Buyer beware – scammers and fraudsters on the prowl

‘Buyer beware’ is a phrase that has been around for a long time and for good reason. There are enough stories in circulation to know that not all sales people or businesses behave honourably, and some are nothing more than fraudsters and scammers. With the market getting more crowded, the need to attract buyer attention and grow revenue, and the rise of the online business model, buyers should beware.

While most businesses and their sales people want to attract and work with viable prospects and customers, there are those less than honourable sales people and business people who are after victims, not prospects. Their entire focus or raison d’etre is to get your money at your expense.

For instance, I recently came across the website Scamnet which was put together by the WA Government and profiles scams targeting consumers and businesses. Scamnet gives you an A-Z listing of scams ranging from Pyramid schemes to the ‘Nigerian scam’ many of us have experienced via our email. The site shows you how to spot a fraud or scam, hopefully before it gets you.

In my line of work I also come across all sorts of information about questionable business practices which may not feature on Scamnet but nonetheless may be equally problematic. I recently found some terms I had never heard of before on Wikipedia – Ethically Disputed Business Practices. On the surface these practices may seem legitimate but are widely regarded as inappropriate, unethical and even illegal in many circumstances. Despite their dubious nature, you see these practices being employed by some businesses, politicians and others on an almost daily basis to serve their own needs at the expense of others. Here are some questionable business practices I thought worth mentioning (source Wikipedia):

Frugging: In market research, frugging is “fund-raising under the guise of research”. This behavior occurs when a product marketer falsely purports to be a market researcher conducting a statistical survey when in reality the “researcher” is attempting to solicit a donation. Generally considered unethical, this tactic is strictly prohibited by trade groups, such as CASRO and the Marketing Research Association, for their member research companies.

Sugging: is a market research industry term, meaning “selling under the guise of research”. This behavior occurs when a product marketer falsely pretends to be a market researcher conducting a survey, when in reality they are simply trying to sell the product in question. Generally considered unethical, this tactic is prohibited or strongly disapproved of by trade groups, such as the UK Market Research Society MRS, CASRO and MRA, for their member research companies.

Shill: A shill is a person who is paid to help another person or organisation to sell goods or services. The shill pretends to have no association with the seller/group and gives onlookers the impression that he or she is an enthusiastic customer. The person or group that hires the shill is using crowd psychology, to encourage other onlookers or audience members (who are unaware of the set-up) to purchase said goods or services. Shills are often employed by confidence artists.

The term shill (or plant) is also used to describe a person who is paid to help a political party or other advocacy organisation to gain adherents. As with the situation of selling goods or services, the shill gives the impression of being unrelated to the group in question, and finds merit in the ideological claims of the political party.

Shilling is illegal in many circumstances and in many jurisdictions because of the frequently fraudulent and damaging character of their actions. However, if a shill does not place uninformed parties at a risk of loss, but merely generates a “buzz”, the shill’s actions may be legal. For example, a person planted in an audience to laugh and applaud when desired, or to participate in on-stage activities as a “random member of the audience” is a type of legal shill.

“Shill” can also be used pejoratively to describe a critic who appears either all-too-eager to heap glowing praise upon mediocre offerings, or who acts as an apologist for glaring flaws. In this sense, they would be an implicit “shill” for the industry at large, possibly because their income is tied to its prosperity.

My intention is not to be a moral arbiter here, I will leave you to be the judge of what you do and don’t do. However, in the spirit of ‘fore warned is fore armed’ I hope this helps you and your people steer clear of any scammers or fraudsters before they get you. This information may also help keep you from ‘unintentionally’ taking up any dubious marketing or sales activities that may impact on yours, your business and your customers’ viability and credibility in the future.

Remember, everybody lives by selling something.

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Sue Barrett practices as a coach, advisor, speaker, facilitator, consultant and writer and works across all market segments with her skilful team at BARRETT. Sue and her team take the guess work out of selling and help people from many different careers become aware of their sales capabilities and enable them to take the steps to becoming effective and productive when it comes to selling, sales coaching or sales leadership.To hone your sales skills or learn how to sell go to www.barrett.com.au.