What I Learned About Myself When I Returned An iPhone 7 (or Verizon’s Screwing Up How To Sell Expensive Phones)
I needed a new phone. Or so I thought. The GPS no longer worked on mine. At the time, the fact that I had to navigate streets the old fashioned way, by reading street signs and looking for turns and exits, seemed ridiculous to someone used to being guided by the voice of Waze or Google Maps (never Apple Maps).
The maps worked well enough to ping cell towers (instead of GPS) to figure out my general position (it was actually pretty accurate), and deliver the step by step directions that you can access with a swipe. So while the navigation apps were not able to track my exact position or give me voice instructions, I could navigate to there from here (wherever here may be). But it irked me that I was navigating like it was 1999.
At the advice of my friend I analyze my data useage and plan and realize that I can lower my data cap, and add a phone and likely keep my monthly bill about the same. Hmm, same bill and new iPhone? Yes please. Not a hard sell.
How Verizon sells phones and mobile plans has changed since I bought my last phone. Gone is the model I have come to know for 20+ years where a 2 year contract extension comes with an opportunity to “upgrade” to a new device. The cost of these devices ranged from $0 to as much as $200 for a top of the line new iPhone. Effectively the deal was, commit to a 2-year contract and Verizon would sell you a new phone at a deeply discounted cost.
Now, I am not so naive as to not realize that the rest of the cost of that phone, including some margin was baked into the cost of my cellular plan. But this is where the magic is. This is where the psychology of buying and selling, comes into play. Most people have two competing voices when it comes to large purchases. The voice that wants the new, shiny object and articulates all the reasons why it makes sense. Then there is the inner CFO voice. The voice that reminds us that this is an additional cost, and maybe more of a want than a need. We all hope the first voice wins. Because truth is, we all want the new, shiny thing.
That was the genius of the two-year contract plan. It was all theatre. Verizon (and the other carriers I’m sure, but was not a customer for over 20 years), created the illusion that there was some give and take in the deal. We actually did not think we were being screwed by the cost of the phone, because we had acquiesced to the 2-year contract deal. In other words we know we have to be screwed in some way, so Verizon gave us the 2-year contract with penalty for early closing. That was the “take”. The “give” was the deeply discounted phone for $0 to $200. Boom! There was give and take, we have a deal. Both inner voices satisfied, we left happy and able to enjoy our new gadget.
The theater is now closed. If you are not already painfully aware, Verizon (again, I am sure the others as well) have ceased the 2-year contract extension play. In an effort to compete with the other carriers and discount carriers, Verizon needed to unbundle everything so they could claim low data packages, or family line charges, etc.
The problem by unbundling and stripping the components as bare as possible was that Verizon would have to sell you the phone at full retail price. Of course they would need to soften the blow by providing monthly financing. Not a lot of people would be able to plunk down $700–800 for an iPhone up front and they knew it. Furthermore they were smart enough to simply promote the monthly cost of the various phones vs. the full prices. Maybe the inner CFO wouldn’t notice. That’s what we hope when we just focus on the monthly cost.
Ok , so I know all of this already but I have convinced myself that by lowering my plan costs, I can absorb the cost of the phone without much difference to my current bill. So into the Verizon store I go. Because inner voice #1 (the guy who wants the phone) is driving, we immediately ask for the latest model iPhone 7 plus. If the inner CFO was awake, he would have asked to see the 6 Plus and inquire about the feature differences between the 6 and 7 to determine if the $250+ delta is really worth it based on how I use the phone. But he was not awake, and we just activated a shiny, new, red iPhone 7 plus. So far so good.
Then the paperwork happened. This is where things start to go sideways for me. The financing paperwork shows the cost of the phone as $880 dollars and this all but takes my breath away. But you can’t let the sales rep see that, right? So I stay cool. Poker face.
Just when I think I am done and can walk out the door and get some fresh air into my lungs and clear the anxiety creeping in from buying an $880 phone, the guy tells me that I need to pay the taxes and activation fee of another $120 bucks on my credit card! So now in two separate transactions I am now painfully aware that I just paid $1,000 FOR A PHONE! The inner CFO is awake and is having an anxiety attack.
The whole drive home I am almost in a daze. What have I done? What was I thinking? Inner CFO where the hell were you??!! But then I remember something the sales rep said at the end. I barely heard it through the ringing in my ears and the vertigo, but it was something along the lines of “You have 14 days to return this”.
When I get home instead of digging into the new features of my phone and geeking out (yes I am an Apple fanboy), I am on the website of the Verizon store I was just in researching their return policies. Instead of joy, I am feeling dread.
This morning first thing at 9AM (this all went down yesterday) I am back at the store. I won’t go into the details of my negotiating myself out of the restocking fee, but it included my having to cite case law (Kerr’s Catering case) to rebuff the claim that the rep would be charged if I did not pay the restocking fee, after I had explained that I read all my paperwork including the TOS of their site, and it was clear that no restocking fee should be assessed. Ok, I guess I did give you all the details.
So, I am back to my old, no-GPS, iPhone. Old? It’s an iPhone 6! How old can it be? 2 years, maybe. This is where I started to discover something in me was changing. Lately I have been downsizing, purging, reading books like Essentialism and watching minimalism documentaries. More than intellectualizing, I was internalizing the fact that stuff really doesn’t matter and buying stuff no longer made me feel good. In fact the opposite. Buying stuff made me feel bad. Wow!
So back to Verizon and sales and sales packaging for a second. What happened here? Simple. The new way of unbundling the phones from the plans forced me to face the stark reality of the cost of the phone. Previously I was still paying for the whole, expensive phone. But it didn’t FEEL that way. It FELT like I paid a greatly reduced price, because I made this promise to stick with them for 2 years. Give and take. Both voices happy. This has nothing to do with reality. This has to do with how voice #1 can win. If the inner CFO is awoken before the purchase it may not happen, if he is awoken with a vengeance after the purchase, a return is on it’s way.
So this whole experience cost me $35. The activation fee was un-refundable, and I knew that going in. But the $35 was worth the personal insight. I realized that I am actually changing in the direction I am trying to go. My new values were taking hold. I literally, physically rejected this new iPhone. The entire time I had it, I was uncomfortable and anxious because it was out of alignment with my newly held beliefs about stuff, purchasing and debt. In fact, not only did I have a strong rekindling of appreciation for my old, paid-off phone, but it extended to my old, paid-off truck. Recently I was fantasizing about getting a new car. Voice #1 was arguing the truck is a gas guzzler, and almost at 200k miles. But I realized today, if I bought a new car and saddled myself with 30k in debt, I would be having a reaction 10 times that of the anxiety and buyers remorse I felt over the phone.
The right time to buy a new phone? When the iPhone 8 comes out? Nope. When my phone dies. Same for the truck! I am starting to recover from a life of consumerism. I never enjoyed returning something so much.