Bitterbabe cites an article about how the ease and accessibility of porn for men has killed their libidos as well as unrealistically increased their physical expectations of women. This is bad because it destroys relationships and "hey, women want to have sex too you know!"
But at its core this is nothing more than a simple lesson in basic economics. Namely, "substitute goods."
Substitute goods are precisely that. Goods that can be substituted for another. You may want to have an apple, but if there are no apples, perhaps you'll settle for an orange. You would like to go to Disney World, but the flight is too expensive. So you drive to Great America instead. You would like that platinum necklace, but the silver one will suffice.
The key relationship between substitute goods is that as the price of one goes up, the demand for the substitute good goes up as well. So even though you may really, really want that steak, if it's too expensive, you will instead order the chicken. But the reverse can happen as well. Say the steak is very affordable. But the chicken only costs $1. You may prefer steak, but the price of chicken is so compelling, you go with the chicken instead. Thus a significant drop in the price of a substitute good can force a significant drop in demand for the original good as well.
The issue with internet porn is no different.
Previous to it porn came in some physical form. It was hard to store/hide. It came with a price. You also had to physically go and pick it up. And there was an element of societal shame about it. But with the internet the effective price of porn dropped to zero. It was also made incredibly convenient. And now with an entire generation brought up with it, society has become inured to the idea of internet porn.
However, true to the law of substitute goods, a drop in the price of porn has caused a drop in demand for real sex. And this does not make the little ladies happy. Why
So let's do a little experiment and play "Amateur Economist." Specifically, I want you to think of it in terms of a business-customer relationship. Take the crassness out of it. Take the sex out of it. I want you to treat it as a genuine economic problem.
You are an economist at a high end consulting firm and a client comes in. She is the CEO of "GS" (General Sex, a spin off of GE) the sole supplier of sex in the country. Her sales are down, despite it being a monopoly. After some market research she sees there is a new substitute good being offered by another firm, Pron Enterprises. Pron Enterprises does not offer sex, but a substitute good. So when men are looking for sex here are their two choices:
General Sex- Go to the bars, hit on girls. Buy a bunch of drinks. Repeat for several nights over the course of weeks. Get some numbers, go out on several dates, and after a month of hard work, and about $1,000 in social expenses you get to have sex.
Pron Enterprises - Go home, spend 5 minutes on the internet, done.
The CEO of GS wants to know how to increase her sales!
"How or how Mr/Ms. Economist do I do this?!"
Bonus Cappy Cap points will be awarded for thoughtfulness and incorporating real world business principles to this problem!
40 comments:
I would suggest several points to the CEO...
1) Marketing. The company needs to put out an advertising campaign to let consumers know that from now on they will be charging significantly less for their products.
2) PR. They need to hire some spin doctors to get the public back on their side after the countless public relations nightmares of the past.
2b) I would also tell the CEO of GS that they need to publicly disassociate themselves with their evil business partners, Feminist Inc.
3) Sales. They need to hire/train sales people to get folks to buy their products. They need to stop doing business the old way, expecting customers to come up to them and beg them to let them make a purchase. This business model is now obsolete. They need to be pursuing customers.
4) They need to better understand their market. Instead of telling customers what they want them to buy and what they believe is in the customer's best interests, instead they should be doing customer surveys to find out what the customers actually want.
5) Improving the product. For too long GS has been putting out products that are defective, poorly put together, have very few features, etc. Not only that, but they don't even come with a warranty! And when you ask them for one, they go nuts!
6) Better customer service. This shouldn't have to be explained, but the customer is always right. They should be doing everything they can to get the customer to want to do business with them, instead of going out of their way to alienate customers.
7) They need a better investment strategy. Currently most of their investments are tied up in things like Twilight, Doritos, Sociology, etc. Instead they should be investing in things like the Manosphere, the Gym, Mathematics, etc. If the company continues to make bad investments, they will continue to get the same bad results in their finances.
8) New management. The current managers (Hill-Dogg, Oprah, etc.) are leading them more and more down the wrong path. They need better managers, such as Margaret Thatcher, Marilyn vos Savant, the Victoria's Secret models, etc.
