Truth in lending, truth in marketing. Bloomberg reports in “U.S. Bank to Reimburse Military Members in CFPB Crackdown” that US Bancorp and a partner company have agreed to pay $6.5 million in restitution to members of the military that they provided loans to while failing to disclose all the fees embedded in the loan, which increased the final cost to the military borrower.
If your product is good, why do have to hide elements of the product from the user? If you can lay out all the parts of your product/service and it doesn’t sell, you don’t need more marketing, or deceptive marketing. You need to retool and rework the product service so that it becomes a compelling choice for the consumer.
I don’t like people that lie to me, and I don’t like businesses that lie to me in order to win my business. I especially don’t like business that do not treat members of our Armed Forces with the respect they have earned.
So was it worth the deception to consumers to earn an additional $180 per loan? How much more did Bancorp earn with the deception. They did not make more money, not when you look at the $6.5 million pay back that they are forced to pay out. It gets even worse on the return on US Bancorp’s business reputation, how much value has that lost, now that consumers and service members know they mislead to win business?
All good marketers are story tellers, framing an honest, compelling story about their products and how they benefit the consumer. Bad marketers need to lie and mislead to succeed and sell their product, but the success will always be short lived until the deception is discovered and the reputation ruined. Create a great product with a market need, market it with a compelling story that meets the target consumers’ world view, sell it, profit honestly and build a great brand.
Bancorp should spend more time reading Seth Godin’s “All Marketers are Liars” and improve their marketing and less time developing schemes to rip off American service members.