The shady economics of ‘buy one, get one free’ deals • Hacker News Board

Re: The shady economics of ‘buy one, get one free’ deals

#191

Post by tych0 » Mon, Feb 18, 2019, 4:34 PM UTC

samstave wrote: post #190

Tangentailly related; i recently needed to buy a new shirt, where in the past, i had shopped at Express for some work shirts - but havent been in their store in several years - i went in as they were having a 40% off store wide. Their shirts, which i used to have dozens of - are now priced at $69 per shirt... less 40% for this sale. Ive never paid $69 for one of their shirts in the past. So the 40% off now reflects w…

JCPenny very famously nearly went out of business because they do this all the time, but then tried to revert to just pricing things normally. People thought they weren't getting deals any more, so they stopped going there.

Re: The shady economics of ‘buy one, get one free’ deals

#192

Post by mcv » Mon, Feb 18, 2019, 4:35 PM UTC

mikeash wrote: post #181

mcv wrote: post #23

Earlier quoted context omitted.

Shipping cost can vary a lot, though. Especially in the internet age where it's easy to order things abroad. When I order from a Dutch webshop or from amazon.de, shipping is generally free, but when I order from amazon.com, it's not. So that means the webship has to know where I live and what kind of shipping I want. Granted, Amazon probably already knows this, but when I use a new webshop, they can't know this, and…

What use is it to see the price of the item without knowing the shipping cost? It seems to me that what you’re really saying is that they need to know where you live and what kind of shipping you want before they can show you the real price.

> What use is it to see the price of the item without knowing the shipping cost?

It's better than not knowing the price until I tell them where I live.

> It seems to me that what you’re really saying is that they need to know where you live and what kind of shipping you want before they can show you the real price.

If they want to include shipping in the price, then yes, they need to know where I live before they can tell me the price. So either they can't tell me the price, or they will change the price after they learn where I live, or they won't change the price and lose money on it, or they may refuse to ship to me. None of these options are in any way reasonable, except maybe not telling me the price, but that's extremely annoying.

Better to not include shipping, tell me shipping is not included, and add shipping later. That way, shipping cost can be the real shipping cost, rather than shipping cost for 1 item times the number of items, which is likely to be more than the real shipping costs.

Re: The shady economics of ‘buy one, get one free’ deals

#193

Post by mikeash » Mon, Feb 18, 2019, 4:41 PM UTC

mcv wrote: post #192

mikeash wrote: post #181

Earlier quoted context omitted.

What use is it to see the price of the item without knowing the shipping cost? It seems to me that what you’re really saying is that they need to know where you live and what kind of shipping you want before they can show you the real price.

> What use is it to see the price of the item without knowing the shipping cost? It's better than not knowing the price until I tell them where I live. > It seems to me that what you’re really saying is that they need to know where you live and what kind of shipping you want before they can show you the real price. If they want to include shipping in the price, then yes, they need to know where I live before they can…

My point is that the only “price” that matters in the end is the total amount you pay, with shipping. If shipping is separate then they’re not really showing you “the price,” they’re just showing you a somewhat arbitrary number that sets a floor on the actual price you’ll pay.

Re: The shady economics of ‘buy one, get one free’ deals

#194

Post by rootusrootus » Mon, Feb 18, 2019, 4:43 PM UTC

chrisan wrote: post #52

ChrisSD wrote: post #4

> A coffee mug that usually sells for $10 + $3 S&H will go for $13, with FREE shipping. I actually prefer this. It's much better than shops that activity try to hide shipping costs until the last moment. Also it makes comparing prices quicker.

When comparing it also makes you realize how much Amazon Prime "free shipping" is a joke sometimes since they just roll the cost into the product. "Why am I paying for prime?"

The original proposition was that Prime wasn't geting you free shipping -- that pre-dates Prime -- it was getting you upgraded to two-day service rather than the standard wait-a-week ground shipping.

Re: The shady economics of ‘buy one, get one free’ deals

#195

Post by themoat » Mon, Feb 18, 2019, 4:44 PM UTC

hopler wrote: post #153

vxNsr wrote: post #94

Earlier quoted context omitted.

When it comes to commodities, the best thing to do is shop by unit, ignore the "sale price" and the msrp, look only at the cost/ounce or cost/unit most US stores list both on their price tags, though you have to watch out for when they use different measurements for directly competing products (ie kellogs sold by the ounce while store brand by the pound). In semi-blind taste tests I've always preferred the name brand…

The name brands taste better because they have put more effort into researching weird chemicals that taste good

I took a fun cooking class in college that was targeted at home cooking.

We did double blind taste tests on nearly every type of food we could think of. It's still amazing to me how infrequently the brand name won in terms of flavor.

