Stephen Karlson (shkarlson) wrote in 50bookchallenge,
Stephen Karlson


Just before the liberation of Iraq began, business gurus Michael J. Silverstein and Neil Fiske published Trading Up: The New American Luxury, and the publisher chose to feature yuppie cheerleader David (On Paradise Drive) Brooks on the dust jacket, praising the work as "smart and illuminating ... packed with insights on how shoppers think and behave."  On toOn to Book Review No. 31.

I picked it up on the cheap at Half Price Books.  Perhaps a lot of the disposable income Messrs Silverstein and Fiske noticed accumulating in the hands of New Luxury Spenders (and the rate of accumulation was faster in the upper bars of the histograms) was in the form of securities, hedge fund investments, and home equity.  Thus the value of the book to marketers and managers might be diminished, as the interest in boutique wines, error-correcting golf clubs, restaurant-grade kitchen appliances, and German-styled automobiles might not be what it used to be.

But what really amused was the hype.  It's not enough to suggest to owners, managers, or product planners that there might be potential in product improvement.  Oh, no, we have to have a new way of thinking about product placement.

I scanned the above image from page nine.  The caption reads, "Kendall-Jackson wines are off the price-volume demand curve, selling at higher prices and in higher volumes than conventional wines and than competitive premium labels."

Any reasonably competent economics student ought to understand that at higher incomes for the buyers in this market, the whole demand curve would lie to the right of the original demand curve. But that's not illuminating enough for David Brooks, I suppose.  (There's also a way of analyzing the wine market using hedonic pricing methods, but you'll never sell copies in volume at the airport with that sort of content.)

What amuses about Trading Up is the authors' struggle to distinguish their New Luxury shoppers from garden variety status seekers.  (Thus, for instance, the BMW is the anti-Cadillac, and some shoppers shun credit cards or place a value on environmentally friendly food and clothing.)  At best, though, it offers seriously dated advice to producers of consumer goods.

(Cross-posted to Cold Spring Shops.)

Tags: business, unimpressed
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