Price discrimination

March 22, 2021
 by Paul McGowan

When I am auditioning a new product, circuit, or technology I do not want to be prejudiced because of its price.

Price discrimination is real.

For most of us, it's difficult not to be swayed by our perception of an object's value. If it's "too cheap to be any good", or "so expensive it damned well better be good", we start out with a preconception that is difficult to wipe clean.

To make matters more difficult, the outward appearance of a product almost always tells a story about its cost. A chassis with lots of expensive gingerbread is expected to have the same level of innards as outsides. But, of course, that's not always the case.

It's hard not to judge a book by its cover, a stereo product by its looks or price, but if you can figure out how to overcome the problem of basic prejudice, with respect to price, you're light years ahead of the pack.

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48 comments on “Price discrimination”

  1. Ok, so you take a couple week break from this website and upon returning you discover the last ten years of comments have mysteriously disappeared? Now, appearing on the page is an in-your-face mugshot of the brand ambassador pointing to the 800 number and the lower page that used to highlight the poster’s comments is dominated by metaphorical pictures?

    I recall a threat two months back that if an Aussie wrestler didn’t stop taking Sclaningham to the mat he would pull the ‘comment’ posts from his site. Guess he followed through on that promise.

    Oh well, the same 15 people respond every day in a world of 8 billion, so no big deal really. Guess it’s back to binge watching The Crown on Netflix (scandalous bastards) the price i have to pay for watching Ozark. sigh...

    1. I didn’t appreciate Paul’s finger pointing to the 800 number. I thought his finger was indicating the direction of his profit margins now that everyone pays retail prices for online sales.

      The pricing thing is relatively straightforward. The MereMortals audio market is highly competitive on price and quality and the main benefit of Chinese production is that the SAME components cost 10% with zero lead time, they have highly skilled workers and often more up to date production technology. The good products and manufacturers rise to the top and are easy to find online.

      Companies over here like Linn, Chord and Devialet can produce locally due to ultra-modern design and production. I chose Devialet because it is based on mobile technology so cheap to produce with 0% failure rate. The entire electronics of my unit (power supply, amps, DAC, phono, streamer) were replaced in a factory upgrade for £2,990. It would have cost me £2,500 just to upgrade my PWD DAC to DSD and it was a DIY kit.

      As for some high end, I think they just make up a price and add a zero.

      I was convinced 15 years ago that streaming and Class D would kill profit margins because it produces great sound very cheaply. The main reason for some high prices is branding.

      1. In regards to today’s subject line, value in audio is always relative to the individual and their specific application. Therefore, there are no universal solutions.

      2. Steven (NTBCWS), you are right. I came here because my equipment "needed" (really?) updating. My pre/DAC was "old" (it was). My amp didn't have the muscle for my speakers. It took me time to figure this out, I first thought my speakers' bass was wimpy. After investigating Paul's technology, I also went the Class D way ,(Hypex instead of ICE), no regrets at all. My speakers' bass is not wimpy anymore. Their impedance was way low for my old amp. I changed may pre/DAC for an RME, decided to splurge instead of a SMSL or Topping that would save me a lot. I couldn't conceive of the $$$ for PS Audio stuff, very regretfully. Instead of spending fortunes on an Auralic server, I got a Mac Mini, again based on Paul's recommendation. Discovered that wires are myths in our insecure brains. All that wasted money.

        Contrary to what was said yesterday, you don't need to spend mucho money to get wonderful sound. You just have to control your bias. Be patient, investigate and DON'T trust your ears. They are controlled by your insecure brain. Use your ears, it is a different concept.

          1. "stereo product by its looks or price, but the problem of basic prejudice"

            Goodyear, Stef, Chicago, Ruts, are all wise men --- and great Americans.

            However, I believe in, live by, and feverishly proselytize the precepts and words of The Holy Audio Prophet [THAP], A. Dudley.

            If it looks old, because it is old, then it's always superior to anything else that exists, or ever could exist.

            Rock on.

