Quality Costs
Posted by John Draper | Filed under Smart Shopper, Take Control
So PJ and I were walking past a shop window on the way to a shoot the other day when we looked in at the washers and driers. PJ has just bought a new house, which came with a washer and dryer she doesn’t particularly like. She was looking at an energy efficient front loader with a little lust. The set was on sale; a good price we thought. Especially when we turned around and compared it to the Big Name set that was priced higher.
Funny that. It seems it’s in our natures to assume that because it has a higher price, it’s a better product.
To prove the point, researchers from CalTech and Stanford told their guinea-pigs that they were drinking five different wines at five different prices. You know what? Those tricky psychologist lied; there were only three types of wine because two wines were offered twice: a $5 wine was described as costing $5 and $45, and a $90 bottle was described as costing $90 and $10. (There was also a $35 wine with the accurate price given.)
The guinea-pigs not only rated a wine as tasting better when they were told it was pricier, but their brain scans showed greater activity in their pleasure zones. OMG! Just being told the wine was more expensive gave the drinker greater pleasure. How awful is that?
Perfume is another good example of a product whose quality is often measured by its price. You can buy a six-ounce bottle of a lovely perfume at the drugstore for $30.00. If you want Chanel No. 5, one ounce will cost you $250.
A friend of mine told me a story that made me split with laughter. It seems her cousin was in the drugstore where he saw an expensive brand of cologne on special, two-for-one. So he bought them. He didn’t need them, but the idea that he was getting something expensive for FREE made him bite. His perception wasn’t that the colognes were half the price they had been before. No. He kept the original price as his benchmark, and registered the other bottle as FREE to justify dropping a lot of money he could ill afford to spend.
Hey, nobody likes a BOGO sale more than moi. I’m talking averaging down two pairs of shoes to $20 each here, not popping for a $300 handbag so I can get the other one for $150. I guess, it’s all a matter of perspective.
While it is sometimes true that “you get what you pay for”, if you decide to pay two or three times the price for a particular product, does that mean you expect it to be twice or three times as good? Think about it. Is that Super-de-dooper Latte really three times better than the coffee you could pick up at Timmy’s?
This is where we get into the whole idea of “value.” Dollar for dollar if the more expensive item isn’t proportionally better than the cheaper one, should you spend the extra money? Would the lower priced item suit your needs just fine?
So how’s a body supposed to counteract the More-expensive-is-better syndrome? You could do some blind testing of our own. If there are products you pay extra for because you think their higher quality makes it worthwhile, maybe it’s time to check your assumption.
You could also be better informed by reading consumer reports available in magazines or online. You could ask for friends’ opinions on the performance of less expensive alternatives they may be using.
Okay, it’s your turn: Have you ever bought a premium anything only to be disappointed? Do you have substitutes that you routinely choose over more expensive items because they are just as good?
July 21, 2008 at 9:27 am
I find this happens most often for me with clothing. After justifying a splurge on a brand name item assuming that the quality would be better and the piece would last longer … only to find a hole in the fabric or the seam came apart after one or two washings! Definitely not always worth the higher price tag.
July 21, 2008 at 11:31 am
yes. yes. omg yes. that latte is better than timmy’s. much better.
therefor i get it only every now and then as a treat.
otherwise i agree 100%.
i research big time to make sure when i buy something it’s the best for me with all the features i want for a good price. that way i buy it once. not 3 times over the next year or two.
i also look for return policies and guarantees, which i have used many times if i’m not satisfied. there is always an out and rarely a commitment when you buy something.
and that way if you do experience buyers remorse, you get yourself out (mind you since i started putting effort and thought into things, i’m never disappointed and always pay a decent price).
for me, just think about it, research it and make an educated purchase. it works for me anyways.
July 21, 2008 at 11:46 am
I think the whole “organic” thing can be a huge trap. When we got out of debt (thanks, Gail!) I had more leeway to spend more to shop better. So I’m trying to shop local first, organic second. And overall the experience has been positive.
