Are there any economic tips that can be used for daily shopping?

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This post was last edited by cflt111 on 2016-5-12 at 10:47. During my return to the country this year, I went to a supermarket with my mother to buy some snacks as well as anti-inflammatory drugs that are regulated abroad. It was a local store with a busy entrance, noisy and chaotic. However, after taking just a few steps inside, I immediately sensed the unique atmosphere of this supermarket: \"There are experts here.\" ”I stared intently and began to observe. This store has separate entrances and exits: enter on the right and exit on the left. The majority of people in the crowd are right-handed, and this distribution makes it easier for them to take items from the shelves. The decorative colors at the entrance are cool and pleasing to the eye, which slows down people’s pace. Once most customers subconsciously start walking slowly, walking too fast will seem out of place. It is basic common sense in retail that high-margin products are placed at eye level based on the average height. But placing snacks and desserts at a height at children’s eye level really made me praise the skill involved. Every supermarket is a hunting ground; you might be the hunter or the prey. Do you think it is you who makes the shopping decisions? With the development of behavioral economics and psychology to what it is today, we have long recognized the naivety of the \"rational actor hypothesis.\" Consumers are never rational when shopping, and businesses understand this; they continually take advantage of consumers’ irrationality. When I go shopping, I always ask myself three questions to do the calculations. The first question is “why sell it this way”. Only when you know how merchants influence your judgment can you eliminate these distractions and make choices that are in your own interest. Let’s continue using the supermarket as an example. The everyday items commonly used in supermarkets are often found at the back of the store. Products like eggs and milk can entice you to browse the entire store. Soft music and bright decorations can extend customers’ stay time, which often translates into higher sales. Therefore, business owners, please don’t play “Happy New Year” or other upbeat music in your stores. The floor tiles in large supermarkets are never uniform. In the high-profit sections with shelves, the floor tiles feature materials and patterns that give an \"exclusive\" feel. If experts can offer advice, the tiles here can be made slightly uneven; this way, when customers push their carts past, they will instinctively slow down. The shopkeeper’s tricks go far beyond that. Experts will remove symbols and words such as “yuan” or “￥” from product price tags; a simple numerical price reduces the logical connection between the product and money. According to a statistic in TIME magazine, Campbell’s canned soups with dollar-sign price tags are purchased by only one in every 103 customers, whereas those with plain numerical price tags are bought by one in every 14 customers. When you see signs like “Limited-time sale” or “Three per person,” don’t you think it won’t affect your decision? Yet though you say no with your words, your body remains restless and eager – why? This is due to an innate trait that has developed during human evolution: there is a physiological pleasure associated with having access to items whose supply is limited, especially when it comes to stored food. “\"Limited-time sales\" stimulate the release of dopamine in your body, and no matter how smart a person is, they can’t control their hormones. We know that higher profits for supermarkets mean less cost-effective expenditures for customers. So every time I go to the supermarket, I take advantage of its layout to find items with good value in the lesser-used shelves, maintain a steady speed while pushing my cart, and never touch the products that are right next to me while waiting in line at the checkout – those are the items that generate the highest profits for the supermarket. If it’s difficult for you to keep the logic of economics and your opponent’s tactics in mind at all times, the best approach is to make a shopping list in advance. My second question to myself is “What is its inherent value?” ”It’s a theory that’s easy to understand: when we buy something, we’re not only paying for the production costs of the item itself, but also for things such as advertising, labor costs, and rent. Therefore, every time I return to my home country and go to a pharmacy to buy medicine, I ask the pharmacist to make recommendations for me, and then I eliminate all the brands they recommend. The reason is simple: kickbacks for drugs are an open secret; the drugs that the salesperson recommends to me must be those for which they receive the highest kickbacks. If, at the same price, more kickbacks are paid to the clerk for a certain drug, its quality must be relatively poor; otherwise, there would be no profit to be made. By the same logic, for those consumer goods that have high sales volumes and wide distribution, such as Coca-Cola, the additional cost per unit is very low, making them a cost-effective choice to purchase. I can’t know the production cost of each item, but I can roughly estimate