          2. Wet Rat, you confuse insecurity with curiosity. I wanted to move to a streamer system and eliminate the CD clutter. My pre/DAC did not have a USB input. I was aware of my amp/speaker "confrontation". I did what smart people do. I researched, investigated systematically. I went for objective evaluations instead of flowery statements. I discovered a new world. I saved huge amounts of money, gained enormous convenience and (probably) improved the overall sound of the equipment, besides the obvious improvement in the bass. I became frustrated that I was "conned" by the superstitious sound mythology.

            A combination of curiosity and insecurity in people with determination drive improvements. If you do this with the proper methodology, you learn.

            You should try investigation, you will discover how little you know.

            1. CtA,
              Blah, blah, blah from you, as usual.
              My ears work well enough for me to enjoy the music that I love through my current audio rig (I've had many in my lifetime) & that's what home audio is all about.
              I prefer not to spend my time turning home audio into a drawn out crime scene investigation like you seem to be obsessed with doing.
              Whatever floats your boat; happy listening & thanks for the laughs.
              Btw it now looks like some of your replies are also being deleted by the moderator...aren't YOU embarrassed? 🙂
              Your insecurity is self evident by the way you need to put others down.

  2. When I started investing in a stereo system I still trusted reviews (authority bias) and judged a receiver primarily by its ease of use (user interface) and styling of the outer appearance (control knobs, displays, color etc). The most crucial and relevant component however was definitely the turntable and the cartridge-tonearm combination. Only few loudspeakers required megawatt amps or tiny vacuum tube amps. Today I judge the quality by simply listening to each new component ignoring any reviews. Technical (white) papers are relevant for a preselection. Does a heavy chassis carved from a metal block by a huge nc-machine justify a higher price? Only if it sounds better. I guess the biggest challenge for audio manufacturers are the low manufacturing costs in China, South-Korea, Taiwan, etc.. Braun company from Germany was famous for the styling (Bauhaus design philosophy) of its products (designed by Dieter Rams) which however offered only mediocre sound quality and rarely highend quality but the outer design successfully helped selling for a higher price.

  3. Yesterday I used the quote, "If it ain't broke don't fix it"
    A prime example of this is PS Audio's revamped (new) format here.
    Except for Paul's smiling mug plastered everywhere & the greyish (grayish) print issues,
    I can't see why the change(s) was(were) made.
    Is this just a case of 'Change for change's sake'?
    (Change for the sake of change is not always the best strategy)

    **A observation**
    Today my audio rig sounded awesome, for what I paid for it.
    I don't know whether my tympanic membranes &/or other associated bits woke up in excellent spirits this morning or whether the last ten days of driving rain has saturated the air with so much moisture that the dynamic slam & higher frequencies are just more visceral than usual, but as far as audio goes today was definitely a good day.

    Having been in audio retail for 22 years I know how to devoid myself of the influences of price & looks when it comes to critical listening.
    Playing with so much audio product for over two decades helps to desensitize to secondary considerations such as price & appearance.

    1. The good news is heavy rains ensure better continuity to the electrical ground so don’t disregard what you’re hearing as coincidence. The bad news is the potential for flooding, consequential property damage and evacuations.

      1. Hi Doc,
        I think that it was my taking 'CtA' to the mat from mid February until about ten days ago that was what broke the camel's back re the comments section being wiped.
        Everything's a compromise.

        I reside on the 3rd floor of a double brick building built on massive chunks of sandstone.
        There will be no "bad news" for me 🙂

  4. It’s a hard one. Price point of a particular audio product until you actually hear it. 😉
    Your experience comes into play as well as your intuition if you actually get to touch and listen first hand of that audio product.
    I hate assuming in audio.
    If a headphone costs 5500$ I’m not gonna fall off my chair. Let me hear it and let me read about it.

    1. Hey Doctor George. Our programming people don't work over the weekend so we need to give this a bit more time. Also, Copper Magazine didn't ship out this morning because of yet another programming bug so they will be hard at work trying to fix that first. The font issue will come later, hopefully this week.

      Lots of sourpuss comments this morning! Yikes.

  5. Over the years I have heard components that performed way better than they should. Nicely matched components round them aside they set a new bench mark within a price point and when stripped down, leave you questioning how is this possible. DCM Time Windows from the early 80s is a very good example of how a very well designed cross over can take a less than spectacular set of drivers and make them musical. Early Time Windows used Philips drivers and yet they were capable of excellent sound stage, detail and depth. They should not have been able to do this but they did.

