Chaudywogbaaga

I’ve noticed something very odd about people’s purchasing habits. They will readily pay ten to twenty dollars on a meal or a haircut but hand them a more durable item to purchase and they will balk at the same dollar amount even if they will be able to use that item for years.

I recently made a few items and tried to sell them at a craft show. Nearly everyone that walked by would suddenly stop and exclaim “Wow!” or “Amazing!". Some items I had were priced approaching the $200 range, most were $20 to $40 dollars. Many people were interested in the $20 to $40 items and really no one argued that the prices were unreasonable. In the end no one bought anything! I debated why this was with myself for quite some time and finally remembered a principle that I had formulated years ago.

Follow up:

Because of imports from places like China, India and Mexico people are used to paying only a meager amount of money for goods. This means that anything that can be transported has a low value. Now I don’t begrudge anyone from making a living and I’m not complaining about imports, I have my share of them sitting in front of me.

What I will complain about is that people have allowed these low priced items to skew their perception of value. What is interesting is that items that cannot be easily transported like a haircut, are accepted as being in the $10 to $20 dollar range. This very roughly equates to the hairdresser being paid fifty cents to a dollar per minute! Now I realize there are mitigating factors, like the time that it takes them to clean up and go out and get new customers and the rent of a building but I cannot come close to demanding that much money for any goods or services that I can deliver!

Even when people are willing to pay such a high price to some people, they do not compare that to items that have real utility and can be used over and over again. They expect to pay as little or less on such an item as they would on something that will only last them hours in the case of food or at the most several weeks in the case of haircuts.

To make matters worse, people (myself included) will pay $2-$8 on a single coffee when they could reasonably easily make it at home and save most of that money. They will pay this every day, sometimes several times a day. Then they will look at a shirt or a book and view it as too expensive. They have no concept of value.

I suddenly remembered how to account for this. People are not paying for goods and services. They are paying for a good feeling. Coffee or alcoholic drinks make people feel good. Fast food is loaded with sugar, salt and fat and give a rush to the taste buds making people feel good. Haircuts make people look better and therefore improve self esteem. A more expensive meal is usually similar to the fast food meal with the addition of some herbs and spices and a little more effort in making it so it is a little bit of self esteem and a little bit of rush to the taste buds.

In essence, people are willing to pay to elevate their mood, even if only slightly. Most of these purchases are in small increments to fool the brain into not realizing that their value is far lower than their cost. Most utilitarian items deliver no rush and so therefore are viewed as having less value. I think it’s truly sad that people are so dependent on these meager elevations of mood but it hammers home the point that this is a society based on luxury. The odd thing is that the luxury is targeted at even the lowest income members of society and they feel that they truly cannot live without these luxuries.

This brings me back to the main point. People do not view the value of goods and services in a rational way. They have been fooled into thinking that they do but in the end they are willing and even eager to pay for meager luxuries but unwilling to pay a comparable amount for items that will improve their lives if it does not carry prestige with it.