Blinded Trials Bait: An Ethics Quandary

Updated Below

I had an exchange at a large retailer this weekend that made me question some of the struts in my own ethical framework.  Intellectually, I’m having a hard time piecing together whether my ethical instincts are on sound footing, or if I’m just telling myself a story to make myself feel better about being Evil Tod.

One of the advantages to writing for the League is that I am surrounded by people who study and write about ethics either as a hobby or as part of their job. So I thought I’d throw it out to the Hive Mind and ask for your thoughts.

In order to do this, I have to tell you two personal anecdotes.

Anecdote #1

When I was 21 I was still working my way through school.  I was working one of those full time jobs where I could say that even though it was a miserable, soul-killing grind, at least it paid almost nothing.  I had no savings, and was living (barely) paycheck to paycheck.

My financial situation was this bad: Some store had once given me change that included a $10 bill.  Though not as rare as a $2 bill, you don’t often see a $10 bill very often. For some reason whenever I looked in my wallet and saw it sitting there, it made me feel wealthy in a way two $5 bills would not have.  Because of this, if I needed to buy food or happy hour beers I would search my laundry for spare change to get what I needed so that I didn’t have to break that $10.

One day I got my paycheck and paid my rent, utilities, and all of the other outstanding bills I had accrued.  Thanks to some astoundingly bad financial investments on my part from the previous week (I blew too much money taking a girl I was trying to impress to a restaurant I couldn’t afford) I discovered I was about as broke as broke could be.  Once the various checks I had just mailed cleared, my checking account would be down the minimum amount allowed in order to keep it open.  The only real liquid asset I had left was that $10 bill in my wallet, and I was suddenly realizing I had to make it last for fifteen days.  My anxiety level shot through the roof.

I grabbed my pocket calculator and walked to my neighborhood Fred Meyer to see if it was at all possible to shop for two weeks worth of food on $10.  I walked through the aisles, grabbing ramen here, on-sale spaghetti sauce there, until I had a basket full of food that would absolutely, positively not last me until my next paycheck.  I took my basket to the checkout line, and as my spartan purchases were tallied by the cashier I silently prayed to Agnostic-god that my calculations were correct and the bill didn’t go over the paltry amount of money I had.  The total ended up being something like $8.67.  I handed the guy my last $10, he put it in the register, and then he started count out the change, saying his calculations out loud as he dropped the coins and bills in my hand:

“Here’s three cents for $8.70, thirty cents make nine dollars, ten dollars, twenty, forty, sixty, eighty, and one hundred. Here’s your receipt.  Thanks for shopping at Fred Meyer.”

In his rush to make the lines move quickly he had assumed my somewhat rare $10 bill was actually a $100 bill.  I stood frozen for a moment, waiting for his brain to catch up to his hands, but he was already checking out the next customer.

I took my bag, and saying nothing I walked out of the store.

It’s important for the purposes of this anecdote that you realize just how badly I needed that $90. It doesn’t seem like a lot of money now, but at that moment having it handed to me was the equivalent of Auntie Em winning the lottery hours before the bank came to repossess the family farm.  Five minutes earlier I wasn’t sure how I was going to eat for the next two weeks.  So please believe me when I say that I really, really needed that $90.

And of course, after stopping at the automatic door and cursing myself, I turned around and walked back to the cashier.

“Hey,” I said, trying hard to sound like I was just now coming to a realization, “I think you gave me the wrong change.”

Anecdote #2

This weekend my wife and I decided to buy one of those high-end espresso and coffee machines that uses the little pod thingies.  My sister has one that makes espresso and my mother-in-law has one that makes coffee, and we’ve enjoyed using them when visiting.  The drinks turn out fabulous, and they are amazingly quick and easy to use. When we found out recently that there was one that actually did both coffe and espresso, we decided to get one.

You don’t exactly need to take out a mortgage to buy one, but they are expensive enough that we “had a talk” about it before pulling the trigger.  My wife (who is the bargain hunter in the family) went online to see what kind of deals we could get.  It turned out that the price point at every store that sold it (including online) was identical.  However, one of the stores’ website offered her a printable “10% Off Your Entire Purchase!” coupon.  This store is a ginormous, well known, big-box kitchen and home supply chain.  It’s out of our way; worse, it’s in the middle of a part of the suburbs that’s just rows and rows of other big-box chain stores.   It’s the kind of place I really hate to go.  I hate driving there, I hate trying to park there, I hate shopping in the crowded tiny aisles there – I just hate the whole experience.  But in this instance, the 10% discount was enough to make me suck it up and we drove over to Big-Box Land.

When we were grabbing the machine and some boxes of various pods, an employee came up and asked if he could help us find anything.  No thanks, we said, this was all we were getting.  Despite the fact that we were purchasing it, the young man started selling us on its virtues.  Did we know it made coffee as well as espresso?  Did we notice how sleek and beautiful it looked?  We were doing that kind of “politely nod and say little” that customers do when they have already made up their minds and are wanting to get on with their day, when he said, “Did you bring the 10% off coupon for this?  Because this is the one thing in the store we won’t accept the coupon for.”

This irritated us, since the only reason we had come was the damn coupon. We actually went and found another employee to verify that this was the case, and was told that yes, we could not get a discount on this one product.  Apparently the manufacture did not allow the store to grant discounts on their product. We considered going somewhere else to get the machine, but eventually used the “bird in the hand” argument and decided to just get in line with the damn thing.

When the young woman rang us up we gave her the coupon. (We had also bought some new espresso cups, and at least wanted the discount for them.)  She scanned it a few times, and then obviously frustrated, called a manager.

“It’s not giving them the discount on the machine or the pods,” she explained.

“Huh,” said her manager, who tried to make the coupon work a few times before giving up and using her Magical Manager Override to give us 10% off our entire purchase.

My wife and I said nothing.  We paid, saying nothing, and walked out of the store, saying nothing.  I am looking, right now as I type, at our new 10%-off coffee and espresso machine.

It is beautiful.

My Ethical Quandry

So here’s the thing:

When I think about that evening at Fred Meyers years ago when I was a poor student, I have no question that taking that money would have been wrong.  To this day I’m still really ashamed that I walked all the way out the door with the intention of keeping that money before turing around and doing the right thing.  And that was a over an amount of money that meant I was going to be able to eat. 

But what happened yesterday?  My wife and I getting away with something that was (let’s face it) very similar for a product that (let’s face it) we don’t really actually need?  I feel absolutely no guilt at all.  At all.

