Option consommateurs - 2009-10

Suite 604
2120 Sherbrooke Street East
Montreal, Quebec
H2K 1C3
Telephone: 514-598-7288
Fax: 514-598-8511

1. Displaying prices by unit of measurement: a useful "measure"?

$52,300

In the current global food crisis, Canadian consumers are paying more and more for their food. What is more, the effects of this food crisis could be magnified tenfold by the recession now settling over the country. Given these circumstances, it becomes even more important to equip households to make informed consumer choices. Displaying the prices of consumer goods, particularly food products, based on a unit of measurement, is one of the methods that can be implemented to help Canadians make informed choices—and it is inexpensive. Other countries have already adopted rules on labelling by unit of measurement or are in the process of doing so.

In Canada, only Quebec has a rule obliging stores to display prices by unit of measurement for their products not sold in bulk. However, this rule remains obscure and does not apply to all retail stores, or even all food markets. Many consumers have found that, despite the existence of this rule, it is difficult to compare the prices of similar products. Not only is no unit of measurement imposed by regulation, but the units chosen do not have to be uniform (e.g. in one store, tomatoes may be sold by the kilo, the basket or per 100 grams). This can be disconcerting. We also see that many merchants tend not to put the price per unit of measurement on products that are on sale. Hence it becomes practically impossible for the average consumer to compare the price of a product on sale with that of a regularly priced product.

To offer a diagnosis on the present situation, OC will conduct a survey of Canadian food markets. Next, with the assistance of a specialized firm, OC will conduct a cross-Canada survey to determine what proportion of Canadians know and use unit-of-measurement price displays, how and why they use them, and what improvements would best meet their needs.

Expected results

OC will issue recommendations for provincial governments to adopt, where appropriate, uniform rules that meet the needs of consumers.

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2. Awareness of energy efficiency in populations with low literacy levels

$51,000

Energy efficiency (EE) stands forth as a solution for reducing energy consumption. In a current context of increased energy rates, it is thus particularly important for Canadians to manage their energy consumption wisely. This is even more important for low-income households, since compared with other households, more of their income goes toward paying their energy bill. In fact, according to Statistics Canada, a low-income person living alone allocates an average of 6.2% of his/her income to paying the electricity bill, versus 2.6% for the population with an income above the poverty line. Also, in 1999 the Privy Council Office estimated that 51% of functionally illiterate people had an annual income of under $10,000. Given the great financial vulnerability of this segment of the population, we must be sure they are provided with the knowledge they need to put energy efficiency into practice at home.

The questions are as follows:

  • Are people with low literacy levels putting EE measures into practice?
  • Are there any barriers that reduce understanding and application of these measures by the consumers concerned?
  • What are the best practices to promote adoption of EE measures by consumers with low literacy levels?

This project is intended to analyze the characteristics, behaviours and needs of consumers with low literacy levels with respect to EE. OC will assess the socio-demographic profile of this consumer category, the consumers' understanding and perceptions of EE measures, and the programs and measures in place for this particular clientele.

Expected results

The results of this research project will permit the stakeholders, such as Option consommateurs, literacy organizations and sponsors of EE programs (including federal and provincial government agencies), to increase the ability of low-literacy consumers to make informed and sustainable choices on domestic energy consumption.

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3. Customer service from telecommunications carriers: do you have the right number?

$51,000

Over a year after the creation of the Commissioner for Complaints for Telecommunications Services (CCTS), the number of consumers complaining of the poor customer service they are offered by telecommunications carriers is not going down. In 2007, over a nine-month period, Option consommateurs (OC) alone received over 300 complaints about telecommunications services. Forty percent (40%) of those complaints were in connection with customer service. (For the first 10 months of 2008, this proportion was 41% of the 329 complaints received.) Furthermore, telecommunications is now the field generating the second most complaints to the Office de la protection du consommateur du Québec (accounting for 11% of the complaints processed).

This research project is designed to determine the customer service situation of the principal Canadian telecommunications carriers with regard to complaint processing and dispute resolution. OC therefore proposes to assess the customer satisfaction policies of the principal Canadian telecommunications carriers as well as the perceptions of the consumers who do business with these companies.

The research project will serve to answer the following questions:

  • Are Canadian consumers receiving good customer service from the telecommunications service providers?
  • Does that service meet ISO standards for customer satisfaction (code of conduct, complaint processing and dispute resolution)?
  • Does that service comply with the internal customer service and complaint processing policies of the telecommunications carriers?
  • What measures have been put in place to make complaint processing services more accessible for consumers?
  • Are the dispute resolution mechanisms designed to be accessible? Are they in fact accessible?
  • Is good customer service that complies with ISO standards in fact generating customer satisfaction, loyalty and respect?

The research questions are designed to learn more about the complaint processing process adopted by the telecommunications service providers. In answering them, OC will be able to verify whether the policies adopted by these companies are in fact effective and to issue, where appropriate, relevant recommendations for improving service. These recommendations will be based on the new ISO customer satisfaction standards.

