"you get what you pay for"

[disneysteve]

There is a concept that hasn't come up yet in this thread but that I think ties into the conversation: Upscaling. There was a book a number of years ago called The Upscaling of America (or something like that). It talked about how over time what people consider "the good stuff" has evolved to more and more high end products. Years ago, people were perfectly happy to drive a Chevy (we had a 73 Impala) and if you drove a Cadillac, it was a sign you had really made it. Today, I don't think I have a single friend or relative who owns a Chevy (or a Cadillac). That's considered a poor man's car today.

When I was in college, my friends loved when we hosted a party because I served "good" drinks. That meant Smirnoff vodka, Jack Daniels, etc. I had one friend who swore she hated vodka. After one party at my place, she changed her mind. Once she tasted Smirnoff she realized it wasn't that she didn't like vodka. She just didn't like crap vodka. Today, however, you hardly ever see anyone serving Smirnoff. Everyone is serving Grey Goose, which as I noted earlier, costs 2-3 times more. Guess what. Smirnoff still tastes just as good as it did in 1985 but people have relegated it to the bottom shelf.

Coffee is certainly another example of this. Every house you walked into in 1970 had a can of Maxwell House on the counter. Now, forget that. Nobody buys that anymore. It's all about "premium" brands.

This has a lot to do with the "you get what you pay for" concept because perception plays a big role in this. If you're happy with Maxwell House coffee, you probably don't see the value in buying 100% Kona beans. If you are satisfied with your Chevy, you aren't likely to find a BMW appealing. If your favorite chocolate is Hershey's, you likely think people are insane for spending the money to buy Valrhona. So the whole "you get what you pay for" issue, I think, is sometimes a lot of marketing magic at work. Not always, of course. There are truly quality differences but they often don't justify the price differential.

[Jimhassel]

It Depends On Your Culture...

Consumers from less individualistic cultures are more likely to judge the quality of a product by its price

[97guns]

im really liking this $200 chromebook

[UnknownXV]

Very cheap products (relative to their category) are just that, cheap. You virtually always get what you pay for if you buy the cheapest option available.

Middle ground on the other hand, is the sweet spot. There are only a few exceptions where I will splurge to get a luxury item, and that's for computer parts. I find they tend to be far higher in quality, but I also assemble custom computers. I want them to last and be as reliable and stable as possible.

Generally speaking, items with luxury price tags are not necessarily better than mid-range items, and if they are, diminishing returns most definitely applies in nearly all circumstances. It may be better, but is the lavish cost really worth it?

I suppose it's personal preference, and what your mind tells you. Often what you buy can feel superior to an equal product merely because you paid more, so your mind fools you into thinking it really is better. At least, initially it does. That luster soon fades.

[~bs]

in my opinion, the higher up you go, the more of the cost is attributable to intangible things such as branding.

A middle ground product may be 50% more expensive that the cheapest, with only 10% of the increase attributable to branding. But a luxury product may be 50% more expensive than a middle ground product, but 40% of the increase is attributable to branding. Note that I just made these figures up to make an example.

[YLTL_Dan]

I think people use the "you get what you pay for" as an excuse to justify their overspending

But yes, I agree with everyone else in that it does depend and some items are worth their extra expense, but it just makes me laugh when people use it as an excuse.

[~bs]

I think people use the "you get what you pay for" as an excuse to justify their overspending

But yes, I agree with everyone else in that it does depend and some items are worth their extra expense, but it just makes me laugh when people use it as an excuse.

you mean like

"you live only once"

"it's only money"

"I 'saved' $500 on this bag (no you didn't, you spent $750 instead of $1250)"

[Petunia 100]

There is a concept that hasn't come up yet in this thread but that I think ties into the conversation: Upscaling. There was a book a number of years ago called The Upscaling of America (or something like that). It talked about how over time what people consider "the good stuff" has evolved to more and more high end products. Years ago, people were perfectly happy to drive a Chevy (we had a 73 Impala) and if you drove a Cadillac, it was a sign you had really made it. Today, I don't think I have a single friend or relative who owns a Chevy (or a Cadillac). That's considered a poor man's car today.

When I was in college, my friends loved when we hosted a party because I served "good" drinks. That meant Smirnoff vodka, Jack Daniels, etc. I had one friend who swore she hated vodka. After one party at my place, she changed her mind. Once she tasted Smirnoff she realized it wasn't that she didn't like vodka. She just didn't like crap vodka. Today, however, you hardly ever see anyone serving Smirnoff. Everyone is serving Grey Goose, which as I noted earlier, costs 2-3 times more. Guess what. Smirnoff still tastes just as good as it did in 1985 but people have relegated it to the bottom shelf.

Coffee is certainly another example of this. Every house you walked into in 1970 had a can of Maxwell House on the counter. Now, forget that. Nobody buys that anymore. It's all about "premium" brands.

This has a lot to do with the "you get what you pay for" concept because perception plays a big role in this. If you're happy with Maxwell House coffee, you probably don't see the value in buying 100% Kona beans. If you are satisfied with your Chevy, you aren't likely to find a BMW appealing. If your favorite chocolate is Hershey's, you likely think people are insane for spending the money to buy Valrhona. So the whole "you get what you pay for" issue, I think, is sometimes a lot of marketing magic at work. Not always, of course. There are truly quality differences but they often don't justify the price differential.