But having read up over the years, I’ve discovered that something labeled ‘organic’ isn’t necessarily as wholesome as one might think. Because it’s a highly unregulated industry, the term can mean anything from ’squeaky-clean’ to ‘just a few less chemicals than before’. Just cuz it’s labeled ‘organic’ doesn’t mean it can’t be unhealthy (i.e. cookies, chips, etc). Nor does it guarantee that the makers are practicing fair labour standards or earth stewardship. And don’t even get me started on the whole grey area in the term ‘free range’.
It’s a mess. But that’s branding for you. Putting that tag on it means they feel justified in charging you 5 times as much for a product that might be no less harmful than the regular version. It’s as manipulative as anything. Buyer beware, I guess.
–M.
July 21, 2008 at 1:33 pm
My results have been mixed, it seems in the last few years, it isn’t the NAME that is on the product anymore…. so many of the tried and true brands have gone for the quick profit and the quality is suffering. I hate to say it but I think WHERE something is manufactured can have a big impact on how well it is made a lot of the time. (I love finding old, working items at used stores. The stuff that was made to last forever, and even be serviced!) instead of just lasting until the minute the warranty expires.
Helpful tip: Have you ever seen “the shopping bags” TV show? It’s a Canadian show on W Network… Look for it! That are all about the blind testing and doing their own consumer rating, a favourite thing they do is compare the higher priced things with generic. The results are always surprising since there doesn’t seem to be a steadfast rule for everything! Sometimes the extra money is worth it for the quality, and sometimes its nothing more than personal preference for the product. They also do “as seen on TV” products, I love watching them try the stuff that works so terrific on the commercials (sometimes very funny).
July 21, 2008 at 1:41 pm
<- that. and don’t forget that not everything at a farmer’s market was grown locally – you have to ask sometimes.
I’m pretty cheap, and I love all kinds of fruit, so I’m hard pressed to do local or organic very much of the time. If I did local year-round, I’d be sick of beets and potatoes by the end of the 8 months of winter…
I buy pricey clinique face soap and lotion because it’s the only thing that doesn’t make my face feel like it’s on fire. it usually lasts well over a year so I don’t have to buy it too often. I like MAC make-up, which is pricey too, but I don’t buy it very often either. I also splurge on fancy-pants dental floss (feel soooo good), name-brand dry macaroni and q-tips (the no-name brands honestly taste worse/fall apart, respectively, we’ve tried both and been disappointed), and a few other things. Items that should be exactly the same as no-name (e.g. frozen corn), we buy the cheaper brand, unless we have a bad experience (see: macaroni).
Premium fuel is apparently a rip-off unless your vehicle manual specifically requires it for your vehicle (most apparently recommend against it), so we don’t buy into that…
July 21, 2008 at 1:43 pm
IA on that as well, big love for the shopping bags!!
July 21, 2008 at 1:50 pm
I understand the mantality. Personally my favorite food is usually as the scuzzy looking dives. Before I shop for anything I decide what features are important for me. I also prioritize and set my budget. Always do your research ahead of time so the salesman can’t talk you into something you don’t need or want. Then I go shopping. Sometimes you can get exactly what you want other times you have to give up something to get your price. My parents never buy anything just to get a new shiny one with all the latest and greated features. My parents have only recently purchase thier second refridgerator (they kept the first one, a std harvest gold for about 24 years). I view applance purchase as long term as a result. I am in the process of buying a house and need to buy at minimum a refridgerator and it is very easy to get blinded by all of the features on some models. Many time if you step back and think about it you will never use the features anyway.
July 21, 2008 at 2:46 pm
I have to admit that with my addiction to Coach handbags, I would be one of those drawn to the $300 handbag to get the second one for $150. I’m working on this addiction and just last week returned $750 worth of merchandise to Coach.
Just yesterday I made a related post on my blog about the uselful things one can find at a $ Store. Now, of course, not everything at a dollar store is even worth a dollar due to poor quality but these are some of the things I regularly buy and see no difference between them and their brand name counterpart:
generic Woolite/Zero
generic Comet
coffee filters
gift wrap/bags/boxes, cards and tissue paper
crushed garlic
gum
plastic baskets to organize drawers
bubble envelopes for packing items sold on ebay
batteries for my many remote controls
brand name DVD-R’s (Sony, Maxell)
July 21, 2008 at 3:41 pm
When I shop for appliances I have to admit that I shop at one department store because I know they back their warranty and that if there is a problem they have a service centre that I can call. To me, a stove is a stove unless I am a specialty cook and I don’t cook except on Sundays. It is really the service behind the name and that has worked for me for the last say 40 years. However, I do not advocate additional warranties as I believe this is just another way for companies to make a fast buck!