Expected results

Based on these results, OC will be in a position to issue, where appropriate, recommendations to the carriers, the CRTC and the CCTS for improving the situation.

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4. The hidden side of online credit

2009/10 – $46,000
2010/11 – $46,500

Not so long ago, when a consumer wanted to get a personal loan, he had to make an appointment with an employee of his financial institution. Today he simply has to go on the Web to find offers of all kinds. Option consommateurs (OC) is receiving calls from consumers who are worried about online credit.

This research project aims to understand the characteristics of certain online credit offers, namely offers of credit cards and personal loans (including second and third chances at credit) from companies established in Canada. It will take place over a period of two years.

In this project, OC will analyze the websites of companies offering online credit, as well as the forms that consumers have to fill out to apply for credit. This will allow it to identify shortcomings and issue advice to consumers so they can steer clear of the traps that might be laid for them.

OC has two objectives: first, to verify whether consumers who make online credit applications have all the information needed to make an informed decision; and second, to verify whether the personal information they are asked for is necessary for their credit application, and whether the consumers know how their personal information will be protected.

Expected results

The results of this research project will allow OC to learn more about the advantages and disadvantages of certain online credit offers. OC will thus be able to inform consumers about what to check and the precautions to take when they apply for online credit. OC will also be able to intervene better with the government agencies involved in financial services and privacy protection, as well as legislators.

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5. Claim forms used in class actions: when defending your rights becomes too difficult a task

$36,100

In a great many consumer class actions, to claim compensation each member has to submit a duly completed claim form. However these forms are written in legal language that is difficult to understand. (Legal offices working on claims as well as consumers' associations involved in these actions regularly receive calls from members of class actions wanting to know how to fill out their form.) On occasion, this has an impact on consumers' decisions to claim what is owing to them.

This situation is not without its consequences, for the number of individual claims has an impact on the amount disbursed by the company to compensate consumers. If there are not enough members to file a claim, the company will not have to pay an amount commensurate with the harm it has caused (since unclaimed amounts are returned to it).

Through this research project, Option consommateurs (OC) wants to analyze the readability of class action claim forms, inventory best practices and make recommendations for improving the claim forms distributed to members.

Expected results

Implementation of the project should on the one hand defend consumers' interests to government bodies and stakeholders with an interest in these matters, and on the other permit OC to sensitize and equip these stakeholders, such as magistrates, solicitors involved in class actions (both claim and defence lawyers), the various provincial bars and the Canadian Bar Association, the Fonds d'aide au recours collectifs du Québec and consumers' associations involved in class actions.

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6. "Spend to save" products: Characteristics and consumer understanding

$51,000

In a context of economic crisis, when the savings rate is at its lowest, financial institutions introduce numerous products that allow them to save. These include products of the "spend to save" type which, as their name indicates, allow consumers to put money aside while spending at the same time. These products are tempting for consumers. But are they really advantageous? Do consumers have access to all the information they need about them? Since these products are becoming more popular, it is important to study them quickly. This will enable Option consommateurs (OC) to fully inform consumers, and if there prove to be risks to using this type of product, to protect them.

Products of this type raise many questions: What information is available to consumers when they decide to use them? What do they understand about them? What kind of commitment are they making to the company? Do they have to pay any fees? Do they get a monthly statement indicating the amount saved or number of points accumulated? Can they withdraw the amount saved or benefit from its reward program at any time? How much can they put aside during one year?

This research project is designed to understand the characteristics of products of the "spend to save" type from the consumers' perspective. Therefore, OC will evaluate the products offered in Canada and the commercial practices of the institutions offering them, analyze and understand the behaviours and needs of the consumers who use them, and analyze the positions of the various parties involved in this area.

Expected results

The results of this research will allow OC to better define the issues related to these new products and to educate consumers and decision makers about any problems raised.

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7. Are discounts really discounts? Regulation and case study in the mattress and furniture market

2009/10 – $31,300
2010/11 – $24,800

Price is an important factor for consumers. It allows them to make a choice between the various products on the shelves and to make their purchases where they are made the best offer. Normally, products sold at regular prices are sold at the same price for a long period (what some call the usual price). Products on sale, on the other hand, are sold at a lower price than the regular price for a short period (this is the criterion that makes them discounted products), then return to the regular price.

This description of regular and sale prices may seem self-evident. But it is not. This year, Option consommateurs reported the practices of two electronics retailers who increased the regular price on some of their items in order to present phoney discounts to consumers. After it released its investigation findings, some consumers and merchants informed OC that these practices are widespread in the retail mattress and furniture sector. But what is the real story?

In a recession context where retailers are trying to attract clientele, we have to know more about commercial discounting practices. This research project is therefore designed to identify commercial pricing practices in the retail mattress and furniture sector.

Expected results

The results of this research project will serve to educate consumers about the accuracy of regular and sale prices by providing them with tools to help them recognize those prices. Furthermore, by comparing Canadian and foreign regulatory frameworks, OC will be able to make recommendations to the federal government so that it can take steps to better regulate these business practices.