What’s a way to make online shopping more appealing to game theorists? Make it a lottery, of course! For 10 USD, SomethingStore.com will send you . . . something. According to their website, the company will send you something randomly chosen from their inventory. They make no guarantee of suitability or value, or even that your "something" is brand new. Of course, the majority (I would venture, a vast majority) of their inventory would have to be less than $10 in value in order for this to be profitable at all, but part of what the customer is paying for, presumably, is the fun of playing the game.
This is either the best idea ever or the worst idea ever–I guess it depends on the density of risk-seekers among the general online-shopping population. The risk adverse, of course, are probably not the target demographic of a store such as this; nor are the risk neutral, if the distribution of values of products in their inventory is what I imagine it to be.
Now, I am not risk seeking, but I would love to know if the risk seekers out there would actually go for this–thoughts?
The price also is a factor here – 10 USD is worth spending for the sheer excitement of finding something totally unexpected in the mail. More than $10 and the website might find fewer takers. I personally would be willing to spend 10 USD, but definitely not 15 USD – even 12 might make me think twice.
For me, this is an appealing impulse buy, but if I allow myself the time to actually calculate my reservation price, I find that it’s probably closer at $7.50. Ten dollars is just slightly too high. If they charged for shipping, I wouldn’t even consider it.
When I was younger and collected random collectables (comics or trading cards), many comic book shops would offer grab bags at a reasonable price and advertise that some valuable comics were in there. It was a way for them to clear out the garbage while giving state-based lottery odds (or worse) to win big.
This almost has to operate on the same system to be profitable. Sell discounted/liquidated merchandise while maybe advertising some good items. If you are lucky, even the liquidated items will be valued higher than their actual worth since the consumer has less than perfect information.