Glenn is embarrassed about how he handled a gay couple earlier in the episode and he seeks Mateo’s help in trying to differentiate their product offering by providing a section tailored to gay weddings. Even though Mateo points out that it’s the same as s straight wedding, Glenn is convinced they should setup a section specific to gay weddings. Product differentiation is a characteristic of monopolistically competitive firms. By offering a specific section of the store to one group of people, Cloud 9 can set themselves apart from other retailers.
Tag: product differentiation
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You Never See That
Adam has a YouTube channel where he shows people how to cook, but how does he differentiate himself from all of the other YouTube shows out there? His episodes are done in real time, which means that while his ribs are cooking for 2 hours, he just stands there and waits. He hates when shows just cut to the end and the meat is fully cooked. Jonah and Adam both remark that they never see that online, which implies that’s probably not really a feature people want.
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Get the Better Bike
Garret is in the process of convincing a customer to purchase a more expensive bike, the Vilano Forza, but the customer wants the cheaper RX-5 bike. Price isn’t the only determinant of a consumer’s utility function and Garret tries to convince the customer that the other features of the bike are worth the price. To end the scene, Garret also tries to get the customer to buy a bicycle helmet, which is a good example of a complementary good.
A customer is having trouble identifying a new toothbrush to help with his tartar problem. With all the options available, some companies advertise as being good at fighting plaque while others focus on tartar prevention. When consumers have a lot of options, it’s sometimes hard to fully consider the tradeoffs. This paradox of choice can explain why some people don’t behave rationally when presented with a seemingly overwhelming number of options.
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Señor Cloud Salsa
Cloud 9 has developed their own brand of salsa called Señor Cloud Salsa. In an attempt to seem more authentic, the store manager is looking for employees to offer samples to customers. Glenn believes this will be a key selling point that differentiates their store brand from more recognizable substitutes in the store. Successful product differentiation gives firms some market power and the ability to charge a price greater than marginal cost.
Teaching with Superstore 