Interesting story from the AP

westernrvparkowner wrote:
It's Government Motors for goodness sakes. When have they ever taken the effect of taxes on anyone into consideration? As for raising prices to offer rebates, that is the American way. If offered a choice between two identical trucks, one showing a price of $40,000 and the other a price of $45,000 with a 10% rebate, the vast majority of people would choose the $45,000 truck with the discount. After all, in their minds, they are getting a $4500 rebate and a $5,000 more valuable truck, even though the trucks are identical. Doesn't matter that the $45,000 truck with the $4500 rebate ends up costing $500.00 more.
Psychology is one of the most important components of sales success. As it applies to RVing, why do you think RV parks offer one price and then offer a myriad of choices to get a 10% discount, where almost everyone eventually can qualify? The lemming public is more interested in how much they get off than they are in how much it costs.

I remember (years ago LOL) being floored when my Marketing prof explained that the reason that companies often offer mail-in rebates rather than up-front discounts is that companies realize that so many of us will get lazy and never get around to mailing in that $5 rebate.

In simple terms, it's cheaper for them to offer a $5 rebate that requires action on the consumer's part rather than take $5 off the price because a certain percentage of us will either forget about the rebate or be too lazy to redeem it.

Unfortunately, jacking up the price and offering rebates is another example of the "gotcha!" part of capitalism...kinda makes me sad...seems there'd be a way to make profits without squeezing every penny out of the consumer in a borderline dishonest manner...


End of rant. :W