Why is this?  Seriously ethicists, I’m curious.  They do not seem remotely similar to me from an ethical point of view, but I’ll be dammed if I can tell you why that is.  Am I just telling myself something something I want to hear to get a few bucks?  Or are the two situations as different from an academic point of view as they feel to me?

Am I a lucky consumer, or am I a Bad Person?

 

UPDATE: Many of you in both the threads and emails have asked if the coupon had actually identified the coffee/espresso maker on the offer.  I have obviously chosen not to identify either the retailer or the manufacturer.  However, after this conversation I did go back to reread everything, which gave me more information than I had gotten from my wife.  (Also, it showed that my memory was incorrect; it was 20% off, not 10%. This, of course, is not relevant to the question at hand.)

I will tell everyone upfront that none of what I am about to pass along changes my feelings one way or the other, but might very well help others better determine the morality involved – both mine, and the store’s.  

The offer made on the website states that in exchange for our email address, home address and telephone number we would save 20% on our purchase on our next trip to their store.  The coupon is shown on the screen, and there is a button you press to send it to your printer to print.

On the website, this is the language that is scattered over the face of the coupon:

SAVE 20%.  Click the Button to print this coupon. Bring it in to any of our locations and take 20% off of your next trip to XXXX.  Limited time offer for this email address only.  Coupon must be printed.  See store for details.  Cannot be redeemed on a mobile device.

So as you can see, it does indeed let me know that I should go the store and check in first.  But there’s more:  The printed coupon is in fact slightly different from the the coupon as it appears on the computer screen.  The difference is indeed very, very, very small print at the very bottom that gives the store the right to not give the discount for products of about thirty listed manufactures – and yes, the manufacturer for my new machine is indeed one of them.

As I said, none of this changes my feelings about having taken the discount.

 

Follow Tod on Twitter, view his archive, or email him.

Please do be so kind as to share this post.
TwitterFacebookRedditEmailPrintFriendlyMore options

125 thoughts on “Blinded Trials Bait: An Ethics Quandary

  1. Very clearly, need is not the issue. Desert seems to be. Where the grocery store didn’t deserve to be shorted by $90 the Big Box store did something to deserve living with the consequences of its own error. So what did it do? Was it all unpleasant and out of your way and impersonally Big Boxy?

    Report

      • Yes. It is your call as to whether the man deserved to lose his job for being a “bad cashier” (let’s face it, losing that much money is being bad, even if you aren’t at your best).
        But the manager doesn’t take much of a hit, and may not even notice.

        Report

  2. From my outlook, it’s two different situations.

    Situation 1) The cashier is going to get hit directly, possibly losing his job for a mistake that large.

    Situation 2) At worst, the maker of the magical coffee machine will send a nasty email or two to the regional manager.

    Report

      • Me three, with an added splash of “the manager didn’t discount the product, he/she force-discounted your entire order, which falls within the store’s ‘allowable tolerances for soothing pissed-off customers'”. If I were that manager, I would have chosen to use part of my allowable-tolerance funds to cheer you up from your sucky experience, anyway. Fussing because it happened without my actual *knowledge* seems like cavilling…

        I know it feels slippery (and being cautious about slippery-feeling things is what keeps us off that slippery slope). But I really don’t think there’s a problem with it.

        Report

        • Also, if I were you and I felt bad about it, I would probably call up the store / said manager and say “hey, hypothetically if this had happened, would it cause you suffering or would you write it off without stressing over it?” And gone from there.

          Report

        • Exactly, which makes Maribou’s view here definitive. The store (that location of the chain presumably) simply chose to honor a more tolerant interpretation of their offer.

          It’s an instance of the value of one of my primary consumer maxims for the retail environment: “Ask for things.” You often get them, or parts of them.

          Report

  3. I suspect that one reason that it may feel less like stealing is that you’re not actually walking out with more money than you brought in. They may even be making a profit on the transaction, depending on their margins.

    Report

  4. Did the advertisement or the coupon itself state clearly that the coffee/espresso machine wasn’t included in the 10% offer? If not, in many states the store would be legally required to give you the discount. False advertising and all that.

    I sure as hell wouldn’t let it keep me awake nights.

    Report

  5. It’s one thing to get more money back than you were owed. That’s taking money out of the till.

    To be charged only 90% of what you were going to buy anyway? There isn’t even a case where the store has two sets of books that they’re cooking. The machine eats that.

    It’s easy to feel obligations to people and feel like the machine has ripped you off enough times that getting one in is just collecting a little bit back from the machine. Screw the machine anyway.

    Report

  6. Here is where I get a little frustrated…

    When companies make errors such as these in THEIR favor, they are rarely so quick to correct them, sometimes going so far as assuming consent absent a near-immediate objection. Yet when the error goes against them, we are made to feel as if failing to object on their behalf is an ethical failing on us. If that cashier rung up your purchase incorrectly, charging you $8.67 instead of $7.67, would they have taken any steps to rectify the situation? Would they have been wrong not to? More to the point, was there any language on the coupon indicating which products it did or did not apply to? If not, not only do I think there is no problem with what ultimately happened, I would have *insisted* on the discount.

    Report

    • I have had cashiers proactively give me free stuff, on the “it’s not ringing up right” level of things (policy says: if it doesn’t ring up right, first one’s free).

      Other companies have been much less generous… $10,000 bill from Verizon requires much yelling and complaining before you can even get it resolved…

      Report

  7. Or maybe there is a value threshold. In the first story the error was $90, in the 19-mumblemumble dollars of your young adulthood and the purchasing power thus implied. The 10% discount on the coffee toy is probably between twenty and thirty dollars in 2012 dollars. So while approximately thirty dollars today is not a trifling amount of money it’s not enough to get worked up about, not enough to register as a serious motel issue the way $90 did back in 19xx.

    Report

    • The more I think about this the more I think there’s something to this.

      Adjusting for inflation, the discount is the equivalent of about four hours’ worth of work at minimum wage, either back then or today. The grocer’s error is the equivalent of about twenty-seven hours’ worth of minimum wage work, again adjusting for inflation to either an arbitrary date in the past or today.

      But not everyone makes minimum wage. Starving students do, but people who are more advanced in their careers left the minimum wage behind a long time ago. So the amount of value that must be exchanged to an employer to get the money in question decreases as one earns more over one’s career arc.

      So the discount probably doesn’t feel like a whole lot of money to Tod now, where taking the equivalent of close to a week’s worth of wages would have felt like an indefensible theft.

