I initially posted this two years ago on Reddit and I’ve brought it here since it was pretty popular there:
Last week I went on a bus tour through Shanghai and Jiangsu province with my parents. We went from elaborate scam to elaborate scam and no one would believe me that they were scams. It was a social psychology clinic.
We went to these middle-of-nowhere but well furnished facilities with equally well dressed salespeople (got to give the air of authenticity yo). The only other customers were tourists on similar tours. This is apparently not a red flag at all when I asked the other people about it.
This was followed by a pitch and upselling products around 3x their market price (in the case of raw goods like pearl, silk, tea) or 10x their market price (in the case of arts/crafts). In two cases I literally said, “I’ve been to Thailand, silk is actually really cheap” or “Pearls can be farmed easily nowadays and dropped a ton in price since a few decades ago” days before the pitches and people still bought things at these facilities.
Despite my vocal anger that we had to listen to scams for 6 hours a day many of my fellow busgoers were still convinced that their $15,000 jade and $5,000 teapot were good deals.
Here’s what I learned from ~24 hours of listening to these pitches:
HOW TO RUN A SCAM
Even before you get to the store, the tour guide is wearing whatever they’re about to sell and tells you why the pearls/jade/silk/etc in the region is special or cheap. You go into the facilities and the guide there corroborates the same information. There are museum-like signs on the wall that say the exact same thing.
In the 30’s a psychologist named Carl Hovland ran a study focusing on biased messages. He found that when people receive new information they believe is biased they may be wary to believe it, but over time the memory of the source of the information fades and the wariness disappears, especially if it’s corroborated by different sources over the same period of time. It’s actually how a lot of marketing fads work, you might not believe initially that gluten-free or juice detox works, but if you see enough information corroborating it, you will believe.
- You Guys are Smart, Aren’t You?
Some presentations they show an obviously fake jade or pearl and ask what’s wrong with it. When everyone answers “it’s fake”, the presenter acts impressed “wow you guys are so smart”. Unfortunately she did not give us stickers to reward us for our intelligence.
My friend Sam once told me that he found the best way to get someone to like you is to pretend you think they’re smart, which I strongly agree with but fail to do like 90% of the time because I guess I’m an asshole.
This technique also works really well here because it also reinforces the idea to these people that they are informed customers and can tell fakes when they see it, even though they have no fucking clue.
Every location has either an actor posing as a master or student crafter working in the middle of the sales area or the tour area, the noisiest, busiest area of the facility because that makes sense.
Everyone coming into these now believes the goods are made on the spot. Clearly they’re not though; there’s no kiln where they’re making the teapots, there’s no dyes where the silk is being spun. Also did I mention they’re making the stuff in the middle of the fucking sales area?
This is usually combined with the presenter casually mentioning/reinforcing that handmade goods are worth more or talking about how long a piece took to make. Spoiler alert: it’s never less than a year.
There is almost always an actor that the staff pretends to respect and honor. In turn, the customers respect and honor the actor as well. In several places there are cards that talk about the master crafters who have been there for 70+ years or went to college for “tea” who just so happen to be in that day (“you guys are so lucky!”) so they can impart their wisdom to you. I would like to know if they are so wise and respected why they have to work in the middle of the tour route, you’d think they could at least have their own office right?
One location the staff even acted afraid of the master who was standoffish initially but “noticed” us on his way out and took an interest. Everyone laughed at his jokes and was quiet when he spoke. I was told by the tourists that I should respect him when I started talking over his presentation and was later shunned by other busgoers for it.
Later some girls my age told me they felt “pressured” by him and I think a large part of it was because they believed they should respect/fear him like the staff did. They bought matching $500 jades. I later told the same girls that we could use the same technique to help me pick up girls (if they pretended to have the time of their lives with me at the club) and they told me “that wouldn’t work on us”
I keep going back to this “master” but that pitch was by far the best. Studies show that for you to like someone initially the three biggest factors are: 1) They are attractive 2) They are like you 3) They like you
I think the last one is the most important and that’s the one a salesman has the most control over.