9) They need to stop vilifying their customers. This is the only company on earth that openly hates their customers. You don't see McDonald's making fun of fat people, you don't see FUBU making fun of black people, you don't see truck companies making fun of hillbillies, etc.
P.S. - Captain, can you PLEASE turn off the comment approvals? I know some dumbasses like to post a lot of stupid things, nevertheless I never know if my post has been submitted or not and sometimes it shows up later and sometimes it doesn't. It keeps me, and no doubt other fans from posting as much as we would like to. No matter how ridiculous the comments people make, they can always be deleted. Furthermore, socialist trolls would encourage people to post more to refute them which would have more people spending a lot more time on your blog. I don't see a downside to people being allowed to freely post. Just my two cents.
At the risk of sounding churlish, doesn't prostitution already incorporate real world business principles to this?
...The CEO of GS should therefore become the Chief Executive Madame of GS.
This example ignores the existence of the third competitor, Hookers United LLP.
As long as we're making it an economic transaction, let's go all the way (pun intended).
Focus people, focus.
What BUSINESS ADVICE would you give the CEO.
That's just it, Cap. By reducing the transaction to just sex - well, there's an existing black market for that that GS can't compete with.
The only way for GS to survive given the market disruption caused by PE and the existence of HU on the fringes is to distinguish their product from the competitors. They need to provide more than just sex, something that neither HU nor PE can nor will provide.
HU has a small subsidiary business experimenting with a new product, GFE(tm) but it's expensive to maintain and prone to failure. If GS could reverse engineer the GFE and bundle it with their product offerings at a reasonable price and improve the long-term reliability, they'd have a dominant market position again.
I might go for a $1 menu. It works for McDonald's.
I know very little of business practices --but it seems to me you have to "accentuate the positive" and focus on what internet porn doesnt have and real sex does. The experience. Its a shot in the dark since the downside is pretty dam steep....but at this point its all women have.
RealWorld Sex is (usually) better than the internet variety, but is considerably more expensive. Your CEO has to lower the cost of RealWorld sex.
Her agents have to stop demanding expensive dinners and drinks (singles sales); or jewelry,honey-do list completion, or begging (married sales) and start accepting a (much) lower price. Also, they have to pursue customer satisfaction and stop pretending to be a monopoly.
Internet sex is less satisfying, but the cost is nearly zero. So it's simple - lower costs and give better service.
CEO wil give massive donation to the current administration who will then shut down the competition.
Another large part of the problem is that GS refuses to do business with 80% of its potential consumers. And for the remaining 20% the product delivered is of poor quality and unreliable as well as often having undocumented long term costs.
Demand for their product has fallen at all price levels. The possible "solutions" to this perceived problem will fall into three broad categories: shifting the demand curve for their product, shifting their supply curve and improvements in management and distribution.
For shifting the supply curve I recommend GS immerse itself in the principles of lean manufacturing in producing its' product, reducing expenditures on items that don't create value for the end customer; jewelry and shoes for instance.
To shift demand, GS might experiment with boutique manufacturing, producing smaller batches of custom products for the customer. Instead of offering only the Bud Light of sex, they can offer a variety of microbrews. GS can also increase the reliability of their product and market the reduced maintenance costs for the customer.
As pointed out in your post, the customer is forced to pay excessive costs to various middlemen in order to obtain GS' product. GS might be able market to their customers more directly and avoid all the middlemen.
Finally, it appears GS has become accustomed to the customer purchasing its' product in spite of the high initial cost. GS needs to offer more attractive lease options, or maybe rent to own in order to bring down the initial capital investment required by the customer.
Alternately GS can just hire a lobbyist and buy some senators who will outlaw the competition and make purchase of GS' product mandatory unless the customer wants to pay a tax.
how long till the ceo of GS lobbies the government to institute a tax on PE so GS doesnt have to compete on a level playing ground?
I'll have to agree with Daniel Ream here. If it's just sex, then there's no hope that General Sex is going to be able to compete with Pron United and Hookers United. They're going to be required to diverify or add more value to their product that simply isn't just sex, especially when Pron United is stepping up its game. Features such as intimacy which Feminist Inc. persuaded them to take off the shelves need to go back on.