    Judging equipment on its sound and the detail it delivers is the test, not price, after all we should applaud excellence in design and innovation. We may not all be in a position to afford a pair of Stax SR-007, but what a magic experience it is to hear them and understand what is possible.

  6. I just read some guy on the forum going on about cable that changed everything! For obvious reasons, I had never heard of the brand, looked up the cable and it costs $18,000. All that says is that people with can have very different expectations and mindsets and vastly different concepts of value, which may overlap or be light-years apart. Paul's concept of value may be completely different to mine, and probably is. I'm probably more on FatRat's wavelength.

    For a neutral assessment, I would tend to revert to Ted Smith's foot-tapping test. That's as good a measure as any, and if the price is right - Bingo!!!

    There is a rather cynical saying that poor people are always happy as they don't know any better, and rich people are always unhappy because they want to be richer. You could apply this to hifi as people with basic budget systems are invariably happy with them, whereas high-end audiophiles seem to be endlessly chasing their tails for more, never entirely satisfied with what they have. You can't reconcile the two groups and the high-end advocate can shout as loud as they like at the budget-guy, they might as well be shouting at a brick wall. Meanwhile, budget-guy is looking on wondering why the high-end advocate is going red in the face.

    1. Steven (NTBCWS),
      That spending on wires is beyond ridiculous. But around where I live, you can see Bugatti Veyrons occasionally. You don't turn your head for Ferraris. Maybe a new McLaren or a fancy Lambo. Porsches are just "volks" cars. Those prices for wires for a stereo are more like those cars. They look fabulous (not the wires), they are extraordinary machines, but for many of them, a Tesla has faster acceleration.
      Audio is not like cars. But for many people, it appears that way. Why do you "need" a dCs? Or a $100k amplifier? It doesn't really give you "more accurate" sound. You may "like" it more, but that's different. Too many people confuse what they like with what is more accurate.

  7. Decades ago the Melos company produced a pair of triode output tube amps rated at 400 watts each. Many of the customers didn't believe that could be done well for the $10,000 a pair they cost and it actually caused the dealers trouble selling them. Many of the dealers asked the manufacturer to put a thicker front panel on the amps, call the the MK 2 version and double the price to $20,000 telling the manufacturer they could sell more amps at the inflated price.

  8. How long before price discrimination becomes listed as a federal hate crime? From reading so far apparently it’s systemic.

    It’s a pretty simple concept to deal with in reality. If you like the way it sounds for the price then buy it, if not then don’t. Maybe insist the gov’t get involved, pick a price, say any component over $1k, add a luxury tax.

    As far as the continued comments concerning the web site and this posting page. No one is forced to post here. Even the moderator chooses to post. If you like it then continue to post, if not voice your opinion in an e-mail to the CEO and walk away. Then Crawl in your safe room with your “bankey” and suck your thumb because the change is too much to deal with.

    Apparently Comments are welcome, but remember it’s Paul’s (PSA’s site) not ours.

  9. What is price discrimination? At what price does it become an issue? And you want government to step in? This would be insane, government should stay out of everything. Nobody is forcing anybody to buy a more expensive product and not all people can justify or hear a difference in better quality equipment.

    This same can be said to everything we buy: house, car, diamonds, shoes, etc.. I’m sure the guy who can only afford a Corolla looks down on a Porsche owner saying it’s crazy to spend that much money on a car because his Corolla does the same thing and is probably better for much cheaper, even when he has not experienced driving a porsche

    1. Rs350z,

      If part of your post was directed at me, then you must have missed the word “maybe”. Address the absurd with the absurd?
      Otherwise I agree with your premises. Although the Corolla guy may be jealous rather than looking down.

      1. Mike,
        I think the 350z part of Rs350z gives the game away. I am also a Nissan owner, my name here really should be SsPulsar1.2Auto, which I bought 3 years old and cost considerably less than my loudspeakers. 5 of us have been on holiday in it and the trunk occasionally gets mud and detritus from the garden centre. I don't use it for pleasure as I don't enjoy driving, but I have friends who would get great pleasure just sitting in their Porsche on the driveway, revving the engine.

