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The case against Buy 1 Take 1 Burger (or why it’s dangerous to favor price over value)

“Why would I buy that if I can get the same for a cheaper price with this brand?”

This was my mindset before. I applied it most of my life because I thought it gave me leverage. When eating out, buying appliances, buying gadgets. I just compared features & price. That’s it. I thought buying the more expensive brands was a scam because hey! There are a lot more cheaper options out there. And then I entered the world where value is more favored than the price. Then I felt I was the one who was scammed. My old mindset wasn’t so healthy at all.

I didn’t consider the more important stuff – value.

Buy 1 Take 1 burger!

Sadly, in our country, we’ve created a dangerous cycle where cheap is always favored. Businesses make cheap alternatives of their products. Then more people choose to buy these cheap products. In turn, other businesses try to compete by offering even cheaper products. Then people switch to these even cheaper options. Then the cycle goes on and on without us realizing that we’ve become hooked!

We start looking at the price tag and nothing else. Even if we can easily afford the more expensive brand. The sad thing is, we complain when we get what we paid for, thinking that we deserve more.

Take for example the case of the buy 1 take 1 burger. It’s cheap and we get 2 burgers for the price of 1. Not bad eh? But then we start to make fun of it: “Sa unang kagat, tinapay lahat” (At first bite, it’s all just bread). As if we deserve more for the price we paid (less than $1 for 2 burgers!). Others then offered a much cheaper option with the promise of more tasty burgers! Only for us to realize that they just added more flavoring to make it more tasty.

It won’t take a genius mind to figure out the math. Increasing cost of operation/production, cheaper product? Something has to be taken away to reach that ridiculously low price tag.

Don’t get me wrong. It’s ok to sell cheap products & services. Especially if we consider our economic situation. What’s not good though is that we made the system so dangerous that even those who can afford are starting to look for cheaper options.

The danger of the cheap cycle

The danger of being trapped in the cheap cycle is that businesses have to take away some form of value from the product/service. Thus, if they want to offer the same features, the quality of the product or the service has to be sacrificed in some way.

Further, because the price has become so low, there is no way to add any more value to it. They just can’t! Otherwise, what’s the point of staying in business if they keep losing money.

Then the competition start to evolve based on price and not on value. Businesses start to flood the market with cheaper and cheaper products/services because people will keep looking for cheaper options. Other businesses are either forced to compete based on price or risk losing a fair share of the market. New and emerging businesses will have difficulty taking off because they are also forced to compete in price based market. The price margins have become so thin that value has become almost none.

Not too long ago, I was looking for an IPS monitor for my computer. I wanted a bigger screen because of my line of work. Of course, this type of monitor tend to be more expensive. But lo and behold! While browsing online, I found this very cheap (less than $50), 27″ curved IPS gaming monitor. I thought it was a real steal! I checked the website and they do have one (although it reeks of a generic, free WordPress theme that’s just made to look pretty with graphics). I bought it online without hesitation. I was so thrilled when I got it. I set it up, plugged it in and oh boy! The colors are so alive! I was like a kid in a candy store while I opened my apps to appreciate how cool everything looked. Then not more than 15 minutes of browsing it suddenly flickered. Tried to fix all the connections but it’s still flickering. I tried my old monitor to make sure that it’s not my computer’s graphics card and it worked. I tried to turn on the new monitor by itself, without it being connected to the computer and it indeed is broken.

I contacted the store, confident that they would replace the monitor. Obviously, I deserve a replacement because it’s still way within the warranty period. But guess what, it took me 2 days of arguing with the store before they could give me my refund! They had so many excuses like they have no stock because that model was end of line. That they will have to order the parts and it will take time. That I can replace it with another model (which is more expensive) so I just have to add more money. That it will take time to refund because of their ‘system’ that needs some verification from who knows who. If I hadn’t threatened to report them, they would not have given me back my money. In the end, I got my money back and I bought a more expensive monitor from a more trusted brand.

Because the monitor brand is so cheap, the quality of their product was really bad. I learned later on in the forums that so many people had the same experience. And that they are recommending others to avoid it at all cost. Not only that, even their after sales service is so bad. People tell stories of having to wait for their replacement or repaired units for months! And that they only get the replacement after weeks of arguing and threatening.

