14 ms·

Why is every consumer startup selling me what I already own for 10x the price?

113 points by bko 5y ago

btbuildem 5y ago
Because they all have the same goal: do whatever it takes to get rich. That means taking as much money as possible from other people.
metalliqaz 5y ago
I was hoping for an article that offers some explanations rather than a blog post that is actually just asking the question. The first thought the headline provoked in my mind is the strange proliferation of "services" that are really just monthly payments for thing I used to be able to buy (and usually still can). It started with software, where at least some argument can be made around ongoing support. But now it's just everything. I don't understand how these companies make money. Are there people out there with dozens of subscriptions for various things, adding up to many hundreds of dollars every month? Do they even know what they are spending? Perhaps that is the business model... get people to forget they are paying you.
- bko 5y ago
  I agree there are "X as a service" start ups out there. The first one that comes to mind was Dollar Shave Club. Prior to that, people would just buy a few dozen disposable razors or an expensive razor every every few months from CVS, but this was a subscription. But that was a trend from maybe ten years ago now. None of the brands mentioned in the article follow that model though. None of them offer a subscription, just expensive versions of the same stuff. I don't have any explanations why this is a thing. I think its just easier to outsource production. You can buy some off label good enough product from China or send over design specs if you really want to. So whats left? Marketing the product, which is essentially what these companies do. You also can't compete on the low end (you won't be able to get a cost or distribution advantage to someone like Hanes), so that leaves the high end. But what's interesting is the high end is inconspicuous. If I buy a $100 umbrella from Prada, I know its a lux product because its Prada. But these new startups will sell you a $100 non-lux umbrella and make you think its a reasonable decision.
- insickness 5y ago
  > Are there people out there with dozens of subscriptions for various things, adding up to many hundreds of dollars every month? Yes. There's even an app that seeks to cancel all those subscriptions you forgot you signed up for: Truebill.
  - jnsaff2 5y ago
    Let me guess, Truebill itself is a subscription? Self-canceling?
flappyeagle 5y ago
The author is describing lifestyle brands. This is a market segment that's as old as time, they are prevalent on Instagram. He complains about a direct-to-consumer underwear brand costing 10x as much as fruit of the loom. This isn't any different from Ralph Lauren, or Calvin Klein, or any of the legacy players in the segment. Lifestyle brands have large creative and marketing teams, with production secondary and technical production largely outsourced, sometimes to the manufacturing partners. This is a well worn business model for product categories in which all the margins have been competed away. Pricing power comes from the emotion of brand alignment.
- bko 5y ago
  Ralph Lauren underwear costs $11 - 18 a pair (directly, probably cheaper on Amazon), less than half the price this new start up is selling for. Apart from maybe Avocado, these companies aren't marketed as lifestyle, just sensible products. And note its not complaining. I don't care because I don't buy these overpriced products. I'm just commenting on the idea that all the "innovation" in consumer tech is basically just selling the same shit made in China for 10x the price to people who are susceptible to advertising. It's just weird and not the kind of progress I would expect in a dynamic innovative society. https://www.calvinklein.us/en/underwear https://www.calvinklein.us/en/underwear https://www.ralphlauren.com/men-clothing-underwear https://www.ralphlauren.com/men-clothing-underwear
  - nikanj 5y ago
    That's not the only kind of innovation. There's also innovation in displaying ads, for the same shit made in China for 10x the price.
  - soared 5y ago
    I challenge you to purchase a product from one or two of these brands and compare it to the Walmart/China version. They are not the same. From my experience, the quality has been better than brands I’d usually get at Nordstrom rack.
    - 5y ago
hnbad 5y ago
Conspicuous consumption isn't exactly new. These products aim to be affordable luxury brands while usually greenwashing or "socialwashing" (redwashing?) the product to appeal to consumers who either try to be more conscious (but don't or can't invest the time to see through the marketing) or who want to appear more conscious while steering clear of the perceived ickiness of the causes they support (e.g. direct contact with homeless people). I'm actually not sure whether some of the mentioned price tags aren't actually justified given the overhead of the x-washing (e.g. supplying homeless shelters with variable amounts of socks rather than simply setting up a recurring donation). The real grift are white label electronics bulk purchases from Alibaba and sold at a 10x to 100x price tag. There is an entire industry in creating brands out of whole cloth to do just that.
- HWR_14 5y ago
  Your socks, underwear and mattress aren't conspicuous consumption, because they aren't conspicuous.
  - hnbad 5y ago
    Welcome to the wonderful world of social media influencers. Everything is conspicuous if you make an instagram story out of it.
paulcole 5y ago
> I get it, maybe Tommy John is better than Fruit of the Loom. I like seeing ads and spending money on things that might be nicer than the things I have now. I can't imagine I'm the only person like this.
- bko 5y ago
  I take the opposite approach. I like seeing these ads and brands knowing that people are making sacrifices for their career to buy essentially the same products I can get at one tenth the price. But I guess I'm the "make your coffee at home" kind of guy. But I'd rather invest that time and money into things that really matter
  - netizen-936824 5y ago
    You can spend $30 on equipment and another $8 for a pound of beans OR You can spend $300 on a burr grinder $150 on one of those neat vacuum brewing devices, and who knows how much for fair trade single source coffee beans roasted in your back yard Or you can find a balance that gets you things you care about (fair trade beans, good roast, a nice grinder for flavor, whatever your taste might be) at a lower price than going all out When it comes to underwear or other clothing items, I'm generally willing to pay a bit more if I know that I'm avoiding plastics and pollution and the workers who make the items aren't working in sweatshop conditions
    - bko 5y ago
      > When it comes to underwear or other clothing items, I'm generally willing to pay a bit more if I know that I'm avoiding plastics and pollution and the workers who make the items aren't working in sweatshop conditions Why do you have so much faith in these new startups? Sure their marketing copy says they're all ethical and great and stuff. But the legacy guys have a reputation and experience. I've been buying their stuff for decades. They've been around for 100 years and will probably continue to be around for another 100 years. Who knows about these new guys? They don't have a reputations. And the new guys don't make their own stuff. You can't even find out where they're made or under what conditions. They probably won't exist in 20 years, let alone 100. They're mostly a bunch of MBA grads that came up w/ this idea a few years ago. You really think they have a better handle on working conditions than the people who have been doing this for 100+ years? I don't buy it
rieTohgh6 5y ago
The title is weird, the post is actually asking "why do premium brands exist?". It doesn't matter much if their product is actually better - the high price itself is the part of experience. It sounds weird but you "pay more to be able to paying more". And of course to show other people that you can afford doing that.
- deleted 5y ago
  [deleted]
- throwawayboise 5y ago
  > the high price itself is the part of experience https://en.wikipedia.org/wiki/Veblen_good https://en.wikipedia.org/wiki/Veblen_good
- chx 5y ago
  > And of course to show other people that you can afford doing that. There's an excellent book about that. Spent: Sex, Evolution, and Consumer Behavior by Geoffrey Miller.
- dntrkv 5y ago
  Yes, all of those people spending a whopping $700 on a mattress are really just trying to flex on the Walmart shoppers. These aren't really examples of "premium brands" He's comparing the cheapest products available, to mid-tier products where you actually see a difference in quality, comfort, and style.
- FollowingTheDao 5y ago
  > the high price itself is the part of experience. Yes, this. We are living in a new Gilded Age.
fithisux 5y ago
Because we allow it.
nikanj 5y ago
My banner spots have been completely taken over by underwear companies. The Other Danish Guy and Mähöne Brothers seem so keen to buy ad space, they've managed to replace the traditional "big spenders" for ad spots (vacations, cars). It's easy to see how a $50000 car has enough margin in the price to sustain the advertisement spend. I don't understand how a pair of underwear manages to do the same - even if it's a $35 pair. Maybe the advertising money comes from VC pockets? Selling the same made-in-farawaystan underwear for $35 instead of $3.50 is a great business opportunity, assuming you have repeat customers.
cornstalks 5y ago
I’m not sure I totally get their perspective on the Avocado mattress. I have one and love it. But I didn’t get it for any “lifestyle” reason or whatever. I got it because Consumer Reports rated it as the most comfortable mattress (and I kept it because it was indeed very comfortable for me and my wife, unlike Purple…). It’s not an absurdly expensive mattress either. It’s far from cheap, but there are plenty of other mattresses in the same ballpark (or higher!). Of course you can find cheap mattresses elsewhere. And if they’re comfortable enough for you then that’s fantastic. But Avocado isn’t a big outlier (in price) in the mattress industry.
- barkingcat 5y ago
