Wednesday, May 12, 2010

Customer Ethics

Apparently young Australians have loose ethics. Shopping ethics that is, according to a 10-year study.

Let's have a look at this statement made in the article and see what's wrong with it:
The moral decay has been blamed on new technology, including the rise of self-service transactions, and the common perception that businesses are purely out to make as much money as they can.
Straight away, the phrase "the moral decay has been blamed on new technology" begs the question. Decay compared to what? Was there a previous study performed that they're not mentioning that is being used as a benchmark? Unless this previous study exists, there is no reason to assume that customer ethics have changed one iota.

Second, it's being blamed on technology. They are arguing that customers now have the means to more easily steal from businesses. Let us assume this is true, though you'd have to talk to experts in shop security to get any real data. That doesn't mean that customer attitudes have changed, it would only mean that they can now take actions based on those attitudes in a way they couldn't before.

Thirdly, they state that the 'decay in ethics' is due to the perception that businesses "are purely out to make as much money as they can." It makes sense that customers have this perception, because businesses are out to make as much money as they can.

Dr Neale, who was part of the 10-year study, says "Businesses cannot rely on their customers to always do the right thing." Interesting, I can also phrase that the other way. "Customers cannot rely on businesses to do the right thing." That is something everyone would agree with. After all, it's only when laws and regulations are put in place to prevent businesses from doing the wrong thing that they actually stop doing the wrong thing.

Even with regulations in place, it's no secret that businesses, particularly big businesses, make very lucrative profits on their sales. Enough to give CEOs bonuses of millions of dollars on top of their already enormous salaries. To my mind, and indeed to every other consumers', the fact that they can afford to throw around such large sums of money probably means that the price of the goods we buy is probably a little over what it actually costs to make, ship, store, package, advertise and sell them. Maybe.

It should therefore come as no surprise if some consumers didn't feel any remorse at saving themselves those few dollars by stealing from big business.

The assumptions made by the article go further than that. Let's assume that the article is right and that a third of customers are likely to try and get away with stealing items, or paying less, or failing to refund extra change. Perhaps it is simply a fact that a third of all people will behave similarly, whether they are consumers, or businesses, in any transaction.

Another flaw in the study is the fact that it was conducted using data from "3700 young consumers on five continents including Australia" over a period of ten years. I hate to break it to the researchers, but 10 years means that some of your subjects have probably changed demographic.

Since the study is being conducted over five continents, it means that, taking the average, we expect around 740 people from each continent. Given that Australia is the only country that is also a continent, that means that in the other countries the study was performed in, much fewer than 740 people would have been polled. Add to that the fact that Australia is likely to be the country involved in the study with the smallest population. That means the percentage of the population polled is so minute as to become statistically meaningless. Unless the study took into account cultural norms and values in each country, region, demographic and cultural group, the results are likely to be similarly devoid of any meaning or comparison value.

It's hard to see what the possible conclusion to the study could really be other than "some people steal stuff and they think it's ok". Which is hardly something we need to have proven in a study.


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