The “master” took a “genuine” interest to us after being standoffish, asking us about where we were from and taking his “valuable” time to especially focus on the most important clients. I think that actor was most successful because he made us feel liked by someone who was “important”.
I mean, I didn’t feel liked though. They actually wouldn’t let me into the master’s private office after I asked him if he could calligraph “scam” in Chinese so fuck that guy.
The presenters almost always tells true things when presenting. They teach interesting new things like how silk is made, how jade is mined or carved, or how pearls are farmed. They tell you how to value pearls or jade by size, color, etc. so you feel like you’re informed. They also give a demonstration that wows people: Real silk never burns. Green tea can clear red iodine (or some chemical that they use) from water whereas water cannot. Real jade scratches glass without scratching itself. Some of these are actually pretty cool.
Even if you already know this, this further extends your trust in them. Because what they teach you is true, it’s assumed that everything is true.
This is a small one, but we always got free tea, free gifts, etc. In the case of the previously stated “master” they got free palm readings.
People have an extreme discomfort when they feel like they “owe” someone something.
Marketers know this technique and do a soft version of it by giving free samples, but salesmen master it by giving a legitimately expensive gifts to high net-worth individuals. There’s a trick where if you get a P.O. Box in an expensive zip code ($>1M average income) you can get free nights at hotels or free first class flights. These only exist in New York and California; I checked.
While this subversion generally doesn’t work nowadays, this is why guys learn to buy drinks for their intended targets at a bar.
- Chi, Detoxing, & other Bullshit
They threw these in for good measure: Jade apparently centers your chi, green tea can reduce the toxins in your body, etc. These are marketing/pseudoscience scams that you are likely to believe if you are their target market.
The most straight up amazing thing to me is that these people clearly had no interest in these products before because they clearly don’t know how they’re priced. After watching a short presentation they’re suddenly inclined to blow hundreds or thousands of dollars on these objects. I think we cleared $30k on this trip between the 12 of us (I know because every purchase over $5k was followed by a round of applause which I actually find hilarious).
I wanted to ask a few questions to these buyers like:
- If these guys are master crafters whose work are worth thousands, and these are collectors items, why are they only selling to tourists in remote facilities?
- How do you think they can afford to run these massive businesses if they are giving us a good deal on these products and their only customers are tourists?
- Why are they building shit in the middle of the sales area?
- If you agree that there is a chance this is a scam, why would you consider buying anything at all?
- If this bus tour was a scam, what would they be doing differently than what they are doing now that would make you believe it’s a scam?
The most infuriating thing to me was that when I told some people they were being scammed they were angry with me. In fact I think in some cases it made them want to purchase more. After a somewhat heated exchange with one of the girls my age, she made the regretful $500 purchase.
We saw 6 hours of presentations a day. I think for a lot of people they would rather believe they weren’t scammed and spend hundreds more than believe they wasted their vacations. When some of them came to the light, they were also furious, whereas most of the others said they enjoyed their trip.
For the captive audience I think it was more fun to believe that it wasn’t a scam and consider purchasing something rather than be like me.
Also, I think it’s a blow to the ego to realize you’ve been scammed. I think most people would describe themselves as “street smart” since it’s a way to feel smart that’s ambiguous/hard-to-test and being scammed definitely wrecks that image.
Post Purchase Rationalization
Not really part of the scam, but after my mother purchased her 3x overpriced pearls (she actually did not believe me until she was told it was a scam by the bank when withdrawing money to pay). She justified it as donating to the local economy. The girl who spent $500 on the jade is convinced it’s still worth $500, she just doesn’t know why she bought a $500 jade. For some of the art pieces it was justified that they would “appreciate in value”. I notice myself doing this sometimes too after making a poor choice or purchase and I think it’s very natural for most people to do this.