platforms often inflate prices when users repeatedly search for the same flight or hotel. The algorithm detects interest and manipulates prices to create urgency. The best way to counter this is to browse in incognito mode or use price comparison websites before making a purchase.

2. Planned Obsolescence: A Forced Upgrade

Ever wondered why smartphones slow down after a few years? The culprit is planned obsolescence—a strategy where companies design products with a limited lifespan to force customers into buying newer models.

• Smartphones: Tech giants like Apple and Samsung have been accused of intentionally slowing down older devices through software updates. Apple even paid a $500 million fine for deliberately degrading iPhone performance.

• Electronics: Many laptops and appliances come with sealed batteries or non-replaceable parts, making repairs impossible.

• Printers: Some printers stop working after a certain number of pages, even if they are in perfect condition.

To combat this, the European Union introduced Right to Repair laws, mandating that companies provide replacement parts for at least 10 years. Similar consumer protection laws are necessary worldwide.

3. Shrinkflation: Paying More for Less

Shrinkflation is a sneaky trick where companies reduce the size of a product while keeping the price the same. This tactic is especially common in the food and beverage industry.

• A 500ml soft drink bottle is now 450ml, but the price remains unchanged.

• Chocolate bars, chips, and biscuits have shrunk in size, yet their packaging remains identical.

• Washing powders and soaps are slightly diluted, making them less effective per use.

Consumers often don’t notice these small reductions, but over time, they pay more for less. Always check product weight and quantity before purchasing!

4. Misleading Marketing: The AI and Doctor-Recommended Scam

Companies frequently use misleading buzzwords to make products seem superior. Two common examples are:

The "AI-Powered" Lie

Many electronic appliances—such as washing machines, refrigerators, and air conditioners—are marketed as “AI-powered.” In reality, most of these devices use simple pre-programmed settings, not artificial intelligence. This is just a marketing gimmick to charge higher prices.

The "Doctor-Recommended" Trick

Many toothpastes, shampoos, and skin creams claim to be "doctor-recommended," but no specific doctor names are mentioned. Most of these claims are fabricated, with brands using vague surveys or paid endorsements.

To avoid falling for these traps, always read fine print and research the actual technology before making a purchase.

5. The Razor-and-Blade Model: The Hidden Cost of Accessories

Companies typically sell a primary product at a low price but make their real profits from expensive accessories and consumables. This strategy is known as the razor-and-blade model.

• Printers and Ink Cartridges: Printer companies sell cheap printers but charge exorbitant prices for ink refills. Many printers even use software locks to block third-party ink cartridges.

• Water Purifiers: Some water purifiers require frequent filter replacements, often costing more than the device itself over time.

• Gaming Consoles: The PlayStation and Xbox are sold at a lower price, but games, controllers, and online subscriptions make up for the loss.

To save money, look for products that allow third-party accessories and consumables.

6. Hidden Fees and Subscription Traps

Many companies advertise low prices but later charge hidden fees. Common industries guilty of this include:

• Banking: Banks charge hidden fees for ATM withdrawals, maintenance, and international transactions.

• Streaming Services: Platforms like Netflix and Amazon Prime increase prices gradually after offering cheap introductory plans.

• Airlines: Many budget airlines offer cheap tickets but charge extra for seat selection, luggage, and food.

Always read the terms and conditions before signing up for any service to avoid getting trapped in unexpected charges.

7. Fake Discounts and Price Manipulation

Ever noticed how e-commerce sites show huge discounts? Often, these discounts are fake—companies first inflate the original price and then apply a discount to make it look attractive.

• A product originally priced at ₹1000 is marked as ₹2000 with a "50% off" label.

• During festive sales, some products return to their normal prices after the discount period ends.

To verify real discounts, track prices using comparison websites or check price history tools.

8. Warranty Scams and Paid Repairs

Many electronic devices come with warranties that don't actually cover major repairs. Instead, companies push consumers to buy expensive extended warranties.

• Laptop and smartphone brands often exclude battery and screen damages from warranty.

• Some brands refuse repairs if the customer doesn’t buy an official service plan.

Instead of falling for extended warranty scams, check for third-party repair options or buy devices from brands known for good customer service.

Conclusion: Stay Informed and Shop Smart

While businesses will always seek profits, consumers must stay informed to avoid being exploited. Read product labels, compare prices, check reviews, and question marketing claims before making any purchase.

Governments and consumer rights organizations are pushing for stricter laws, such as the Right to Repair and truthful advertising regulations. However, until such protections are universal, staying aware is the best defense against these manipulative tactics.

Have you ever experienced any of these tactics? Share your thoughts in the comments!