omg, brace for BS marketers start putting fake cost numbers on their products to boost sales..
Wouldn't that be illegal?
Yes, your point? That's never stopped them before!
Show your costs to boost sales
51–60 of 144 posts
Re: Show your costs to boost sales
#52Most "premium" products costs are mostly Advertising, R&D, paying employees/shareholders, etc. They're valid things to spend money on, but don't reflect the "top quality ingredients" that consumers expect the money to be spent on. I suspect many consumers wouldn't like to know that the $1500 iPhone they just bought only has $400 worth of actual parts in.
To be honest I don’t pay for expensive parts, I don’t really care if they cost $100. Instead I pay for a final product that can last me more than 2 years without becoming crap. I bought my first iPhone 4 years ago, today it works like the first day (I only had to replace the battery a few months ago). I never experienced that from any Android, I’m not saying there aren’t good quality Android phones out there, but I never found it and I got tired of not finding it. If another brand can give me that same reliability and for less money I’ll happily and quickly switch.
Re: Show your costs to boost sales
#53The article is interesting and all, but the fact that I had to wade through 3 separate "subscribe to our newsletter!" sections before even getting to the start of the real content is ridiculous.
I counted a total of 6 different places where the user is asked to sign up for something or take some sort of action. Good lord.
Re: Show your costs to boost sales
#54"People said they were 14.2% more likely to buy this chocolate bar when they were shown the version with a cost breakdown." What people say they would do and what they actually do are 2 very different things. The conversion rate of actual behavior needs to be tested for this to mean something useful.
Good point! Sadly, I don't have access to the Harvard study ( https://pubsonline.informs.org/doi/10.1287/mksc.2019.1200 ), so maybe someone with access to it could check it, but the linked article might be misleading in some aspects (depending on the results of the study shown in the paper). From the study's abstract: > A preregistered field experiment indicated that diners were 21.1% more likely to buy a bowl of chi…
"21.1% more likely" is how articles phrase a 21.1% increase in observed frequency.
"Sales increased 21.1%" is equivalent as long as the unit price remained the same.
Re: Show your costs to boost sales
#55Yes it's always a great idea to boast about my costs, that way my competitors can see my cost structure and margin to undercut me!
Re: Show your costs to boost sales
#56The article is interesting and all, but the fact that I had to wade through 3 separate "subscribe to our newsletter!" sections before even getting to the start of the real content is ridiculous. I counted a total of 6 different places where the user is asked to sign up for something or take some sort of action. Good lord.
Sadly this is standard practice now on every "website" out there.
Re: Show your costs to boost sales
#57Earlier quoted context omitted.
Hi Thomas, thanks for your work. I am a fan! Just a minor comment: I find using decimals places (like 16.1% and 21.1%) in human experiments pretty irritating. It feels like false precision. After all, these experiments must have confidence intervals. If I had to guess, I’d assume at least a +/- 5 ppts variability in all these numbers. What’s your view on that?
Thank you so much! I agree that the figures can vary for many reasons and we shouldn't expect them to be exactly the same (some things we don't end up controlling for). At the same time, if we take the experiment of the soup for example: They measured 9,227 sales of it so the 21.1% increase is quite robust and I'd expect the error margin to be much lower than 5% either way - so in some ways the precision is warranted…
Thanks for explaining! Your point about miscommunication makes a lot sense to me!
Re: Show your costs to boost sales
#58Maybe it works for products and services that are priced based on the costs (i.e. cost + a competitive margin). Not so much if you can do a value based pricing. Which is the case when you don't have too much competition, when you're not selling a commodity.
Re: Show your costs to boost sales
#59Earlier quoted context omitted.
Hi Thomas, thanks for your work. I am a fan! Just a minor comment: I find using decimals places (like 16.1% and 21.1%) in human experiments pretty irritating. It feels like false precision. After all, these experiments must have confidence intervals. If I had to guess, I’d assume at least a +/- 5 ppts variability in all these numbers. What’s your view on that?
Thank you so much! I agree that the figures can vary for many reasons and we shouldn't expect them to be exactly the same (some things we don't end up controlling for). At the same time, if we take the experiment of the soup for example: They measured 9,227 sales of it so the 21.1% increase is quite robust and I'd expect the error margin to be much lower than 5% either way - so in some ways the precision is warranted…
You are confusing confidence intervals (used to say that you are confident the increase is positive at all) with error margin (the false precision in the 3rd significant figure).
Re: Show your costs to boost sales
#60Earlier quoted context omitted.
As it says in the article "Sales of chicken noodle soup bowls ($4.95) in Harvard’s campus canteen increased 21.1%"
Interesting. I'm curious how they got to $3.23 of labor for 16 ounces. And I suppose that drops as they sell more, assuming it's made in large batches.
There's no reason to believe the costs are accurate at all. Obviously a business would lie if they applied this theory to their pricing. The experiment was based on the presence and magnitude of numbers in the advertising.