The Power Of A Phone Call
Haggling. It’s a word that conjures up exotic imagery of wet markets and distant locations around the globe….you know, the kind of thing you expect to do on vacation.
Unless you’re shopping for a car, or traveling overseas, “haggling” just isn’t a word that comes up frequently in the “first world”. Most people walk into a store, restaurant, or other place of business, and assume that prices are just fixed.
I’ve got news for you — Everybody doesn’t pay the same amount. Not even close. Prices can vary significantly from city to city, region to region, and person to person. Not only that, but for people willing to work just a little bit harder, there are big discounts to be had.
Usually, all it takes is a simple phone call.
Internet Service
Probably the single most frequently asked question I get on this blog is, “How do you get your internet service so cheap?”
Many people pay significantly more to their friendly neighborhood monopolistic cable provider — so it comes as quite a shock when they see our low monthly cable internet bill.
Currently, I’m paying $39.99 per month for 25Mbit service, which is cheap and reasonably fast. Good enough for my needs at least.
This package was a promotional price for new customers and was only limited to one year… Except I wasn’t a new customer. I’ve had the same ISP for 8 years now.
Next month, when my old promotional package ends, my next one year promotional package starts. This time, the package is $49.99 per month for 100Mbit internet service. A slight increase, but significantly faster and still less than full price.
How do I score these great deals on internet service year after year? I simply call and ask. No magic tricks. No under-the-table handjobs.
I’m polite and straightforward with the customer service reps — I simply let them know what I want.
My recent conversation with the cable company went something like this…
Mike: “Hello, this is Mike in the Customer Retention department, what can I do for you today?”.
Mr. Tako: “Hi Mike, Mr. Tako here. My internet service price is set to increase next month, and I’m looking to make some changes. I’d like to stick with your company, if possible. I’m hoping to get that new promotional package of $49.99 per month for Performance Pro internet. It’s up on your website.”
Mike: “Yes, well that package is for new customers only….”
Mr. Tako: “Yes, I’m aware of that Mike. I was on a promotional packages last year and I’ve been a loyal customer since 2009. I already know it’s possible for existing customers like me to get these promotions. Can you help get me that package?”
Mike: “Yeah Mr. Tako, I can do that for you. It’ll be a 12 month promotional again…”
That’s it. It’s really that easy. A simple 5 minute phone call that saves me hundreds of dollars a year…and I do it year after year. I’ve probably saved over a thousand dollars on internet service with this simple tactic alone.
What’s the downside? Well, the package does vary from year to year. Some years I’ll have really fast internet service. Some years it’ll be slower service. Some years it’ll include cable TV.
You have to be willing to continually put up with changes to your internet service. For our family, as long as the bits flow at 10Mb or higher, we’re fine with the changes. We never watch cable TV, and don’t hedonically adapt to higher levels of service.
Other Places To “Haggle”
Believe it or not, a huge number of businesses in the United States are willing to work with you on price…if you ask.
Last year, I negotiated 70% off some fancy Samsonite luggage for my visiting in-laws at a fancy department store. Yes, 70% off…because I bothered to ask for discounts! The price ended-up being cheaper than Amazon, and I think I may have scored a few extra points with my in-laws.
Remember that bathroom sink repair fiasco from February? I scored free replacement parts for my broken sink, just talking to a customer service rep.
Pfister hooked-me-up with free sink parts despite the fact that I didn’t have a receipt or even a serial number. I was just some random guy calling for free parts…and they gave them to me.
Brand loyalty really matters to companies, and more often than not they really do want to keep your business. The key to unlocking these discounts is doing your homework ahead of time. Find out if online promotions exist. Determine what prices competitors sell the product at.
If it’s a brick and mortar retailer, make printouts or take photos of the discount you want. Bring them with you. Then, talk to the manager or a senior sales person. Be extra nice.
It won’t work 100% of the time, but you can often get at least a matching price.
The Insurance Game
Insurance companies are sometimes willing to move on prices, but it isn’t nearly as easy. Before calling, I do my research ahead of time and get quotes from all the major competitors. I think of it as ammunition for the upcoming battle.
When I do call, it’s always a difficult conversation… insurance companies never seem to admit that their prices have some flexibility. But they do…
Mr. Tako: “So, yeah, I’m looking to renew my insurance next month, and your competitor [XYZ company] is offering a better price. Can you do something to help me out? I’d like to stick with your company”.
Jenny: “Well, our rates are fixed so I really can’t help you. But, would you be willing to walk through your existing coverage to make sure you have the right package?”
Mr. Tako: “Sure Jenny, let’s do that.”
More often than not, the insurance rep finds something to tweak and is able to reduce my bill. If they don’t, I’m completely willing to play The Insurance Game and jump ship to another insurer. I let them know it too.
Insurance companies will often start out new customers with slightly discounted service — designed to win over new customers. Then, on the eve of the second year, they’ll bump-up rates on you. Usually a considerable increase (8% to 12%).
When that happens, it’s time to play The Insurance Game and make that annual phone call.
