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

Post by klyrs » Mon, Feb 18, 2019, 5:16 PM UTC

eeZah7Ux wrote: post #56

pattle wrote: post #29

Earlier quoted context omitted.

> This isn't even getting into the actual value of perceived value (cf. the sticker price of wine vs. its perceived quality). Really interesting stuff. I fall foul of this trick quite a lot when food shopping. For example if I'm buying a box of cereals and I see one is priced at £1.80 and another is priced at £2.50 but is on sale from £3.50 I'll buy the more expensive one because I'm under the illusion that I'm getti…

Thankfully in some European country food must be sold with a clear indication of the "real" cost per KG

Post by C1sc0cat » Mon, Feb 18, 2019, 5:32 PM UTC

pattle wrote: post #29

rlue wrote: post #21

What makes this really interesting is how living in an economy where prices are both set by the seller and non-negotiable causes consumers to equate asking price with value. As a consequence, BOGO feels like a better deal than one item at 50% off MSRP. A 50% discount is a change in the asking price; the value of this item must have depreciated in some way for the seller to want to get rid of it (e.g., this garment is…

> This isn't even getting into the actual value of perceived value (cf. the sticker price of wine vs. its perceived quality). Really interesting stuff. I fall foul of this trick quite a lot when food shopping. For example if I'm buying a box of cereals and I see one is priced at £1.80 and another is priced at £2.50 but is on sale from £3.50 I'll buy the more expensive one because I'm under the illusion that I'm getti…

Post by C1sc0cat » Mon, Feb 18, 2019, 5:36 PM UTC

dazc wrote: post #89

hannob wrote: post #80

Earlier quoted context omitted.

I don't have hard numbers to quote on this, but I'm very convinced that you end up paying more in the end. From my own experience and pretty much every one I talk about this, people have a tendency to buy things they'll never need. (I constantly try not to do that, but it takes active thinking about it all the time.) No discount deal is cheaper than the one where you don't buy something you don't need. Then there's u…

A long running promotion in Tesco is 3 bottles of any brand beer for £5.25. I can't imagine anyone ever goes into a store with the intention of buying 3 bottles but if you just buy 2 you're misguided into thinking you'll lose out. In reality, you're spending more and drinking more than you really want to.

Post by C1sc0cat » Mon, Feb 18, 2019, 5:43 PM UTC

chippy wrote: post #32

> Most online clothing brands offer ‘free’ shipping, with the catch that you have to meet a minimum purchase amount (often $100) to qualify. Some 58% of consumers will add additional items to their cart — often things they didn’t originally intend to purchase — just to “save” $5 to $10 on handling fees. You will find people vigorously defending their behaviour when challenged on this. For example: Amazon Prime. Amazo…

Post by wdutch » Mon, Feb 18, 2019, 5:48 PM UTC

multibit wrote: post #172

ocfnash wrote: post #11

I quite enjoy mentally parsing these "offers" in logically equivalent ways. E.g., "buy one get one free" as "only sold in units of two" or even "each purchase of one requires compulsory purchase of a second". As a child I remember considering the difference between "extra free" and "free" which I used to see on cereal boxes. Sometimes the box claimed "10% free!" but other sneakier boxes would claim "10% extra free!".…

BOGO does not always mean "only sold in units of two". Sometimes retailers, like my grocer, will just halve the price of a single item if it's BOGO.