Amidst allegations that Reebook’s line of EasyTone walking and RunTone running shoes are just overhyped marketing, Reebok has agreed to a $25 million settlement charge to the Federal Trade Commission for deceptively advertising “toning shoes,” which the shoe company claimed would provide extra tone and strength to leg and buttock muscles, according to a recent article in PR News.

Reebok was quick to respond to the FTC’s announcement, posting an official statement on its Web site Wednesday. “In order to avoid a protracted legal battle, Reebok has chosen to settle with the FTC. Settling does not mean we agreed with the FTC’s allegations; we do not,” said Reebok global PR rep Dan Sarro in the statement. “We fully stand behind our EasyTone technology. We have received overwhelmingly enthusiastic feedback from thousands of EasyTone customers, and we remain committed to the continued development of our EasyTone line of products.”

The damage has already been done to Reebok’s corporate reputation, and it may be setting itself up for subsequent bad press cycles by continuing to market and push its sullied product, states PR News. In light of the company’s decision to “avoid a protracted legal battle” while continuing to produce and market the product in question, Reebok’s PR experts may be able to restore the brand’s credibility by  mining for customer testimonials and success stories that better tighten and prove the company’s original claims.

@EMortek

Update: Report, “Shortchanged?” cited on SmartMoney.com and in the Star Tribune.

Over the past decade, service fees have become a part of the banking experience that most consumers have come to expect. While rankling for many customers, financial “add-ons” have become not only a critical source of revenue for banks and credit unions, but also an effective means of deterring unprofitable consumer behavior. According to new research we conducted at Russell Herder, customers’ loyalty to their financial institution is greatly impacted by service fees and whereas, perhaps unsurprisingly, being assessed a fee can negatively affect consumer opinions, the extent to which fees are believed to be unfair – and the types of fees incurred – can have a substantial impact on consumer attitudes.

Using our firm’s social media research tools and traditional online methods, we conducted a survey of more than 500 United States bank and credit union checking and savings account customers to ascertain if, and to what degree, loyalty to their financial institution is impacted by service fees.

The results suggest that customers strongly distrust the legitimacy of banking fees, with more than 70 percent of them believing charges to be unfair. Furthermore, an astounding 90 percent of customers felt their bank could have done a better job communicating what fees it charges and how they are incurred.

Download the white paper at http://russellherder.com/research.