      This suggests that the threshold at which one’s “trivial amount of money not worth a moral quandary” is tickled changes as one advances in one’s financial comfort. Which smacks horribly of the most crass kind of moral relativism: one threshold of moral discomfort for the financially struggling, and a different one for the financially comfortable.

      Report

  8. The grocery store mistake is clearly one of unjust enrichment. Even though you were horribly in need of the money, you were clearly making a benefit at someone else’s innocent mistake. It was also a working stiff like you who could get fired for his harried but very reasonable mistake.

    On the other hand, the Big Box store acted in a bit of negligence because not all employees were given knowledge about the no coupon rule. There did not seem to be any fine print on the coupon indicating that it could not be used for the Espresso Machine and I’ve discovered that large stores are often very good at having all the fine print on the coupon. Even if you had to argue with the manager, you probably could have made a strong and good-faith argument about why the discount should apply to the fancy coffee machine. You are not eating into the profits of either the manufacturer or the Big Box store by taking the discount that should not be applied, etc.

    I have a similar story about trying to do good when a store clerk messed up. Way back in 1998 when people still bought movies on VHS tapes, I bought some anime at a local mall video store. Anime was rather expensive at the time. When I got back to my dorm room and looked at the receipt, I discovered that they only charged me for one of the two tapes. I went back to the mall, tried to explain the problem at the store, and got the biggest blank looks from the employees. They looked at me like I was the biggest idiot in the world. And then I just walked out with my 2 for the price of 1 deal.

    Report

  9. The coupon said 10% off everything in the store; no exceptions were specified.

    So you went to a store you would not normally visit, for the one thing (that we know of) that wasn’t eligible for the discount; but were not informed of that. Was that ethical? If you’ opted to not make your purchase; would you have felt the store had robbed you of your time and gas money?

    Actually, my real ethical concern here is the maker of this marvelous machine; that dictates it cannot be discounted. Retailers selling this are doing the manufacturer/distributor a service. I’m not sure I find it ethical that they can dictate the margin of profit the retailers can make of the sale.

    Report

    • edit: and you did the right thing in the first case, from an ethical point of view.

      But survival when you’re starving often means making unethical choices. My step father spent a year in a POW camp during WWII. When the allies were coming toward the area, he and the other prisoners were taken out and marched around in circles in the woods for several months, without being given food. More then a quarter of those men died on that march. Those that survived? I’ve wondered what they did. I think that haunted my step-father’s dreams as much as what was done to him in the camp. But he survived.

      Ethics slide in the face of these things, and we’ve got to sort it out after the fact, if we’re so lucky.

      Report

    • “Actually, my real ethical concern here is the maker of this marvelous machine; that dictates it cannot be discounted. Retailers selling this are doing the manufacturer/distributor a service. I’m not sure I find it ethical that they can dictate the margin of profit the retailers can make of the sale.”

      I don’t know if I would make this a consideration of ethics but I am curious about your logic.

      The reason certain brands do this is largely for branding reasons and usually on the high-end for products. Not for big luxury companies that everyone knows like Prada, Hermes, Coach, etc but for luxury brands with a smaller and more niche appeal. Though I am not sure whether this normally happens in the coffee-maker industry.

      There is a clothing brand I like a lot. They are fairly obscure and most people would consider them pretty expensive*. They make all their products in the U.S. and in much smaller batches than the GAP and even big luxury brands like Paul Smith and John Varvatos. This company has a rule that they do not allow their clothing to be sold on-line. Retail companies can show the product on-line but they always include a line about “We are not allowed to sell X on-line if you are interested please call us at….”

      This is the interesting stuff about business to me. How do you maintain an elite status, how much of a product can you make and still be considered luxury. I largely like this stuff for the psychological reasons over anything else.

      *And such reliable sellers than one store I know never puts it on sale. They will put every other company on sale but this one.

      Report

      • For some smaller stores, moving those items with a sale matters very much when it comes to end-of-year inventory.

        But I guess my bottom line here is that as a retailer, you purchase something to sell, you’re not distributing it on a commission. What margin you opt to make on that should be at your discretion. If the product is desired enough, you can take the full margin. But I think any retailer has the right to mark something down to attract customers from a competitor; price fixing prevents that and so eliminates competition in the market for marvelous machines.

        Report

        • But aren’t these just the terms of the contract? Doesn’t the manufacturer have the right to decide how it sells its wares to the stores, including negotiating a final sale price?

          Report

        • Zic, these sorts of pricing agreements actually benefit small specialty retailers who can’t afford to offer the same discounts as big box stores. That’s basically the whole point.

          After all, look at what happened.

          All things being equal, Tod would have got to Café l’Fancy, a specialty store downtown on his way home from work. Instead, he drove an extra 30 minutes away to buy the thing from WalBox, dispite the long drive, the crowds, and the poor customer service.

          Clearly, Café l’Fancy is the loser here. It goes through a lot of effort to be better than WallBox and still loses the sale. And the maker of the CoffeeGizmo wants its products to be sold at places like Café l’Fancy because the customers will associate its brand with the better service available at that store.

          This is a tactic that manufacturers will take when they see it as in their best interest for products to be sold at specialty shops. When I worked in a board game and role-playing game shop, there were a few publishers that did this. Because these sorts of games rely on a community of people who play them to make sales, and specialty game shops help create and maintain that community.

          Settlers of Catan in a WalMart or Target is just a box on a shelf. If you walk into a specialty game store, there will be a guy who recommends it as a great way to become familiar with European Board Games, recommends some expansions if you want to add more players or more complexity, and can recommend some other games that you might enjoy. Mayfair games finds the latter preferable, and that’s why they won’t allow anyone to sell the game for less than $33.60.

          Report

      • The explanation I’ve heard is that it has do with preventing people from going to stores with big showrooms and helpful staff in order to decide what to buy and then buying it at a deep-discount retailer that doesn’t offer those amenities.

        I don’t have a problem with it. It’s their right to sell their products on whatever terms they want, and if that model works for them, more power to them.

        Report

        • “The explanation I’ve heard is that it has do with preventing people from going to stores with big showrooms and helpful staff in order to decide what to buy and then buying it at a deep-discount retailer that doesn’t offer those amenities.”

          I do this all the time. Is it unethical?

          Report

          • I’ll ask you: Hypothetical consumer goes to a stereo store known for knowledgeable sales staff, has a 20-minute conversation with one of them about speakers that would suit his living room configuration and listening habits, has the floor sample of those speakers hooked up, listens to them, approves, and says “Thanks. They are awesome.. I’m going to go find the best price for them online.”

            Ethical or no?

            Report

              • Jaybird, everyone makes commission somehow.