Places Not To Haggle
Unfortunately not every business is going to be willing to work with you on price. Businesses in low-margin mass-market industries are probably the least likely to have room (if any) to modify the price. I recommend not trying to haggle with these guys.
Well, you can try…but don’t expect discounts.
In my experience, grocery stores, airlines, Costco, government services, and even online retailers fall into this category. There may be others, but these are the ones I’m most aware of from personal experience.
Your efforts are better spent finding discounts elsewhere — Find coupons using RetailMeNot. Get free shipping promotions (like Amazon’s 30 day free Prime trial), or use services like Ebates to lower the price.
Final Thoughts
Conventional thinking might have you believing that haggling just isn’t done in first world countries.
Ignore the conventional thinking — it’s totally wrong. Haggling is actually alive and well in the first world… it just takes a slightly different form.
It’s not for the lazy either. You have to be willing to make a phone call, or do an extra little bit research…but there are good discounts to be had.
Many people won’t even bother. “That’s too much work for $10” they might say…
OK, you go ahead and take that easy route. Me? I’m going to be making those phone calls.
Ooh, you mentioned haggling for a car, and didn’t go back an address it in conjunction with using the phone. Nowhere have I had as much success with using the phone to haggle than after having left one vehicle to go look at another. The basic idea is to be honest, but tell them why you are going to look at vehicle “B” unless they can meet your price needs on vehicle “A”. A phone and cash. It’s less personal so sometimes sellers are more realistic and don’t feel like they have to win to save face. We then meet at a bank, theirs or mine, usually theirs as there almost always a lien holder on their title to pay off FIRST.
Great points Bob! Cars are another one of those great things to haggle over, but unfortunately the post was already getting too long! 🙂
I do this with my insurance all the time! I call about once a year to ask for discounts. Most times they’ll just slap a discount on my account for asking. There are times I have to take some BS safety class, but the savings over time make up for the cost of the classes.
They always try to fight with me about the discounts, but I haven’t tried taking a safety course! How much did you end up saving? That would make for an interest blog post Mrs. PP!
I am not great at haggling, but I am always looking for a way to get a buck back.
Last month I bought some patio furniture from Costco. Then I get an email saying it is on sale for $300 off. I wrote an email to customer service and bam, I was credited back $300.
Haggling internationally is fun, but as Americans it is not ingrained in our genes. Thanks for sharing.
Nice score on the free sink parts! I once had an issue with a bathroom faucet I purchased online. After telling them the filter screen got rusty they sent me a whole new faucet and said the keep the old one. I’ve also found a lot of local retailers will now match prices from bigger online retailers like Amazon, and they usually have much more forgiving return policies as well.
It never hurts to ask 🙂
Absolutely! Never hurts to ask! 🙂
I’ve always been shy about haggling and when we were kids I used to make my sister do it for me. I get over myself though, if I think the savings might be worth the discomfort. We have switched internet providers 4 times in the last 5 years – back and forth between the two giants (let us call them A and C) – and thus kept our bill at $50/month.
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We’re a little more limited here when it comes to internet options. Prices tend to be a bit higher because of the localized monopolies, but I have been able to stay in that $50 sweet spot for a number of years now.
We’re so similar. I make these kind of phone calls all the time to try to reduce reoccurring monthly expenses. Recently phoned internet provider and got our speed doubled while reduced our monthly bill by $15. It’s pretty easy to ask for a discount, especially if you can find a competitor deal.
Haggling is pretty fun. I find that mentioning that you’re a long time, loyal customer helps. Also smiling and being very nice. Assertive but charming, that’s the way to do it.
Sometimes I’m just too lazy to haggle though. For expensive items or reoccurring costs (like cable, internet, etc), it’s totally worth it. But for little things (clothing, trinkets, food), not really worth my time. Plus, I feel bad for the merchant, so I just pay the price if it’s reasonable. In South Asia, the food and accommodations are both so cheap, I never bother haggling.
Potential clients try to haggle with my small business, but I know that I am already under-market. Helps me to be firm.
Better than the phone, I’ve done “chat with a representative” to ask about lowering car insurance, and cell phone plans. My current car insurance increase was due to a state-wide fee, so my years of loyalty and good record don’t help me out this time.
My bank is fee free if you have direct deposit. The last time I was unemployed, I found out my state puts money on a card, and then you can use the card to pay stuff, or transfer the money out, but no direct deposit to a checking account. I chatted with a bank representative and he agreed to waive the fee for 3 months, which was a big help while I job searched to not have a fee to worry about. It can’t hurt to ask. The chat also gives me the option to capture the conversation so I have ‘proof’, if questions come up later.
I find haggling pretty uncomfortable but force myself to do it on occasion. I guess I like not spending money more then I dislike asking for a better price! My local bank has a service where they have an insurance rep who will shop around for the best insurance deals available. With her help I got my car insurance down by $300!
Yeah! I just followed your advice almost verbatim and was able to lower our internet bill from $80.97 to $52.97/mo! It will be slightly slower but hey, that’s $336 a year in savings, thanks!!