Need to save money? Don't fall for price discrimination (invest, grocery, economic)

[Humanoid]

Price discrimination in economics is:

"A pricing strategy that charges customers different prices for the same product or service. In pure price discrimination, the seller will charge each customer the maximum price that he or she is willing to pay. In more common forms of price discrimination, the seller places customers in groups based on certain attributes and charges each group a different price."

Price Discrimination

It is a strategy used in almost every industry and I'm always amazed how well it works, in places like the grocery store where the products are literally side by side.

Anyhow, so an easy way to cut around 40% off your food/household item budget is to not fall for price discrimination. Almost every standard product as an associated generic that is 30~60% (in some cases more) less.

Typically grocery stores have 3 classes of food products- brands, store brand, value brand. They are the vast majority of the time the same product, although the value brand is usually only available in basic food stuffs. Grocery store's don't over good values on household items, instead the generics at Target, Wal-mart (they have a few private labels like equate) are around half.

Anyhow, I'm just always amazed when I see someone take something like Listerine off the shelf at Target when the Target brand (which is identical) is less than half the price. The biggest price differential I've seen is in over the counter meds like Claritin, where the generic is around 3~4 times cheaper.

[IonRedline08]

Unfortunately, you are paying for the branding of those items.

It costs to advertise, and, Listerine is a heavy advertiser.

Also, people place a higher premium on name brands whether its handbags, cars, potato chips, or mouthwash

In my bathroom right now, I have generic mouthwash, generic shampoo, but a $65 dollar t-shirt hanging on the back of the door.

It is all about where you want to spend your money

[harry chickpea]

Pricing used to be discretionary back in the days before supermarkets, when people had to wait for a clerk to gather groceries and goods from behind a counter. Affluent customers were often charged more for the same goods. However, they might have been sold the freshest box of crackers, the flour with the fewest moths, and so on.

Got a chuckle the other day when buying packaged hot chocolate. Brand name was somewhere in the $2.50 range, store brand was $2 for box of 10, and value brand was $1.75 for box of 12 (same size packet). Got the value brand home, opened it up and it was exactly the same packet as the store brand I had purchased earlier. I'm going back looking for a box of 24 for $1.50.

PS, something I learned long ago from a concession vendor - most people enjoy hot chocolate more if it is weaker and has more sugar added.

[lovinCarl]

Sorry but I don't agree.

We'll buy generic on most things if we have too but we have found some items generic is absolutely horrid and not worth the money

Mouthwash (we went right back to name brand after getting the value/generic brand.. that **** was horrible and burned our mouth)

Dishwashing soap

Laundry detergent

Popcorn

Shampoo (No Suave or any of that cheap crap. They work horrible. We stick w/salon brands)

Lotion (and I'm even talking Vaseline.. watery.. ewwww.. we get the pricier but IMO worthier lotions (i.e. Curel, Aveeno, Jergens etc)



These things we have found that it is worth it to pay for the name brand over the value/generic.

[bibit612]

Best thing to do is buy the brand at the discount store...

At the Dollar Store, Dawn DW detergent, Dial soap pump is $1. No name mouthwash is horrid...eewwww, blech!

[Humanoid]

Originally Posted by lovinCarl

Mouthwash (we went right back to name brand after getting the value/generic brand.. that **** was horrible and burned our mouth)

Which mouthwash? There is no difference between Listerine and the Target brand version. The burning is caused by the alcohol and each contain around the same amount. Just look at the ingredients.

Originally Posted by lovinCarl

Dishwashing soap
Laundry detergent
Popcorn

I buy all these generic and there is no difference in quality. But of course even among brand names these products can differ a bit. The point isn't that generics are always 100% the same, although in many cases this is true, rather that there is no difference in quality. When you buy a brand over a generic you are paying for much more than the product itself.

Originally Posted by lovinCarl

Shampoo (No Suave or any of that cheap crap. They work horrible. We stick w/salon brands)

Suave isn't a generic. Generic doesn't mean "cheap crap" it means it means its not a brand (or perhaps a private label). Wal-mart (and to a lesser degree) target sells a number of generic Shampoos of higher quality shampoos.

Originally Posted by lovinCarl

Lotion (and I'm even talking Vaseline.. watery.. ewwww.. we get the pricier but IMO worthier lotions (i.e. Curel, Aveeno, Jergens etc)

Wal-mart sells a generic Aveeno (under its equate label), its the same thing but around 30% cheaper. I get it all the time.

When a generic exists, there is never a reason to buy the brand unless you like paying more for the same product. More often than not the products are made by the same manufacture. Often brand names will try to make their product seem more special in some way, but never does this "specialness" translate into higher production costs. Usually generics are only available for the standard product, although at times its available in many different varieties of the product (as is the case with mouthwash).

[Flamingo13]

I find in most cases that the store brand and the name brand are the same, I check ingredients, etc. - BUT: if there is a sale and I have a coupon, sometimes the name brand is less expensive than the store brand. You have to check the price per ounce/pound, whatever the measurement is. Sometimes the store brands are higher than the name brands if the the name brand is on sale at that time.

[rubber_factory]

It is all fun and games until your generic-brand trash bags split open, spilling a week's worth of rotting comestibles down the stairway.

[IonRedline08]

Right. There are some things that are terrible as Generics.. at least that I have found. Trash Bags being one of them.

But, more often than not, the generic is as good as the store brand.

When I was 28, I worked for a very, very brief time in a bread factory, called Nickles Bakery, which is really popular in Ohio. They made break under their name, as well as TONS of Generic bread for local grocery stores. It was the exact same bread, just in a different bag.

Recently, I moved, and the water was killing my hair, and I got dandruff very bad. I went to target, and they had T-Gel, and a Target Brand T-Gel. The Target one was barely half of the regular. I got it, two days cleared it up.

HEB is a local grocery store chain here. Almost everything I have gotten from there that was their brand was fantastic!

[Humanoid]

I would like to stress that generics are equivalent to the brand names. That is the whole point. There is a difference between a generic and a cheap knockoff.

There are generic trash bags that are equivalent to the brand name trash bags, after all how hard is it to make a plastic bag? But there are also cheap trash bags that are thinner and therefore cheaper. Generic products will almost always say "Compare to XXX" on the product.