        Porsche-man's craving for status is often based on the false premise that Corolla-man actually gives a damn, which he normally doesn't. He's not looking jealously to or down on Porsche-man, he's usually not looking at Porsche-man at all.

        1. Hello Steven,
          I noticed that. 🙂

          I guess I just got rubbed the wrong way with the way todays responses started. From where I sit we are the consumers. If we don't like a product because of price or affordability, or we don't like a posting place because of changes, then all we have to do is walk away. If enough do, and the manufacturer is no longer making a profit or their words are falling on deaf ears, then its up to them to figure out what's wrong and why. I like a bargain or perceived value as much as the next person. Like many here I look through the pragmatic lens of what I set for a budget.

          In the end it's my issue for "firing up" and I shouldn't give a shit. Just accept there's differing options and ways to express them. 😉

          1. I meant to say Opinions, instead of options - you'd think by now I'd learn how to proof read in the allotted edit time. But NO!!!! I just read back what i wanted to say, and see the mistakes too late.

          2. Agreed. I post here because as the consumer I think Paul can learn a thing or two about how we make decisions and how we see audio from the other side of the fence. Paul never discusses pricing and value is a rather nebulous concept, but according to recent research by Qualcomm price and sound quality are equally the most important issues in audio decisions.

            Frankly, my situation is that I have an excellent relationship with a dealership, I get a personal service from a consultant who knows my house and my budget range and he knows to call is something crops up. I spoke to him today as he has an almost new trade-in mains conditioner that is a good upgrade for me. My wife loved the furniture in one of the listening rooms and the owner has given me the supplier details, so she's delighted as well. I know, or feel, I get the same treatment as customers spending 10 times as much.

            I get that people buy direct, but there is value to service as well as the product and I doubt Rs350z bought his Nissan unseen off a website.

            1. Thanks for the reply Steven.

              A big difference about the way you go about audio versus me is due the area you live in. Dealerships with-in walking distance and personal relationships being built.

              Where I’m at on this side of the pond - the closest dealer is a minimum of an hour away, assuming I can keep the Corolla averaging 65+ miles/hour. (I’ll let you do the km/hr conversion)

              So what that means is it’s hard to audition a big selection and even harder to get someone out on a routine basis. So people like me are in a different boat so to speak.

              That necessitates a completely different approach as to how to proceed with any equipment changes if I desired to. A speaker change is the most difficult in my book. You talked a bit about how you settled on your most recent choice. In some respects I’m jealous, in another respect I’m forced to become more self sufficient and reliant. Live in a larger metropolitan area and things become more doable your way. That all being said, the perspective for many in the US is changing because the number of brick and motor establishments is diminishing. Have you ever given any thought to how you would proceed if you were “stuck” in a similar situation?

  10. Hmm...seems to me not everybody is happy today.
    I kinda liked the picture of grandpa Paul (I'm a grandad myself, nothing wrong with that).
    The only thing missing for me was the prisoner plate in front of his chest 🙂
    But seriously, I do agree with dr. goodears. I don't like the mug shot. But we all know PmcG is addicted to attention; he likes to write, and talk, and write and talk some more...No greater pleasure for him (I think) than give a speech.
    As for today's post...I read some interesting things.
    I don't agree that appearance is not important. I would have preferred a photo of a nice woman instead of some middle aged/old men like on this site. Sells the products better.
    Then, Linn cheap ? Since when ? (e.g. network players euro 4,800 - 20,000, turntables 4,100 - 22,000).
    Then, "it’s Paul’s (PSA’s site) not ours"...does that mean we are not allowed to complain and PmcG can do whatever he wants ?
    Sure, technically he can. But is it wise to ignore what the readers (and potential customers !) want (back to black) ?
    After all, what is the reason he is writing on (t)his site. Just to please himself ? Maybe.
    It's my guess that PmvG is a nice man, but also very stubborn. I don't think he'll listen to these complaints. No changes made.
    Just like when I wrote some years ago about a mistake in a manual and PSA answered that they would change it. They never did.
    Today's topic :
    After decades in this hobby, it's my firm belief that you get what you pay for. Generally speaking, not always.
    Do PSA products have the "right" price ?
    Hard to say. Compared to some competitors they are relatively cheap, compared to others they are expensive.
    And after spending a few years with some of their products I can say they are not the most reliable, trouble-free I ever had.
    Probably due to poor quality control/testing. But I wrote that already some posts ago.
    And why is it that when I click on "cables" I get to see cables from another brand (AQ). Odd, to say the least.
    Because their own cables didn't work ?
    I had some PSA powercables in the past. The sound was okay, nothing special. Their greatest "virtue" was that they were as flexible as an iron rod. Pushed even a power amp from the shelves. Definitely too expensive.

