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The discount also tells us "you should buy this now, because if you buy it later, the price may go up." But who cares if it's average or even poor value at the

The discount also tells us "you should buy this now, because if you buy it later, the price may go up." But who cares if it's average or even poor value at the current discount? My thinking should be, "which item offers me the best value as priced right now"? I think what you're suggesting is that the "full price" gives customers a "hint" about how much to subjectively value the item, which is also sad because the last person I want telling me how much something should be worth is the person selling it to me.

brodney 14y ago
I recently purchased a projector from amazon. I actually used the original price in my comparisons. For example, a heavily discounted projector with few reviews left me wondering the reason for the discount. Overstock? Overpriced for its actual performance? I felt much safter purchasing a projector with a relatively modest discount.
rhizome 14y ago
Is that box of crackers worth 4.29, which is its price when other crackers are on sale, which is half the time, or is it 2.99, its own sale price, which it is the other half of the time?
redwood 14y ago
You're running something of a fool's errand arguing this point. Of course you're right. It's sad on so many levels that retail stores are important, that fashion is important, that fads, trends, and other trivialities are important. However if we accept that all of the above are inevitable, then we must accept a friction-free experience as valuable. And the poster above is pointing out that whether it's logical or not, the feeling of "I made the smart choice!" by buying the discounted option, provides this easier experience. At a high level human choices aren't rational which is sad, but we must accept it.
- chongli 14y ago
  >At a high level human choices aren't rational which is sad, but we must accept it. I can accept that but I have to ask: who would have the time to make a deep, rational analysis of the value for everything they buy? At some point I think the quick "discount heuristic" is the more rational choice because it saves time. On the other hand, for big ticket items (cars and houses) I'd hope people would spend a lot more time making a rational choice.
  - redwood 14y ago
    Good point
rayiner 14y ago
It's not a matter of "sad" or not. It's a matter of: how do you rationally evaluate the value of one crappy garment versus another? There is total information asymmetry, since you have more or less no information about the garment other than it was made in Vietnam. So you use the retail price as a signal because that's all you have.

brodney 14y ago

I recently purchased a projector from amazon. I actually used the original price in my comparisons. For example, a heavily discounted projector with few reviews left me wondering the reason for the discount. Overstock? Overpriced for its actual performance? I felt much safter purchasing a projector with a relatively modest discount.

rhizome 14y ago

Is that box of crackers worth 4.29, which is its price when other crackers are on sale, which is half the time, or is it 2.99, its own sale price, which it is the other half of the time?

redwood 14y ago

You're running something of a fool's errand arguing this point. Of course you're right. It's sad on so many levels that retail stores are important, that fashion is important, that fads, trends, and other trivialities are important. However if we accept that all of the above are inevitable, then we must accept a friction-free experience as valuable. And the poster above is pointing out that whether it's logical or not, the feeling of "I made the smart choice!" by buying the discounted option, provides this easier experience. At a high level human choices aren't rational which is sad, but we must accept it.

chongli 14y ago
>At a high level human choices aren't rational which is sad, but we must accept it. I can accept that but I have to ask: who would have the time to make a deep, rational analysis of the value for everything they buy? At some point I think the quick "discount heuristic" is the more rational choice because it saves time. On the other hand, for big ticket items (cars and houses) I'd hope people would spend a lot more time making a rational choice.
- redwood 14y ago
  Good point

rayiner 14y ago

It's not a matter of "sad" or not. It's a matter of: how do you rationally evaluate the value of one crappy garment versus another? There is total information asymmetry, since you have more or less no information about the garment other than it was made in Vietnam. So you use the retail price as a signal because that's all you have.