4425: " i spend way too much on cables often thinking how mindless it is when i look at the cost of the things in my house. in one hand i have a cable and in the other a high end tv which cost less than the cable. mind boggling if you think about it. i think people like me are the root of the problem bc we still buy the uber expensive cables knowing that they are grossly overpriced. Consider that 1000 american dollars for a pair of cables is no longer considered anywhere near the top. no one to blame but myself... but i do love great cables. that’s the problem."
Hello 4425,
I congratulate you on your self-awareness and analysis of why there’s a market for stupid expensive cables when you stated "I think people like me are the root of the problem bc we still buy the uber expensive cables knowing that they are grossly overpriced."
I believe you hit the proverbial nail on the head. These cables are not very expensive because they are intrinsically of high value. Dollar wise, these cables are not expensive to produce but are worth as much as individuals are willing to pay for them; what the market will bear, based on the dynamics of supply and demand just like any other commodity including currency itself.
Stupid expensive cables are unique, however, in that the supply is basically infinite. More can be supplied or produced easily as long as there’s no shortage of the raw materials or some other issues in the production process.
They’re also unique on the demand side, makers spend a lot of money and effort studying the psychological reasons why a very small segment of the population are willing to behave so illogically and buy their cables at such extravagant prices.
Cable companies understand that the main reasons for this willingness of most individuals to buy very expensive cables are emotional in nature. They’ve discovered that these buyers perceive extra value simply due to the arbitrarily high prices they initially set, the higher the price the higher perceived value inferred by the buyers. They also found there’s a placebo effect whereby buyers perceive improvements in performance that are phantom in nature due mainly to a personal psychological need to rationalize the cable’s high cost. These are all dynamics that supersede traditional explanations of simple supply and demand forces at work.
These cable vendors understand these unique dynamics and their own requirements to budget relatively and proportionally very large amounts of money on advertising targeted to reach and influence the small segment of the population that are psychologically and emotionally predisposed to spend a high percentage of their typically high disposable incomes on very expensive cables.
If they’re unable to increase demand via advertising, real or contrived testimonials, positive professional reviews and other means, these cable makers realize they can only keep demand high by having enough buyers like you. And as you have stated and understand, "I think people like me are the root of the problem bc we still buy the uber expensive cables knowing that they are grossly overpriced."
Bingo, I believe you are exactly correct. If enough buyers like you come to their senses and refuse to still buy cables knowing they’re grossly overpriced, then the demand will be reduced while the supply will remain virtually infinite. The traditional laws of supply and demand will be restored to these likely high quality but grossly overpriced cables and the traditional equilibrium price will also be restored. Affordably priced high quality cables? Wow, I bet a company would sell a boatload of those.
But it would probably require a change in marketing strategy to volume, volume, volume. And their ROI would likely be reduced.
Tim
Hello 4425,
I congratulate you on your self-awareness and analysis of why there’s a market for stupid expensive cables when you stated "I think people like me are the root of the problem bc we still buy the uber expensive cables knowing that they are grossly overpriced."
I believe you hit the proverbial nail on the head. These cables are not very expensive because they are intrinsically of high value. Dollar wise, these cables are not expensive to produce but are worth as much as individuals are willing to pay for them; what the market will bear, based on the dynamics of supply and demand just like any other commodity including currency itself.
Stupid expensive cables are unique, however, in that the supply is basically infinite. More can be supplied or produced easily as long as there’s no shortage of the raw materials or some other issues in the production process.
They’re also unique on the demand side, makers spend a lot of money and effort studying the psychological reasons why a very small segment of the population are willing to behave so illogically and buy their cables at such extravagant prices.
Cable companies understand that the main reasons for this willingness of most individuals to buy very expensive cables are emotional in nature. They’ve discovered that these buyers perceive extra value simply due to the arbitrarily high prices they initially set, the higher the price the higher perceived value inferred by the buyers. They also found there’s a placebo effect whereby buyers perceive improvements in performance that are phantom in nature due mainly to a personal psychological need to rationalize the cable’s high cost. These are all dynamics that supersede traditional explanations of simple supply and demand forces at work.
These cable vendors understand these unique dynamics and their own requirements to budget relatively and proportionally very large amounts of money on advertising targeted to reach and influence the small segment of the population that are psychologically and emotionally predisposed to spend a high percentage of their typically high disposable incomes on very expensive cables.
If they’re unable to increase demand via advertising, real or contrived testimonials, positive professional reviews and other means, these cable makers realize they can only keep demand high by having enough buyers like you. And as you have stated and understand, "I think people like me are the root of the problem bc we still buy the uber expensive cables knowing that they are grossly overpriced."
Bingo, I believe you are exactly correct. If enough buyers like you come to their senses and refuse to still buy cables knowing they’re grossly overpriced, then the demand will be reduced while the supply will remain virtually infinite. The traditional laws of supply and demand will be restored to these likely high quality but grossly overpriced cables and the traditional equilibrium price will also be restored. Affordably priced high quality cables? Wow, I bet a company would sell a boatload of those.
But it would probably require a change in marketing strategy to volume, volume, volume. And their ROI would likely be reduced.
Tim