Russ’s promotional rate for Time Warner cable ends today. His rate goes up by almost $50, which is sad news for him. Except Time Warner saved the day with some “special savings.” Are the savings really all that special? Russ sees it differently. He sees “special savings” wrapped up in a rate increase. The end result was that Russ opened this letter that told him he was getting “another special offer.”
Of course, any retailer (and especially erstwhile JCPenney CEO Ron Johnson) could tell you that consumers prefer to feel like we’re getting a deal. Time Warner could have set his new regular rate at $101.99 and called it a day. Most people will have warmer feelings toward Time Warner when they read that their rate could have been $138.98, but they’re getting a special discount.
Also, this leaves the door open for them to end the special discount at the end of 2013.