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Similarly, when I was a teenager I knew a guy who built guitars by hand. He is a master craftsman who makes beautiful instruments, but he told me one time that
by bigstrat2003 8mo ago
Similarly, when I was a teenager I knew a guy who built guitars by hand. He is a master craftsman who makes beautiful instruments, but he told me one time that he had customers sometimes lose interest because his guitars were cheaper than similar competitors (5k vs 10k as I recall). He wound up raising his prices, and got more sales as a result, even though the guitars hadn't changed at all. It was a really interesting (and to me, bizarre) demonstration of how people can make decisions very irrationally at times.
- johnsillings 8mo agoveblen goods
- alexpotato 8mo agoCouple of other interesting pricing stories: 1. Cereal Apparently cereal makers were losing money b/c they priced their product at a much lower price point than, at the time, the regular breakfast of bacon and eggs. They hired a consultant who pointed out they could raise their prices as long as it was lower than bacon and eggs, make more money and still be cheaper. 2. Raising prices There is a story in one of the pricing/economics books about a store keeper who told her assistant to halve the price of jewelry that wasn't selling. The assistant misheard and doubled the price. The jewelry immediately sold. 3. The shelf that always sells In the book about Shopsin's in NYC, the author and owner mentions that certain shelves in a store will sell out of whatever is on that shelf. Regardless of price, product, time of year etc. Apparently, putting things right by the front door in supermarkets is the opposite: very few people buy anything that is there. I noticed that one of the Real Housewives of NJ had her food product there and thought to myself: someone is giving you bad advice and/or humoring you by putting your product there.