Discounting has broken my brain

I don’t think I can buy a pen at RRP any more.

I’ve been so conditioned by discounting that I expect a saving by default.

Pelikan and Aurora seem to get the biggest cuts — I saw 50% off Optima flex the other day — but discounting is common even for Montblanc, with Wheeler’s offering 20% off at least a few times each year.

Some retailers like Iguanasell heavily undercut competitors year-round on nearly all brands; others like Endless Pens give a rotating set of steep discounts.

The effects are several.

First, I’ve become totally desensitized to ‘normal’ discounts. I don’t get out of bed for 10% any more. When you get 10% just for signing up to a newsletter, it’s no longer a special occasion that spurs me to action; instead it’s an expectation, and stores that don’t provide a discount actually annoy me. When I get emails from the American retailers offering a free bottle of ink of case with an expensive pen, I run the numbers and get cross when I find it equates to something like a 3% discount. Of course, at the other end of the spectrum, a huge discount can trigger me to buy a pen I don’t really want — an equally problematic outcome!

Discounting has also changed my perception for what pens are worth. If Endless Pens can sell an Aurora Minerali for $398, it becomes very difficult for me to contemplate paying £600 for not only that exact model, but any Aurora 88, now or even in the future once that promotion expires. Effectively that discount poisons the well for the brand. I have felt this with Visconti, where I have paid £350 each for two Homo Sapiens editions. I recognise that I did very well there, but still I now find it impossible to conceive of paying over £800 for the new turquoise one, even though that’s what most retailers have it listed at and what most buyers are prepared to pay.

I’m also encouraged to time my purchases around discounts. If I want a pen and can’t find it discounted, I may simply not buy it. Pens are never urgent purchases and I have full discretion to wait for the best price, which hurts both brands and retailers — and therefore may be partly responsible for the rise of the limited edition, designed to drive urgency in purchases through FOMO, and deter discounting through artificial scarcity and skin-deep differentiation. It’s a crazy world where a different barrel colour commands a premium.

However I believe the hype train of limited editions to some extent actually fuels discount-driven behaviour. Retailers must dump old editions to make room for the new, and it’s hard to predict which ones will sell out and which will linger even at a discount. I know there’s a good chance that the LE I have my eye on will be discounted in a few weeks, and if not, I can generally find it for RRP later if the desire becomes irresistible.

The sad result of all this is that I find myself buying from discount retailers rather than from those stores selling at RRP, even when I know in my head that price isn’t everything, and no matter what the product. Even pens in my impulse-buying price level are not immune, because I’ve been conditioned to feel that when I buy without putting a code into that field at checkout that I have somehow lost or missed out.

The only decisions immune from the effects of discounting are those where I’m buying from a maker directly or from a brand with a limited retail network and therefore less choice. Here the decision is as it should be: do I want the pen? Is it a fair price? Can I afford it? I’ve paid retail for Nakaya, Carolina, Desiderata and others, because they opt out of the discounting game and have unique products. But even small makers can be lured into discounting: Karas Pens runs such frequent deals that I don’t think I would ever expect to pay full price again. The new V2 design of the Ink may test my resolve, though!

As a serial pen seller, discounts are doubly important. A pen that I buy for a keen price will lose me less money — or even turn a profit — when I come to sell. And I would be a foolish seller if I didn’t count the market (discount) price when setting my list price. If I buy a Visconti for £800 and try to sell it for £650, nobody will buy it if they can get it new from a retailer for the same price.

Is all this a problem? For me as a buyer, I think it is. I get frustrated that I can feel my thought process being driven by pricing rather than product and service. The thrill of a bargain is a powerful drug. As a retailer or brand, well, I can’t speak from experience. But I am a marketer, and I know that reputation and buyer expectations are hard to change. Once you get on the heavy discounting treadmill it’s hard to get off. And every discount not only kills margin but erodes your brand. For premium brands selling pens for hundreds of pounds, it’s a problem if retailers are fire-saling your designs for half price. It tells the market that your pens aren’t worth what you’re asking; that other people aren’t buying; that you can’t forecast stock or run an efficient business. These are not good signals to send.

