What have you always wondered about the economy? Tell Us

The price of non-things

Marketplace Staff Jul 18, 2006

TEXT OF COMMENTARY

TESS VIGELAND: The penny is not the only item facing inflation. The Labor Department reported this morning that prices at the wholesale level rose half a percent in June. That’s a bigger bump than analysts were expecting. Commentator J.D. Samant argues it’s not just the price of tangible things that’s going up.


J.D. SAMANT: If you think things are expensive, consider non-things.

Case in point: my gym.

Now, I’ve always felt there’s something, how shall we say? Extra . . . ordinary about gym membership representatives. I find them Svengali-like, these absurdly fit people who take my money once a year, always in a little room and always with a frightening conviviality

Anyhow, I called, and here’s how the conversation went:

-Regular membership is $70 a month, sir.
-Great, sign me up.
-Pro membership is $75.
-What’s the difference?
-Well, sir, Pro membership comes with parking.
-How much is parking?
-$2.75 an hour.
-Where do your regular members park?
-Nobody gets it.
-Gets what?
-Regular membership, sir.

Eureka! No wonder I had shriveled before membership reps. They were a breed of geniuses, all of whom were apparently graduates of the Vito Corleone School of Product Pricing.

Even better than an offer I couldn’t refuse, she’d made me a non-offer I could refuse by offering, both, the thing itself, and, a non-thing.

So. Inspired by the product pricing brilliance of gym membership reps, I’ve written memos to corporations.

To: Coca-Cola. Increase the price of regular Coke and call it Premium. Then, fill the shelves next to Coke Premium with regular Coke, which has a minor change, reflected in its new tagline: It’s LIKE Coke, But Without the Bubbles.

People will happily pay the extra 10 cents for the new thing because, hey, the thing is only a dime more than the non-thing.

Moving on, Memo to Boeing. How much is a 747? $50 million. OK, here’s how the gym people would do it. Increase the price to $70 million and call it the Plus, but continue offering the old 747 at $50.

I can just hear the sales pitch. “The 747? Oh, it’s great. It’s got everything the 747 Plus has, everything, except . . . wheels.”

Marketplace is on a mission.

We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.

Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?

Your donation is critical to the future of public service journalism. Support our work today – for as little as $5 – and help us keep making people smarter.