  the word "lifestyle" is heavily overloaded. In this usage, it's not your lifestyle the word is referring to, but the idea that the company exists to provide the owners/proprietors of the company a certain kind of "lifestyle" So by you buying an Avocado mattress, you are letting the founders (https://help.avocadogreenmattress.com/en/articles/4650111-who-owns-avocado https://help.avocadogreenmattress.com/en/articles/4650111-wh...) have the lifestyle they want. I know, that could mean anything! and all companies at the end are "lifestyle" companies (ie doesn't a stock broker work at a trading firm so that their family can have the lifestyle they want?) That term is just really non-descriptive. Don't take my word for it, wikipedia has a pretty decent entry https://en.wikipedia.org/wiki/Lifestyle_business https://en.wikipedia.org/wiki/Lifestyle_business
  - s1artibartfast 5y ago
    There are lifestyle companies and lifestyle products. Lifestyle products are goods that are perceived as an expression of an individual's style, preferences, values, way of life. Selling a cheap T-shirt with Che Guevara or ripped jeans are just as much a lifestyle product as lululemon or Tory Burch. You can charge a premium or sell an inferior product because consumers are buying more than just the functional utility of the item.
  - drewzero1 5y ago
    I think 'lifestyle brand'[0], linked on that same Wikipedia page, is a more accurate description of what people are talking about here. The discussion is not about the lifestyle of the founders (though I'm sure that's great), it's the lifestyle the brand is attempting to sell you. [0] https://en.wikipedia.org/wiki/Lifestyle_brand https://en.wikipedia.org/wiki/Lifestyle_brand
jrochkind1 5y ago
https://en.wikipedia.org/wiki/Capital_accumulation#Over-accumulation_and_crisis https://en.wikipedia.org/wiki/Capital_accumulation#Over-accu... > Over-accumulation and crisis > The Marxist analysis of capital accumulation and the development of capitalism identifies systemic issues with the process that arise with expansion of the productive forces. A crisis of overaccumulation of capital occurs when the rate of profit is greater than the rate of new profitable investment outlets in the economy, arising from increasing productivity from a rising organic composition of capital (higher capital input to labor input ratio). This depresses the wage bill, leading to stagnant wages and high rates of unemployment for the working class while excess profits search for new profitable investment opportunities. Marx believed that this cyclical process would be the fundamental cause for the dissolution of capitalism and its replacement by socialism, which would operate according to a different economic dynamic.[9] > In Marxist thought, socialism would succeed capitalism as the dominant mode of production when the accumulation of capital can no longer sustain itself due to falling rates of profit in real production relative to increasing productivity. A socialist economy would not base production on the accumulation of capital, instead basing production on the criteria of satisfying human needs and directly producing use-values. This concept is encapsulated in the principle of production for use.
- DaiPlusPlus 5y ago
  > The Marxist analysis of capital accumulation... > In Marxist thought... Marxism, as an idea of the 19th century, finds little relevance in the 21st century we find ourselves living in.
- steve76 5y ago
- replygirl 5y ago
  companies are flush with capital and desparate for labor input; wages are not stagnating in this case i'd recommend "post-scarcity anarchism" by bookchin
micromacrofoot 5y ago
Because the market can bear it. If you don't like it, don't buy it... and if other people agree with you, the company will fade away. What's the alternative?
- Veen 5y ago
  I suppose the writer is asking why the people behind these companies think they will succeed in the first place. Or why the market will bear it. Why do people buy very expensive socks when cheap socks are readily available? It's a conversation I often have with my wife. She prefers to buy as cheap as possible provided a product does its job reasonably well. I prefer to buy the best possible version of a product that I can afford (which doesn't always mean most expensive, so I end up doing a lot more product research whereas she will just buy whatever).
celestialcheese 5y ago
I'm going to defend bombas socks. Absolutely 10x better than fruit of the loom socks in my opinion. I've splurged quite a bit on these socks and love them. If there's a non-branded bombas equivalent, I'd buy it, but comparing walmart fruit of the loom and bombas isn't apples to apples.
- bko 5y ago
  I have bombas socks as well thanks to the wife. They're fine socks. However I have fruit of the loom socks that have 10+ years from heavy use (running, workouts, etc). I don't know, maybe the newer socks are cheaper material? I often just get the slightly more expensive "cushioned" socks. You can feel how thick and see what they're made of which is pretty good indicator of how comfortable they are and how long they'll last. I disagree bombas are 10x as good or will last 10x as long (my bombas are only a few months old at this point)
  - rdtwo 5y ago
    It’s way more complicated to knit the toes on bombas having no seam at the toe is hard
  - mr-debil 5y ago
    I don't wear Bombas, but i do wear Darn Tough socks, which are in a similar price range as Bombas. I can say, all their socks, especially the thinner socks from Darn Tough are 1000x more comfortable and durable than any 'traditional' sock brand. That said, I consider them a luxury and not a necessity. If I had a tighter budget, I'd have no issue wearing traditional brands, but I do enjoy the extra comfort. Also, with Darn Tough the socks have a lifetime guarantee, so in theory I shouldn't have to ever buy socks again. Generally the socks I've gotten from walmart/tj maxx/any department store the elastic starts to go after a few years.
  - HomeGear 5y ago
    I agree with you. I have Bombas and Hanes socks. I don’t notice much of a difference. I don’t care about the 10x life as I don’t plan to keep my socks more than a couple years.
rnernento 5y ago
It's almost like we're operating in an economy where it's easier and more lucrative to be a huckster than it is to innovate and create something useful. Maybe part of this is just that we've already optimized so many things - what's left to do with the products in question other than up the price and market the heck out of them? As they say, "nobody ever went broke underestimating the intelligence of the American people"...
- pcmoney 5y ago
  So your theory is people have fruit of the loom and buy meundies or some other DTC brand with no real brand recognition and they keep doing it BECAUSE its more expensive? You don’t think the do a calculation like: “sure its 10x cheaper but its more comfortable/durable/fits better etc and its still cheap because its still underwear even if it is 10x” Or “im too well off to have a favorite pair of underwear, I like this one more so I am getting 12 of them”
  - mr_cyborg 5y ago
    A few years ago (2016-2017 maybe?) I ordered a pair of underwear from several of these brands, like Saxx, MeUndies, 2undr, and Calvin Klein. After some time passed and I had given them all a fair shot, I ordered like ten pairs of my favorite one and I have never regretted it. Only one has not survived to this day and they’re still wicked comfortable.
    - pcmoney 5y ago
      Exactly, Hanes, Fruit of the Loom etc. all raced to the bottom years ago. I have had Patagonia underwear last 10 years+ and still look new. Maybe life is too short for bad underwear?
    - tristor 5y ago
      I did the same thing, also with undershirts and socks. There is a quality difference in some brands, and others are overpriced junk. You pretty much need to sample test to find out which is which. I paid $80 for an undershirt, and $40 for a pair of underwear, and $15 for a pair of socks, but all of them have been heavily abused and washed for years and are still in fantastic shape and super-comfortable. There were more expensive and cheaper options available that were worse, however, some worse than Walmart brands, for too much money. I wish there were some truth in advertising to consumers, but caveat emptor is the the rule of the day. All you can do is get one of each, pick what actually works, and invest in your comfort.
alberth 5y ago
This is Market Segmentation 101.
zelienople 5y ago
Because market research has discovered that many customers are not price-sensitive, even when it makes no sense. Some people with limited means do not even look at prices. The ready availability of consumer debt allows them to buy whatever they wish without considering price as a factor. They simply do not consider any form of budgeting or interest rates on debt when they spend.
- ch4s3 5y ago
  Consumer credit card debt has decreased more than 12% since 2020 and is trending down.
d23 5y ago
> Who knows how long I would have survived on my toxic mattress! I mean. Yeah? If I found out my mattress was toxic and had been slowly poisoning me by releasing VOCs every night for 8 hours, I'd probably want one that wasn't. I don't know anything about that particular brand, but if you're going to bring it up in a blog post, it seems like a good place to actually investigate whether there's any merit to the claim instead of just assuming there isn't.
- Traster 5y ago
  The problem is that it doesn't pass the sniff test. Do you really think that your mattress is poisoning you? Like, we can spend a load of time chasing down whether VOCs really are a thing and all that, but it's just not really how the world works, if you think through the implications of really believing that toxic chemicals from your mattress are impacting you, you end up very quickly in an absurd state - because the same things that are meant to be killing you in your mattress are in everything.
  - travisjungroth 5y ago
    > but it's just not really how the world works Uh, proof? People being around chemicals all the time that end up being more harmful than first believed is common enough. Let's take lead and asbestos for easy examples. BPA for a more recent (but I think more controversial?) one.
    - Traster 5y ago
      The thing is, if it were real, the company would be getting signed off by the EPA, not by some 3rd party "non-profit" that it pays for certification. What I'm saying is look at the list of materials in a mattress, and look at the list of materials everywhere else in your house. If you truly believe your mattress is poisoning you then the solution isn't to buy this mattress. It's to replace every item of furniture, clothing, wallpaper, paint, cleaning sprays, air fresheners etc. And you'll do all this despite noticing literally no symptoms from exposure to these life-threatening chemicals.