Take that as you will, sample size was only about 25 students and my memory might be flawed. But I'll never buy brand name chocolate chips again in my life, I remember that much.

Re: The shady economics of ‘buy one, get one free’ deals

#196

Post by rootusrootus » Mon, Feb 18, 2019, 4:45 PM UTC

chippy wrote: post #35

ChrisSD wrote: post #4

> A coffee mug that usually sells for $10 + $3 S&H will go for $13, with FREE shipping. I actually prefer this. It's much better than shops that activity try to hide shipping costs until the last moment. Also it makes comparing prices quicker.

>I actually prefer this Yes, this is why these tactics work. The human brain is being hacked by shady practices.

Or, you know, it is actually preferable for rational reasons, rather than an indicator that your brain has been hacked. You go to the store and the price you see is the price you pay (well, those of us not stuck in a sales tax state), so it's nice to be able to shop the same way online. I know the shipping is baked in, but I don't have to factor it in separately. I just shop by price.

Re: The shady economics of ‘buy one, get one free’ deals

#197

Post by heywire » Mon, Feb 18, 2019, 4:45 PM UTC

samstave wrote: post #190

Tangentailly related; i recently needed to buy a new shirt, where in the past, i had shopped at Express for some work shirts - but havent been in their store in several years - i went in as they were having a 40% off store wide. Their shirts, which i used to have dozens of - are now priced at $69 per shirt... less 40% for this sale. Ive never paid $69 for one of their shirts in the past. So the 40% off now reflects w…

I like to call this the Kohl's model. I can't imagine anyone ever pays sticker price for anything in a Kohl's store. The prices are ridiculous. Purchase some socks and underwear and the cashier will gladly tell you that you saved hundreds of dollars. Compared to what?!

Re: The shady economics of ‘buy one, get one free’ deals

#198

Post by ip26 » Mon, Feb 18, 2019, 4:58 PM UTC

ghaff wrote: post #142

tyingq wrote: post #136

Earlier quoted context omitted.

"Free shipping" is a funny one. For smaller businesses, it's basically subsidizing far away customers with nearby customer money. I offer it not because I want to deceive people, but because we sell more that way. People like predictable upfront prices without having to tell anyone their location. It is, of course, not "free". We just calculate the average shipping cost and pad the price.

Part of it is that "free shipping," at least over a fairly modest purchase dollar amount, has become so prevalent from most large retailers that dealing with a shipping charge that's unknown going in and/or that gives sticker shock checking out turns a lot of people off.

The lack of free shipping can also be a clue that this retailer sends $3 widgets via $20 FedEx, or this moderately large item will be $100 freight.

In other words, free shipping sellers work hard to find cheap shipping. Those that do not offer free shipping seem less inclined to do so.

Re: The shady economics of ‘buy one, get one free’ deals

#199

Post by pbhjpbhj » Mon, Feb 18, 2019, 5:01 PM UTC

TeMPOraL wrote: post #184

vxNsr wrote: post #175

Earlier quoted context omitted.

I’ve heard it’s kinda the opposite. Apparently, lotsa white labeled goods are manufactured in the same plant as the name brand stuff, by that brand, but to differentiate it, the brand will tweak the recipe slightly for the white label run.

I suspect (but never confirmed) that they have some "quality binning" at the factory; the runs closer to set quality get the "main brand" label, the slightly worse get the "value brand" label, etc. That the cheap store brand is made by the same company that makes the expensive brands is true, one only has to check the manufacturer data on the label.

Fwiw I did strawberry packing at a farm when I was a teen in the UK. This was the exact thing, M&S got the top "quality" selection, then the other supermarkets took the rest.

Only thing though was that the selection was purely visual, M&S wouldn't take any "uglies" (we were told that if we let any in the whole batch would be rejected).

The expensive strawberries were the same ones from the same fields, same picking and packing just put in different boxes with different labels, and they conformed more closely to an idealised strawberry shape.

A good lesson to learn early on.

Re: The shady economics of ‘buy one, get one free’ deals

#200

Post by 0x445442 » Mon, Feb 18, 2019, 5:15 PM UTC

whoopdedo wrote: post #125

0x445442 wrote: post #119

Earlier quoted context omitted.

> but I'm very convinced that you end up paying more in the end This is actually the same tact credit card companies use, even if the balances are paid off every month. That's why we still use budgeted cash from envelopes to pay for most things. The only payments we run through a card are fixed costs where the percentage paid back on the card exceeds the transaction fee if any.

You're still paying for credit card transaction fees indirectly when you use cash. Since retailers are prohibited from charging discounts for cash purchases then to cover the card fees they raise the price for everyone. Cash buyers end up subsidizing card users.

The fees aren't the point. The point is, using something other than cash tends to trick people into spending more in the same way buy one get one free does.