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July/August 2002

DOLLAR 2 Auto Glass Companies

Heal Thyselves
Minnesota Better Business Bureau Establishes Innovative Advertising Standards
by Penny Beverage

BROKEN The battle has gone on for years—that of the independent auto glass shop versus the insurance industry. Some glass shops just fear the networks and say they discourage of competition. However, some have found their own way of handling this alleged problem: rewards and incentives. 

Some auto glass companies offer rewards to both consumers for having their windshields replaced—and to insurance agents for referring consumers to their shops. While many think this combats the work of the networks, others say it discourages true competition—that which is based on the quality of work—and is a deceptive practice, according to Jay Pfaender, president of the Minnesota Better Business Bureau.

“Free Steaks!”
According to Pfaender, the Minnesota Better Business Bureau, an independent organization, had received numerous complaints through the years about auto glass shops that give away free steaks and other items to consumers every time they had their windshields replaced. Soon, the gifts became larger than steaks, raising the eyebrows of consumers, other auto glass shops and, in turn, the Better Business Bureau.

“There started to be competitors who decided to give more than a box of steaks and you started to see $35 or $50 or $100, even $400 or $500, given as incentives to get windshields replaced,” Pfaender said.

The Standards Emerge
However, the Better Business Bureau was receiving complaints from both consumers and businesses about the fairness of these practices. It also started to notice a surge in windshield replacements. 
“There were some reports that some consumers were taking a ball-beating hammer to their windshields so that they could collect these rewards,” Pfaender said.

At this point, the reputation of both insurance companies and auto glass companies were being tarnished in the media and the Better Business Bureau decided to step in. Thus came the emergence of the Minnesota Auto Glass Industry Advertising Standards Committee.

“The insurance companies and the auto glass officials weren’t talking to each other, but after the Better Business Bureau met with the two parties individually, it could see that both wanted to keep their images from being tarnished,” Pfaender said.

By bringing the two together, the Bureau helped them reach an agreement and take it to the state legislature themselves. A $35 limit on the value of gifts to consumers as a reward for their business was established by the 2000 Minnesota State Legislature (see April 2000 AGRR, page 41, for related story).

The Better Business Bureau, in conjunction with the auto glass industry, wanted to go further, to establish standards for advertising services and to ensure no deceitful advertising practices would be used.

“The hope was to clean up the bad image the industry had gotten with consumers [through the reward programs],” said Sally Custer of Glass Plus in Mound, Minn., who currently serves on the Bureau’s auto glass advertising committee.

Such a program was not a completely brand-new idea. According to Pfaender, his branch of the Better Business Bureau has had a similar on-going program with the auto dealers of the Minneapolis area for more than 20 years. Pfaender and his staff composed a similar committee for the auto glass industry, made up of approximately 30 industry representatives and several from the Better Business Bureau of Minnesota.

Kim Walseth of Ultimate Auto Glass in Oakdale, Minn., has been on the auto glass committee since its inception. He said it has been helpful with advertising practices, but hopes it soon tackles steering problems.

“A lot of us here are going to be out of business soon if [the committee] doesn’t [deal with steering],” Walseth said.

Custer also joined the committee early on—after there had been only two meetings.

“The goal was to get the standards done and notify auto glass shops about the standards, and we’re almost there,” Custer said.

Even after that goal is met, the committee will work together to develop basic business practices by which Minnesota auto glass shops specifically are expected to abide. 

“The way it works is that the Better Business Bureau will become aware of a business practice that is bringing about complaints and the committee will meet and decide if [the complaint] has to do with an existing standard. If it doesn’t, we’ll write a new one,” Pfaender said.

How the Standards Work
Currently, five standards have been developed for the Minnesota auto glass industry with several more in the works. The standards focus on certification, specifications, inflated- value items, used glass and free gifts and rebates. (See below sidebar for more info).

However, the standards work quite differently from legislation. 

“We are not a government agency. We are an organization sponsored by annual memberships by businesses. If you are a member, you agree to abide by the advertising and business practices and you will respond to inquiries from the public or from us,” Pfaender said. “If you are not a member, we appeal to your sense of right or wrong, and usually people agree with us.”

At press time, the final draft of the standards had just been completed.

In addition, the Bureau has published a brochure for consumers called “How to Choose An Auto Glass Company”. The committee is discussing how to distribute the brochure to consumers currently. 

“One of the suggestions is that we can distribute it to glass companies, but in many cases by the time the consumer gets to the glass company he’s already made his decision on whom he’s going to choose,” Pfaender said.

Custer said the committee was also considering distributing the brochure to townships throughout the state to distribute to new residents in their welcoming packets. Another consideration is for each of the state glass associations, the Minnesota Glass Association and the Minnesota Independent Auto Glass Association, to send out samples with their next mailing and allow shops to order more for customers. 

Moving Across the Country
The program has stayed within Minnesota so far, but Pfaender said he expects other Better Business Bureaus to soon attempt similar methods for developing industry-specific standards. He had received interest from auto glass executives wishing to work with their Bureaus in Iowa, Illinois, Wisconsin and Indiana at press time.

Custer hopes it will take hold throughout the United States.

“Somehow it would be nice to raise the national level of professionalism,” she said. 

The Standards

Currently, the Minnesota Better Business Bureau and its auto glass committee have developed five advertising standards for the industry:

Certification: “If certification is specified in an advertisement, auto glass technicians must be certified by the advertised entity or installation must be performed under the direct supervision of a certified technician. Advertisers should state which program that they are certified under.”

Specifications: “If any type of quality specification regarding glass is referenced in advertising copy, this must be consistent with your business practice.”

Inflated-Value Items: “Savings bonds or other inflated-value items must carry a state retail cost in advertising in the same sized type. Original purchase price should be advertised, not price at maturity.”

Used Glass: “If the term “used” or “imperfect” is not specified in an advertisement, consumers assume that all products advertised are new and free of imperfections.” (See May/June 2001 AGRR, page 48, for related story.)

Free Gift/Rebates: “Any rebate, gift, prize, bonus, coupon, credit, referral fee, trade-in or trade-in payment, advertising or other fee or payment, or any other tangible thing or item of monetary value, directly or indirectly, to an insured or any other person not in the employ of the seller, must not have an aggregate value of more than $35.”

Other standards may be in development soon, based on the work of the committee and the response it receives from both the public and the industry, according to standards committee member Sally Custer of Glass Plus in Mounds, Minn.

“The feeling right now is to get the standards out there, along with the brochure, and then see where we are next year,” said Sally Custer of Glass Plus in Mound, Minn.


Penny Beverage is the editor of AGRR magazine.

 

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