Imagine the stress that people had to go through. Just because they bought something cheap. The product has very little value. And the store/manufacturer can’t add more value in the form of support service because they can’t afford it anymore. The scary thing is that this brand is still in the market. Some selling it with headlines like “Di kailangan bumili ng mahal para magka-gaming monitor” (No need to spend more to afford a gaming monitor).

Sadly, this is becoming the theme of ad headlines especially in the online marketplace. And there are a lot more cases of these cheap products and services. Name it, and most likely you’ll find a very cheap alternative. Cooked food, catering services, mobile phones, computers, gadgets, appliances, photo editing services, graphic design, website development, video editing, tutorial services, music lessons, marketing lessons, freelancing lessons. All cheap. But where is the value? Where is the business-customer relationship? Where is the after sales support? The quality? The peace of mind?

Go ahead. Ask the one who sells buy 1 take 1 burger for less than $1 to add mustard to your burger. Ask the store about the benefits and other after sales service of that $40 mobile phone your looking to buy. Ask the person who’s doing graphics & photo editing service for $0.20 to make the design not look like everyone else’s (or try to ask them to revise twice). Ask the person who does video editing for $2 per hour to help you speak your brand or tell your story in the video. Ask the business that offers music lessons for $4 when are you going to have a live tutorial session. Ask the person who offers marketing & freelancing lessons for $5 when are you going to have 1-on-1 coaching so you can ask questions.

You get what you pay for.

Then we read in the reviews & comments. “Madaling masira” (broke easily), “ang pangit ng gawa” (it doesn’t look good), “ibalik nyo ang pera ko” (give my money back). We expected value but the business can’t give it because they can’t afford it themselves.

“Di bale na’ng konti ang kita basta madami” (it’s ok if the profit is not big as long as it’s a lot). Suddenly we realize that this mindset is not sustainable. There’s no more room for growth because the margin is too slim.

Burger the way I want it

Luckily for us, people like Simon Sinek, Ramit Sethi, Seth Godin laid out a solution for this. If you’re a business or somebody who’s struggling to compete in a price based market, this solution might seem odd. But based on historical events, it seems to work.

Don’t focus too much on the competition but focus within. The idea is for you to identify your purpose (or the purpose of your business). This is your deeper why and it should dictate the actions of your business.

Why do you have the business? What’s the purpose? Who are you going to help? Why are you helping them? How are you going to help them?

When you let your business revolve around this purpose, you will attract people who share the same belief as you. Not only that, the people you attract are the right fit and they will stay loyal to you. You will then begin to build a community who share the same beliefs as you.

The thing is, when you find your purpose and act around it (instead of competing), it’s not just about the price anymore. It’s about delivering value. Simon Sinek discussed this intensively in his book “Start With Why”.

When I started my coffee business, my purpose was to promote the local coffee. Batangas was the most accessible province to me so I reached out to the farmers there with the help of my former colleague’s mother. I learned about the struggles of the farmers to produce and sell Barako coffee (Liberica). The coffee variety was almost at the brink of extinction. One of the reasons is that people prefer the other coffee varieties. The farmers couldn’t sell Liberica coffee for what it’s really worth. So they started to replace the Liberica coffee with other varieties.

When I learned about this, I changed to goal of my coffee business to helping the coffee farmers and help the Liberica coffee to be valued as it should be. It was a difficult journey for the business simply because there are cheaper options. Not to mention that people (at least in my country) preferred the other coffee varieties.

A few months of trying to keep the business afloat went on. Then somebody who share the same mission as I have found my business (through my sister). He was also advocating to help coffee farmers and introduce lesser known coffee varieties. The only difference is that his business already has a considerable following. We started to work together and a whole new world of coffee enthusiasts who share the same visions as we do opened up for me.

It’s not the coffee that bridged me to this world and moved the business forward. It’s the purpose why the business was built.

The values that you have will attract the right kind of people to your business. And when you firmly believe in your purpose, you don’t have to compete based on price. You will instead, commit to deliver value (and sometimes add even more value). The right people who share the same belief as you will choose you even when there are cheaper options. They will then attract even more people. Suddenly a community based on those same beliefs is built.

And when value becomes more favored than the price, the cycle of cheap is broken.

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