July 21, 2008 at 4:11 pm
I LOOOOVE the Shopping Bags! g
July 21, 2008 at 5:51 pm
Purina Maxx Multi-cat clumping litter. When I switched over to it I thought it helped with the litter box smell and it was easier to scoop, and it was only $4 more expensive than the regular Equality brand I was buying.
But the expensive stuff caused my one cat to have bowel issues. My vet thought it was a food allergy, so my cat was put on a pricey diet ($70 for a 10lb bag of kibble that my cats could inhale in 3 weeks), plus the cost of a couple of visits and medication. Eventually I realized the symptoms coincided with new litter, but not after a couple of months of my kitty’s suffering and $300+ in vet bills.
Needless to say, I’m back to using Equality clumping cat sand.
July 21, 2008 at 7:10 pm
Certainly more expensive shoes are definitely better (Hush Puppies, Nine West). I have a pair of Hush Puppies which I took for repair more than a few times in the last 3 years. The shoe repair people told me that those shoes should last at least 5 years, despite walking on them every day. I can’t help destroy the heals, however, because the way I walk. But it costs less to buy a comfortable pair for about $100 and then take them for repair for $15 a year, than buying a pair every six months for $40 or 50?
However, I do find buying Prada for $500+ a pair a bit too much.
July 21, 2008 at 8:20 pm
I just wrote on my blog the other day about my solution to curtains. I had a 9′ x 5′ section of windows I wanted to get curtains for to replace my defunct roman blinds and allow me to let more light into my family room. I bought two $10 table clothes, a $10 curtain rod, and a $4 worth of curtain rings (that have alligator clips on the them) and now have have a very pretty set of “curtains” without any sewing. Leaving the store, I saw the same brand, pattern, material, colour curtain panel, that was even a bit smaller than one of my table clothes, go for $26 a piece. All together, I paid $34 plus tax for a window treatment that would have cost easily double otherwise.
I BATTLE over “cheese” in my house. My husband HATES “fake” cheese, and DESPISED store brand cheese, until I finally made him perform a taste test. The rules were, if he picked the “name brand” cheese from the “no name brand”, I got to pick which cheese we picked up next time.
Guess who won?
And, finally, I was able to prove to the lifemate that cheap coffee made well is far better than expensive import coffee if you have someone that knows what they’re doing at the helm.
And I have yet to find a brand of laundry soap that works better and hurts my skin less than Purex, which is usually cheaper than the store brand where I shop.
I got my favourite body spray, plus the matching body lotion, for $.99 at a Liquidation World today. It’s wonderful stuff.
July 21, 2008 at 10:38 pm
brand names only products:
toilet paper, dish soap, body soap, laundry detergent, aluminum foil, q-tips, batteries, and Fruit of the Loom or Hanes for socks and underwear
I don’t mind generic: Paper towels, feminine hygiene stuff, granola bars, some cereal, mozarella or cheddar cheese, zip-lock baggies, frozen veggies, canned tuna
I joined Costco last month, and the best deal I’ve found so far was on the Kitty Litter – 22.7 kg (that’s 50 freakin pounds!) for only $8.69. It’s a brand I’ve never heard of, and I prefer it over the Maxx brand.
I know that a lot of food that is generic is actually manufactured by the big brands. It’s probably the same for other industries as well.
I’ve also learned through experience that cheap shoes aren’t worth it – unless it’s a cheap pair of flip flops that will only be worn a few hours a year at the beach.
Umbrellas – it seems that the expensive good quality umbrellas always get lost of forgotten in a restaurant or something. So I now insist on only cheap flimsy umbrellas.
July 21, 2008 at 11:40 pm
This entry made me smile as I had just read the article “Buyer Beware: The Many Ways Retailers Can Trick You” on the Live Science website. It’s opening sentence says: “Shoppers do crazy things. And retailers bank on it.”
Having read The Undercover Economist (Harford) and part the way through Consumed (Barber), I figure I’m getting savvy to the ways of evil marketers… er shops, etc. use to get money out of me.