soared 5y ago
Is it not possible that we’ve had quite a long time of low quality products being produced by major brands? Perhaps fruit of the loom has degraded in quality over and over again, to the point that actual long lifespan quality products are difficult to find. I bought a pair of lululemon pants for $140 and they are incomparable to any other article of clothing I’ve ever owned. They cost 5-7x the price of my usual h&m/Nordstrom rack/etc pair of pants, but are way more than 10x better in terms of fit, comfort, and not fading/lose strings/etc.
- rdtwo 5y ago
  Try outlier they are like one step up on lululemon.
- notyourday 5y ago
  Lululemon actually collapsed a few years ago after their switched to cheaper fabric while raising prices. The issue was that the leggings, which is the core of their brand that women wear quite a lot became so thin the sun from quite a few angles introduced near transparency. It completely destroyed their brand. It has not came back since.
sulam 5y ago
Why are Mercedes, Porsche and Lamborghini trying to sell me cars for 10X the price of a Kia? This article is not worth your time to read and neither is this comment. ;)
- yafinder 5y ago
  Mercedes, Porsche and Lambo aren't startups though. They aren't even normally described as "innovative" (which is kinda weird).
  - s1artibartfast 5y ago
    I think the innovation, to the extent it exists is just in the marketing space. This isn't particularly new, because marketing is a continual process of consumer discovery as people and demographics change.
noasaservice 5y ago
This author is comparing bottom-of-the-barrel chinesium walmart garbage, with high quality boutique merchandise. Sure, you can cheap out on ___, but you'll replace it soon enough. If you need it once, this might not be a bad idea. But if you use it regularly, this is just a terrible way to burn money up. But then we have https://www.getrichslowly.org/boots-theory-of-socioeconomic-unfairness/ https://www.getrichslowly.org/boots-theory-of-socioeconomic-...
soared 5y ago
It’s incorrect to assume that because a company outsourced a section of their business that there is no innovation occurring there. Companies can innovate and not be direct to consumer. By OP’s logic Apple doesn’t innovate in product production because they outsource production to Foxconn.
PaulHoule 5y ago
It's a better business to sell something expensive than to sell something cheap.
conjecTech 5y ago
This phenomenon becomes a lot clearer when you invert the question: Why are all the products selling for 10x the commoditized version direct-to-consumer? I think that's a lot more obvious. Or at least it is to me since I had a startup which created a premium version of something VERY commoditized(car batteries) and went through this thought process. The first reason is retail margin. If you can manufacture something for $X, it will probably retail for $2.5-3X. When it's really cheap to make, that might be a reasonable price, but when you are making something that has 3-5x the BOM of the cheaper versions, that high of a markup can make the product inviable. When you start to look at the absolute dollar values, you realize you might be able to do your own marketing and sell direct at a lower price. Second, with such a price premium, retail isn't as appealing because your buyers are going to be high intent. If your underwear is 5x the cost of everything around it, you're not going to sell the average Walmart shopper just because they're already there. So the other value prop of retail, exposing your product to their captive audience, isn't going to be very valuable either. So we're left with a lot of DTC business, generally selling quite premium products at high prices, but what are often very reasonable margins. The economics can be shaky because of the high cost of user acquisition, but unfortunately there aren't really any better alternatives at present. Some people do take advantage of this general ecosystem to try to sell cheap stuff in the same manner. I think long term this is hard to due because so much of the business relies on word of mouth, but these sorts of entities definitely do come and go.
jugg1es 5y ago
I don't know about the rest of the stuff on this list, but Bombas socks are worth the extra cost.
D13Fd 5y ago
His post relies on a false assumption that the new products are equivalent to the previous comparison products. This falls apart quickly. On mattresses, for example, it's uncommon for queen-size mattresses with higher-end features (pocket springs, etc.) and quality to be in the price range he suggests. He makes no effort to find actual comparable products. The post might as well say "Why do iPhones exist? I can buy a Boost Mobile Android phone for $116 from Walmart! Apple wants 5-10x as much!! This product will never succeed..."
- dntrkv 5y ago
  Seriously, what a bad post. It would be way more interesting if the author went out and bought all of these items and compared them side-by-side. Yeah, no shit the Fruit of the Loom underwear is gonna be significantly cheaper. 170 year old company that makes low-quality, basic design, extremely mass-produced product is cheap. Wow, no way. Guess everyone should just only shop at Walmart from now on. "But Tommy John offers a “quick draw” fly opening, which I guess is worth paying 10 times the price?" Does this person compare everything he buys based on listed "specs"? Buy both underwear and compare how they feel on your body. It's not even a contest and it's not a secret that people are willing to pay significantly more money for things that are comfortable.
  - snowwrestler 5y ago
    It’s a good idea to try things and make up your own mind, sure. But a lot of folks who buy high-end stuff think they are being value-conscious when in reality they are just parroting the features and benefits copy the manufacturer or retailer gave them. I’ve worked specialty retail and did this for years. Here’s a great example: a rain jacket for kids had a tag advertising that the special high-end fabric was “wind proof up to 60 mph.” At first you’re like, wow that is really wind proof. But if you think about it, who the hell is going to take their little kid out in 60mph wind?? It is pointless marketing copy. Most higher-end-features are pointless, or overkill. My mattress does not have “pocket springs” and I sleep just fine. And how great does underwear need to be? For most people, not that great.
    - 5y ago
Khelavaster 5y ago
Mattresses are usually soaked in fire retardants. 'eco' mattresses aren't. Worth $800-$1100 for an 'eco' California king mattress from Brooklyn Bedding or one of their subsidiaries.
blenderdt 5y ago
How to make a million: Sell 1x $1,000,000 Sell 10x $100,000 Sell 100x $10,000 And so on Why are startups selling expensive underware? Because they want to earn a million with a low volume. And there are people willing to pay for it!
- MetaWhirledPeas 5y ago
  I have a similar take. What startup can succeed selling $1.25 socks? None. Walmart and their suppliers have worked for decades at massive scale to trim every possible cost and make money on slim margins. For most startups selling physical goods, the only way to make money is to charge a premium. This is exactly how Tesla grew their business.
nottorp 5y ago
Besides those lifestyle companies that can afford billboards, there are the 3 million online stores that advertise on facebook and sell product that's on aliexpress for 1/3 to 1/5 of the price. Usually with time pressure built in on the lines of "we're liquidating our collection, take this chance at...". Except maybe the chocolate. I don't believe the popular brand that he mentioned has actual chocolate in it.
poulpy123 5y ago
I don't know any brand cited but good chocolate is easily worth 10 times the crappy chocolate
ch4s3 5y ago
I’m surprised no one here has mentioned the chocolate. Hershey’s Kisses are terrible. They contain just at or abouve the amount of cocoa in a product that the US allows to be called chocolate, and a lot of butyric acid which gives it a cheesy taste and vomit like odor. Almost any chocolate is better and will cost more.
- D13Fd 5y ago
  I disagree that Hershey's Kisses are terrible. They are delicious. I don't know or care what's in them. That said I agree it makes no sense to compare them to chocolate truffles.
  - ch4s3 5y ago
    I guess taste is very personal, but it’s pretty hard to categorically call them chocolate. In fact I just double checked, and they’re now classified as “chocolate candy” by the FDA meaning they probably use less than 10% cocoa.
- atestu 5y ago
  I find Hersey chocolate inedible, but I think it's one of those products you have to have grown up eating, like how some people prefer canned green beans to fresh ones.
  - rubyfan 5y ago
    I feel like the recipe for Hershey chocolate has changed over the decades I’ve experienced it. It’s more wax-like than I remember in my childhood.
  - bko 5y ago
    I agree they have a nostalgic appeal, kind of like candy corn which truly is inedible. They can't exactly change the formula. But their ingredients are pretty normal. There are other "truffles" that don't cost as much. The "no chewing allowed" pricing is absurd IMO https://smartlabel.hersheys.com/00034000025053-0010#ingredients https://smartlabel.hersheys.com/00034000025053-0010#ingredie...
rbrbr 5y ago
snowwrestler 5y ago
The short answer is that there is a new class of young professionals who are extremely well-compensated and have sensibilities about value that are different from their parents’. If your brand can get enough of these folks as customers, you will make bank. Most startups won’t, of course, but the market opportunity is so obvious that everyone goes after it.
Bradlinc 5y ago
I think the question I find interesting is are these new startups generating a product that is 1) better than products already available on the market and 2) better enough to justify the 5x to 10x price? I don't know about the products mentioned in the article. I have had mixed results from my own experience of purchasing similarly markets products. However, I am excited about these new products coming to market. If you can 10x my underwear experience bring it on!
