Wells Fargo Reflects Larger Practice of Relentless Cross-Selling

The recent scandal at Wells Fargo which resulted from the relentless pressure on low-paid, front-line tellers to cross-sell credit cards and other financial products to customers reflects a phenomenon not limited to banks. Anyone who has ever attempted to engage in a simple transaction to pay for a handful of products at the cash register in a retail store or drug store is familiar with the “cross-sell.” At any large retail store, the clerk will ask you if you have a store credit card. If you say no, the clerk will ask if you want to sign up for one, promising it will only take a minute. (Woe to the next person in line if the customer says yes.) At drug stores and book stores every single time I check out I am asked if I am signed up with the member rewards program. Again, if you say no, the clerk will hound you to join, promising discounts and even calculating the amount you would save — that very day! I always respond to the question as to whether I am in a member rewards program with a “no, thank you” which anticipates the follow up. This sometimes throws off the clerk, who is trained to follow up with a scripted “would you like to join?”

These clerks are obviously required, as part of their job, to ask each and every customer if they want a credit card or want to join the member rewards program. Undoubtedly, they would be fired if they did not ask each customer. These requirements, however, are de-humanizing. The practice prevents a natural conversation between two people. You can see it in their eyes: “Don’t blame me for asking this question. I have to. Save me. They are watching!”

Retailers make money from credit cards the old fashioned way, from interest. Retailers make money from member reward clubs in a more 21st century fashion: from data. Once you enter in your name and e-mail, the retailer can track every purchase you make to determine what you like and then send you e-mails promoting similar products. Sounds nice, but my analysis is if the program actually saved me money the company would not be pushing it so aggressively. In exchange for my discount I would simply receive a bunch of unwanted e-mails and possibly purchase something I would not have otherwise purchased.

Progressive cities like San Francisco, Seattle, and Minneapolis are currently engaged in a trend of enacting local ordinances on behalf of employees on topics of minimum wage, sick pay, and fair scheduling, as well as the use of plastic bags. I am predicting that one of these cities will propose an ordinance to prohibit retail employers from requiring sales clerks to cross-sell financial products or member reward programs, or to condition their employment or pay on such activity. I am at best ambivalent about the rise of local employment law regulation, but this one might make the world a better place.