It first came to prominence in the motor trade when the car firms were compelled by law in the USA to put the actual real final price of a motor vehicle for sale onto a prominent place on each car. The flummery and bamboozlement that went on before that with sales talks and commercial theatre still went on – you were never going to legislate morality, after all – but there was a starting point around which it was required to proceed. A lot of people got a rude awakening when they saw what financing does to prices.
Then there is the fact that prices nearly always rise as time goes on but memories do not let go of the old numbers. The car that cost $ 2000 in 1966 now costs $ 20,000. The rest of the finances may have advanced in step with this, but the client who remembers buying the ’66 Cheapmobile will choke on seeing what the new one costs. And in many cases go right away from the dealership.
The same happens with clothing, cameras, white goods, and furniture. And as much as the sales people may think that it doesn’t matter – that the client will be driven by need back to the store anyway – in some cases that shock will cause an entirely different reaction.
Take the toy ( Okay, okay, model ) car hobby. A good-quality model might have sold for $ 50 a decade ago. Then it went to $ 69, $99, and up as time went on and the affluence of Chinese society increased. Now it is $ 179, $ 199, $ 249 and up. Unless you are still earning mining money somehow, you are not going to be able to laugh off the sticker.
It has caused me to stop desiring every new model that comes out. I realise that I cannot afford them – I can pop for a few good things in the year, but need to spend most of my modelling time making things, and making them inexpensively.
Fortunately this has proved to be a lot more possible than I had suspected. Unfortunately it means that I am not helping the retailer out by keeping the machinery of his sales rolling. And as the machinery slows, there will be fewer manufacturers willing to continue operating it. It is a sad cycle.