Econ 101. Please don’t run away, this is important. It’s about shopping.
This morning Shade Clothing, a very popular brand in these parts, announced it was going out of business and everything is marked down (up to 75%!) for their liquidation sale. The thought of them going out of business was a little bizarre–they are very popular, they just opened a brand new ENORMOUS flagship store. Almost everyone I know either has Shade items, or Shade knock-offs. They are kind of a big deal.
At any rate, I had purchased a few things on Monday, so during my lunch break I went back to see if anything was cheaper for a price-adjustment. And I was shocked. Every single item I purchased on Monday (on sale, mind you, because I’m cheap) was priced at twice as much as I paid for it. That is not a typo–twice as much, 100% more expensive.
Example 1: I bought this dress on Monday for $14.99. By any and all standards, that is a really good deal.
Today, this same dress went “on sale” for the liquidation at the bargain price of $30.99 (original price $38.50).
Example 2: I bought a pile of these belts for $3.99 each (inlucding 2 gold ones, worn together over the dress pictured above, which was adorable).
Today these belts are “on sale” for $7.99 each (original price $10.50 each).
Sound fishy?
No, it sounds smart. This is a brilliant marketing ploy. Shade announces a HUGE SALE that no one will ignore (Liquidation! Everything must go! Up to 75% Off!) Everyone who has any interest in Shade clothing makes plans to go to one of their stores, or logs onto their website looking for back-to-school deals. They see items “on sale” and purchase them in multiples, thinking they are getting a great deal. Meanwhile, Shade rakes in extra profits on clothing they couldn’t sell at a lower–although less advertised–price. This is the law of supply and demand. I will not draw the graph here, but just so you know, there is a graph that explains all this.
So, let’s recap. Shade announces they are going out of business and jacks up their prices. You purchase items you would not have otherwise spent money on, thinking you are getting a bargain. Shade pockets the extra revenue.
Who wins? I win. Because I went shopping on Monday. And thus endeth your Economics 101 Lesson. Class dismissed.
17 Comments so far
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You are obviously an A student!
Comment by Melanie 2010 August 12 @ 2:53 pmGrrrr….. brilliant on their part, brilliant on your part. I still like my shorts, so OK (but not brilliant) for me. But half price would have made me like them way more. And buy in multiples. That’s all.
Comment by pinksuedeshoe 2010 August 12 @ 2:54 pmEveryone wins, because they are paying what the items are worth to them! Woohoo!
Comment by Jess 2010 August 12 @ 3:28 pmI still smell fish.
Comment by Allie 2010 August 12 @ 3:57 pmI love how neither you nor Isabel were fooled!
Comment by operation pink herring 2010 August 12 @ 4:58 pmThat is kind of brilliant on their part, also lucky you for going shopping on Monday! And that is a cute dress you got there for 15 bucks!
Comment by Karen 2010 August 12 @ 5:35 pmthat is so smart on their part, but lucky you for getting the real deal. also that dress…excellent purchase and so cute!
Comment by katelin 2010 August 12 @ 5:48 pmThat is so so bizarre.
And a DARLING dress.
Comment by Janssen 2010 August 12 @ 8:28 pmlove it, you are a genius!
Comment by Lacey 2010 August 12 @ 11:51 pmfishy fishy, but not unheard of alas… anyway, i totally love your dress! sigh, kind of the style i’m always on a look-out for but never seem to find. well done you!
Comment by piaktw 2010 August 13 @ 3:19 pmDude! Not cool!
Comment by Britt 2010 August 13 @ 5:24 pmWow. Lucky you…not so lucky for everyone else!
That dress is fantastic!
Comment by Erin 2010 August 13 @ 5:53 pmSo you obviously learned SOMETHING in school.
Love your dress. I sure you hope you have the right shoes to go with it.
Comment by Cheeky Monkey 2010 August 13 @ 6:46 pmWait? So did they go out of business or not? See, I’m EXACTLY the kind of confused consumer they are targeting with these guerilla pricing tactics.
Comment by thecoconutdiaries 2010 August 14 @ 1:51 pmThanks for the class, Teacher! Yeah, the same exact thing happened to us here when Gottschalks closed. The employees even told me so in your exact words. “Yeah, you could’ve gotten a better deal with our sales last week, but they weren’t advertised as much…” LOL
I had an economics class in highschool that I really enjoyed. I’m having a brain fart and can’t remember the official term, but I get a kick out of noticing “geographical ___(insert official term)”, where the prices for a product are significantly higher in a small town because the seller of the product feels that they can get away with charging that price because otherwise his/her consumers would have to travel a long distance in order to obtain the same product for cheaper. What’s that called again??? Ah! Bugging my brain.
Comment by Ciarra 2010 August 16 @ 3:14 pmThey may think it’s smart, but I think it’s dishonest. Can’t help but feel they might deserve what’s happening, if this is the way they handle things.
Meanwhile, you got a cute dress for a a *REAL* bargain price
Comment by Elisa @ Globetrotting in Heels 2010 August 17 @ 3:10 amYour last line is the best. You certainly do win
Comment by Sra 2010 August 17 @ 12:15 pm