Will it change? After Corona, I can’t see it getting better. Discounts will intensify as hard-pressed brands and retailers try to stay afloat. And opportunists like me will keep scanning the sites looking for a bargain, feeling just a little bit grubby about it at the same time.

9 thoughts on “Discounting has broken my brain

  1. Oh the glorious irony, Anthony!

    There’s a (20%) discount code at one of the discount pen retailers you mention, further down on your blog page.

    Whether or not it is customised to my browsing habits I know not but I have not visited the store hitherto: for all the reasons you’ve cited: begone temptation!

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  2. Thoroughly agree with you and know where you’re coming from. Problem is also being a small market, the key purchasers are assuming it will continue this way, so when recently Platinum told their resellers in the US to not discount their brand new model (I assume they did the same else where), the Curidas, the forums and blogs were suddenly full of complaints be people cancelling their pre-orders, and I know some did look at other countries to get it for less.

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  3. I think the problem is even more core to the industry: MSRP inflation.
    When you see a Homo Sapiens for $400, you think “yeah, that’s cool, I think I’d buy that”. when you see it for $950 you think “WHOAH, no way!”
    I sincerely believe that anyone who buys a Montblanc at retail is, at best, a kindhearted fool buying what is meant to be a thoughtful present, but is more likely an ignorant status-seeking idiot. That is why regular Montblanc pens sell for 30-50% of MSRP on the secondary market. They simply aren’t worth what is being asked for them.
    I think that is the core of your feelings on discounts. Once you see a pen for sale for a price more in line with what you unconsciously feel it “should” sell for, you are less likely to tolerate the over-inflated prices intended only to convey an air of luxury and exclusivity that the product alone does not justify.

    Liked by 1 person

    • You make a very good point. We all have a gut feel for what a pen is worth based on brand, materials, technology, rarity. I find Conids expensive but I don’t think they’re overpriced. I find the MSRP of Viscontis about 20% too high. I am not sure I totally agree with you on Montblanc. In materials, engineering and service I’ve received from the company (nib exchanges etc) they don’t feel as overpriced as some people say. The secondary market price depression on the standard Montblanc range is I think largely driven by the fact that the 146 and 149 are superficially exactly the same as they were 50 years ago, so there’s plenty of supply, and because lots of people receive them as gifts and want rid of them fast.

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  4. What a great post Anthony, this really resonated with me.

    “… because I’ve been conditioned to feel that when I buy without putting a code into that field at checkout that I have somehow lost or missed out.”

    Exactly this. Drives me nuts. Especially with all the podcasting discount codes for various retailers.

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    • I meant to put it in the post, but I’ll put it here… Back after the last financial crisis, all the chain restaurants in the UK went really big on discount codes. 50% off your bill, BOGOF, etc. It took them literally years to wind it down to more reasonable levels, and although I don’t eat out as much as I used to, my partner still asks me to check for a discount code whenever we sit down for a meal.

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  5. Amen! I too have become numb to the daily barrage of discounted pen emails (long before the Covid crisis). Discounting is the slippery slope of a race to the bottom. If you’re a maker, charge a fair price and stick to it — and insist your resellers do the same. If they refuse, stop doing business with them — they’re undermining your brand, and it’s simply not worth it in the long run.

    Liked by 1 person

    • Hey Mark — I think a lot of makers could do to learn from Rickshaw in design, ethics, community involvement and now I can add pricing to the list too.

      Thanks for the work you’re doing on PPE. I’m excited to receive the custom order I placed with you back at the start of this crisis, whenever you are ready to get back to business as usual. Keep on going!

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  6. So many great shops out there that seem unable to move off RRP. A shame in the end as I too rarely buy from them.

    Agree with you about Montblanc. Can’t think of another company other than Lamy that would swap out an almost year old 149 nib for a different width without raising an eyebrow.

    Liked by 1 person

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