Wednesday, 15 December 2010
Internet Love song (She Blocked Me)
What it is is this. I've bought my darling wife a Christmas present on the internet. Nothing unusual in that you might say (unless you live in Scotland - in which case don't expect it to be delivered anytime soon). But I am a parsimonious old bastard: I just hate paying out more than I have to.
I rationalise this behaviour but arguing any business worth its salt should be profit maximising. That means screwing down the price you pay your suppliers and charging your customers the most you can. Most consumers are price takers: in simple terms we have little or no economic power individually. If a business says he'll sell you something at £10, you're unlikely to be able to get him to reduce it. This power imbalance is exploited by large firms, market leaders, niche markets and luxury goods. When these combine you as a consumer are likely to be shredded.
The net has been a godsend to us shoppers. Well, it used to be. In the early days, before the big boys woke up to its power the www allowed the savy and not so savvy consumer to search out lowest price, best buys with some ease. Now the main players put road blocks in the way. Search costs have soared; and the temptation now is to go for the most obvious site. E Bay, Amazon and any one of the large retail outlets.Hidden away, however, beneath this virtual High Street of big names are still zillions of small sellers trying to get heard and offering extra good deals.
OK, less of the spiel on with the deal.
My wife loves Chanel No 5, and her morning ablutions are not complete without a spray of Chanel No 5 eau de toilet in all the vital places. I usually buy her a 100 cc size. Last weekend I typed in Chanel No 5 into Google and top ranking was Amazon, next was Debenhams , followed by Boots. The prices quoted were £63.03/£70/£70. In fact both Debenhams and Boots have exactly the same web pages for Chanel, that's how tightly the company controls its brand image.
I hit on a web site called Scent Mall. I'd never used them before but they looked a good deal. They were offering the perfume at 68.74 Euros and with the Euro at about 1.17 to the £ that looked fine. So I signed up.
I soon after received a confirming e-mail and I noticed that my name had been mispelt Baryy. This got me worried. So I looked at the company address which I hadn't seen on the website. "Sophia, Bulgaria". My heart sank.
Some mafia type creature, I was sure, was at that very moment using my credit card details to rob me rotten. As for the perfume - forget it. I'd ( or more accurately, my wife would) never see it. If by chance the order did arrive it would probably give paint stripper a good run for its money. My next anxiety was the exchange rate. They might apply some hideous conversion rate; so that my bill would be extortionate.
Since I placed the order I regular visited my Mastercard website to see how much my Eastern European adventure cost me. £58.80!!!! that's what I've been charged, and no other item such as a new car is featured.
O.K. I may have been rather alarmist. After all Bulgaria is in the EU; unlike it's neighbour Rumania which I was, in my panic, confusing it with. It still might turn out to be paint stripper.
The net is a marvel but it's been taken over. In the early days it was like the American plains before the railroads. Lots of individuals playing with this new toy, trying out all sorts of business plans. Just like the American West it attracted masses of money and loads of ne'er do wells. When the dot.com bubble burst, the landscape was blasted - a few of the originals remained to rebuild, but the "real economy" giants moved in having learnt from the mistakes of the first movers. Now it's like life, except more predictable.
So it's great to see some of the early anarchy returning as WikiLeak's supporters start making life on the web not such a doodle for the big boys. Just as long as they don't muck up my virtual life lines too much.