- FollowingTheDao 5y ago
  These products are worth the money until no one has any money. The products are a sign of loose monetary policy.
FollowingTheDao 5y ago
This article is a subconscious frustration with inflation and a predictor of an economic recession/depression. Companies innovative during hard times. There is no need to innovate when the world is flush with cheap money. As we will see today, the days of cheap money are over.
mathattack 5y ago
There are many price points in any market. These are aimed at people with more money than time, for whom the higher cost is a rounding error. Whole Foods costs more than Costco. Different demographics shop in each.
replygirl 5y ago
clothes, bedding, and food are exactly the sort of things you should spend more money on
Asmod4n 5y ago
There are some new food brands here in Germany which sell their stuff at 10 times more than their competition in the supermarket. The only differentiating thing i see is their packaging.
iamben 5y ago
Even if you can't tell the difference in quality, for some of us (thank god we're all different!) there's a certain feeling attached to purchasing things. Like being a kid and getting Jordan's as opposed to a regular basketball boot - thrilling! We may be buying the brand, we may be buying the dream, we may be buying the experience, we may just enjoy the placebo effect - it doesn't really matter. If you have no interest in paying for it, don't buy it. If no one has an interest, they go out of business. Sometimes I buy cheap things, sometimes I spend far more. Maybe no one ever sees my $50 underwear and maybe the quality isn't 10x my cheaper ones. But also maybe I have just a little more confidence on the days when I put them on in the morning. Life doesn't always have to be so rational.
Glyptodon 5y ago
I think they are taking advantage of the fact that many consumers feel their is a quality deficit with products but don't know where to turn to actually find things that aren't mediocre or cheap, particularly in the "doing well but not really rich" zone that some single people and time-scarce double income groups have.
aaron695 5y ago
z9znz 5y ago
This is the same mentality that asks the skilled problem solver, "Why should I pay you $150 when it only took you 2 minutes to solve my problem?" There are so many things wrong with this post, not the least of which is that Walmart exerts perhaps the most downward price pressure of any retailer in the history of retail. If you want to sell your product in a Walmart store, chances are you will make a deal where you are left with the tiniest sliver of profit for yourself. You might even adjust your manufacturing ethics to meet the price demand from Walmart... And with other items, such as an eco mattress... perhaps it is greenwashing, or maybe it really does take into consideration offgassing and other factors which are (or should be) important to humans who will spend 25% of their lives in close proximity to the product. This feels like a hit piece paid for by some PAC.
midislack 5y ago
Lots of seething but people are missing his point. Hip marketing isn’t going to make undies which are better.
ufmace 5y ago
I have a decent amount of Tommy John's stuff. I personally think it's substantially higher quality than any of the Fruit of the Loom stuff that I've been able to find. Maybe it is 10x the price, but it's still cheap enough at the quantity I'm buying that I don't really notice. Is there some other brand or big brand variant out there of similar quality that's like 2x or 5x the price instead? Not sure, I haven't been able to find any. I could research harder to try and find such a thing, but is that work on my part worth the potential price differential? I highly doubt it. And why do we need this cheapest price obsession anyways? We're wearing this stuff on our most sensitive bits for most of our waking life, why is it necessary to get the cheapest thing we can possibly find? This 10x price is still a meaninglessly small fraction of total income, at least for me. I bet it's more in line with the historical price for what ordinary people wore than the cheapo stuff. Maybe this alternate mode of product distribution feels weird. But I think the question we ought to be asking instead is why has there been such a race to the bottom in mainstream goods obtained via mainstream distribution routes? Your mainstream producers and store shelves mostly only have the lowest quality stuff that won't fall apart immediately. If we want something a little better, we need to invent a whole new mode of distribution. Maybe we should ask ourselves what's wrong with our current mainstream where you have to go outside them to get something that isn't junk.
bedast 5y ago
I've noticed there's been a lot of shoe startups in recent years. This is of interest to me because several years ago I broke my foot (Jones Fracture) thanks to poor advice from a shoe salesman for an expensive stability shoe of a major brand. The shoes were fine, but my orthopedic surgeon informed me I should avoid stability shoes if I want to avoid another 5th metatarsal break. Based on my experience with looking for shoes (communications with the companies, etc), and trying one of the startup brands (the only one I could find with wide sizes), I've sworn off these startups. These days I just look at their products to see how absurd the price is. $100+ hoodies? Come on.
mint2 5y ago
> I get it, maybe Tommy John is better than Fruit of the Loom. Or maybe not! I don’t know, Fruit of the Loom has been making underwear for a long time. They’re probably pretty good at it. He’s stating that everything is a fungible commodity in his view and then gripes about the costs being different. Everything is not an interchangeable commodity and to view it that way creates a toxic race to the bottom. The part that kills me is this is posted on a site called “machine learning everything” and yet the post shows a lack of basic understanding of basic data stuff, and zero desire or motivation to look into the actual data. Vastly different things are grouped and it goes well beyond just ignoring signs that they are actually different. In fact, in the face of such indicators he decides the best course is to actively refute them without looking into it to understand what’s going on. And being a longtime producer of something absolutely does not have bearing on quality. There is a common brand arc where in the latter stages they cut costs and quality to capitalize on built up reputation. Anyway I’d be curious on his opinion of cheap 40oz bottles of malt liquor vs normal beer.
AlwaysRock 5y ago
Yikes. Lot of grumpy change resistant posts on HackerNews this morning. It's wild to me that an blog pointing out that some brands cost more than others is upvoted highly.
- smoldesu 5y ago
  Sounds like a common sentiment then. I don't think it's unreasonable to be mad that people are trying to sell you iterative changes on what you already have, it's the race-to-the-bottom mentality that SAAS models tend to encourage.
  - AlwaysRock 5y ago
    > unreasonable to be mad that people are trying to sell you iterative changes on what you already have You must be furious about phones or game consoles or cars or...
    - smoldesu 5y ago
      Can't say I am, I haven't bought a game console since the original Wii, but that hasn't stopped me from playing the latest Zelda and Metroid and such. I think Stallman hit the nail on the head when he said that "all software wants to be free", and I have yet to see any evidence that it isn't true. Phones I try to keep for as long as I can until they're unsupported via software, but traditionally yeah I do get a little miffed that hardware vendors don't encourage people to run aftermarket software on out-of-support devices. Cars are mechanical devices that ultimately decay into unusability after a certain point, but there's not really much difference in core functionality between them as long as you can obey traffic laws while driving them. I don't really see what you're getting at. Maybe I'm not consooming hard enough for this site? If I subscribe to Disney+ and AppleTV will I finally be cool too?
rdtwo 5y ago
Because basic items have low margins high volume and low quality. It’s created a market opportunity to add a bit more quality back in and change 10x at low volume. Big brands have been chasing optimization so hard that they ended up cutting out the things that matter and that made them good in the first place.
5350-uiop-1130 5y ago
Because there are people who will pay that. It really seems that there are more wealthy people now then ever before. Just looking at the housing market, not sure where people get these large sums from.
whitakerch 5y ago
Sometimes I wish folks would put as much effort into asking "how does this cost so little?" as they do with "why does this cost so much?" Also don't you dare compare Hershey to an actual Truffle and say "But they use practically the same ingredients". NO THEY DON'T. You're comparing an edible chocolate flavored preserved emulsification to actual chocolate. Imagine the process that food item went through to get to your mouth. What you should be concerned about is wtf is in Hershey's and how it's so cheap.
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tristor 5y ago
Bombas socks in particular annoy me, because for that price you can buy Darn Tough which are actually amazing socks, better than anything else, and made entirely in the USA. Bombas is just a lot of expensive graphic design and marketing on top of socks ordered through a rebrander on AliExpress from China. These companies always annoy me, even though I'm presumably their "target demographic" because I happily pay more for quality. The thing is, I actually buy one, test it for quality, and if it's not there I move on.
slantaclaus 5y ago
Author clearly shot himself in the foot with the mattress mention. I don't know about you guys but I spend close to 1/3 of my life on a mattress. I can afford to spend more than $400 on something I spend 1/3 of my life on.
ambientenv 5y ago
An attempt to ride the Veblen [1] or Giffen goods cycle, perhaps? [1] https://en.wikipedia.org/wiki/Veblen_good https://en.wikipedia.org/wiki/Veblen_good
fmajid 5y ago
Because signaling quality through clever marketing is way cheaper and more profitable than actually making a quality product. As for why people get bamboozled, P.T. Barnum and Honest Abe had some choice words on the matter.

