Friday, November 26, 2010

Price Discrimination and Black Friday

My family doesn't normally shop on Black Friday -- the savings aren't worth the pain. Today, though, I took the boys to a local nordic ski shop. The timing was right, and I figured a specialty shop like Finn Sisu wouldn't get a lot of sales traffic.

Wrong. We walked in, looked around, and walked out.

Which made me wonder - why is Black Friday such a mess?

It's the same reason that clipping coupons is a tedious chore. Coupon clipping and Black Friday sales enable price discrimination. Black Friday wait times eliminate people who will pay full price, while pulling in people who won't pay full price.

(PS. I figured out the price discrimination angle myself, but instead of writing a long and ill-informed post I found someone who'd written a good explanation. See also: Price discrimination - Wikipedia.)

1 comment:

Paul said...

For the first time that I can remember 'Black Friday' got a mention on the BBC evening news. Of course they also had footage of the NY parade and the piece included an interview with the head honcho of Macys filmed, unsurprisingly, in Macys. He was saying how much better they were doing than last year and how much more money was being spent by young (<25) males.
Which was odd because we were in Macys last year on Black Friday and it was possibly the busiest place I've ever been in in my life compared with the vacant aisles shown in the background of the interview...
Anyway, our Christmas shopping this year - as for the last 5 at least - will be done 90% plus on line.