Flashback – Price Deception

[On New Year’s Eve 2012 I posted a look at the various ways advertisers use prices to convey a false impression. Make prices appear low to suggest a bargain; jack them up to give the impression of special quality or luxury items. Because of the date, I ended with a brief note on champagne. Though it’s only June, why not read this and then find something to celebrate?]

We are deceived by a lot of things, by ourselves and by others, especially advertisers. We are all familiar with the pricing scheme of marking items as $19.99 instead of $20 to make them seem like a bargain, even though many people, when asked, will describe the $19.99 shirt as a $20 shirt.  Consciously we are not fooled, but subconsciously it registers as a better deal. Consider that  nine-tenths of a penny per gallon on the price of gasoline.

Surprisingly, the opposite strategy is also used. When paying a higher price, we often believe we are buying better quality even when we are really getting substantially the same thing. In prior postings I brought your attention to tests of (more expensive) organic foods showing that they are not nutritionally superior. Recently we learned that family cars outperformed luxury cars in the new crash tests. I have seen many Consumers Digest-type articles saying that ordinary moisturizers help your skin as well as the high-priced brands that claim to be superior. Higher-priced brand name drugs continue to sell well against similar or even identical generics by virtue of perceived quality. “When served microwaved food from the frozen food section in the setting of a fine restaurant, most people never notice.”

I remembered some time ago seeing a story about wine judging. Experts were asked to rate a certain group of wines. Later, in what they thought was a different event, they were presented with the same wines. The ratings of the same wines by the same judges came out completely different – no correlation whatsoever. I couldn’t find that source, but was overwhelmed by similar stories.  One told of wine tasting experts fooled in general, recommending wines with expensive labels with eloquent descriptions of their superiority over the same wine poured out of an different bottle. Experts also gave differing descriptions when served a white wine and the same wine with red food coloring added. Others couldn’t tell if a wine was red or white when they drank them from black-colored glasses.

It’s not only the experts who are fooled. “Expensive wine is like anything else that is expensive, the expectation it will taste better actually makes it taste better.” This article gave even more examples.  HDTV clarity and cheese tasting elicited the same perception errors based on price. A January 2008 study showed that adults rated the same wine as tasting better when it came from bottles labeled $45 than from ones labeled $5.

How would this apply to the art world? Experts always want to tell us what to think and what is real art. We often look at the work and scratch our heads. Here is a comment from a friend who visited an exhibition of what was proclaimed to be a major contemporary British artist at the Aberdeen (Scotland) Art Museum. “Imagine a giant empty exhibit hall with nearly-blank canvases, each about 7 feet square, or painted unevenly in reddish-orange oil. A life-size bronze casting of a rumpled sleeping bag.” I'm sure most of us would be equally puzzled at the praise for such an exhibit, but in the art world there is so much hype, and it’s so easy for the experts to pompously fall back on the accusation that others "just don’t get it." We buy that logic and that’s why we get what we get. (For an amusing spoof on contemporary art check out a film called Untitled).)

The effects of high price and over-reliance on so-called experts apply in many other fields. So before you buy something based on the name or the price, do the research. Whether it’s food, art, drugs, wine, cosmetics or cars, more expensive is not necessarily better. When all you have to go on is expert opinion rather than evidence, you are usually safe to trust your own taste.

Which brings us to the real topic for today – champagne. It is, after all, New Year’s Eve.  In this case I have done the research for you, and guess what?  More expensive is not necessarily better. As this British source says, “In a blind test that has thrilled the marketing departments of the major retailers and perturbed at least one of the grande marques, six wine experts gave a resounding vote of support to some of the less glamorous bottles.”

So buy what you like and save a little cash. Happy Critical Thinking in the New Year [or Independence Day], and Cheers!

More on Resolutions

Last time I recommended overcoming fear of the stock market and investing all the money that's basically thrown away on lottery tickets, because they are statistically a terrible deal, and on most nutritional supplements, because those that are not outright dangerous are usually ineffective.  The money saved and invested could easily reduce anxiety over future education and retirement costs (or even car repairs).  By thinking in terms of wants vs. needs individuals can easily come up with other sources of cash to set aside.  This is perspective, critical thinking and discipline rolled into one set of beneficial behaviors.

Now it’s time for the other side of the coin, a subject for a silly resolution motivated by hype and celebrity endorsements.  I refer to skinny wine.  As thedrinksbusiness.com puts it, “With around 20% of Americans on a diet, low-calorie wine brands are booming in the US, and particularly where celebrities are involved.”  The article was from 2013, but the subject seems to come up around this time every year.

Top brands include skinnygirl, introduced by chef, author and TV star Bethenny Frankel and then sold to Fortune Brands/Beam for $8.1 million, and The Skinny Vine promoted by Christine Avanti, celebrity nutritionist and author.  Since most dry wine has little sugar, these brands cut calories by reducing the alcohol content.  They contain 100 and 95 calories compared to 112 for a regular glass of wine for a savings per glass of 12 to 17 calories.

If true, that’s not much of a reduction.  One fruit and nut granola bar, which many people consider healthy eating, contains 140 calories.  Break it in half, in half again and in half again.  That little piece, one eighth of a granola bar still has more calories than you are saving by buying skinny wine.  Another site pins their high sales on customers being “duped into thinking the calorie count is significantly [less] merely because it is prominently posted on the label.  Actually it is “no less caloric than other wines” with the same percent alcohol by volume.  [Emphasis is in the original.]  They go on to recommend drinking regular wine in moderation.  That's not rocket science.

Huffington Post makes a few more good points beyond the issue of calories, asking why the ads for these brands are directed at women.  “Would anyone make a Skinnyboy wine?  I don’t think so.  Why do we need a special wine brand, especially when the calorie savings are [modest]?  According to most recommendations, women should not drink more than one glass of wine a day.”  The rant goes on, accusing these wines of working against equality by implying women need wines of their own as they are not capable of wisely choosing from a wine list without some not very subtle guidance.

Calories in a bottle of wine vary based primarily on alcohol content (about eight and a half calories for each 1% alcohol) and the sugar content (for sweeter wines).  Some French and German wines naturally have fewer calories.  But if a New Year’s resolution is to lose a few pounds, the answer will not be found in the wine section.  That fact does not keep the marketing machines of the various companies from trying to dupe their customers into another supposedly easy answer to the challenging problem of weight loss. 

For wine and so many other products the pattern is the same, some combination of hype, celebrity endorsement, Internet buzz, misleading information, junk science, and trigger words.  And we fall for it every time.