The Shady Economics of Buy-One-Get-One Free Deals [The Hustle]

Dated Feb 17, 2019; last modified on Mon, 05 Sep 2022

The Shady Economics of Buy-One-Get-One Free Deals. Zachary Crockett. . 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.