113 points by bko 5y ago

Because they all have the same goal: do whatever it takes to get rich. That means taking as much money as possible from other people.

metalliqaz 5y ago

I was hoping for an article that offers some explanations rather than a blog post that is actually just asking the question. The first thought the headline provoked in my mind is the strange proliferation of "services" that are really just monthly payments for thing I used to be able to buy (and usually still can). It started with software, where at least some argument can be made around ongoing support. But now it's just everything. I don't understand how these companies make money. Are there people out there with dozens of subscriptions for various things, adding up to many hundreds of dollars every month? Do they even know what they are spending? Perhaps that is the business model... get people to forget they are paying you.

bko 5y ago
I agree there are "X as a service" start ups out there. The first one that comes to mind was Dollar Shave Club. Prior to that, people would just buy a few dozen disposable razors or an expensive razor every every few months from CVS, but this was a subscription. But that was a trend from maybe ten years ago now. None of the brands mentioned in the article follow that model though. None of them offer a subscription, just expensive versions of the same stuff. I don't have any explanations why this is a thing. I think its just easier to outsource production. You can buy some off label good enough product from China or send over design specs if you really want to. So whats left? Marketing the product, which is essentially what these companies do. You also can't compete on the low end (you won't be able to get a cost or distribution advantage to someone like Hanes), so that leaves the high end. But what's interesting is the high end is inconspicuous. If I buy a $100 umbrella from Prada, I know its a lux product because its Prada. But these new startups will sell you a $100 non-lux umbrella and make you think its a reasonable decision.
insickness 5y ago
> Are there people out there with dozens of subscriptions for various things, adding up to many hundreds of dollars every month? Yes. There's even an app that seeks to cancel all those subscriptions you forgot you signed up for: Truebill.
- jnsaff2 5y ago
  Let me guess, Truebill itself is a subscription? Self-canceling?

flappyeagle 5y ago

The author is describing lifestyle brands. This is a market segment that's as old as time, they are prevalent on Instagram. He complains about a direct-to-consumer underwear brand costing 10x as much as fruit of the loom. This isn't any different from Ralph Lauren, or Calvin Klein, or any of the legacy players in the segment. Lifestyle brands have large creative and marketing teams, with production secondary and technical production largely outsourced, sometimes to the manufacturing partners. This is a well worn business model for product categories in which all the margins have been competed away. Pricing power comes from the emotion of brand alignment.

bko 5y ago
Ralph Lauren underwear costs $11 - 18 a pair (directly, probably cheaper on Amazon), less than half the price this new start up is selling for. Apart from maybe Avocado, these companies aren't marketed as lifestyle, just sensible products. And note its not complaining. I don't care because I don't buy these overpriced products. I'm just commenting on the idea that all the "innovation" in consumer tech is basically just selling the same shit made in China for 10x the price to people who are susceptible to advertising. It's just weird and not the kind of progress I would expect in a dynamic innovative society. https://www.calvinklein.us/en/underwear https://www.calvinklein.us/en/underwear https://www.ralphlauren.com/men-clothing-underwear https://www.ralphlauren.com/men-clothing-underwear
- nikanj 5y ago
  That's not the only kind of innovation. There's also innovation in displaying ads, for the same shit made in China for 10x the price.
- soared 5y ago
  I challenge you to purchase a product from one or two of these brands and compare it to the Walmart/China version. They are not the same. From my experience, the quality has been better than brands I’d usually get at Nordstrom rack.
  - 5y ago

hnbad 5y ago

Conspicuous consumption isn't exactly new. These products aim to be affordable luxury brands while usually greenwashing or "socialwashing" (redwashing?) the product to appeal to consumers who either try to be more conscious (but don't or can't invest the time to see through the marketing) or who want to appear more conscious while steering clear of the perceived ickiness of the causes they support (e.g. direct contact with homeless people). I'm actually not sure whether some of the mentioned price tags aren't actually justified given the overhead of the x-washing (e.g. supplying homeless shelters with variable amounts of socks rather than simply setting up a recurring donation). The real grift are white label electronics bulk purchases from Alibaba and sold at a 10x to 100x price tag. There is an entire industry in creating brands out of whole cloth to do just that.

HWR_14 5y ago
Your socks, underwear and mattress aren't conspicuous consumption, because they aren't conspicuous.
- hnbad 5y ago
  Welcome to the wonderful world of social media influencers. Everything is conspicuous if you make an instagram story out of it.

paulcole 5y ago

> I get it, maybe Tommy John is better than Fruit of the Loom. I like seeing ads and spending money on things that might be nicer than the things I have now. I can't imagine I'm the only person like this.

bko 5y ago
I take the opposite approach. I like seeing these ads and brands knowing that people are making sacrifices for their career to buy essentially the same products I can get at one tenth the price. But I guess I'm the "make your coffee at home" kind of guy. But I'd rather invest that time and money into things that really matter
- netizen-936824 5y ago
  You can spend $30 on equipment and another $8 for a pound of beans OR You can spend $300 on a burr grinder $150 on one of those neat vacuum brewing devices, and who knows how much for fair trade single source coffee beans roasted in your back yard Or you can find a balance that gets you things you care about (fair trade beans, good roast, a nice grinder for flavor, whatever your taste might be) at a lower price than going all out When it comes to underwear or other clothing items, I'm generally willing to pay a bit more if I know that I'm avoiding plastics and pollution and the workers who make the items aren't working in sweatshop conditions
  - bko 5y ago
    > When it comes to underwear or other clothing items, I'm generally willing to pay a bit more if I know that I'm avoiding plastics and pollution and the workers who make the items aren't working in sweatshop conditions Why do you have so much faith in these new startups? Sure their marketing copy says they're all ethical and great and stuff. But the legacy guys have a reputation and experience. I've been buying their stuff for decades. They've been around for 100 years and will probably continue to be around for another 100 years. Who knows about these new guys? They don't have a reputations. And the new guys don't make their own stuff. You can't even find out where they're made or under what conditions. They probably won't exist in 20 years, let alone 100. They're mostly a bunch of MBA grads that came up w/ this idea a few years ago. You really think they have a better handle on working conditions than the people who have been doing this for 100+ years? I don't buy it

rieTohgh6 5y ago

The title is weird, the post is actually asking "why do premium brands exist?". It doesn't matter much if their product is actually better - the high price itself is the part of experience. It sounds weird but you "pay more to be able to paying more". And of course to show other people that you can afford doing that.

deleted 5y ago
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throwawayboise 5y ago
> the high price itself is the part of experience https://en.wikipedia.org/wiki/Veblen_good https://en.wikipedia.org/wiki/Veblen_good
chx 5y ago
> And of course to show other people that you can afford doing that. There's an excellent book about that. Spent: Sex, Evolution, and Consumer Behavior by Geoffrey Miller.
dntrkv 5y ago
Yes, all of those people spending a whopping $700 on a mattress are really just trying to flex on the Walmart shoppers. These aren't really examples of "premium brands" He's comparing the cheapest products available, to mid-tier products where you actually see a difference in quality, comfort, and style.
FollowingTheDao 5y ago
> the high price itself is the part of experience. Yes, this. We are living in a new Gilded Age.

fithisux 5y ago

Because we allow it.

nikanj 5y ago

My banner spots have been completely taken over by underwear companies. The Other Danish Guy and Mähöne Brothers seem so keen to buy ad space, they've managed to replace the traditional "big spenders" for ad spots (vacations, cars). It's easy to see how a $50000 car has enough margin in the price to sustain the advertisement spend. I don't understand how a pair of underwear manages to do the same - even if it's a $35 pair. Maybe the advertising money comes from VC pockets? Selling the same made-in-farawaystan underwear for $35 instead of $3.50 is a great business opportunity, assuming you have repeat customers.

cornstalks 5y ago

I’m not sure I totally get their perspective on the Avocado mattress. I have one and love it. But I didn’t get it for any “lifestyle” reason or whatever. I got it because Consumer Reports rated it as the most comfortable mattress (and I kept it because it was indeed very comfortable for me and my wife, unlike Purple…). It’s not an absurdly expensive mattress either. It’s far from cheap, but there are plenty of other mattresses in the same ballpark (or higher!). Of course you can find cheap mattresses elsewhere. And if they’re comfortable enough for you then that’s fantastic. But Avocado isn’t a big outlier (in price) in the mattress industry.

