The Straits Times says

When discounts prove to be costly

It appeared to be a well-intentioned plan by technology giant Huawei to tie its promotional offer of a smartphone for just $54 to Singapore's 54th National Day celebrations this year. Indeed, the discount was a substantial one for the Huawei Y6 Pro 2019, which costs $198. The three-day promotional offer by the company was targeted specifically at Singaporeans and permanent residents above the age of 50 as this demographic reinforces the idea of Singapore's longevity and success since the country's sudden independence in 1965. However, what could have been a feather in Huawei's Singapore's cap turned ugly, and into what some have described as a fiasco when thousands of people, responding to the generous discount, turned up at stores across the island, only to be told that the phones were out of stock. Disappointed customers grew understandably agitated, leading to the police being called in to handle the situation at various locations. This meant the deployment of state resources to deal with a commercial event that went sour. That was no way for the company to pay tribute to Singapore or Singaporeans on a happy national occasion.

Instead, the episode will be remembered as an example of planning and management having gone wrong to the extent that it has now also raised questions about whether Huawei breached consumer protection laws and advertising guidelines in its promotion. The cynical might wonder whether the promotion did succeed after all - as a publicity stunt, drawing attention to the brand - since it does not make financial sense otherwise to sell a product at a reduced price. However, the company disappointed many people whose feelings, amplified in the media, hurt its corporate image. Huawei has apologised and decided to give $100 vouchers to those who registered at its stores to purchase the phone between July 26 and July 28. This means they will be able to buy the phone at an even lower price than those who managed to obtain it earlier. However, the latter would not be wrong in feeling offended this time.

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A version of this article appeared in the print edition of The Straits Times on August 05, 2019, with the headline 'When discounts prove to be costly'. Print Edition | Subscribe