|May 19th, 2008 by Robert | Word Count: 1138 | Reading Time 4:35||2,244 views|
How informed do you believe the customers are in this country? Do you believe we are well informed as a society on what we purchase? Do you think we are below average, adequately, or something else? My personal belief is that even with the Internet, we as a country are very poorly informed about our product purchase choices. It appears that advertising via television or print ads are the primary teasers we pay attention to. Sometimes we depend on friends and their information but that can be few and far between because not everyone buys the same stuff. What it usually comes down to is brand name. Do you trust brand x to produce quality products for the price that you pay? You use your own experience, other people’s experiences, and sometimes you might actually trust a salesperson (at your own risk). Not a very good way of determining if a product is actually worth the price you pay in my opinion.
In my experience, I have found that the Internet is most valuable in two areas. The first is learning about things outside of visiting your library or looking through books at a bookstore. And the second is doing valuable product research. Yes, there are many, many other things the Internet allows us to do as individuals, but the power in these two areas cannot be defined. You have the power of millions at your fingertips. All you have to do is spend time searching, reading, and learning. What I am getting around to is a new product becoming available as we speak. It has already hit some store shelves and is soon to be in a variety of stores. This product type may not be known to some people out there depending on how technically advanced you care to be. It’s a new, cheaper blu-ray player. It is made to be an entry level player to help people begin migrating to a new format for movies. Remember DVD as it came out and everyone had their VHS players? Same thing here, blu-ray is trying to replace DVD as the standard for home movies.
There is nothing at all wrong with that. Blu-ray is a better technology as it offers more space for additional features, higher quality sound, and high-definition movie playback. It also includes the ability to connect to the Internet for content in the future (several current blu-ray players lack this function as does this current product). This leads me to the crux of this article. Funai is a Japanese company that has manufacturing plants in China. They currently build over half of the DVD players in our country. Needless to say, they know how to manufacture this product. Great, they have the capacity and know how to do it, guess we won’t have to worry about inventory being a problem. That’s not the issue either. The issue is that this company builds the product for many different brands. Brand x has the product with their label on it. Brand y has the exact same product with their label on it. They may be different colors are arranged a little nicer or have fancy boxing and maybe some other little differentiating tricks. However, the product inside is the EXACT same thing, just a different skin on it.
Still, there is nothing to worry about here. That is until you see what the stores are doing with the product. Store x has the product from brand x available for $298. Store y has the product from brand y available for $350. Store z has it available for yet another price at $325 for brand z. Why the discrepancy for the exact same product with just a different name on it? No, you aren’t buying brand name here, you are paying profit margin here. These stores know that the consumers aren’t informed and will purchase the product because it’s the cheapest blu-ray player available (cheapest other is $399). Consumers are starting to hear about blu-ray and high definition movies and now that there are a lot of high definition televisions in the households of Americans, there is a new push for blu-ray to enter the audio/video equation. Customer x walks into electronic store y, sees the new “cheaper” blu-ray player and knows its entry level and the brand is ok. Sales person pushes the product or tries to upsell the customer. Sounds normal and is. However, the customer doesn’t know they can immediately save $50 by going elsewhere.
What the stores and retailers are banking on is that the customer will not know the products are the same because they have different brand names on them. They of course rely on the fact that their store name carries with it a certain quality and thus they will pay a little more than another store because of this. The customer has not been informed adequately and the information is readily available on the Internet (it took me maybe 5 minutes to find out the information). You may say that’s fine, the customer is at fault for not doing the research. I agree to an extent but there is a point where it’s blatantly ripping people off because they basically have insider information. Your average customer is going to depend on outside information to help determine purchase decisions outside of price.
Of course this is not the only product in our stores that are like this. There are many products we buy that we can find a better deal elsewhere. But, we don’t do the research and find out. Why don’t we? Because most of us either don’t know how or don’t want to waste the time it takes to research something. The retailers know this so they continue to set pricing the way they do and continue to make higher profit margins on the same items packaged differently. We are being taken advantage of because we are allowing it. If we decided to become more educated on our product choices, we would not buy the higher priced products of course and the retailers would be forced to lower their prices or stop stocking that particular brand. The power is in our hands and the information is free and readily available.
Next time you are on the Internet, rather than just surfing around, research a product and just see what it is exactly you are spending your money on. At the very least, for any new product you buy, research about it on the Internet first. You will be greatly surprised what you find and you will be nicely surprised by how much money you can keep in your wallet. Don’t allow the retailers to take advantage of you because they lump you together with the other uneducated consumers. Take back the power and educate yourself.