In the name of protecting consumers from being “gouged,” two Senators recently introduced a bill that will require airline add-on fees to be “fair and proportional” to their costs. What these Senators don’t understand is regulating add-on fees will actually harm consumers. Any regulation will result in the base price of airline tickets rising.
For full insights – and reasons why this Senate bill makes no sense – please check out my Op Ed in today’s Wall Street Journal. The Journal has a paywall – so consider subscribing or stopping by your local newsstand for the full article.
Posted on March 30th, 2016 (0 Comments)
How many of us believe “list” or “original” prices are meaningful, in any way, to consider when making a purchase? Most of us are dubious of their veracity…but somehow seeing a higher such reference price brings us comfort. In the best light, reference prices (list, original, manufacturers suggested, etc.) are aspirational and at the worst, well, deceptive.
While it’s easy to shrug off misleading reference prices with a “caveat emptor,” I don’t think we should condone this chicanery. In their current form, reference prices provide no practical benefit to consumers. Please check out my latest piece for the Harvard Business Review which discusses reference prices and provides a prescription to make them more meaningful.
As always, thank you for dropping by to read my blog!
Posted on March 23th, 2016 (0 Comments)
A common proposed remedy for high U.S. pharmaceutical prices is to import cheap drugs from Canada. It’s a nice fantasy to believe the remedy to this major issue is as simple as trucking discount pills over the border.
For clarity, this is not a political piece as both Democrats and Republicans have advocated this remedy. Here’s why this strategy won’t work: Suppose you are the head of pricing for a major pharma company and observe low-priced drugs targeted to Canada are now being used in the U.S.. As a result, your company’s profits are declining. What would you do? Of course, you’ll do everything in your power to curb this importation.
For more insight on this important issue, please check out my latest piece for the Harvard Business Review. For latest updates on key issues, follow me on Twitter @cultureofprofit.
Posted on February 12th, 2016 (0 Comments)