Of course, all the points that Anon 2:25 pointed out would help as well, but I feel Daniel pointed out the core issue.
Easy enough.
The CEO for GS should spend a ton of money on Congress, get several laws passed outlawing pornography and making those that possess it labelled sex offenders that have to register with massive amounts of forfeiture provisions for those that engage in it. (all "for the children")
This won't eliminate it, but it will drive up the price of pron considerably which will reduce the amount of competition from it.
Its going to be difficult to make the supply scarce, so I'm going to have to find ways to make it seems scarce.
Again, an ad campaign selling how wonderful it is, and how only the "best men" get it, I'm going to have to go to the government again and make it a hate crime to say anything negative about GS.
Because realistically all the franchises this company has is going to continue to slash prices for the best customers (because, like starbucks, they're competing with themselves)
Testimonials from men about how wonderful it is (or suffer the loss of all their worldly possessions) will help.
That's a start
Cap you are implying that GS is a rational actor. all data shows that no matter the change in environment GS will refuse to adjust behavior to the current market. if anything GS will lobby the government to tax their competitors
enjoy the decline.
What would actually happen in the real world is that GS would look to Washington to either ban, regulate, or heavily tax the competition.
"It's a substitute good," they would rail. "It's unregulated, and costs jobs, and hurts GDP"* And with plenty of campaign contributions, something would certainly be done about it.
Which makes for an interesting "What if?" Assuming the Captain is correct**, how long will it be before feminists make a concerted effort to ban porn as "objectifying to women?" by which they actually mean, "raising the opportunity cost of dating for men beyond what they will pay"?
* After all, it doesn't matter how much of a free product you use, it does not increase GDP. But using the power of G to get you to C increases GDP - and more importantly to Washington, increases G.
** Always a good assumption.
A good way to expand the business.
From Drudge
http://sanfrancisco.cbslocal.com/2012/12/03/sf-based-porn-company-offers-sex-ed-classes-with-live-demonstrations/
Back in High School, this class would had a very high demand.
So I thought about it for a while, and the thing that finally came to mind was "New Coke". Remember that? It was Coca-Cola's attempt to change up their brand by foisting a new recipe on an unsuspecting public. It was an utter disaster that sent sales of their product crashing through the floor. Sales only recovered when they reintroduced the older product as Coca-Cola Classic.
With the advent of hook-up culture and feminism, GS is now offering "New Sex". "Sex Classic" was a little more expensive (Harder to get), but it came with a secondary benefit: a solid relationship with a sane, decent girl. It came with the option to upgrade to "Marriage Classic", too.
"New Sex" is in every respect an inferior product compared to its original counterpart. Rising obesity rates in the states mean you're either sleeping with a fat woman, or if you're not, you're sleeping with a woman who can afford to be far choosier than she would've been 20 years ago, since demand for her is far higher.
"Marriage Classic" has also been replaced with "New Marriage", and I don't need to tell anybody that it tastes like shit. Divorce, entitled attitudes, and things like that have made it a lousy product that you'd be a fool to buy.
But like you said, you can get by with a lousy product if you're a monopoly, and GS has one. Think a world where there is no Pepsi, and if you want something to drink you're stuck with New Coke. Until, of course, a substitute product drops in price and damages demand.
This means the way to bring back demand is to bring back the old product. Drop the unpleasantness, the flakiness, and the weight, and sales will come roaring right back.
GS used to compete with Hookers United LLC on service such as home delivery.
Sadly, due to the merger with Feminist Inc the product has been reduced parity in quality.
Why pay more for the same good?
All purchase decisions are predicated on price, quality, service and delivery.
General Sex has the option to blow the porn industry out of the water on all four counts.
The fact is that porn is not a 'substitute' or 'alternate' to real sex - unless General Sex insists on making it one - and that isn't good for anyone.
That is my scholarly take on the situation, and is no doubt worth exactly what you paid for it!
JM
It's not the product.
It's the warranty.
The warranty on GS has been devalued from a lifetime of commitment to what have you done for me lately.
There's no longer any reasonable guarantee of return on investment and the risk has increased beyond let's just go our separate ways.
