Pricing Policy

I just hacked the end of the stiff cardboard box off my new Verizon Blackberry Pearl. I had to do it to fulfill the detailed requirements for a $100 rebate. Then I had to fill out a tedious form, putting all of my name and address info into individual letter boxes, and not forgetting to go through the list of 673 different phone types with their rebate amounts on the flip side to check mine. Finally I had to figure out which of the “Customer Receipts” (there were three) was the one desired by the rebate paperwork and make a copy of it. Address a self-supplied envelope, affix postage and then hope/pray for six weeks or more.

Now, I’ve been a long time Verizon customer. I’ve got another phone from them, as well as my landline, DSL and data service. They’ve got the record on me for billing, credit history, and vital life signs. They supplied me with the phone in the first place, so they know I’m the guy entitled to the bloody rebate! Why then must I go through all of this to get my $399.99 phone for $149.99 with a $100 rebate to net me a cost of $49.99? If the damn phone costs $400, then charge that. If it’s a buck-fifty, then charge that. Is that too complex?

Frankly, I hate rebates. I despise them. I will choose not to buy a product which offers a rebate if there is a reasonable alternative at a fixed price. I’ll even pay more for freedom from rebates!

I used to buy clothing from a menswear place called Jos. A. Banks. They’ve got some nice stuff; shirts, suits, polos, sweaters, accessories. Good selection, lots of stores around the country, and a pretty good online outlet as well. But, everything they sell is priced at double or triple what it is worth. That’s so they can continually have a half-price or two-for-one or “everything goes for $99” sale. If you ever buy anything at Jos. A. Banks for the base price, you are a fool. If the stuff can sell for half the sticker price, why don’t they sell it at that price to begin with? Am I supposed to believe that I’m really getting a $900 suit for $400 because they want me to be happy? Sell it for what it costs you to market it, plus a reasonable profit. I’ll come back.

Been watching the car sales recently? I can buy a $72,000 Cadillac Escalade for more than $15,000 less than the sticker price! What does that tell me about the sticker price? If GM could sell vehicles for that price as a standard policy and have any sort of margin, why don’t they do it all of the time? Does that tell me I’m really stupid if I believe the sticker price has any relevance at all to the value of the vehicle?

Next time you fly somewhere; see if you can ask a handful of your fellow travelers what their ticket cost. I will guarantee no two people you talk to will have paid the same price. Does the seat at the front of the airplane get there any faster or more comfortably than the seat at the rear? Is it less expensive for the airline to take a window seat passenger than an aisle? If all of the seats leave and arrive together, and the cost of fuel/staff/equipment/processing is the same for all passengers, why don’t we have single pricing in effect?

I’m just an ignorant fool, but I would think that if I wished to produce a product and sell it to people as my business that I would calculate my cost of producing the product and delivering it, then add a reasonable percentage and sell it in the competitive marketplace. I couldn’t sell it for less and survive. I couldn’t sell it for appreciably more or my competitors will beat me. It would be a quality product, at a fair price and the customer would know they paid what it was worth.

Why wouldn’t that work?