    1. I am truly surprised at all the vitriol this post seems to have generated. Mystified is perhaps more to the point.

      JB4 seems to have me pictured as someone who has to have the spotlight on a continual basis. Kind of like a former president of this country. That put a smile on my face. I certainly never thought of myself as such, but maybe?

      As for the mug shot, are we referring to the little picture of my mug at the top of this page or the giant picture of me on the Paul's Post home page? The big one has to go. I hate it and as soon as we can get some programming resources freed up we'll get something else up instead.

      Lastly, I have no problem with criticism. I welcome it and hope for constructive criticism. My comment was (and is) one of surprise. As I said in my opening sentence, I am mystified as to what sparked what seems like a lot of anger amongst our family this morning. It just seemed out of the blue.

      Maybe I am being blind to the obvious.

      1. That must have been a Covid frustration or boredom package exploding today 😉
        Tomorrow is another day and as soon as the site upgrade is finished, things get normal again...I remember the riot after you upgraded the forum...quiet like the see shorty after 😉

        For today I recommend the AC/DC track „If you want blood“ to upset posters and Strauss‘ „Der Morgen“ with Jessye Norman and the Gewandhaus Orchestra for you.

  11. With respect to price discrimination, in 1979 my favourite marketing prof used to say

    “The worth of the thing is the price it will bring.”

    As to the font, resistance to change has been well documented over the years as well.

  12. For some companies, price can be a marketing concept. For others, a specific ratio to cost. For still others, a reaction to competition. However, to the consumer, it can also be an irrelevancy. For example, I've been researching 35 mm lenses for my camera and I happened to mention it to my brother, assuming he, being a practical accountant, would ask about the cost. Instead, he opined that no one uses such things anymore, given that cell phones have cameras built in. There is a parallel of course to the audio world, just as there is to cars, watches, wines, whatever.

  13. Good news for our Australian friends and totally on topic with today's post.
    Halcro (we all remember the brand from 2002) comes out with a new amplifier.
    Prices ? USD 39,990 for the stereo version, USD 69,990 for the mono blocks.
    And by the looks of it, they are worth every penny of it.

    And then one more thing.......
    Reading your 7:09 comment, I'm a bit disappointed with your somewhat sourpuss response, mr. mcGowan (ESPECIALLY the "Yikes")
    IMHO taking complaints and (mild) criticism seriously is part of your function. And maybe reconsider what you did.
    But then again, every family has its ...erm family problems. This hifi "family" seems to be no exception.

  14. Today's Post is so true. What makes matters worse is that reviewers hardly ever judge a smaller, cheaper product better-sounding than a bigger, more expensive one. It shows that most reviewers suffer the same price and size bias as most of us.

    1. Yes, that is so true also Joseph. Many reviews I have read qualify the positive comments with “at this price point” or something very similar. The strong inference being that if you spend more you’ll do better, it’s annoying. Who do the reviewers work for, the consumer or the manufacturer?
      From some of the other comments here it must be annoying Monday today.

  15. Remember folks, it is 4 parts corn flakes, one-eighth part poop. Get that formula out of balance and it's Yikes!!
    Woooooosaaah... deeeeep breaths..... Oooooooohm..... lavender incense....decaf..... one of those gummies in the back of your freezer.....maybe a dose of Yanni 🙂

  16. One of the nice things about audio shows is that in many cases you can walk in, sit down and listen without knowing the prices of what you're listening to. It's always helpful to have the prices available, of course, but not necessary for forming opinions. Descrete cards identifying products and their prices, and/or a list on the wall are very helpful. Naturally, some brands are easily identified, revealing a certain price range, but even then, there are often surprises.

