Why Is Nokia Charging Customers More Than The Invoice Amount?

Nokia has already had a few problems rolling out its new touchscreen 5800 XpressMusic phone, including earpieces that go bad in humid weather and firmmware that wouldn’t work on certain big-city 3G networks on the US model, but now they’re screwing around with something serious: customers’ money.

This post by a user named ChOpSu3i on HowardForums explains what’s going on:

After ordering, the order confirmation screen showed the final price as “$727.48″; the email order confirmation also showed “$727.48″. I thought nothing of this, then when the phones shipped on 3/19 I received a shipment confirmation with a final price that was also “$727.48.” I thought, cool, I’m finally going to get these things. Fast forward a week and the pending credit card transaction was gone, but moved to recent transactions. Here is what I see:




…[I] called back today and was promptly transferred, I spoke to some random guy who didn’t give his name, but after a few minutes of arguing told me to disregard whatever prices I was emailed, or whatever prices show up on NokiaUSA.com because the invoice price should have been “$734.25″. I asked to speak to his supervisor after 5 minutes of circular arguing, in which he told me he was not available. Huh? It’s a Tuesday, yes it might be Caesar Chavez Day in California, but this call center was definitely not in California and they are definitely not celebrating the day as everyone else seemed to be working.

Anyway, so the reason for posting this long winded thread is because like many others in the 5800 Official Thread, I was charged more than was quoted. I don’t know their disclaimer on this, but that is definitely NOT right. How can you send someone 3 different screens for a single quoted price, yet later charge more?

Nokia clearly indicates that the tax and shipping are estimated amounts during checkout by using a red asterisk next to each field and adding a dislaimer nearby.


However, by the time you’ve reached the confirmation screen, shouldn’t this be taken care of? And if not—if it’s still an estimate—then where did the asterisks go? Compared to the checkout screen, all the screens and emails that follow seem pretty finalized:


ChOpSu3i, we think you should try calling again, and if you get another unhelpful CSR, consider disputing the amount with a bank. Yes, we agree, it’s almost a trivial amount to deal with, but Nokia needs to address this more satisfactorily than just saying you shouldn’t pay attention to any of the documentation they provide you—even your order confirmation.

“Attention Customers of NokiaUSA.com” [HowardForums]

Comments

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  1. SWBLOOPERS says:

    Charge it back. If they dispute it, tell them that they “shouldn’t pay attention to any documentation” you provided.

  2. nybiker says:

    I always wondered about sites like that. You have a shipping policy and it says $x for sales between $y & $z. And if you’re shipping to a tax-aggressive state (like NY) where they charge sales tax on the combined shipping/handling charge, then use the tax rate. What’s so complicated for these guys? Are they actually getting a bill from UPS/FEDEX/USPS based on actual charges and then charging you that amount? If so, they have some explaining to do because I’ve not seen that explained before.

  3. Web Reacher says:

    May I suggest a chargeback? For difference between the quote and the final price ?

    That way Nokia will have to pay around 25$ in fees, to your credit company.

    By the way, Nokia’s ”after sale” service is pretty abhorrent in general. Your story does not surprise me.

  4. Coles_Law says:

    Even if you give Nokia the benefit of the doubt an assume $734 was the proper price, they’ve now pissed off a customer over a difference less than 1% of a $700 sale. Even if he doesn’t chargeback, the negative word of mouth will undoubetly cost them more than $6 in sales.

  5. nybiker says:

    They need money to maintain the upkeep on all their theaters. That could be another reason for their attempt at ripping off their customers.
    /just saying.

  6. I_am_Awesome says:

    Lulz he spent $700 on a cell phone

  7. Anonymous says:

    Had the same thing happen with an update to ZoneAlarm Pro on their web site. Three times the price reflected a $25 discount, but the final confirmation page was increased by $25. I call tech support. No you can not do that here in India, you must ……

    I just canceled the order. Flushed the cache and several other methods of clearing the transaction off my browser history, etc.

    No ZoneAlarm Pro upgrade for you, out of the upgrade line.

    George

  8. CC-Man says:

    I think I may have an answer. As of tomorrow, April 1, 2009, the California sales tax goes up by 1%, or ~$7 for a $700 purchase.

    I am unsure, but they may be charging you based on when the item will be shipped, not when the order was placed.

    • Coles_Law says:

      @CC-Man: Good catch there-that may be the reason right there.

    • chopsu3i says:

      @CC-Man:

      how would it be related to the tax rate change that happens TOMORROW? i ordered the phones in february, and received them last week.

      • CC-Man says:

        @chopsu3i: I didn’t catch that you received the phones already. In this case, I will go back to what I originally thought–Nokia is giving you the run-around, and you should bring this up with your credit card company.

    • chrisjames says:

      @CC-Man: Sales tax is meant to be applied at time of sale, not time of shipping or delivery. That means that when you confirm the sale, the tax rate in effect at that time is locked in, so to speak. Receipts and confirmations should come with a clear time of sale, or at least a date.

      If they cycled the sale to make it more recent, their new calculation might catch a recent change in sales tax, but A) it’d still be the wrong rate, and B) they’d have no reason to do that. To do this just to catch a new tax rate, higher or lower, is borderline criminal. They’d have some serious ‘splainin to do to the Feds if they were collecting higher sales tax when they shouldn’t be (and likely pocketing the difference), or lower sales tax and not turning over the proper amount.

