Discovering a holiday discount to indulge in a present for yourself
December is the month when most people scramble to find gifts for their friends and family. In the process, many decide to treat themselves to a gift as well — especially when they notice that something they’ve wanted is now on “sale.” According to a business professor at Washington University in St. Louis, most people have an easier time justifying an indulgent purchase when there is the promise of saving money, especially when it is in the form of an unexpected discount or rebate. The catch is that frequently customers aren’t saving as much money as they might think. More…
Low price doesn’t always mean low quality, but it could mean a challenge to high-end products
Low quality threatens the high end.What company wouldn’t attribute its profits to the quality product it produces? The answer might be: the company that competes on price. According to research from Washington University in St. Louis, producers of lower quality products actually have better prospects for gaining market share and improving their bottom line. The findings indicate the Chinese manufacturers could easily gain an edge over American producers. More…
Discounts and sales don’t always mean more profits for retailers and manufacturers
Every week you see it: the local supermarket’s specials include a discount on Brand X tuna fish. Common knowledge assumes that a sale on tuna fish will induce more people to buy Brand X, which boosts profits for both the manufacturer and the grocery store. However, a recent study by professors in the Olin School of Business at Washington University in St. Louis has found that discounts are not always in the best interest of the retailer or manufacturer. In fact, some promotions may end up hurting future profitability.
Gambling psychology offers insight into self-control, risk-taking, impulsiveness
Photo by Joe Angeles/WUSTL PhotoAre gamblers impulsive?Why do people engage in behaviors they know are harmful to them in the long run? Why do we give in to that incredible chocolate cake even though we’re trying to lose weight and stay fit? The answer, suggests a recent study on the psychology of gambling and impulsive behavior, is a simple economic phenomenon known as discounting. While good health may be its own reward, research suggests that the value of that reward diminishes as it’s delayed; and the longer it’s delayed, the less it controls your present behavior. Although gamblers may deserve their reputations as notorious risk-takers, they often do better than non-gamblers at delaying gratification to maximize long-term rewards.