The Shady Economics of Buy-One-Get-One Free Deals.
Zachary Crockett.
thehustle.co .
Feb 17, 2019.
BOGO goods are usually low-demand, non-efficient, lacking in quality and/or close to the expiration date. The BOGO deal is usually a 50% discount off of the manufacturer’s suggested retail price (MSRP). And oftentimes, this price is artificially marked up to begin with.
- MyPillow offered BOGO deal on their pillows, but really just doubled the price of the first pillow.
Law of diminishing marginal utility: consumers will buy two of something when the word ‘free’ is involved, even when they only need one — and the second item often ends up in the trash.
Most online clothing brands offer ‘free’ shipping, with the catch that you have to meet a minimum purchase amount (often $100) to qualify. Amazon factors free shipping into the price of the item.