IT’S NOT ONLY compulsive shoppers who get high on the phrases “outlet mall” and “online shopping.” Bargain hunting is a sport that delights even the conservative acquirer of goods. Its logic is simple — if you can get the same goods and services at a lower price than usual, let me know where I should shop.
Differentiated pricing of the same (or almost the same) service has been a long-standing tradition in the airline industry which introduced three (and sometimes even more) price classes for first, business, and economy. While the cheap category is sometimes given fancy names like “world class traveler” or “sardine,” the first two are unabashedly descriptive of their target niches.
Bargain hunters argue that the price premium is a waste of money. You’re in the same plane, headed for the same destination, so why pay more to have leg room and panna cotta for dessert? Of course, those behind the curtain consider themselves in a different place — where sleeping is possible, unless there are crying babies nearby.
The bargain hunter, say for a hotel room, argues that a room is just a room. Isn’t it just for storage of luggage and crashing? Why pay for the view of the sunrise over the water, a bathtub, and breakfast buffet? You can still walk to the same white beach and watch dolphins if you wake up early. Anyway, how long do you stay in your room? It’s just for sleeping.
The other end of this bargain hunting culture aims to flaunt wealth. (If you’ve got it, show it.) Bragging rights drive politicians, successful boxers, and the new rich from online gaming to go for status symbols and splurge on high-end cars, luxury watches (with their auction price) that don’t track blood pressure, celebrity mistresses, and mansions overlooking golf courses out of town. They post their luxurious possessions on social media, intending to attract the envy of other social climbers.
Even well-trodden beaches that already offer a full spectrum of experiences and prices need to have pricing differentials to give the bargain hunter a financial incentive. Stations (arbitrarily designated) mark how far one is from the white sands and how isolated or crowded the area is.
On the luxury end are isolated villas with their own infinity pools and breakfast served on a private terrace. From the welcome serenade, garlands of flowers, cold face towels and quick check-in, there is a sense of unaccustomed bliss — who says money can’t buy happiness?
The premium staff combines efficiency and thoughtfulness — do you want to have a bonfire and dinner at the beach? Housekeeping is unobtrusive, making up the bed and laying out the incense while guests are out. You may even get a personal valet to lay out and match clothes or book a table at the beach restaurant for the evening.
The luxury market is available not just in resorts and hotels but in all service categories, including bespoke jeans, fine dining, private banking, travel, and theme parks that offer no-queue passes.
Increasingly, the upper end of the spectrum is catering to senior citizens and retirees. This gray niche can go on a reckless spending spree, heeding the advice of ancients to cash out long-held investments and properties and spend the money on yourselves with sybaritic abandon. Any remaining cash or assets should just about cover the wake.
Can prohibitive luxury goods target the bargain hunters too?
Special promos persevere and have opened traditional luxury services like two-week cruises to the low end of the spectrum by bannering discounts (as much as 75%) for a limited period. Luxury liners don’t want to leave the dock with empty rooms which can never be sold again.
Even in investments like the stock market, the price rally of stocks that have taken a swan dive previously is attributed to “bargain hunting,” referring to now cheaper and undervalued stocks being snapped up by savvy players. When the trend reverses, it is explained as “profit taking.”
Even bargain hunters do not apply their stinting approach to everything they need to buy. It is not a luxury to go for the best available. There is still room for discarding bargain hunting habits for such necessities as healthcare, diets — and a good sleep.
Tony Samson is chairman and CEO of TOUCH xda