barkingcat 5y ago
the word "lifestyle" is heavily overloaded. In this usage, it's not your lifestyle the word is referring to, but the idea that the company exists to provide the owners/proprietors of the company a certain kind of "lifestyle" So by you buying an Avocado mattress, you are letting the founders (https://help.avocadogreenmattress.com/en/articles/4650111-who-owns-avocado https://help.avocadogreenmattress.com/en/articles/4650111-wh...) have the lifestyle they want. I know, that could mean anything! and all companies at the end are "lifestyle" companies (ie doesn't a stock broker work at a trading firm so that their family can have the lifestyle they want?) That term is just really non-descriptive. Don't take my word for it, wikipedia has a pretty decent entry https://en.wikipedia.org/wiki/Lifestyle_business https://en.wikipedia.org/wiki/Lifestyle_business
- s1artibartfast 5y ago
  There are lifestyle companies and lifestyle products. Lifestyle products are goods that are perceived as an expression of an individual's style, preferences, values, way of life. Selling a cheap T-shirt with Che Guevara or ripped jeans are just as much a lifestyle product as lululemon or Tory Burch. You can charge a premium or sell an inferior product because consumers are buying more than just the functional utility of the item.
- drewzero1 5y ago
  I think 'lifestyle brand'[0], linked on that same Wikipedia page, is a more accurate description of what people are talking about here. The discussion is not about the lifestyle of the founders (though I'm sure that's great), it's the lifestyle the brand is attempting to sell you. [0] https://en.wikipedia.org/wiki/Lifestyle_brand https://en.wikipedia.org/wiki/Lifestyle_brand

jrochkind1 5y ago

https://en.wikipedia.org/wiki/Capital_accumulation#Over-accumulation_and_crisis https://en.wikipedia.org/wiki/Capital_accumulation#Over-accu... > Over-accumulation and crisis > The Marxist analysis of capital accumulation and the development of capitalism identifies systemic issues with the process that arise with expansion of the productive forces. A crisis of overaccumulation of capital occurs when the rate of profit is greater than the rate of new profitable investment outlets in the economy, arising from increasing productivity from a rising organic composition of capital (higher capital input to labor input ratio). This depresses the wage bill, leading to stagnant wages and high rates of unemployment for the working class while excess profits search for new profitable investment opportunities. Marx believed that this cyclical process would be the fundamental cause for the dissolution of capitalism and its replacement by socialism, which would operate according to a different economic dynamic.[9] > In Marxist thought, socialism would succeed capitalism as the dominant mode of production when the accumulation of capital can no longer sustain itself due to falling rates of profit in real production relative to increasing productivity. A socialist economy would not base production on the accumulation of capital, instead basing production on the criteria of satisfying human needs and directly producing use-values. This concept is encapsulated in the principle of production for use.

DaiPlusPlus 5y ago
> The Marxist analysis of capital accumulation... > In Marxist thought... Marxism, as an idea of the 19th century, finds little relevance in the 21st century we find ourselves living in.
steve76 5y ago
replygirl 5y ago
companies are flush with capital and desparate for labor input; wages are not stagnating in this case i'd recommend "post-scarcity anarchism" by bookchin

micromacrofoot 5y ago

Because the market can bear it. If you don't like it, don't buy it... and if other people agree with you, the company will fade away. What's the alternative?

Veen 5y ago
I suppose the writer is asking why the people behind these companies think they will succeed in the first place. Or why the market will bear it. Why do people buy very expensive socks when cheap socks are readily available? It's a conversation I often have with my wife. She prefers to buy as cheap as possible provided a product does its job reasonably well. I prefer to buy the best possible version of a product that I can afford (which doesn't always mean most expensive, so I end up doing a lot more product research whereas she will just buy whatever).

celestialcheese 5y ago

I'm going to defend bombas socks. Absolutely 10x better than fruit of the loom socks in my opinion. I've splurged quite a bit on these socks and love them. If there's a non-branded bombas equivalent, I'd buy it, but comparing walmart fruit of the loom and bombas isn't apples to apples.

bko 5y ago
I have bombas socks as well thanks to the wife. They're fine socks. However I have fruit of the loom socks that have 10+ years from heavy use (running, workouts, etc). I don't know, maybe the newer socks are cheaper material? I often just get the slightly more expensive "cushioned" socks. You can feel how thick and see what they're made of which is pretty good indicator of how comfortable they are and how long they'll last. I disagree bombas are 10x as good or will last 10x as long (my bombas are only a few months old at this point)
- rdtwo 5y ago
  It’s way more complicated to knit the toes on bombas having no seam at the toe is hard
- mr-debil 5y ago
  I don't wear Bombas, but i do wear Darn Tough socks, which are in a similar price range as Bombas. I can say, all their socks, especially the thinner socks from Darn Tough are 1000x more comfortable and durable than any 'traditional' sock brand. That said, I consider them a luxury and not a necessity. If I had a tighter budget, I'd have no issue wearing traditional brands, but I do enjoy the extra comfort. Also, with Darn Tough the socks have a lifetime guarantee, so in theory I shouldn't have to ever buy socks again. Generally the socks I've gotten from walmart/tj maxx/any department store the elastic starts to go after a few years.
- HomeGear 5y ago
  I agree with you. I have Bombas and Hanes socks. I don’t notice much of a difference. I don’t care about the 10x life as I don’t plan to keep my socks more than a couple years.

rnernento 5y ago

It's almost like we're operating in an economy where it's easier and more lucrative to be a huckster than it is to innovate and create something useful. Maybe part of this is just that we've already optimized so many things - what's left to do with the products in question other than up the price and market the heck out of them? As they say, "nobody ever went broke underestimating the intelligence of the American people"...

pcmoney 5y ago
So your theory is people have fruit of the loom and buy meundies or some other DTC brand with no real brand recognition and they keep doing it BECAUSE its more expensive? You don’t think the do a calculation like: “sure its 10x cheaper but its more comfortable/durable/fits better etc and its still cheap because its still underwear even if it is 10x” Or “im too well off to have a favorite pair of underwear, I like this one more so I am getting 12 of them”
- mr_cyborg 5y ago
  A few years ago (2016-2017 maybe?) I ordered a pair of underwear from several of these brands, like Saxx, MeUndies, 2undr, and Calvin Klein. After some time passed and I had given them all a fair shot, I ordered like ten pairs of my favorite one and I have never regretted it. Only one has not survived to this day and they’re still wicked comfortable.
  - pcmoney 5y ago
    Exactly, Hanes, Fruit of the Loom etc. all raced to the bottom years ago. I have had Patagonia underwear last 10 years+ and still look new. Maybe life is too short for bad underwear?
  - tristor 5y ago
    I did the same thing, also with undershirts and socks. There is a quality difference in some brands, and others are overpriced junk. You pretty much need to sample test to find out which is which. I paid $80 for an undershirt, and $40 for a pair of underwear, and $15 for a pair of socks, but all of them have been heavily abused and washed for years and are still in fantastic shape and super-comfortable. There were more expensive and cheaper options available that were worse, however, some worse than Walmart brands, for too much money. I wish there were some truth in advertising to consumers, but caveat emptor is the the rule of the day. All you can do is get one of each, pick what actually works, and invest in your comfort.

alberth 5y ago

This is Market Segmentation 101.

zelienople 5y ago

Because market research has discovered that many customers are not price-sensitive, even when it makes no sense. Some people with limited means do not even look at prices. The ready availability of consumer debt allows them to buy whatever they wish without considering price as a factor. They simply do not consider any form of budgeting or interest rates on debt when they spend.

ch4s3 5y ago
Consumer credit card debt has decreased more than 12% since 2020 and is trending down.

d23 5y ago

> Who knows how long I would have survived on my toxic mattress! I mean. Yeah? If I found out my mattress was toxic and had been slowly poisoning me by releasing VOCs every night for 8 hours, I'd probably want one that wasn't. I don't know anything about that particular brand, but if you're going to bring it up in a blog post, it seems like a good place to actually investigate whether there's any merit to the claim instead of just assuming there isn't.