I can't tell the difference between Smirnoff and Stoli or Skyy either. To me, it is smooth or it isn't. The only two brands I have ever had which taste smooth are Grey Goose and Belvedere.

BMW is one brand people put a premium on which I really do not understand. I have a friend who gets a new BMW every 2 years, and has for the decade plus I have known her. For her, it is very much a status symbol. I have ridden in several of her cars, and I find them very uncomfortable. You feel every bump in the road. I have been told that is because it is a "performance" car. Well, so what? I don't care to feel every bump in the road; I like my Honda Accord much better.

[~bs]

^
Sorry, as somewhat of a "car guy", I have to chime in a bit.

Performance does not equate to "comfortable". You sacrifice comfortable to get performance. Regarding BMW and other luxury & sports makes, as mentioned earlier, you're paying partially for brand, partially for product. She could be trying justify her status symbol by saying it has better performance & safety, but her point is most likely true.

Many features that are standard today, including most safety ones are developed and start from the luxury lines.

A honda accord does not equate to a bmw in any way. On the interstate, the speed limit may be 70mph, but is a semi on the freeway equivalent to a suv? is a suv equivalent to a passenger car is equivalent to a sports bike is equivalent to a 20 year old car that's not maintained? Of course the answer is No. Just because your car and another car both get you from point a to point b doesn't mean that there isn't differences that might matter.

I am pretty familiar with my car, which is a mercedes slk55, but not bmw models or honda accords. So I'll just pull up a spec sheet on an accord, same year and highlight differences that may matter to you. This is not meant to be a bragging sort of thing, just an educational one.

Braking: The accord has front disk, rear drum brakes - 70-0 in 187feet. slk55 has front/rear disk brakes - 70-0 in 156 feet. Translates into stopping 17% shorter distance. The mercedes has a brake assist program in addition to abs, the honda only has abs. Beside the ability to avoid more crashes, the stopping factor is important in another way. There is a huge difference in energy transferred to car occupants if a car is going 50 vs 40, or 40 vs 30, etc. Assuming everything else constant, that extra stopping power translates to a slower speed when you finally make impact. Say a car runs a red and pulls into the middle of an intersection. You hit the brakes, but still end up hitting them while going 35. Now imagine how much less injury would be done to both of you if your car had brakes that allowed you to slow down by 17% more.

Performance: the mercedes has over double the horsepower. For the practical minded person, it means it's a lot easier to match speeds of cars doing 70mph while taking the onramp onto the interstate. Can accelerate out of trouble if that situation presents itself.

stability: mercedes has stability control, accord does not. suspension is lower, ride stiffer, which translates to handles better but not really comfortable. Chances of spinout or loss of control lower.

safety: standard features pretty similar, I really don't know how the airbag technology compares. I do know the slk55 has 6 airbags for 2 occupants (the extra airbag is to protect the legs/knees. The honda has 4 for 2 front occupants, and 2 side curtains for rear.
-----------------
Would you ever be in a situation that the stuff I mentioned above mattered? I would not wish that on anyone. I can say that there have been a few times that I believe I would have been in an accident if I had been in a normal compact car. And I understand that if someone isn't a car enthusiast, then they don't realize that there are other features of higher end cars that may be important to them, namely the features you hope to never employ. About the only thing the accord is better in is sight lines. Because my car is so low to the ground, it makes it harder to see. In every other way, my car is a safer car to drive. It stops faster, handles better, less likely to spin out or react unpredictably to a sudden change in course or speed.

Is THAT worth the extra cost? Well that's up to you to decide. It's like the debate about car tires. You can go super cheap low rated tires that have poor grip and higher chances to blow out, you can go mid grade that's average all around, or you can go higher, all the way up to performance tires with superior grip and better blow out protection. Yes they might all be tires, and (hopefully) get you from point a to point b, but N rated tires are not equivalent to ZR rated tires in any way, shape or form, except for "round"

[kv968]

^
About the only thing the accord is better in is sight lines.

I don't think that's the ONLY thing the Accord is better at. Try fitting a family of 4 into your Mercedes

[JoeP]

Good post, Steve. It pretty much sums up what I've observed as well.

[~bs]

I don't think that's the ONLY thing the Accord is better at. Try fitting a family of 4 into your Mercedes

I was thinking performance wise, but so true! Its probably possible, but not exactly safe or comfortable. Nor can you transport a toddler, nor more than 1 suitcase. The ride quality is undoubtedly hatsher as well, not that they dont make models that are far more comfortable. I think air suspensions in most of the upper end luxury cars provide the best comfort, but are expensive to fix and maintain. Overall though, 2 seaters are by far the most uneconomical car type.

[hamchan]

This thread has taken off in some interesting directions. Gives you something to think about.

[elessar78]

I've been thinking a lot about this since I first read the thread.

In most cases, in my experience—NO*.

*I buy a lot of stuff of "bigger ticket" items off of Craigslist. Washing machines/dryers, lawn mowers, power tools, furniture, iPods, as well as used cars (not from C-list). So the retail price of these things was NOT worth their price for me. I get things at a substantial discount.

It's not fool proof, but in the aggregate I think I come out ahead. It takes some research to know the failure rate of certain things and I've developed a sense for what things are worth and what things are worth buying new. Plus there's always a tertiary resale market. If I buy a used lawnmower for example, if I don't like it, I can resell it again close to what I paid for it.