  17. Paul,

    I think that you used the term "price discrimination" incorrectly from what you tried to communicate. Price gives you a bias and this is what you are trying to avoid.

    You should find work from Dan Ariely from Duke that describes the impact of price lists and other phenomena. He is not only entertaining, but brilliant. Ariely's work comes from the findings from Kahnemann. You should read him too.

    Today, the word "discrimination" has a very hot impact on people. I think this is what they are jumping to.

  18. Who is the former President that needed the spotlight? The one who answered all the questions unlike the current one who hides from reporters or cherry picks reporters who will be friendly to him? Staying in the spotlight during a pandemic and leading us through it answering questions from a biased hostile liberal media isn't exactly seeking the spotlight, it's leadership. It would be nice if sleepy Joe would come into the spotlight and be a leader but his administration is afraid of more blunders because he cannot speak without a teleprompter or staged questions that he knows ahead of time.

    You don't mean the one who was silenced by the liberal social media and silicone Valley after he left office? Or maybe that guy and his wife Michael who wire tapped campaigns and wouldn't shut their mouths for 4 years after they left?

    The current guy who is stumbling up airplane stairs and stumbling through speech won't last 4 years. I prefer the leader we had but the swamp establishment legally or illegally made sure he wasn't going to be there, but he will return in 2024 God willing.

    Nothing personal Paul, I'm just defending the man I voted for who you took an unfair shot at. Who was unfairly and unjustly demonized by the corrupt media for wanting what's good for this country instead of what's good for the globalists who sold us out and who control 95% of all media. He had many great accomplishments that the media ignores because they don't fit their propaganda narratives.

    I didn't vote for the President of the world, a world including China and corporations who exploit the Chinese employment slave trade that has been taking advantage of us for too long by stealing away our corporations and good paying jobs who were fleeing to a communist country due to liberal regulations and high taxes. It's ok for China to pollute because they are a developing nation they say. Bullshit it's because the profits for the globalist on wall street are higher there. Are we going to strengthen a communist country that stomps on the human rights of their own citizens or strengthen America and freedom for all around the world?

    Many see our former President through a propagandist prism manifested by the liberal media. Politics have been guided by media bullshit for too long. I don't see politics the way you do Paul, but I'm grateful I agree with most of your audiophile opinions and aside for disagreeing with you on politics I think you're a great guy. Our country and many other country's had the greatest economy the world ever saw until the China virus was unleashed on the world. Only China was doing bad and now they are doing great again. Touché!

    1. If the world economy is going to be based on the Chinese business model it won't be long before we are a communist country making those same kind of wages and without Constitutional rights. We are starting to see them attacking many of our rights already including the first amendment. China is flexing it's communist muscles on us and our bought off politicians. Why hasn't Eric Swalwell the Congressman from California who wants to take away our second amendment been forced to step down after it was found out he was sleeping with a Chinese spy and investigated by the FBI? Because most of them in the Congress are in bed with China for a trade policy that has been destroying our country while strengthening a communist dictatorship.

      1. Joe,
        Just remember that it was America that moved it's manufacturing over to China all those years ago, arrogantly believing that China would see the error of it's ways & magically turn itself into a democracy, & the stupid EU followed suit.
        Now America & the West have to dig itself out of the economic & political sh!t-pile that it has created with China: "What goes around, comes around"
        & that's a fact, Jack.

      2. Hey Joe, it hasn’t even been 100 days so relax a bit, will ya? Things are better than they’ve recently been (less noise, lies, manipulation, media frenzy, negativity, fear, riots).

        Joe’s gift is assembling a team giving them the rope they need to perform their responsibilities. Accountable to the result, not the ego of the President.

        The other side will do everything they can to upset this administration’s agenda as expected in politics. Ain’t it funny how an outspoken Democratic Governor of New York could come under such scrutiny in just the last 60 days. Why now?

        Stay tuned.

  19. very true.Yet there are many who are labouring under the false belief that they have the best simply because they paid a huge unrealistic price for their system.In fact this is the reason for prices which cannot be justified at all. Regarding being taken in by looks it is one of the selling points. Have you noticed how some turntables look like fancy lathes. Regards.

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