                The guy’s paid hourly? Well he didn’t get a chance to straighten the shelves like he was supposed to because he was talking to a customer for twenty minutes. But the sales numbers won’t show that, and everything is based on sales numbers. So next week, hours get cut due to low sales. And they’re probably his hours, because he’s a slacker who never straightens the shelves.

                Report

                • Hey, I’m just saying how I’d feel about it. A guy who is working on commission is working under the hope/assumption that his knowledge is part of what I’m buying. A guy who is there hourly is likely as not to be a kid in college who is doing a part-time job doing what he loves and he loves talking about stereo sound the way that I love talking about the nature of God.

                  Report

            • I actually take it a step further. Even if I knew that the sales staff wouldn’t get hurt, the company would. It would feel like I was taking advantage of certain services without paying for them.

              By way of example, I went to Best Buy and – without bothering any of the associates – I tested to test if a Bluetooth earpiece would work with my Pocket PC. I did (the packaging was such that I could push the buttons). Even though I could have gone home and ordered it online for cheaper, I felt obliged to purchase the thing right there.

              It feels wrong to do anything else.

              Report

                  • Me. I’ve had better luck there in terms of friendly sales staff who, don’t seem to pressure me. (Maybe they don’t sell on commission? I don’t know.)

                    I should say it’s been quite a while since I’ve even gone into a Best Buy, so it’s possible they’ve gone downhill. But compared to other computer or electronics stores I’ve been to, it still ranks toward the top for me.

                    Report

                    • Better than most. I tend to find that the staff isn’t all that knowledgable, unless they work in a really specialized area. Either that or they think I’m dumb and treat me like it. I usually go in there knowing what I want… “I want an ACME TV Model T1000.” “Oh, no, you don’t want that. It doesn’t have a flux capacitor.” “Yea, those are overrated. And this one is highly rated on CNet, Consumer Reports, and New Egg and is at the price point I want.” “But THIS one is shinier!” “Seriously?”

                      And, of course, when I *DO* want help, there is never anyone to be found.

                      Generally, though, their pricing is usually pretty fair (I’ve made some of my biggest purchases there) and I’ve never been hassled when making a return, two things that are pretty key for me.

                      Report

                • To be fair, I think a big part of the reason Best Buy sucks now is because of the way they’ve responded to online wholesalers. They see their marketshare decreasing and so they’ve added in more gimmicks: all sorts of crapware on your computer (and a special fee to “clean” it); layers and layers of overpriced warranties; underpaid and overworked staff; etc. The sad thing is that places like Best Buy are soon going to disappear, and it will be because they didn’t know how to deal with the phenomena of customers coming in to look but not to buy. Indeed, their solution was to scare those customers away by offerring crappier services, which naturally ended up just scaring away the buyers.

                  Eventually, I would like to see stores where you can pay a cover or a membership fee to look at stuff and talk to someone truly knowledgeable. The fee would be refunded if you make a purchase, but there would be no stigma if you don’t.

                  Report

              • I always make clear I am just browsing/researching. I actually rarely engage the staff (I tend to find them more nuisance than help). If I’m in store, it is usually to see/touch/feel the product first hand, get measurements, etc.

                I tend to research a variety of ways, mostly online… Amazon, New Egg, and (to a lesser extent) Best Buy offer good customer review sections. I hit the store if I *really* need to see it, which isn’t common. I ultimately choose where to buy based on price, shipping time, and customer service (Amazon’s guarantees and return policy make it the usual fave).

                I feel no ethical qualms with this. I entered into no contract and never misrepresent my intentions. Given the number of ethically questionable actions taken by these companies in pursuing my business (e.g., overly aggressive sales staff that don’t respect my wishes to be left alone, deceit in marketing or pitches), I struggle to feel any shame about my practices.

                Report

                • And of course there is Amazon’s price checker app, which allows you to scan a barcode and find out what Amazon’s prices for it are. I don’t use it often because I tend not to be in stores without already having done a ton of research, but it adds an interesting dimension.

                  Report

                • My issue is that they are putting that stuff out there in order to sell the stuff. If I enter without any intention of ever buying stuff, I may not have broken any written agreement, but I feel like I’ve broken an implied one.

                  Then again, my ethical philosophy is weird. I think it’s more wrong to sneak food into a movie theater than to sneak into a movie theater to watch a movie.

                  Report

                    • Having said that, I do think the larger the store, the more that “browsing” is acceptable and understood. I have no problem going into a large grocery store or department store, looking around for a few minutes, and then leaving.

                      I have more of a problem going into the “locally owned, but we still treat our employees like crap and charge you extra for the privilege”* stores without buying anything.

                      *Yes, it’s an unfair caricature and the smaller stores sometimes do treat their employees better than McBigBox. But in any given case, I’m skeptical about the Jimmy Stewart inspired labor-management harmony that supposedly reigns in such places.

                      Report

                    • The mother of one of my Highschool friends owns a restaurant. On Mondays, food is on a suggested donation basis only, so folks who can’t afford restaurant prices still have a chance to enjoy a wholesome meal. When she got breast cancer, two of her employees got Pink Ribbon + Restaurant Logo tattoos in solidarity. I’d never go so far as to say that nobody treats their employees like crap, but the Jimmy Stewart types still exist.

                      It’s usually pretty obvious to find out which is which just by observing and asking around.

                      Report

                    • I worked in a local restaurant for a summer as dishwasher. We didn’t have a union, but they paid well and were friendly and clearly cared about my well-being (my most notable memory is slipping down the stairs while carrying a stack of plates, and me being all “oh no, the plates!” and everyone else being “never mind the plates, are you ok?” I was fine.). If we were unionized I might have had longer breaks (it was an 8-hour shift over dinner with two 15-minute breaks), but given the speed of work in a restaurant, I wouldn’t, practically speaking, have had time to take them anyway.

                      Report

                    • Oh, and I got free restaurant meals during my breaks, which was a good thing to include. I always see it as dickish for any kind of food-services establishment not to include that for employees, but most of the big chains don’t.

                      Report

                    • When I worked in food delivery for a family owned restaurant, they generally took good care of their employees. I was paid on the books and got a real hourly wage ($7.50, I believe, back in the early 2000’s). I had to provide my own transportation and gas, but the tips were all mine. I got a free meal plus could buy food to take home at roughly cost. And when I dined their with my family (which is how I came to work there), they gave us a steep discount, which we always paid back in tips to the wait staff. They helped a number of their employees through tough times and it shows, as there are still folks working there today who started when I did, a rarity in the food service industry, especially for a casual Italian eatery.

