Reference no: EM131304118

Want the Low Down? Consumer Reports Has It

For more than 70 years, Consumer Reports magazine has been helping people to make better buying decisions. A subsidiary of Consumer Union, Consumer Reports first began operations in 1936. The company is an independent, nonprofit organization whose stated mission is to strive for a fair, just, and safe marketplace for all consumers. Also, Consumer Reports attempts to empower consumers to protect themselves by teaching them about products to make better buying decisions. The company's National Testing and Research Center in Yonkers, New York, is the largest nonprofit educational and consumer product testing center in the world.

Credibility has been its key to success, and Consumer Reports works hard at maintaining its independence and impartiality by accepting no outside advertising or free samples and maintaining no other agenda than the interests of consumers. The company supports itself through the sale of information about products and services, individual contributions, and a few noncommercial grants. Consumer Reports magazine has about 4 million subscribers. ConsumerReports.org is the largest publicationbased subscription website in the world, with more than 2 million online subscribers.

Before a product enters one of Consumer Reports' dozens of labs, it has been carefully researched as to manufacturers' claims and consumer demand in the marketplace. Products are tested not only against government and industry standards but also on how consumers use them in everyday situations. Consumer Reports employs more than 150 anonymous shoppers in 60 U.S. cities to buy the products for testing. Laboratory testing is supplemented through an annual questionnaire that is sent to subscribers that generates over 900,000 returns. The stakes are high for Consumer Reports to be accurate in its product evaluations.

In some cases the health and the lives of consumers are at stake. Consumer Reports recently investigated the multibilliondollar nutritional supplements business and found that highly dangerous supplements were being legally sold in mainstream U.S. stores and on the Internet. Consumer Reports pointed out that a nutritional supplement's safety claims do not have to be supported scientifically and that the government does not require warning labels of potential dangers.

An article profiled a consumer who suffered severe kidney damage after taking Chinese herbs. The woman had to undergo a kidney transplant and sued the therapist that recommended the products and several companies that manufactured them. Consumer Reports also faces the risk of lawsuits. Obviously, companies are not happy when Consumer Reports disputes their claims or publishes test results that disparage their products or associated services. For example, after several fast-food chains began touting their trans fat-free french fries, Consumer Reports tested their fries and found that stores in one chain still served fries with measurable trans fats.

The company also caught flak after it was forced to withdraw a report that suggested that most child safety seats were unsafe in side-impact crashes; after determining that the tests were conducted at much higher speeds that initially indicated, the company pledged to retest the child safety seats and issue a new, correct report. Although the company has been sued 15 times in its 70-year existence, it has prevailed in every case. Clearly, the nature of Consumer Reports' type of business makes Consumer Union vulnerable to lawsuits. However, its track record speaks volumes about its accuracy and integrity. Consumer Reports has continued to keep abreast of technology and consumer buying habits.

It recently announced ShopSmart, a new service designed specifically for the way people shop. ShopSmart delivers independent expert ratings, reviews, and prices on thousands of popular consumer products to subscribers over their cell phones, wherever and whenever they shop. The service is available on major cell phone carriers for a monthly fee billed to the subscriber's cell phone account. ShopSmart will change the way people shop by supplying them with detailed product and pricing information at the point of purchase. For example, a mom out

shopping for a plasma screen TV for her family sees a sale on one of the latest models, and a salesperson assures her that it is flat-out the best TV at an unbeatable price. On an item with a price tag of $2,000, she wants to make sure that she buys the best product at the best value. By dialing ShopSmart on her cell phone, she can get a product rating, see the suggested price for the TV, and even determine if the same model is available in another store at a lower price.

"Consumer Reports ShopSmart was created with all types of shoppers in mind including the impulse buyer at the counter facing an aggressive salesperson and the researcher in the parking lot contemplating an important purchase," said the senior director and general manager of information products for Consumer Reports. "The service works for every lifestyle-from the teenager out shopping for a new MP3 player to expecting parents buying a new space heater." Seventy years later, Consumer Reports is still helping customers to buy right.

Questions for Discussion
1. What elements of the consumer buying decision process does Consumer Reports' information most affect? In what ways?

2. In what ways could information in Consumer Reports magazine contribute to or help reduce cognitive dissonance? Explain.

3. How can Consumer Reports help a buyer to make a better purchase decision?