its additional costs, and products with excessively high additional costs are often not cost-effective. Why did I add Coca-Cola before putting in the ads above? This is taking advantage of the “anchoring bias” of all you male readers. This is also related to my third question, namely “what’s the benefit for me?” To be honest, most people are not aware of the actual value of the goods when making purchases. When Pearl King Salvador developed black pearls back then, there weren’t many customers, because no one knew how much they were worth. So they placed the Black Pearl in a dazzling window on Fifth Avenue, and included diamonds and rubies in all the advertisements featuring it. Naturally, black pearls thus became precious jewels. The businesses that most frequently use the “anchoring” technique are likely home goods stores and electronics stores. Few people really know the cost of a household appliance, but if fridge A is placed next to fridge B, which has similar functions but costs 30% more, people will naturally want to buy fridge A to save money. You can’t know everything about every thing you want to buy, but you can know yourself. Establishing your own system of benefits when shopping will benefit you. The simplest way is to find something that can consistently bring you joy/happiness, and use its price as a benchmark to determine whether other purchases are worth it. For example, your favorite meal is the Sichuan hot pot found on the street corner; it costs 200 yuan each time you go there, and you think the price is reasonable and you’re satisfied with it. So, whenever you can’t decide whether to buy something new, you can convert it into hot pot. A PS4 is no longer worth 2,000 yuan; instead, it’s equivalent to 10 servings of hot pot. You don’t need to know the actual cost of a PS4, but since you know that 10 servings of hot pot represent the ultimate luxury, you might decide to refrain from buying a PS4. This shopping philosophy may not necessarily help you buy the objectively best value products, but it will certainly ensure that you get products that bring you great benefits as an individual. Similarly, when pursuing the girl you like, you might want to give her a very expensive handbag; that bag could be worth 50 servings of hot pot, while you think the happiness she brings you is worth only about 30 servings of hot pot. Well, in that case, would you really do it? . . . Alone for life. Speaking of goddesses and handbags, let’s talk about luxury goods as well. There are many definitions of luxury goods, but I believe their essence lies in brands that consistently offer high-quality products, and this characteristic is not necessary for everyone. It should be understood that there is no simple linear relationship between the price and quality of goods. An ordinary shirt costs 100 yuan, a shirt with slightly better materials costs 200 yuan, and a high-quality shirt with excellent materials, design, and stitching costs 1000 yuan. But the second shirt isn’t twice as good as the ordinary one; the premium shirt isn’t even ten times better than the ordinary one. If you are very rich, of course you can pay a thousand dollars for a high-quality shirt; although there may be good shirts available for 200 dollars as well, that requires you to spend time choosing them. 007’s entire wardrobe is made of Tom Ford products – they’re high-quality and expensive, but actually there are some less well-known brands that can achieve a similar look. But you can’t expect him to set aside an afternoon without being flashy, trying to impress girls, or killing anyone, just to go shopping However, the high price of luxury goods is a guarantee of quality; it does not mean that low prices preclude access to high-quality products. Therefore, I do not support people who are very idle from buying luxury goods, as they have the time to find similar products with comparable quality at a significantly lower price among alternatives. Not to mention the additional costs we mentioned above. Luxury brands charge high rent, as well as high costs for display spaces and advertising; when you make a purchase, you are forced to bear these unnecessary expenses. Of course, if my spendthrift wife buys something she’s happy with, I feel like I should buy it too – what does it matter whether it’s a good deal or not? Could I still beat her? As the saying goes, those who see great benefits yet do not pursue them, who hear of impending disasters yet take no precautions, who are inept at matters of defense and strategy, and who only strive to present themselves as righteous and moral, are destined to perish. This is also the most important tip I want to share: if you enjoy your purchase, then it’s worth it. In short, we can never know the market value of each product when shopping; completely rational shopping does not exist. Since we cannot make a choice from the perspective of the goods themselves, we can approach the issue by considering the seller’s point of view to understand the psychological aspects involved, then assess the broader costs from the producer’s perspective, and finally make a purchasing decision based on our own personal experiences. For now, my answer can be reproduced freely as long as the source and author are cited, and it is not used for commercial promotion. Wen Yifei