The present and future of post production business and technology | Philip Hodgetts

Jun/10

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Add a story to a near worthless trinket makes it more expensive!

Add a story to a near worthless trinket on eBay and it sells for more! http://bit.ly/dj5JAe

A great followup story to the earlier post today on Paypal and the future of Media this study shows how attaching a “story” to a near-worthless trinket increased the value significantly. They got higher bids on eBay than other similar items.

This is a near-perfect analogy of how giving fans a reason to buy (something) using the infinite digital good (the music, movie or TV show in download form) works.

The “story” was given away for free, but the object cost money. What those involved in the project quickly found was that these worthless trinkets were suddenly selling for a lot more than their nominal “price.” It was a perfect example of how an infinite good (the story), when properly attached to a scarce good (the trinket), can make that scarce good much more valuable. This is a point that many have trouble grasping. They think, when we discuss the economics of infinite and scarce goods, that the price on scarce goods always remains the same, and never seem to take into account how a connected infinite good can greatly raise the value and the price of a scarce good. A hit song (infinite) heard by millions increases the price of a concert tickets (scarce). A brilliant blog post (infinite) can increase the price of a consultant (scarce) who wrote it. A sterling reputation (infinite) for an automobile company can increase the price of the cars (scarce) they sell. It goes on and on and on.

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