The risk is half your income for the rest of your life.
What rational person wouldn't opt for a swift one off the wrist?
What daniel_ream said. What GS needs to do is offer a complete service package along with their product, including live-in services and general trustworthiness.
What they need to do is shift from selling a service to trying to partner their sales representatives with prospective customers, tying the sales rep's paycheck to the customer's over the long term satisfaction.
Right now GS operates on a "quick-buck" high commission service paired with unreliable goods and disreputable sales personnel. This needs to change.
A better plan would be a commission that starts low but grows the longer they remain partnered with a particular customer. This way there is never any particular incentive to leave that customer, at least as long as the customer remains a reliable buyer.
They really need to work on the personal service and trust angle if they want to increase their profits.
And of course the longest-term profits are made when both business and customer profit. So they need to see themselves as partners with, instead of competitors with, General Providers (GP). GP wants sex, and will gladly pay in provisions. GS wants provisions, and ought to reciprocate with GP purely out of self-interest.
Well, yer askin how an entity that's found its comfort level in a formerly capitalist economy can compete in a truly capitalist economy against those who've removed themselves from the legalities of the formerly capitalist economy. They can't. The true capitalists will have an advantage over the former capitalists until the true capitalists get comfortable enough to settle into the system. Wash, rinse, repeat.
A1:
Well, I'd run a PR campaign all about how Pron Enterprises' product was uncool. And unhealthy. And dangerous. And shameful.
And you're a bad mean person, or some kind of ____ist -- for all these made-up credentialed reasons -- if you even WANT to use it, because the cool people aren't even interested in that stuff.
And that chicks won't like you if you buy it.
...
...oh damn. Wait. I forgot. Crap. What a pickle. OK here we go:
A2:
Or rather, I could run a nationwide education campaign in the public schools teaching the GS employees how to increase the VALUE of their product.
(...fat chance, right?)
Easy. Convince Congress to change the child-porn laws so that "no model under 18" becomes "no model under 40"*. If Obamacare can define "child" as anyone under 26, the word obviously has a lot of legal flexibility.
*This is retroactive; possessing CP is a crime even if it was legal when it was made.
Outstanding gentlemen (and gentleladies).
The results are as such:
Great and Powerful Oz gets an Honorable Mention.
Ras Al Ghul and El Borak get Cynical Points.
But the person who hit it out of the park is
Anon 359.
I shall expound later.
here's one factor that'll get me called a "misogynist"-the average woman was better looking back in he day-you can measure this with rising obesity rates....
another thing-for a never married, no children male, once you get to a certain point-27 or so, there are very few women your age who are never married and with no children. That means dating younger women, "opting out," visiting prostitutes or looking for a mail order bride...
"What BUSINESS ADVICE would you give the CEO."
Your product has no redeeming value. Move on. You are peddling a horse and buggy in the age of Henry Ford. Seriously, your Sandra Fluke for my Little Miss Jpeg? GTFOH.
Next question....
real world girls have USPs they can market better....the smell, the touch, the feminine, the laugh, the flirt etc., and be less expensive on their demand being just one of 3bn of median age 29. be more welcoming to potential customers that is.
I haven't read the comments above, so if this contains any duplicate ideas, consider it a vote for the original.
1) Bundled goods. You don't just sell a computer, you throw in the warranty, a few games, and a sound system. So GS needs to throw in something to sweeten the deal - preferably something that Pron can't do. Intimacy, acceptance, sweetness, and a five-year no-questions-asked return policy would make a good start.
2) Easier access to the purchasing environment. Amazon beat out a lot of competition with one-click shopping, which made their products more attractive to impulse-purchasers and lazy people. Likewise, GS could make the purchasing process, if not faster, then at least more pleasant.
3) Improve the customer feedback system. When I call Toyota and say something is wrong with my car, they want to know about it. You can be sure that when they get enough complaints of any particular nature, that data gets passed up the line and fixed. Conversely, GS has been remarkably unresponsive to clear customer complaints.