                      Report

                    • And I should add that the discounts always came with managerial approval. Many times folks (especially bartenders) will give away freebies to increase their tips without appropriate permission. “No no… that drink is on me. Just take care of me on the way out.” The patron often will end up paying roughly the same, but a larger percentage goes to the tip. This isn’t always the case, as some proprietors realize the value that doing a round of buy-backs can create, but often is.

                      Report

                  • I generally only do it at stores where I do buy things. I’ve made several large electronic/appliance purchases recently. I know at least two came from BB (and a third would have but after the order was placed it was out of stock with no timeline for return so we cancelled the order and went elsewhere). A number of come from Amazon and at least one or two from NewEgg.

                    If it is a matter of a few dollars, I likely will just get it at the brick-and-mortar store. But sometimes BB’s prices are several hundred dollars more and, I’m sorry, I don’t think browsing their facility justifies that kind of added expense. And I don’t know if I ever go in thinking, “I know for a fact I’m getting this elsewhere but I want to see it first.” It’s more, “I know I want this product and it costs $X on Amazon. I wonder what it costs at Best Buy. It will also be nice to see it firsthand.” BB’s online prices are not always the same as the in-store, plus you can sometimes negotiate a deal if you are comparison shopping.

                    Still, I really see no ethical issue. You mention an unspoken agreement but I don’t think one exists. Certainly not any that they adhere to with my best interest’s in mind. They do what they need to do to maximize their profit. I do what I need to do to make responsible consumer choices. So long as specific practices used to achieve these ends are themselves not unethical (e.g., lying), I don’t see an issue.

                    The next time a Best Buy employee tells me that there is no appreciable difference between the $100 Monster HDMI cable and the $4 one, I’ll concede an unwritten agreement of mindful of mutual self-interest. Until then… not so much.

                    Report

                    • I guess it’s at least partially a “good faith” issue. If you do actually buy things at these places (including coffee) then my objections hedge a great deal. If you go in genuinely open to buying something, and you can tell just by looking at the price that it’s a terrible deal and go online and get it from Amazon, that’s okay, too.

                      That Amazon app drives me batty, however. As do people who brag about going into stores and then scoping out a better deal elsewhere (not that I think you’re bragging).

                      My experiences dealing with retail differ pretty substantially from yours. Or my perspective on those experiences does. I rarely ask for nor receive assistance.

                      Report

                    • I would guess there is also at lest a bit of a generational issue. I came of age with big box stores and Internet shopping. My relationship with shopping and vendors is different.

                      Report

            • Ethical? Dunno. But it’s sort of being an a**hole. Particularly if the guy’s on commission. (Been there; done that.)

              It’s also inevitable that a certain number, perhaps a large number, of people are going to do that sort of thing.

              Putting on my Amazing Karnack Hat, what I maybe see developing down the road is outfits like Amazon setting up display/demonstration “stores” where you go in and check out the merch and then order it right then and there for home delivery. Or maybe not or maybe something else I haven’t conceived of yet. But it seems like the hands-on retail is unsustainable as it stands and I’m not sure how it gets worked out.

              Report

            • I’d say it’s wrong if you go in with the deliberate intent of doing that. It’s not wrong to get information on something and then decide, all things considered, that it’s out of your price range or not worth it.

              I always feel a little bad when I go to shoe stores, try on about 10 pairs, and buy none, but I’m not going to buy something I don’t actually want or think is a bad deal just to be nice to the store. (For reference, I am not a shoe person. I buy shoes when there’s a good sale on runners or boots, or when my old pair wears out, and that’s it.)

              Report

          • It is if you’re a Kantian. If everyone did this, the full-service retail model would break down. People would go to one store to browse and get information, and then they’d go spend their money at a store that cut corners on service to keep prices low. And then the lookie-loo stores go out of business and all we have left are the discount retailers.

            Ethics aside, manufacturers who believe that their products thrive under the full-service model have an incentive to do what they can to help preserve that model.

            Report

        • So here is another ethical inquiry.

          I buy plenty of books from my local bookstores. However, I write down the names of books on my phone and then take those books out the library because I don’t have unlimited self-space and they looked interesting enough to read but not to buy for one reason or another.*

          Is this unethical? Is it somewhat less unethical than browsing at a local book store and then going to Amazon?

          Report

          • I think it’s less unethical. Because you’re not spending money somewhere else that they helped you figure out how you wanted to spend it – you’re not spending money at all.

            FWIW, as an ex-bookstore-manager who works for a library and buys crap from Amazon a lot, I don’t have any real problem with “browse, buy somewhere else” unless I NEVER buy from the place itself. And, it’s not really an ethical problem, it’s an ‘are you stupid?’ problem. If you never spend money in your charming local retail stores, they will GO BROKE and CLOSE DOWN. If you don’t want them to do that, you should spend money there – for your own future self’s consumer comfort as much as anything else.

            (But, whatever you do, for the LOVE OF PETE, if said local retail store DOES go broke and shut down? PLEASE DO NOT come in and tell its employees how heartbroken you are that they are shutting down seeing as how you always came there to figure out what you should order from Amazon and how could they do that to you. Because THAT, my friends, is an ethical fuck-up, no question about it. And said employee will feel rather virtuous if they manage to avoid punching you in the face. You know, hypothetically.)

            Report

              • More than one someone. And when Jaybird and I were in a Borders that was closing down, a couple of years ago, I saw the person in front of me in line do that to an employee there, too.

                When I stepped up to the counter, I said, “Hey, that person was being a jerk, sorry you had to deal with it on top of everything else,” and she said, “It’s a game for us now – how many assholes can you not let get to you by the end of the day. I’m not even winning.”

                Report

          • You’re not taking up any of the customer service people’s time, so I see nothing wrong with that at all. But then, I’m the kind of person who will sit down in a bookstore, read a book all the way through, and then not buy it.

            Report

    • Resale price maintenance used to be considered a “per se” violation of antitrust law, and the degree to which it was a violation has been whittled down until the Leegin decision in 2007 [Leegin Creative Leather Products v. PSKS, 551 US 877; see http://en.wikipedia.org/wiki/Leegin_Creative_Leather_Products,_Inc._v._PSKS,_Inc.%5D

      Not that this answers the fairness question. But I will say that one conceivable function of resale price maintenance would be to protect smaller merchants from the discounting practices of big box merchants. Having said that, my reading of the dicta in the case (I only skimmed it, and I did so only several years ago, and I’m not a lawyer, either), is that such use of resale price maintenance would constitute and “unreasonable” (and therefore illegal) restraint on trade.

