The NYT has an in-depth look at the pop-psych training that bill collectors are getting, using profile data sucked out of card histories to figure out how to get inside debtors' heads and get them to cough up money they can't afford. This is driven by the long-term strategy of offering cards to poor credit risks on the grounds that they'd be apt to get into debt and cough up huge amounts in interest payment, unlike well-heeled yuppies who pay every bill on time.
The exploration into cardholders' minds hit a breakthrough in 2002, when J. P. Martin, a math-loving executive at Canadian Tire, decided to analyze almost every piece of information his company had collected from credit-card transactions the previous year. Canadian Tire's stores sold electronics, sporting equipment, kitchen supplies and automotive goods and issued a credit card that could be used almost anywhere. Martin could often see precisely what cardholders were purchasing, and he discovered that the brands we buy are the windows into our souls -- or at least into our willingness to make good on our debts. His data indicated, for instance, that people who bought cheap, generic automotive oil were much more likely to miss a credit-card payment than someone who got the expensive, name-brand stuff. People who bought carbon-monoxide monitors for their homes or those little felt pads that stop chair legs from scratching the floor almost never missed payments. Anyone who purchased a chrome-skull car accessory or a "Mega Thruster Exhaust System" was pretty likely to miss paying his bill eventually...
What Does Your Credit-Card Company Know About You?
To see how one company transforms thousands of low-paid employees into telephone psychiatrists, I attended a day of Bank of America's four-week training program at the company's Delaware offices. (I was allowed to attend on the condition that I neither identify nor interview the trainees during the course.) At the front of the classroom, a poster explained the company's "Customer Delight Model." The trainees were supposed to "provide a delightful opening," "employ delightful words," "acknowledge and empathize" and "personalize with a POWER close." They spent the morning discussing hypothetical cases, like a cardholder with twins whose husband announced he had fallen in love with another woman. He handed over divorce papers, had a moving truck outside and in short order took over the house and left the cardholder with two kids, only $400 a week and a ton of credit-card debt.
Compared to 75 years ago, Americans spend less on reading, alcohol, tobacco, clothing, and food. They spend more on education, entertainment, and transportation, but the real bank-breaker is how much more Americans spend on housing, even adjusted for inflation.
I’m at Institute for the Future in Palo Alto, CA today (I’m on staff) at the Positive Platform Design Jam, where we had Cornell historian Louis Hyman give a presentation called “Unnatural Capitalism: How the New Deal Reinvented Capitalism and Why We Need to Do It Again.” You can watch a video recording of his […]
UC Irvine economist Peter Navarro, a hand-picked Trump economic advisor: “Navarro has never met Trump in person. And as for speaking with him by phone, he acknowledges, ‘I have never had the pleasure.'”
If you want to work in tech, but don’t have any desire to code web apps to help businesses sell things to other business, you might want to consider a career in cybersecurity. Judging from the apparent complete infiltration of Russian hackers in American cyberspace, it seems fair to speculate that there’s a major shortage of […]
All moms are different. But all moms like getting flowers on Mother’s Day, and that’s a fact (not, however a fact we can document in any fashion.) Instead of getting chewed out for forgetting to call her on the second Sunday of May, you can take care of it ahead of time with Teleflora’s flower […]
Yeah, Bluetooth audio is pretty common these days, so why should you care about these earbuds? Look how happy that woman up above looks. She’s got FRESHeBUDS in. Boom. There’s your reason. She’s also at the beach and it appears to be a very nice day.But for the sake of promotion, wireless earbuds are fast becoming the […]