The Allegations Against StubHub
Prosecutors in Washington, D.C. have filed a lawsuit against online event platform StubHub, accusing the company of using predatory sales tactics to deceive consumers into paying more for tickets. According to the complaint, filed by Attorney General Brian L. Schwalb, StubHub has been hiding mandatory fees from consumers, resulting in a potential 40% increase in the total cost of tickets. This practice, known as drip pricing, involves initially offering low prices to lure in customers and then adding fees later in the purchasing process.
The Impact of Drip Pricing
As lawmakers and consumer advocates scrutinize the effects of drip pricing, it has become clear that this tactic can lead to higher costs for consumers. By gradually changing the terms of a deal, companies like StubHub can manipulate consumers into paying more than they originally intended. This deceptive pricing strategy not only deceives consumers but also prevents them from comparing prices effectively. StubHub’s use of deal countdowns and multiple browsing screens further exacerbates the issue, creating a false sense of urgency and confusion for shoppers.
The Consequences for Consumers
Consumers are often left feeling manipulated and misled by drip pricing tactics. Vicki Morwitz, a marketing professor, explains that these pricing strategies can lead consumers to overpay for products and services, as they may feel pressured to complete a purchase once they’ve invested time and effort into the transaction. The lack of transparency regarding fees and pricing calculations further adds to consumer frustration, as they are left with unexpected costs and limited options for comparison.