      The lawyers here can correct me if I”m wrong, of course.

      Report

        • That sounds to me like resale price maintenance. Or at least that’s what I had thought it used to be called.

          My reading of the wikipedia post you linked to suggests that I might actually have the right case. My understanding was that Leegin cut away the pretense and allowed manufacturers to practice resale price maintenance whereas before they could only sell products to be resold at “suggested retail prices.”

          Still, you, and not I, are the lawyer here.

          Report

  10. Think about it this way.

    If they give you 10% off the coffee maker, then you buy, let’s say, $400 worth of other stuff.

    If they don’t give you 10% off the coffee maker, then you buy nothing.

    I’m pretty sure that, if all else failed, the store manager would have given you twenty bucks out of his own pocket to make the sale. Because making those sales is what keeps his job in existence.

    Besides,given the way retail markups go, giving you the 10% off wasn’t a huge hardship for them. It just reduced their profit from 85% of the retail price to 75%.

    Report

  11. “Did you bring the 10% off coupon for this? Because this is the one thing in the store we won’t accept the coupon for.”

    Much of my question for the ethics hinges on this. Was there a disclaimer on the coupon about not being valid for particular items? If not, it’s one hell of a bait and switch and I have no problem with your asking the manager to override and honor the deal the store advertised.

    Report

  12. Did the “10% Off Your Entire Purchase!” coupon contain any caveats to the effect there might be things in the store which wouldn’t apply? It seems you only found out about this item once you’d arrived in the store.

    If not, there’s no ethical problem. The store has an ethical problem.

    Report

  13. I agree with all those who said that because the coupon had no caveats, it was a bait and switch. You were entitled to that discount. The store made a promise to lure you in and did lure you in.

    Totally different ethically than profiting from someone’s honest mistake.

    Report

    • If it’s the store I’m thinking of, and if it’s the type of coupon I’m thinking of, those things have several thousand words of fine print on the back, including a whole lot of exceptions. Not, in other words, just an expensive coffee machine, but really enough that you might (correctly) imagine an expensive coffee machine would be among the exempted items.

      If that’s the case, then it comes down to whether or not the ginormous list of exceptions is in itself a shady business practice.

      Report

  14. You’re older and wiser.

    When you were young, you imagined that you needed to be honest, work hard, save, and do everything through your own efforts.

    Now you realize that life is about fairness, and fairness means sticking it to the big corporations whenever you can.

    I dunno, best I’ve got tonight.

    Report

  15. I agree with the others about the bait-and-switch as well, though I suspect you’re going to tell us the product exclusion did turn out to be on the coupon. But, even if the product wasn’t listed on the coupon, there is still a catch, isn’t there? You went ahead and decided to pay the full price. At that point, the full price was arguably rightfully theirs. You were duly informed of store policy, and proceeded to make a contract by picking up the item and taking it to checkout to pay for it.

    If the coupon was a bait-and-switch, you should have insisted to the store manager that you deserved the discount. You probably would have succeeded. If the product exclusion was listed, and you missed it…then this was exactly the same as if you’d kept the change in the grocery store.

    That’s my analysis. Not saying I wouldn’t have done the same thing as you in your situation. As we get older, we build up a collection of slights done to us by faceless corporations, perhaps even by the corporation that we see making an error in our favor right now. Aaaaand, we let the corporation suffer for once. I suppose this is a nice version of Evil Jason above.

    Report

  16. They do not seem remotely similar to me from an ethical point of view, but I’ll be dammed if I can tell you why that is.

    In the first case, the mistake was honest and you – also – were honest about the mistake. In the second, you felt like it was a bait-and-switch, which is immoral in its own right. So, in some sense, you felt justified in taking the discount. And if I’m not mistaken, you weren’t hurting the store’s bottom line by doing so, since they were willing to give you the 10% discount on the product. It was the manufacturer who didn’t want the discount to apply. So in that sense, you weren’t taking money from anyone against their will (since the Box Store ate the discount). At worst, you were not honoring the coffee makers desire to not have teh discount apply to their product. But if so, you wouldn’t have been attracted to it to begin with.

    In my opinion, this is pretty close to an ethical a wash.

    Report

  17. Many of you in both the threads and emails have asked if the coupon had actually identified the coffee/espresso maker on the offer. I have obviously chosen not to identify either the retailer or the manufacturer. However, after this conversation I did go back to reread everything, which gave me more information than I had gotten from my wife. (Also, it showed that my memory was incorrect; it was 20% off, not 10%. This, of course, is not relevant to the question at hand.)

    I will tell everyone upfront that none of what I am about to pass along changes my feelings one way or the other, but might very well help others better determine the morality involved – both mine, and the store’s.

    The offer made on the website states that in exchange for our email address, home address and telephone number we would save 20% on our purchase on our next trip to their store. The coupon is shown on the screen, and there is a button you press to send it to your printer to print.

    On the website, this is the language that is scattered over the face of the coupon:


    SAVE 20%. Click the Button to print this coupon. Bring it in to any of our locations and take 20% off of your next trip to XXXX. Limited time offer for this email address only. Coupon must be printed. See store for details. Cannot be redeemed on a mobile device.

    So as you can see, it does indeed let me know that I should go the store and check in first. But there’s more: The printed coupon is in fact slightly different from the the coupon as it appears on the computer screen. The difference is indeed very, very, very small print at the very bottom that gives the store the right to not give the discount for products of about thirty listed manufactures – and yes, the manufacturer for my new machine is indeed one of them.

    As I said, none of this changes my feelings about having taken the discount.

    Report

    • “As I said, none of this changes my feelings about having taken the discount.”

      You did not *take* the discount. You were *given* the discount. Willingly and voluntarily and deliberately (unlike the $90, which was given mistakenly). They could have declined to give it to you and I assume you would have acquiesced. Hell, the manager could have given you the thing for free if he was so inclined.

      Report

      • At the same time, the manager probably didn’t know that Tod would acquiesce or that he is such a nice guy. I can imagine a scenario where the manager, not wanting to start what might be a fight with a customer, just gives in preemptively to keep the line moving. (I don’t know if it was busy that day or not, so I’m making assumptions.)

        You’re right, though, that the manager was exercising his prerogative. And maybe at the end of the day, getting sales by fine print is dishonorable and deserves to be undermined. But I’m not inclined to so quickly defend Tod’s actions here. (Even though, as I state above, I’m not convinced I would do anything different.)