I was buying a fairly inexpensive face cream from a chain store counter when the salesperson told me that if I spent another US$30 (equiv.) I could get a FREE gift (tautologous). I pointed out that this FREE gift would actually cost me $30. The salesperson just didn’t get this concept! “No it’s free.” “No to get it I must give you $30.” Whoosh!
Turning down ‘free’ things can really throw some salespeople here (Hong Kong) because folks here will queue for hours to get something ‘free’, even if poor quality with no monetary value.
IMO, there is nothing that is really free. Everything has a cost – money, time, space, etc. Now I estimate what that cost is before I buy/accept it… except free luxury chocolate samples because that goes without saying.
July 22, 2008 at 1:38 am
Expensive stuff: knives & good pots are worth it. Certain clothing items, like shoes (I can walk in shoes made in Brazil, Spain, Italy or France: cannot walk in shoes made in China. No matter how cute they are, I can’t buy them) and handbags. Toiletries: face soap (goatsmilk from Mudlark,now must be ordered from internet and I still do it), tampons & toilet paper. Food: cat food from the vet, coffee, fruit, bread. Vacuum is a DYSON, and always will be.
Cheap-happy stuff: clothes. Once I realized that my H&M suits were as well made and much more fun than the suits from Holts, I stopped going into Holts. When I’ve paid off my student loans, maybe. Furniture: all from thrift stores, all recovered and refinished: better quality and more fun than most affordable new stuff. Appliances: all used, all work fine. Car: always used, when I have one at all.
July 22, 2008 at 1:41 am
Oh, and Eleni — Every time I go into Costco I spend 300 dollars (the Dyson vacuum, ie) so it’s not all that great for saving money for me. But they have fabulous underwear and towels.
July 22, 2008 at 8:13 am
Many Large “brand-name” manufacturers have a “generic” line that is made in the same factory as their top of the line using the same components. I have “whirpool” washer and dryer…….yes they say inglis on them and Inglis is a “lower whirpool line followed by roper which I had for years. I buy mostly generic unless the family doesn’t like the taste but they don’t know ahead of time whether it is brand name or not.
The main things I NEVER buy generic are : Ketchup (has to be heinz), fem hygiene products, mac and cheese and thousand Island dressing ( the only dressing out of the 4 that I buy that is runny like water when I switched to generic) and toothpaste,
Personally I don’t see the fascination of costco. There were 3 things cheaper in Costco on my one trip and for the $1.50 I would have saved I would have spent more in gas getting there! I guess it depends on what you buy though. A close GF swears by shopping at safeway which is cheaper for her but for my family I shop at Sobeys….but only on 10% Tuesday!
July 22, 2008 at 3:35 pm
Just a few thoughts:
My $300 watch tells time just as nicely as a Rolex
I know the quality difference between perfume and eau de toilette and don’t mind paying for it because I have only one
I have shoes that are expensive, but I also don’t have the quantity that are found in most womens closets and I take very good care of them
A $40 wine glass breaks just as nicely as a $5 wine glass
Do the research on the best under $20 wines and you will find some jems
We try to avoid as much disposable as possible in our lives (ie: old bed sheets are cut nicely and used in lieu of paper towel, The Keeper Cup and Lunapads are used in lieu of disposable)
Cloth napkins are also better quality than paper towel and look nicer on the table and once they are too soiled get relegated to the rag drawer
Quality for us also means being as gentle on the earth as we can
We don’t mind paying more for quality because we don’t have excess quantity
Cheers.
September 7, 2008 at 10:56 am
I never spend more than $10 on sunglasses. Every summer I hear at least 3 people I know complaining about how they lost their ($30, $60, $200) pair of sunglasses, and in the words of Gail, I give my head a shake. It seems the forces of the universe (those same forces that suck one sock in a pair out of the dryer when you close the door) love expensive things too. I’ve had the same pair of $10 sunglasses from Wal-Mart for the last 2 or 3 years now. The universe doesn’t seem to want them. Sure, they don’t come with a fancy hard-cover case and a little silk cloth to clean them with, but I can just as easily toss them in my purse and wipe them with the front of my shirt when I need to