Traster 5y ago
The problem is that it doesn't pass the sniff test. Do you really think that your mattress is poisoning you? Like, we can spend a load of time chasing down whether VOCs really are a thing and all that, but it's just not really how the world works, if you think through the implications of really believing that toxic chemicals from your mattress are impacting you, you end up very quickly in an absurd state - because the same things that are meant to be killing you in your mattress are in everything.
- travisjungroth 5y ago
  > but it's just not really how the world works Uh, proof? People being around chemicals all the time that end up being more harmful than first believed is common enough. Let's take lead and asbestos for easy examples. BPA for a more recent (but I think more controversial?) one.
  - Traster 5y ago
    The thing is, if it were real, the company would be getting signed off by the EPA, not by some 3rd party "non-profit" that it pays for certification. What I'm saying is look at the list of materials in a mattress, and look at the list of materials everywhere else in your house. If you truly believe your mattress is poisoning you then the solution isn't to buy this mattress. It's to replace every item of furniture, clothing, wallpaper, paint, cleaning sprays, air fresheners etc. And you'll do all this despite noticing literally no symptoms from exposure to these life-threatening chemicals.

soared 5y ago

Is it not possible that we’ve had quite a long time of low quality products being produced by major brands? Perhaps fruit of the loom has degraded in quality over and over again, to the point that actual long lifespan quality products are difficult to find. I bought a pair of lululemon pants for $140 and they are incomparable to any other article of clothing I’ve ever owned. They cost 5-7x the price of my usual h&m/Nordstrom rack/etc pair of pants, but are way more than 10x better in terms of fit, comfort, and not fading/lose strings/etc.

rdtwo 5y ago
Try outlier they are like one step up on lululemon.
notyourday 5y ago
Lululemon actually collapsed a few years ago after their switched to cheaper fabric while raising prices. The issue was that the leggings, which is the core of their brand that women wear quite a lot became so thin the sun from quite a few angles introduced near transparency. It completely destroyed their brand. It has not came back since.

sulam 5y ago

Why are Mercedes, Porsche and Lamborghini trying to sell me cars for 10X the price of a Kia? This article is not worth your time to read and neither is this comment. ;)

yafinder 5y ago
Mercedes, Porsche and Lambo aren't startups though. They aren't even normally described as "innovative" (which is kinda weird).
- s1artibartfast 5y ago
  I think the innovation, to the extent it exists is just in the marketing space. This isn't particularly new, because marketing is a continual process of consumer discovery as people and demographics change.

noasaservice 5y ago

This author is comparing bottom-of-the-barrel chinesium walmart garbage, with high quality boutique merchandise. Sure, you can cheap out on ___, but you'll replace it soon enough. If you need it once, this might not be a bad idea. But if you use it regularly, this is just a terrible way to burn money up. But then we have https://www.getrichslowly.org/boots-theory-of-socioeconomic-unfairness/ https://www.getrichslowly.org/boots-theory-of-socioeconomic-...

soared 5y ago

It’s incorrect to assume that because a company outsourced a section of their business that there is no innovation occurring there. Companies can innovate and not be direct to consumer. By OP’s logic Apple doesn’t innovate in product production because they outsource production to Foxconn.

PaulHoule 5y ago

It's a better business to sell something expensive than to sell something cheap.

conjecTech 5y ago

This phenomenon becomes a lot clearer when you invert the question: Why are all the products selling for 10x the commoditized version direct-to-consumer? I think that's a lot more obvious. Or at least it is to me since I had a startup which created a premium version of something VERY commoditized(car batteries) and went through this thought process. The first reason is retail margin. If you can manufacture something for $X, it will probably retail for $2.5-3X. When it's really cheap to make, that might be a reasonable price, but when you are making something that has 3-5x the BOM of the cheaper versions, that high of a markup can make the product inviable. When you start to look at the absolute dollar values, you realize you might be able to do your own marketing and sell direct at a lower price. Second, with such a price premium, retail isn't as appealing because your buyers are going to be high intent. If your underwear is 5x the cost of everything around it, you're not going to sell the average Walmart shopper just because they're already there. So the other value prop of retail, exposing your product to their captive audience, isn't going to be very valuable either. So we're left with a lot of DTC business, generally selling quite premium products at high prices, but what are often very reasonable margins. The economics can be shaky because of the high cost of user acquisition, but unfortunately there aren't really any better alternatives at present. Some people do take advantage of this general ecosystem to try to sell cheap stuff in the same manner. I think long term this is hard to due because so much of the business relies on word of mouth, but these sorts of entities definitely do come and go.

jugg1es 5y ago

I don't know about the rest of the stuff on this list, but Bombas socks are worth the extra cost.

D13Fd 5y ago

His post relies on a false assumption that the new products are equivalent to the previous comparison products. This falls apart quickly. On mattresses, for example, it's uncommon for queen-size mattresses with higher-end features (pocket springs, etc.) and quality to be in the price range he suggests. He makes no effort to find actual comparable products. The post might as well say "Why do iPhones exist? I can buy a Boost Mobile Android phone for $116 from Walmart! Apple wants 5-10x as much!! This product will never succeed..."

dntrkv 5y ago
Seriously, what a bad post. It would be way more interesting if the author went out and bought all of these items and compared them side-by-side. Yeah, no shit the Fruit of the Loom underwear is gonna be significantly cheaper. 170 year old company that makes low-quality, basic design, extremely mass-produced product is cheap. Wow, no way. Guess everyone should just only shop at Walmart from now on. "But Tommy John offers a “quick draw” fly opening, which I guess is worth paying 10 times the price?" Does this person compare everything he buys based on listed "specs"? Buy both underwear and compare how they feel on your body. It's not even a contest and it's not a secret that people are willing to pay significantly more money for things that are comfortable.
- snowwrestler 5y ago
  It’s a good idea to try things and make up your own mind, sure. But a lot of folks who buy high-end stuff think they are being value-conscious when in reality they are just parroting the features and benefits copy the manufacturer or retailer gave them. I’ve worked specialty retail and did this for years. Here’s a great example: a rain jacket for kids had a tag advertising that the special high-end fabric was “wind proof up to 60 mph.” At first you’re like, wow that is really wind proof. But if you think about it, who the hell is going to take their little kid out in 60mph wind?? It is pointless marketing copy. Most higher-end-features are pointless, or overkill. My mattress does not have “pocket springs” and I sleep just fine. And how great does underwear need to be? For most people, not that great.
  - 5y ago

Khelavaster 5y ago

Mattresses are usually soaked in fire retardants. 'eco' mattresses aren't. Worth $800-$1100 for an 'eco' California king mattress from Brooklyn Bedding or one of their subsidiaries.

blenderdt 5y ago

How to make a million: Sell 1x $1,000,000 Sell 10x $100,000 Sell 100x $10,000 And so on Why are startups selling expensive underware? Because they want to earn a million with a low volume. And there are people willing to pay for it!

MetaWhirledPeas 5y ago
I have a similar take. What startup can succeed selling $1.25 socks? None. Walmart and their suppliers have worked for decades at massive scale to trim every possible cost and make money on slim margins. For most startups selling physical goods, the only way to make money is to charge a premium. This is exactly how Tesla grew their business.

nottorp 5y ago

Besides those lifestyle companies that can afford billboards, there are the 3 million online stores that advertise on facebook and sell product that's on aliexpress for 1/3 to 1/5 of the price. Usually with time pressure built in on the lines of "we're liquidating our collection, take this chance at...". Except maybe the chocolate. I don't believe the popular brand that he mentioned has actual chocolate in it.

poulpy123 5y ago

I don't know any brand cited but good chocolate is easily worth 10 times the crappy chocolate

ch4s3 5y ago

I’m surprised no one here has mentioned the chocolate. Hershey’s Kisses are terrible. They contain just at or abouve the amount of cocoa in a product that the US allows to be called chocolate, and a lot of butyric acid which gives it a cheesy taste and vomit like odor. Almost any chocolate is better and will cost more.

D13Fd 5y ago
I disagree that Hershey's Kisses are terrible. They are delicious. I don't know or care what's in them. That said I agree it makes no sense to compare them to chocolate truffles.
- ch4s3 5y ago
  I guess taste is very personal, but it’s pretty hard to categorically call them chocolate. In fact I just double checked, and they’re now classified as “chocolate candy” by the FDA meaning they probably use less than 10% cocoa.
atestu 5y ago
I find Hersey chocolate inedible, but I think it's one of those products you have to have grown up eating, like how some people prefer canned green beans to fresh ones.
- rubyfan 5y ago
  I feel like the recipe for Hershey chocolate has changed over the decades I’ve experienced it. It’s more wax-like than I remember in my childhood.
- bko 5y ago
  I agree they have a nostalgic appeal, kind of like candy corn which truly is inedible. They can't exactly change the formula. But their ingredients are pretty normal. There are other "truffles" that don't cost as much. The "no chewing allowed" pricing is absurd IMO https://smartlabel.hersheys.com/00034000025053-0010#ingredients https://smartlabel.hersheys.com/00034000025053-0010#ingredie...

rbrbr 5y ago

snowwrestler 5y ago

The short answer is that there is a new class of young professionals who are extremely well-compensated and have sensibilities about value that are different from their parents’. If your brand can get enough of these folks as customers, you will make bank. Most startups won’t, of course, but the market opportunity is so obvious that everyone goes after it.