        Report

  18. I’m inclined to agree with Boegiboe above. But as is my wont, I’ll add my own twist to it:

    1. I think one of the reasons scenario 2 seems different from scenario 1 is that the amount of money is probably not comparable, with the amount in scenario 1 probably being much greater in real dollars (and possibly even in nominal dollars) than the amount in scenario 2.

    2. The negative impact of your not being honest in scenario 1 is much bigger and much more visible. As others have pointed out, that grocery store clerk would likely have lost his job, and considering whatever job you were working at the time, you probably knew exactly that such would be the outcome. In scenario 2, the negative impact is much less visible and diffuse. If enough people did what you did, or if the coffee/espresso maker’s legal counsel got wind of this and decided to make an example of the big box store, then maybe the manager would have gotten a reprimand or as a worse case , though implausible scenario, might have been the final straw in the manager’s otherwise poor performance that would get him fired.

    3. Especially given your update, I’d say you were morally in the wrong in this situation. I’m not sure what ethical rule I would impose–and I’m not sure whether I would make it universal or even if I would abide by it–but it would consider the following:

    3a. You did not need the coffee maker.

    3b. It appears–at least from your post–that you could afford to pay the extra 20%. At least that’s the impression I get. So it’s not Guy de Maupassant’s “necklace” we’re talking about here.

    3c. I admit that retailers and coupon offerers should be more transparent about the fine print stuff. So that’s a strike in your favor. But as Boegiboe said, you had been advised before going to the cashier of the exception.

    3d. The manager should have known his stores policies and did not. But he is probably just trying to earn a living to and is not the second coming of George Pullman, J. P. Morgan, or John Rockefeller. The “harm” you did him was probably petty, but it was also probably not non-existent.

    3e. The cashier had to go through the embarrassment of ringing up a coupon that you should’ve known might not ring up. This probably seems like a petty issue–and maybe at the end of the day it is petty–but sometimes working the cash register can be stressful. I’ve had at least a few jobs where the coupon didn’t ring up properly, and it’s usually a pain (even if it’s ultimately the store’s fault). Here, you had a chance to point out what the other employee had told you so as to lessen the cashier’s embarrassment. Again, maybe I’m being petty and merely showing that I just don’t know how to let my resentments from my customer service days (which I might be revisiting once I finally leave school) go, but I offer this example as a reminder that it’s not just “heartless monopsonist large retailer.” It’s also the employee who’s just doing her job.

    This probably sounds really harsh, but I should be clear that I don’t know what I would have done in either scenario. I would probably have returned the $100. At least I hope I would have. I probably would not have done much different from what you did in scenario 2, however.

    Report

    • I think you’re right. If the machine’s not covered by the discount, and you can afford it anyway, then it’s your call whether to buy it at the full price or not, but it’s not right to deceive the cashier over the applicability of the coupon. But I suspect people are more willing to bend ethics/honesty when they feel that they organization they’re dealing with acted unethically or deceptively.

      Report

      • Thanks. I think in a lot of discussions about what is acceptable to do to an unethical company, sometimes the humans who are affected get lost in the shuffle. That was the main reason I included 3e above (with the proviso that I might very well have done the same thing as Tod did).

        Report

  19. Which kind of espresso machine did you end up getting? In Europe, the Nespresso machines and pods are all over the place and the espresso is awesome. Here I find you can’t really buy the pods in stores.

    Report

  20. scenario one was primarily screwing a single person – and good on you for returning the money – whereas scenario two is, as others have noted, screwing a very large entity out of very little, if anything.

    Report

  21. I’d say that the very, very smallness of the print clinches it. If they had made it straightforward for you to determine that the coupon didn’t work for you, you would have purchased the machine elsewhere (since, as stated, you hate the place.) Since you were there only because they deceived you, it’s only just that they later deceived themselves.

    Report

  22. I shall Devil’s Advocate.

    Regarding the first case, does it affect your feeling of guilt if you know that the store very likely had a markup on the goods you bought and that markup is built into the price by metrics that include loss do both to error and theft? And that you, as the honest Tod, pay the vigorish for this loss factor on all the goods provided in the store? You are, indeed subsidizing the dishonest. And you have all your life. Well outside the tune of $90, you bet.

    One difference between, say, a corporate store and a Mom and Pop store is that Mom and Pop can negotiate you an individual price. This is not a feature of a corporate store. Doesn’t have anything to do with the corporate store being evil or not.

    It just is. It’s a machine. In the back end goes goods and out the front end comes those goods plus the markup, and the markup is applied across the board to all the customers, the honest and dishonest alike. Hey, the dishonest guys occasionally steal. We’re not like that. But pocketing that cashier error is, in the long game, just getting part of your vigorish back. It’s in the formula.

    Why do we regard these as ethical beings, and why do we have an obligation to them beyond their due diligence? It’s certainly the case that if they overcharged you and you didn’t notice they’d pocket the money without attempting to return it to *you*.

    Report

    • Big stores often can negotiate an individual price. In the second example, that’s exactly what happened – the published, pre-approved discount (apparently rather sneakily) excluded the goods Tod was buying. The cashier was not empowered by the store to negotiate discretionary individual prices, but called a manager, who was so empowered.

      It’s true that the larger the chain, the tighter the controls around who can negotiate, by how much, under what circumstances – but that doesn’t mean no one can.

      Report

  23. The other side of this, I guess, is that even if you did somehow conclude it was wrong of you to take the discount – it wouldn’t be an efficacious use of your limited guilt. Or, at least, it’d be awfully far down on the list of things *I* do on a regular basis about which I have ethical qualms.

    I was discussing said qualms with a philosopher friend of mine one day, and she said, “Look, if you aren’t willing to give away all you have and join a charitable order, you really need to let that stuff go. Everybody fucks up, you fuck up a lot less than most, and you’re using energy to beat yourself up that you could put to better use.” I forget that I think she’s right fairly often, but – I think she’s right.

    Report

  24. Weird utilitarian answer: in both cases, take the windfall and donate it to charity.

    For a slightly more conventional answer, one might reason it through like this:
    The manager would prefer to give you the discount to losing the sale (presumably, otherwise he wouldn’t have given you the discount in the first place). You might have taken made the sale anyway, but both of you get gains from trade here, to use the economics term, it’s simply a matter of deciding how much each of you get. You have no obligation to provide perfect information to the vendor if it makes you a bad bargainer. This principle is more clear if you consider cases where dickering over price is more common: when you’re bargaining with a car dealer, you don’t tell them what the maximum price you’re prepared to accept is, you try to get the best price you can.

