BAIT & SWITCH – NOW FOR THE RICH

Bait & Switch is an illicit merchant's tactic: advertising a low price to get consumers into the store, and then switching them to high-priced merchandise.

It works like this –

Mrs. Poor reads an ad promoting $19 loafers. She goes to the store to get a bargain, only to be told, "We're sorry, but that shoe is now out of stock" (at 9:30 a.m. the day of the sale). The clerk then swiftly pops up with a box of $39 shoes, "which are far higher quality."

The poor are too often victimized.

But now clever retailers have found a way to pull a reverse Bait & Switch on "Mrs. Rich and Well-Educated."

How does it work?

A high-end store advertises a highly desirable, but outlandishly priced, piece of merchandise. Mrs. Rich comes to the store and sighs longingly over the beautiful object. But then reality rears its ugly head, so she decides to look at "more reasonably priced" goods.

What at first glance appeared overpriced now seems comparatively affordable. She buys a lower-cost item that she would have considered too expensive before entering the store. She has been sold up by being switched down from the stratosphere.

Bait & Switch for the Rich started in the 1950s, when an astute Cadillac dealer placed a bright red Cadillac convertible in his showroom window. The number of customers who came in, attracted by the flashy car, broke all previous records.

The expensive red convertible never sold, but the dealer moved a ton of lesser-priced sedans. The word of his success spread and soon all Cadillac dealers were displaying sexy convertibles in their showrooms. Red, yellow, pink – anything to attract attention and traffic. Cadillac sold record numbers of high priced cars, mostly Coupe de Villes and Sedan de Villes.

General Motors hired the famous Freudian psychological researcher, Dr. Ernest Dichter, to interview buyers and unlock the secret of Cadillac's success. After he completed his study, Dr. Dichter reported:

"The phenomenon is sexually based. To the buyer, the convertible is a sexy mistress. He is attracted to the showroom by his lust for the mistress. But once in the showroom, reality intrudes. And he goes home with a wife. To him, the sedan is the wife."

The modern version is the Aston Martin or Bentley dealer who plants a sexy and expensive convertible in his showroom, to move his customer into the lust for sex and the stratosphere of price, before he thinks rationally and goes home with a wife – or sedan.

Bait & Switch for the Rich has spread well beyond the auto industry.

Ralph Lauren displays a $14,000 handbag, which tricks the buyer's values into believing a $300 sweater is reasonably priced. Designer sunglasses at $300 encourage customers to think of a $49 pair as "affordable."

A pair of black Prada pants seems sensible at $500 ... after you spend an hour ogling alternative choices priced at $2,900. Coach has enjoyed great success by putting an ultra-desirable, stratospherically priced handbag on display ... surrounded by its lower-priced siblings, who are designed to be popped into shopping bags for a sedan ride home.

Designer jeans surrounded by Levi's move more Levi's than Levi's displayed by themselves. Tiffany diamond engagement rings move a lot of sterling silver key rings and charm bracelets.

Some astute merchandisers can move consumers up and then down by simply adjusting the environment. A few decades ago, Johnson & Johnson had difficulty selling cotton balls, which were stocked in drugstores' paper goods section. When an astute salesman moved the product to the cosmetics section, sales of cotton balls took off. While the product had looked expensive next to toilet tissue, it seemed "reasonable" next to cosmetics.

One of the reasons the original Sears failed was its inability to "get tens of millions of women to cross one aisle to buy a dress." The price image of a Sears dress was set too low.

Walmart has experienced the same difficulty. Its "cheap, cheap" image sets the psychological pricing bar for women's fashion much too low. Why would a woman lust for fashion in a store she knows best as a "low-priced men's underwear" emporium? How do you travel down from "four for $7.00"?

A Tiffany image is not required to execute Bait & Switch for the Rich.

Look at Harley-Davidson. A decade or so ago, a popular joke ran, "What's the difference between a Harley and a Hoover? With the Harley, the dirtbag is on the outside."

Yet Harley's hard-edged image has become extremely popular with business types. Many will spend an hour drooling over a $22,000 chopper, only to walk out with a black motorcycle jacket or – at the very least – some leather gloves.

Bait & Switch for the Rich is like traveling down the up escalator.

It may not seem logical, but it works like a Tiffany charm for the merchant.

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