Thursday, January 7, 2010

BUT WAIT...THERE'S MORE

I am a free market capitalist. Make no mistake about it. You just have to read a variety of articles on my "Ivan Hoffman Attorney at Law" web site (click on "Articles About The Philosophy of Law and Business") to know that. I believe that innovation and the motivation to succeed are the cornerstones of change and progress. Government never did anything but follow.

But free market capitalism, like democracy itself, requires intelligence to operate effectively. Stupidity leaves the playing field of capitalism to the intelligent alone.

And in the words of P.T. Barnum, "there's a sucker born every minute."

Let me then speak of the long form advertising called the "infomercial." These art forms, for they truly are art forms, seem to all be copy cat versions of each other and once someone makes a slight change, others follow. For a while there, every pitchman had to be English. Then we had the era of the screamer.

The earliest of such "infomercials" developed the "but wait...there's more" approach. After offering the product for some "incredible" (their words, not mine) price, the advertiser came back with a "hook" and made the price even less by throwing in some other inducement.


The latest version of this "but wait...there's more" approach is that, if you order "right now!" (never mind that the informercial runs constantly thus diluting the "right now!" message), we'll give you a second product "Absolutely Free!!!!" All the consumer has to do is pay "processing and handling."  By the way, if you observe carefully, you will note that few products now require the consumer to pay "shipping and handling." Perhaps because if it is called "shipping" there has to be some relationship to actual costs. Now it is called "processing and handling." What "processing and handling" apparently means is that when you order the product you have to pay extra to actually have them send it to you.  And if my speculation is correct, there needs be no correlation between the fees added for this "Absolutely Free!!!!" bonus and any actual costs such as shipping.

As but an example: if the product cost $19.95, the processing and handling (almost never posted on the screen) may be around $7.95 so you get the other product "absolutely free" if you just pay separate processing and handling. So what you are getting is 2 products for nearly $36.00 instead of one for $28.00. So simple arithmetic tells you that the products are costing you $16.00 each.  I realize this may seem insultingly stupid to have to explain this but these pitches are apparently hugely successful.  The rule of thumb in the infomercial business is that if you see the spot running, the product is selling.


Now to some of you, this may seem a small thing but given that it is television, the power of the message cannot be underestimated. And if you believe it is a small thing or nothing at all, then I believe you have missed the significance completely. As we say in the law business, if you don't believe there is a problem, then you don't understand the issue.

Well, do the sponsors think we're stupid? No, I don't believe they do. I believe instead that they know we are stupid.

And how do we know that we are stupid? Just look at the world we have created...nuclear bombs proliferate, we're polluting ourselves to death and we elect the most ignorant people to the highest offices.  And because we do all that and more because we are stupid, there isn't enough money left to cure our stupidity with education, better parenting etc.

This is capitalism, if not at its worst, at its not very best.   I am ashamed of us.

That's what I believe.

Copyright © 2010 Ivan Hoffman. All Rights Reserved.

Ivan Hoffman
http://www.ivanhoffman.com/


3 comments:

Unknown said...

Ivan:

First, thank you for the post on the children's publishing list serv. Sorry to see it be taken that way especially when it was a much needed reminder to us all.

I couldn't agree more about write it down, but even when in writing, the contract or written document is only good as the people involved.

With that said, that post got me here and I really enjoyed your commentary on the state of the world. I can't tell you the number of times I have been stupid but not by such obvious ads. It is the predatory and exploitive nature of some current marketing practices online.

I hope you will write about some of those on your blog and your law articles.

Anonymous said...
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Anonymous said...

Ivan:

I agree with you on infomercials but disagree with your comment on Shipping & Handling. S&H is very much alive.

You've missed an infomercial sibling... the "Free Trial!" of TV ads. All the customer needs to do to become beautiful, or maybe healthy, or... is to pay a small S&H using their credit card.

However, if you read the small print on the TV (good luck), or better read it on their website, you'd note that the free-trial ends in 3, or 7, or 30, or 90 days. At the end of the trial the customer will eventually find that their credit card was charged (quite a bit usually) for the original shipment because they didn't return it per the terms of the free trial. They will also find that they are a member of an auto-refill program that is charged to their card.

All of this is made possible because the customer, who did not read the fine print, provided their credit card to cover S&H.

Yes, it's possible (eventually) to terminate the charges but they'll have to go jump through hoops. Hoops that are documented in their terms of service

There are several other such tidbits that are covered in their terms of service that clarify other things found on their site/ad. For example, that the subjects referenced in the website/ad are not real.

Oh yes, if you give them your email or home address they can sell it, Per the site's Privacy Statement.

Check one out some time.