Snake Oil: Up to 70% off

A special price used to be...a special price. A once a year sale used to be...a once a year sale. Back in the day a product could outsell competitors on the strength of a good advertising campaign alone. There was once much less competition; much less choice, much less confusion and much less danger.

I recently searched for an NBN provider for home WiFi. Initially I used an online comparison website, but it only told me that each of up to a dozen companies offered basically the same thing for roughly the same price. I figured out exactly what I needed, and that NBN was available at my place. (FTP:fibre to the premises to be precise). I then called each of the companies to ask why I should sign with them. I'll give the two extremes. Company A answered with silence. Company B offered me $5 dollar off the advertised price for the particular plan I wanted, waived the delivery fee for the free modem, and offered me a month's free internet if I switched my mobile phone to them. Their phone offer was the same price as my existing plan, but included more data, unlimited SMS overseas, as well as 120 minutes overseas call credits.

To get more customers, companies offer all sorts of deals, but to do even better than the advertised specials, you just have to ask. It's totally worth a call. I do the same thing for my insurance policies. Various companies also run event sales: End of Financial year. Halloween. Christmas. Boxing Day. New Year. Australia Day. I'm writing this on December 1. Most of the Black Friday sales are winding up today and tomorrow. Black Friday is on December 13, but never mind. Close enough. Any excuse for another sale.

The fact companies can offer all these special prices and special sales indicates that by and large they are overcharging their customers. In bricks and mortar stores, crazy prices are often advertised. Some places are always having sales and perpetually offering special prices. You will never enter a shopping mall and not find most of the shops having sales. In supermarkets, the sale items rotate but there are always a huge number of items on sale. My supermarket of choice always sells a large variety of products at 20-50% off. Clothing stores boast of half price, or two for one offers. I've seen shops selling products at 75%. If all this is for real, they can't make money, but of course it isn't. It's snake oil: a barrage of clever marketing tricks which most of us have fallen for at one time or another.

The advertised special prices and sales are hooks, and we consumers are fish. Sales get you into the store or onto the website where hopefully you will see something you like, and spend more money than you intended. Companies rely heavily on impulse buyers; people who buy things because they are on sale irrespective of whether they want or need the product, or indeed if they had even given a thought to it previously. The bait is dangled and we bite.

Successful businesses know all the tricks and employ them strategically to maximize sales. Knowing this helps me to control the materialistic urges within me. Utilizing my own set of countermeasures, my advertising snake oil anti-venom, means that even if I don't always get the best possible deal, I will at least be satisfied that I haven't been duped. I'll also minimize the risk of PPR (post purchase regret) 

Here are my top five PPR prevention strategies.

1. Shop around
2. Negotiate as much as possible
3. Use shopping lists
4. never spend more than you planned to.
5. Don't make spontaneous purchases.

Do you have any strategies of your own? Share them here.

Celebrate the Small Things: the NBN

The National Broadband Network (NBN) is Australia's largest ever infrastructure project and was initially planned and commenced by Kevin Rudd's Labour federal government. It has been the subject of much political and community debate. Both the costs, and the timeline for completion have blown out significantly, but I for one, do not care how much it costs or how long it takes to build the network (although sooner rather than later would obviously be preferable.)

Australia is a bit behind the times with technology. Although we love the latest stuff and are quick to adopt new technology we always have a bit of a wait for it, and we always pay much more as well.

We have unlimited ADSL2 broadband with iPrimus. They contacted me yesterday with the good news that the NBN was no available in our area and we could now upgrade with no additional charges. We had to have a new modem which they would give us for free if we paid the postage charge. When I complained about that, I was offered a $50 credit, so we will apparently have a smooth transition to a faster and more reliable broadband service plus $35 credit (taking off the postage charge for the modem) I spent twenty minutes on the phone with the salesman, going over all the details.

The salesman could not say when exactly the upgrade would occur, but told me that we would be notified in due course.

Today I received a text message from iPrimus saying the NBN will not be available in our area until at least December...maybe. I laughed.

I do have NBN where I am living now in Darwin, and I love it. It is faster and more reliable, and thus far I have no complaints at all. So today I am thankful for my internet service.