Hacker News Reader

Comment by eh_why_not | Hacker News Reader

> We plant a tree for every Author Clock sold....

> Shop: $199.00 USD

Funny how products that claim a cause on the side are always 5 times the price they should be.

Do you all not think that companies should charge prices that maximize their profits (in the long run)? Typically, companies are trying to predict the price elasticity curve that yields the most profit via # units sold * price. That said, if you overcharge, that could be bad for the brand, turning off users in the short and longer term.

Another product like this for me is the Manta Sleep Pro Mask. It’s $80, but the best I’ve found, so I buy it anyways. I’m mildly annoyed and also feel like they’re taking advantage of me on price and will switch as soon as there’s an alternative at least as good for less…but when that happens, they’ll probably lower their price, which is what typically happens as sectors and products mature due to competition.

Profit maximization curves are interesting, and I think explain things like how convenience stores exist with much lower volume compared to grocery stores. Eg XYZ food costs 90 cents and the grocery store sells it for $1, yielding profit of 10% whereas a convenience store sells it for $1.50, just a 50% increase in price for the consumer (for the convenience), but the profit is 6x that for the grocery store, so they only need to sell approx 1/6 to make the same profit.

In the case of the author clock. If COGS is $50, profit is $150ish. If they sold for $100, they’d have to sell 3x as many to make the same profit. Given that it’s a niche product for readers (smaller population and typically more educated and wealthier), I think they care less about the price. Doesn’t seem that unreasonable to me.

It’s interesting; we’ve lived within capitalism so long, it sounds reasonable for you to (archly) ask “do you not think all companies… should maximise their profits?” - as it that’s a given, and anyone even treading around questioning this fundamental is by default wrong, or forgetful, or crazy. It’s almost as if had moved from being a choice, to an immutable natural law.

But I’m coming to the conclusion —more powerfully in the recent few years— that not only is this an issue that should be debated, but the pursuit of profit above all else is responsible to a greater or lesser degree for many of the ills that we see and suffer in our societies. And from my European perspective, I believe that it is responsible for America (its culture, way of life, the ‘American way’) fracturing and falling apart.

We just had dinner in our favourite Vietnamese restaurant. It’s closing tomorrow. The rent got too high and the lady who runs it wasn’t taking a wage. It was busy every day. It’s a favourite lunch spot, their bahn mi is the best in town.

So they’ll close, and that’s another empty shop front. God knows if anyone will rent it, ever again. There are plenty more empty shops to choose from.

This is in the centre of Canberra. The capital of Australia.

And why? Because whomever owns the shop owns it as an ‘investment’. So the lovely lady who runs (ran) it needs to not only run a profitable restaurant — pay staff, suppliers, taxes, insurance, take a wage — but she also has to make a profit for the guy who owns the shop.

Because his ‘business’ is owning a shop. So he (I’m sorry, I’m just assuming it’s a dude) needs to turn a profit. For owning a building.

So she’ll close.

---

So restaurants are fucked. They’re all closing. At what point do we think, restaurants are the fabric of society. Cities need restaurants. It’s what makes a city a city. So when do we realise that imposing a condition on a restaurant that not only must they make a profit, but they must make a profit for the owner of the building, who does fucking nothing, is ridiculous?

Anyway. I know this is a rant. I just had dinner at a popular restaurant with amazing food with a wonderful owner that’s closing tomorrow so that the landlord can own an empty space. I’m bitter and sad.

Thanks for listening.

Some restaurants should just be food trucks.

This kind of thing permeates through our society. We can all see it, we all know it's absurd, but we can't change it. That requires the people with the money and power on board. I don't need to tell you how they got that money and power. It's not only the buildings that have owners

We are on the same page here: https://news.ycombinator.com/item?id=39773155

I wonder if more and more people come to the same conclusion, but are not able to voice their opinions loud enough. I also wonder what needs to be done so that the "maximize profit" mantra gets away.

Don't get me wrong, unfettered capitalism has plenty of problems - eg tragedy of the commons, regulatory capture, effective monopolies, etc. That said, pricing things to maximize profits (given societal and economic constraints) still seems like the best route, especially in this case. How else could / should they price it?

I think one of the jobs of gov't is good regulation, which is hard. And once the rules have been set, maximizing profits within that box of regulation seems good, yea? Capitalism is reasonably good at allocating resources in many cases.

I think it was in the 80's, I got a little pine tree from McDonald's. Must have been a promotion or part of a Happy Meal, I honestly don't recall. I planted it in my parents yard, where it is still growing today (and its huge).

We had a live Christmas tree another year that is still growing in the yard too.

Save your money from over-priced clocks, plant a tree yourself and enjoy it for a long time.

Funny how products made as if there's no such thing as an externality or grotesque wealth inequality are always so much cheaper than they really ought to be.

ps. i am not suggesting that the author clock is externality-free. it probably is not. nor am i forgetting that it will be purchased mostly by people on the upside of that inequality.

It's buyer manipulation. "Here's this ridiculously priced item; but it's okay you can feel good about throwing this much money away, because we're planting a tree."

Instead of segmenting/targeting the high-income market by product quality, they target by emotional manipulation claiming good causes. (i.e. higher-priced product that does not have to be higher quality).

You're suggesting that it's somehow made in a way that's more conscious of externalities or wealth inequalities than cheaper competitors, a suggestion that I think is unwarranted.

Absolutely not.

I was contrasting "stuff associated with causes costs more than it should" with "a lot of stuff costs less than it should because the cost ignores externalities"

They don't plant a tree for every Author Clock sold.

They plant a seedling.

This means (a) it may not survive to be a tree, but that's not the mental image they want you to have and (b) it might be in a tree farm, which means it's not a ecosystem-tree but a product to be harvested and processed (with fossile fuels). So, you know, it's more likely about giving you the warm-fuzzies than any particular concern for the environment.

That said, kudos to them for making the device easy to disassemble and repair. That in itself is a laudable thing.

Reply on news.ycombinator.com