I needed some allergy medicine the other day. Normally I would use diphenhydramine (the active ingredient in the overpriced Benadryl) but I also planned to enjoy some alcohol that day and I didn’t want to mix the two. So I went shopping for loratadine (the active ingredient in the overpriced Claritin).
You can probably tell that I am not in favor of brand name over the counter medicines. They are way overpriced. Which is why I went shopping for loratadine and not Claritin. But even I was surprised by what I saw on the shelf at Target.
The branded drug is nearly 4 times as expensive as the store brand!
There are many legitimate criticisms of this pricing.
- There are moral arguments against marketing practices that sucker people into buying something they don’t need. I’ve written about that here. In case you’re wondering, I’m not accusing anyone here of trying to sell allergy medicine to people who don’t need it. I am accusing the Claritin folks of trying to sucker consumers out of $13.90. Yes, they need the medicine, but the $4.99 package from Target will deliver exactly the same relief as the $18.89 package from Claritin.
- There are professional arguments against the sort of marketing that Claritin is engaged in. I have written about that here.
And yes, there is an economic argument in favor of Claritin’s pricing. From a strict economic perspective, they should charge what they can get. Clearly, some consumers are willing to pay for this product. They believe the extra $13.90 they are spending is worth it for whatever reason.
But I’m not here right now to make any of those arguments. Instead, I want to touch on another subject – one I have written about here. I am addressing myself not to some faceless corporation, but to you – an employee. An individual human being.
Let’s leave aside any moral question about price gouging. Let’s assume that it’s totally OK to hoodwink people into believing that your product is worth more than it really is. Let’s ignore classical pricing theory. Instead, let’s focus on a simple question:
Is this how you want to earn your living?
Do you really want to spend your working day – most of your waking hours – figuring out how to persuade people to spend $18.89 on something they could buy for $4.99??? Sure, there is an intellectual thrill involved in such work. Sure, there is a sense of accomplishment in separating people from their money with wit rather than a gun. But is that really how you want to earn your living?
There is another road you could take. Instead of trying to convince people that loratadine in a Claritin box is worth almost 4 times as much as loratadine in another box, you could instead focus your energies on creating, marketing and selling an offering that actually is worth 4 times as much. You could focus on the needs of others for life-changing medicines rather than on your own need for profit.
When you go home at night to your family and tell your kids what you do, what do you want to tell them? That you spend your day hoodwinking people or helping people?
When you’re lying on your deathbed and reflecting on the life you lived, what will give you more satisfaction? The number of people you cheated and the profits you earned, or the number of lives you improved?
Think about it.