Bradlinc 5y ago

I think the question I find interesting is are these new startups generating a product that is 1) better than products already available on the market and 2) better enough to justify the 5x to 10x price? I don't know about the products mentioned in the article. I have had mixed results from my own experience of purchasing similarly markets products. However, I am excited about these new products coming to market. If you can 10x my underwear experience bring it on!

FollowingTheDao 5y ago
These products are worth the money until no one has any money. The products are a sign of loose monetary policy.

FollowingTheDao 5y ago

This article is a subconscious frustration with inflation and a predictor of an economic recession/depression. Companies innovative during hard times. There is no need to innovate when the world is flush with cheap money. As we will see today, the days of cheap money are over.

mathattack 5y ago

There are many price points in any market. These are aimed at people with more money than time, for whom the higher cost is a rounding error. Whole Foods costs more than Costco. Different demographics shop in each.

replygirl 5y ago

clothes, bedding, and food are exactly the sort of things you should spend more money on

Asmod4n 5y ago

There are some new food brands here in Germany which sell their stuff at 10 times more than their competition in the supermarket. The only differentiating thing i see is their packaging.

iamben 5y ago

Even if you can't tell the difference in quality, for some of us (thank god we're all different!) there's a certain feeling attached to purchasing things. Like being a kid and getting Jordan's as opposed to a regular basketball boot - thrilling! We may be buying the brand, we may be buying the dream, we may be buying the experience, we may just enjoy the placebo effect - it doesn't really matter. If you have no interest in paying for it, don't buy it. If no one has an interest, they go out of business. Sometimes I buy cheap things, sometimes I spend far more. Maybe no one ever sees my $50 underwear and maybe the quality isn't 10x my cheaper ones. But also maybe I have just a little more confidence on the days when I put them on in the morning. Life doesn't always have to be so rational.

Glyptodon 5y ago

I think they are taking advantage of the fact that many consumers feel their is a quality deficit with products but don't know where to turn to actually find things that aren't mediocre or cheap, particularly in the "doing well but not really rich" zone that some single people and time-scarce double income groups have.

aaron695 5y ago

z9znz 5y ago

This is the same mentality that asks the skilled problem solver, "Why should I pay you $150 when it only took you 2 minutes to solve my problem?" There are so many things wrong with this post, not the least of which is that Walmart exerts perhaps the most downward price pressure of any retailer in the history of retail. If you want to sell your product in a Walmart store, chances are you will make a deal where you are left with the tiniest sliver of profit for yourself. You might even adjust your manufacturing ethics to meet the price demand from Walmart... And with other items, such as an eco mattress... perhaps it is greenwashing, or maybe it really does take into consideration offgassing and other factors which are (or should be) important to humans who will spend 25% of their lives in close proximity to the product. This feels like a hit piece paid for by some PAC.

midislack 5y ago

Lots of seething but people are missing his point. Hip marketing isn’t going to make undies which are better.

ufmace 5y ago

I have a decent amount of Tommy John's stuff. I personally think it's substantially higher quality than any of the Fruit of the Loom stuff that I've been able to find. Maybe it is 10x the price, but it's still cheap enough at the quantity I'm buying that I don't really notice. Is there some other brand or big brand variant out there of similar quality that's like 2x or 5x the price instead? Not sure, I haven't been able to find any. I could research harder to try and find such a thing, but is that work on my part worth the potential price differential? I highly doubt it. And why do we need this cheapest price obsession anyways? We're wearing this stuff on our most sensitive bits for most of our waking life, why is it necessary to get the cheapest thing we can possibly find? This 10x price is still a meaninglessly small fraction of total income, at least for me. I bet it's more in line with the historical price for what ordinary people wore than the cheapo stuff. Maybe this alternate mode of product distribution feels weird. But I think the question we ought to be asking instead is why has there been such a race to the bottom in mainstream goods obtained via mainstream distribution routes? Your mainstream producers and store shelves mostly only have the lowest quality stuff that won't fall apart immediately. If we want something a little better, we need to invent a whole new mode of distribution. Maybe we should ask ourselves what's wrong with our current mainstream where you have to go outside them to get something that isn't junk.

bedast 5y ago

I've noticed there's been a lot of shoe startups in recent years. This is of interest to me because several years ago I broke my foot (Jones Fracture) thanks to poor advice from a shoe salesman for an expensive stability shoe of a major brand. The shoes were fine, but my orthopedic surgeon informed me I should avoid stability shoes if I want to avoid another 5th metatarsal break. Based on my experience with looking for shoes (communications with the companies, etc), and trying one of the startup brands (the only one I could find with wide sizes), I've sworn off these startups. These days I just look at their products to see how absurd the price is. $100+ hoodies? Come on.

mint2 5y ago

> I get it, maybe Tommy John is better than Fruit of the Loom. Or maybe not! I don’t know, Fruit of the Loom has been making underwear for a long time. They’re probably pretty good at it. He’s stating that everything is a fungible commodity in his view and then gripes about the costs being different. Everything is not an interchangeable commodity and to view it that way creates a toxic race to the bottom. The part that kills me is this is posted on a site called “machine learning everything” and yet the post shows a lack of basic understanding of basic data stuff, and zero desire or motivation to look into the actual data. Vastly different things are grouped and it goes well beyond just ignoring signs that they are actually different. In fact, in the face of such indicators he decides the best course is to actively refute them without looking into it to understand what’s going on. And being a longtime producer of something absolutely does not have bearing on quality. There is a common brand arc where in the latter stages they cut costs and quality to capitalize on built up reputation. Anyway I’d be curious on his opinion of cheap 40oz bottles of malt liquor vs normal beer.

AlwaysRock 5y ago

Yikes. Lot of grumpy change resistant posts on HackerNews this morning. It's wild to me that an blog pointing out that some brands cost more than others is upvoted highly.

smoldesu 5y ago
Sounds like a common sentiment then. I don't think it's unreasonable to be mad that people are trying to sell you iterative changes on what you already have, it's the race-to-the-bottom mentality that SAAS models tend to encourage.
- AlwaysRock 5y ago
  > unreasonable to be mad that people are trying to sell you iterative changes on what you already have You must be furious about phones or game consoles or cars or...
  - smoldesu 5y ago
    Can't say I am, I haven't bought a game console since the original Wii, but that hasn't stopped me from playing the latest Zelda and Metroid and such. I think Stallman hit the nail on the head when he said that "all software wants to be free", and I have yet to see any evidence that it isn't true. Phones I try to keep for as long as I can until they're unsupported via software, but traditionally yeah I do get a little miffed that hardware vendors don't encourage people to run aftermarket software on out-of-support devices. Cars are mechanical devices that ultimately decay into unusability after a certain point, but there's not really much difference in core functionality between them as long as you can obey traffic laws while driving them. I don't really see what you're getting at. Maybe I'm not consooming hard enough for this site? If I subscribe to Disney+ and AppleTV will I finally be cool too?

rdtwo 5y ago

Because basic items have low margins high volume and low quality. It’s created a market opportunity to add a bit more quality back in and change 10x at low volume. Big brands have been chasing optimization so hard that they ended up cutting out the things that matter and that made them good in the first place.

5350-uiop-1130 5y ago

Because there are people who will pay that. It really seems that there are more wealthy people now then ever before. Just looking at the housing market, not sure where people get these large sums from.

whitakerch 5y ago

Sometimes I wish folks would put as much effort into asking "how does this cost so little?" as they do with "why does this cost so much?" Also don't you dare compare Hershey to an actual Truffle and say "But they use practically the same ingredients". NO THEY DON'T. You're comparing an edible chocolate flavored preserved emulsification to actual chocolate. Imagine the process that food item went through to get to your mouth. What you should be concerned about is wtf is in Hershey's and how it's so cheap.

deleted 5y ago

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tristor 5y ago

Bombas socks in particular annoy me, because for that price you can buy Darn Tough which are actually amazing socks, better than anything else, and made entirely in the USA. Bombas is just a lot of expensive graphic design and marketing on top of socks ordered through a rebrander on AliExpress from China. These companies always annoy me, even though I'm presumably their "target demographic" because I happily pay more for quality. The thing is, I actually buy one, test it for quality, and if it's not there I move on.

slantaclaus 5y ago

Author clearly shot himself in the foot with the mattress mention. I don't know about you guys but I spend close to 1/3 of my life on a mattress. I can afford to spend more than $400 on something I spend 1/3 of my life on.

ambientenv 5y ago

An attempt to ride the Veblen [1] or Giffen goods cycle, perhaps? [1] https://en.wikipedia.org/wiki/Veblen_good https://en.wikipedia.org/wiki/Veblen_good

fmajid 5y ago

Because signaling quality through clever marketing is way cheaper and more profitable than actually making a quality product. As for why people get bamboozled, P.T. Barnum and Honest Abe had some choice words on the matter.