    If anyone is being cheated here, it’s the manufacturer, since the retailer is, effectively, breaking the agreement not to discount that product. But I wouldn’t worry too much about that; much of the damage was already done when you first got the (mistaken) impression that the item was discounted.

    In contrast, the store clerk would most certainly NOT prefer to give you too much change rather than not making the sale at all. You’re not bargaining over who reaps the most gain from the trade, you’re actually leaving the store worse off.

    Report

  25. Did the presence of your wife along with you at the store influence your decision?

    As in, were you perhaps more comfortable with Scenario 2 because you had a co-conspirator who was equally cheesed off/irritated at the lack of coupon applicability at first?

    Report

  26. Along these same lines, is it unethical to sample a food court offering from a vendor you have no interest in buying food from? I don’t solicit them, mind you, but I don’t see an issue with taking something offered (sometimes aggressively as is often the case with the chicken teriyaki guys) even if you know the sample won’t lead to a purchase.

    Report

    • That’s an easy one for me. It’s completely fine.

      Two reasons: First, you might approach the sample with no intention of buying, then change your mind. Second, you might remember it fondly the next time you’re hungry. Either way, I can see the store thinking it was good deal.

      Report

      • I can see the store thinking it was good deal.

        I think that’s right. The store puts that stuff out there on the expectation that increased sales will outpace the loss incurred by giving some of it away. If that model breaks down, then they’ll stop doing it. Of course, some people might take advantage of the free stuff – I see this all the time a Costco, where the same few individuals just chow down, moving from one vendor to the next – but that’s part of it.

        In some sense, offers like free food at Costco are based on a cultural model where the expectation, based on social norms, is that that stores customers won’t show up everyday to eat their three squares for free and not buy anything. Insofar as the cultural norms regarding those types of behaviors didn’t exist, or break down, then the free sample will non longer be viewed as a profit maximizer.

        Report

        • Most millionaires (aka the pennypinching type) go there to sample, and then they go at a different time to shop. It would really be silly to assume that since someone isn’t buying then, that they aren’t going to buy later, when it’s more efficient.

          Of course, this isn’t talking about the “lawyers with munchies” issue…

          (Costco says: you paid me $50 to get in the door. How many sample meals does that give you, anyhow?)

          Report

          • There’s that as well. Plus, the ancillary benefit received from Costco of enticing people to enter the store on the expectation that tasty niblits will be scattered throughout.

            Another factor is the otherwise-existing cost of traditional advertising. If sales go up due to giving away free stuff at point of sale, the calculus isn’t necessary profit generated minus free stuff. It’s probably more likely to include the expected profit minus cost calculus of giving away free stuff relative to sales other advertising techniques as well. So some loss due to filching isn’t necessarily a deal breaker.

            Report

    • The vendor is delighted if you don’t walk over to the freezer case and pick up his product immediately. Marketing is all about impressions. The vendor got you to eat a sample of his food: his product is now different than the competitor’s product in your mind’s eye. That’s worth good money. You, greedy thing, actually came up and nibbled his product.

      As value for money, a sample sure beats blindly flogging the ad sections of the newspapers. Now when you’re going through the ad section, you’ll be far more likely to cut out his coupon.

      Report

      • On a related note, my friends and I were discussing the vendor’s response to buying them out of something. I recently went to a farmer’s market and seeing as how it was the second-to-last of the season, I bought all the rib eye steaks they had (all 8 of them). My friend asked if they were excited or upset about this. They were professional and courteous, not really giving an indication of their feelings. On the one hand, I can imagine excitement brews as they make a big sale. On the other hand, they concentrated their exposure in me; anyone else who was a potential customer might not be now that they didn’t get a delicious grass-fed steak. On that given day, 8 steaks sold is 8 steaks sold. But, on a broader level, they MIGHT have preferred to dole them out to more folks and increase the likelihood of developing their consumer base.

        Does anyone who worked in retail have a sense of this? It shouldn’t necessarily dictate the consumer’s shopping habits but it was an interesting discussion I had not thought about at the time.

        Report

    • Until you’ve eaten the sample, you can’t know for certain if you would buy it. That’s part of the point of samples – to try to bring people from “interested but unsure about purchasing” to “definitely going to buy this”, but also to bring people from “uninterested” to “interested”.

      Report

  27. I agree that this is a bait and switch, even if in teeny weeny print the coffee maker was listed as an exception. The point of bait is to be alluring, and it becomes less alluring if it fails to obscure the hook.

    In the first story, the young man who made the error was likely responsible for the amount of cash in the till. He might well have suffered harm directly as a result of your taking the money. While one could argue that that would have been the meet outcome of his error, that is not an argument that leads to a nicer world in which to live. You did the right thing.

    In the second case, the store issued a coupon and then deliberately made as difficult to discover as possible the information you needed to make the best decision about whether or not to use it. The store, not the individual taking your money, is out the difference between what they wanted to charge and what you paid, but since the store engaged in deceptive behavior in order to get you to spend any money there at all, they should be grateful for your custom (I would almost certainly have left without buying anything), and any loss they incur because their deception was good enough to fool even their own employees they have coming.

    Report

  28. Wow. There are some unbelievably petty people who post here.

    You wonder what these people would do if they actually understood how far retail stores mark up their prices over what it cost them to get the item in the store. That coffee maker you’re so torqued about? It cost, at best, half of the price you paid with the coupon. Smaller items are even worse–all that stuff that’s near the cash register, those little five- and ten-dollar impulse purchases, the profit margin on those is well over eighty percent.

    Which, as a side note, is why dollar stores are able to stay in business–because they only sell that high-margin stuff. In a way, things like that coffee maker are loss-leaders–in that they’re present to get you into the store so you buy the low-price high-profit stuff.

    The lesson we’ve learned from Wal-Mart is not that big retailers have an advantage–it’s that, in the end, high-end retail was always being subsidized by the cheap stuff. You look at two TVs, one low-quality 36″ and one high-quality 50″, and you see that the latter’s retail price is maybe twice the former. The store, however, paid maybe four times as much to get the good big TV as it did for the small cheap one. They want you to buy the cheap one. The big fancy one is advertising, a come-on to get you in the store and thinking about TVs so you’re more likely to buy one. If the retailer wanted to sell only good big TVs, they’d have to raise their prices on those good big TVs compared to the guy who focuses on small cheap ones–which means that the retailer who wants to sell only good big TVs is probably going to go out of business, because not only does he not have small TVs but his prices are the highest in town. “But we sell quality!” Yeah, go back to this very thread where people are getting angry about a ten-percent discount on a coffee maker.

    Report

Comments are closed.