4) Location, location, location. Fast food restaurants and gas stations are so predictably located that I can find one quickly in a town I've never even heard of. But doing business with GS is random, at best, outside of bars; further, the quality of goods varies so much from location to location and time to time that customers can't reliably locate the product they want before they lose interest.
5) GS is focusing on harnessing existing demand rather than creating it. When Hollywood cranks out a summer blockbuster, they don't just distribute it to theaters and expect customers to say, "It's summer, I should see a movie." They advertise the movie everywhere, playing up its best aspects for everyone. Conversely, GS directs most of its advertising where it does not intend to make any sales, and has to compete with Pron's much more truthful advertising even there. GS should focus all advertising efforts on locations where they intend to make a sale.
I hope you mean me. I guess we'll find out.
Obviously, the way to increase sales of GS is to get government to restrict the ability of Pron to do business in the US. At least that is the way the "free market" as it exists in the USA operates.
--Prof Hale
"General Sex- Go to the bars, hit on girls. Buy a bunch of drinks. Repeat for several nights over the course of weeks. Get some numbers, go out on several dates, and after a month of hard work, and about $1,000 in social expenses you get to have sex."
You forgot about mentioning the dangers of:
a) "oops" pregnancies,
b) blatantly false paternity claims,
c) contracting STDs (along with HPV and Herpes, the advent of 'Superbug gonorrhea' (which is feared to become virtually untreatable) makes STDs a REAL danger!), and
d) the constant danger of false "rape" accusations if she feels any regrets whatsover at any time afterwards.
Anon 4:09 said "Alternately GS can just hire a lobbyist and buy some senators who will outlaw the competition and make purchase of GS' product mandatory unless the customer wants to pay a tax."
Ranked with all the other options and suggestions written up here, I have to put this as number one in the "What's most likely" category.
Let's compare GS to a chain of car dealerships.
First problem is that you're salespeople have been leasing your top end sports-cars for way under market value. They're taking a brand new $80k ride and leasing out for $100/month. Why would I ever buy one when I can lease it for that price, drive it around like I stole it, and then lease another one once it gets some wear on it?
Then your dealers are taking that same car, now with 120k miles on it, a leaky radiator, and a valve tap and trying to sell it for $80k! Good luck with that. There's only so many suckers who can be talked into that deal; I don't care how good your pitch is.
p.s. the minivans are WAY overpriced, so it's no surprise they're piling up on your lots.
Cap'n, no offense, but your posters haven't spent any quality time in business offices during the past 15 years...
Clearly, the GS needs to synergize end-to-end networks, while changing the paradigm in an attempt to engage best-of-breed e-services. This can be accomplished by engaging in innovative e-business and streamlining bleeding-edge channels, while at the same time working to cultivate revolutionary e-tailers and scale dot-com web services. Doing so will allow GS to monetize value-added models and thus revolutionize dynamic models. The end result will be to maximize robust vortals in a 24/365 environment, allowing the capture of more eyeballs, and expanding the field of ROI...
Or something.
37 comments. That is like having sex with Japanese hookers.
I would suggest to the CEO...
1. Gut it; Realize, that the company is bust. Instead of trying to salvage the whole of GS, Found a new company Private Sex (hence known as PS). Sort out the healthy/profitable departments in GS and transfer them to PS. Stop wasting time on dead weight.
2. Redefine your product/focus on a specific niche; You are offering a superior service package for an annual subscription. Build on public image; Example: "Successful men drive BMW, Successful men use PS."
3. Product redesign; Emphasize utility, ease of use, accessibility, reliability, user friendliness, affordability, lasting appeal. With a good, low maintanence, design you can provide your product within the price range of an average HU user.
4. Modernize; In addition to the standard operating system. Build a comprehensive support network using modern social network technologies. Offer additional software upgrades, new applications, quality checks,..., maintanence manuals. Offer PE compatibility.
5. Realize; The Mormons beat you to it. :-)
Go retro. GS has drifted away from the core competencies that made them a household staple for millennia. PE offers all the flash and sizzle, but no substance, but the price is so low, and the convenience factor so high that noone cares.
In short: lots of women want to be married, rather fewer want to be wives and mothers. Given that state of affairs, and add in the risks of GS, and men find themselves asking: Why Bother?
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