      Still, chopsu3i says this happened in February.

      • CC-Man says:

        @chrisjames: I agree with you that if they cycled the sale to make it more recent, the new calculation would likely invoke the wrath of the feds.

        Sales tax is not, however, necessarily meant to be applied at what most people consider the “time of sale.” Depending on the company, the “time of sale” can either be the order date or the shipment date. So while the tax may technically be applied at the time of sale, the term “time of sale” effectively varies between actual “time of sale” and “time of shipment” depending on the policies of the company.

  9. STrRedWolf says:

    Wait… OP has a N95 (which has the battery life of a brick) with AT&T and now two 5800′s? With all the other problems, plus Nokia’s latest problems with anything cellular (I had a few throw-away phones from Nokia that I really wanted to throw away — but I want to try their Maemo based Wifi tablets)…

    Scott Bourne must be right. Nokia’s latest motto is “We’re not happy until you’re not happy.”

    • chopsu3i says:

      @STrRedWolf:

      yes i have an n95, its been a great phone and quite possibly the only phone ive had longer than 2 years, out of many, many phones.

      • SquareBubbles says:

        @chopsu3i: N95 is a pretty solid phone, but I absolutely love my N82-1.

        I wanna hear how your 5800s turn out, I had a chance to briefly play with a pre-release model, but not enough to really make an impression.

        My friend has an E71-2 that is amazing, but I’m really hoping for a timely NAM release of the N97

  10. howie_in_az says:

    Yes, we agree, it’s almost a trivial amount to deal with, but Nokia needs to address this more satisfactorily than just saying you shouldn’t pay attention to any of the documentation they provide you-even your order confirmation.

    No, it’s not almost a trivial amount. Imagine if Nokia did this for 100,000 customers, or 1,000,000 customers. It’s essentially free money until someone calls them on it.

  11. Blueskylaw says:

    This seems to be happening much more often, and in these days of instant telecommunications, there can only be one reason for not giving you a total, “out the door” bill.
    My humble but wise in the ways of business opinion is that when you are ready to pay for the item, you have already investigated and become emotionally attached to it, and they hope that you won’t complain about paying a “few” dollars more for it.
    They may guesstimate it, but I doubt the final bill will ever be lower that their guesstimate.

  12. allstarecho says:

    People really pay 700 bucks for a cell phone????

  13. YeaYuh says:

    It looks like maybe they charged him twice for the phone. Because you can see the $399 in the order confirmation with $798 which is twice the amount.

  14. Justin Harper says:

    A solution for this poster and the many others I see like this:

    1. Get an AMEX.
    2. Use it religiously.

    Fire your credit card company and hire someone who will actually go to bat for you.

    If Nokia said they were going to charge you an amount, that’s what they better charge you, NO MORE. If they want to charge you more, they need to go out of your way to let you know and *get* *your* *approval* before just putting something on your card.

    If they don’t, get AMEX to slap them with a chargeback fee. That’s what should happen when they lie to you and try to charge you more. If they don’t like it, they can start going about things the right way the FIRST time.

    Disclaimer: I do not work for AMEX. I have, however, had an AMEX for 5 years and after the way they’ve treated me, am a lifelong customer.

    • Anonymous says:

      @Justin Harper: your comment summarizes how I feel about my Amex. I bought this phone with my Amex, had a several dollar difference, but when I did the calculation, the charged price is the “correct” one for the sales tax in my area (Los Angeles). Nokia is being really lame, but since I was charged the correct amount ultimately, I’m not going to pursue it.

  15. Ezra Ekman says:

    The reason for the discrepancy (which they told you about during checkout) was that different cities sometimes charge different rates of sales tax. For example, in California, state sales tax is 8.25 %, yet the city of San Francisco charges 8.5%. There are databases available on both a state-by-state and city-by-city basis, and it sounds like Nokia didn’t want to spring for the more expensive database. Instead, they estimated the tax based on your state, then charged it based on your city.

    I think the real question is this: Why could they get it right when putting through the actual charge when they couldn’t during the checkout process? They clearly have access to the data. My guess is they never hooked up their shopping cart to their payment gateway, which are probably from two different service providers. Nokia probably has their own shopping cart (though it’s possible even that is outsourced, and re-branded to look like Nokia), but the actual credit card transactions are likely handled by a third-party – either a bank, or a credit card processor. You know, one of those companies that seem to be prone to security breaches of late.

    But I digress. The point is that it takes time and money to make both the shopping cart’s API and payment processor’s API talk to each other, which is why Nokia put that disclaimer in place. If you try to do a chargeback, Nokia will probably point to the disclaimer and tell your bank that you *were* notified that the total might be different than the original, which was just an estimate. Figure it out yourself: what’s the sales tax in your area? Multiply that times the total you’re being charged for the product, but don’t apply tax to the shipping cost, which is a service. (Services, most food products not served on-site, and a number of other items aren’t taxable.)

    If the total you get matches theirs, you’re out of luck. If there’s a discrepancy, file a chargeback with your bank. And Nokia, if you’re reading this: get your act together and make your shopping cart and payment gateway talk to each other. It isn’t that hard if you know what you’re doing. If your development team doesn’t, hire some engineers who do. With the economy down, there are plenty available.