JC Penney tried what will probably be the last experiment in fair pricing for a while. Highlights from Bob Sullivan include:

• JC Penney started a new advertising campaign where they would no longer have confusing multiple markdowns, coupons, 99 cents at the end of price tags, and hundreds of sales a year.
• The pitch was that JC Penney was becoming honest with its pricing. The hope was to make JC Penney less of a commodity clothes vendor and more of an honest shopping centre that would attract customers who would appreciate JC Penney’s honesty and respect.
• Revenues have dropped 20% this quarters, traffic has fallen 10%, and the company went from making a profit to a loss.
• The former Apple executive who launched this system didn’t understand human psychology. People enjoy the thrill of the hunt, and the ability to find bargains amid all the disinformation and gimmicks that clothing retailers sow.
• When Intercontinental Hotels tried a similar strategy of honest, up-front pricing it also failed. Customers kept away from the chain and instead went to hotels that had deliberately misleading and low advertised rates.
• Southwest airlines with its no additional fees for checked baggage is also similar although there are signs that it will soon eliminate that policy – there is too much money to be made by advertising low rates.

To read more about the failed experiment, what it means for consumerism, why this is depressing, how printers can help us to understand the market, why Ellen DeGeneres is not at fault, what shrouding means, and why educating customers is a bad thing for retailers, click here.

Source: MSNBC

Via: Marginal Revolution

After the New York Times published an exposé that wiped $12 billion out of Wal-Mart’s book-value Felix Salmon wondered if there was a way for the New York Times to make money from this:

• The newspaper could offer a service where big-name hedge funds could pay to get early access to news stories, letting them take advantage of stories that can move the market.
• This is ethical. Other news organizations such as Reuters gives early access to well-paying customers.
• One problem is that whistle-blowers could potentially be persecuted as inside-traders if newspapers were to engage in such a practice.

To read more including the multitude of people that help write an article, why journalism is increasingly being done by people who have an interest in the stories they’re writing, and how such a process would work operationally, click here.

Source: Reuters

Via: Freakonomics

Hugh Merwin took a look at the recent history of the word ‘artisan’ to conclude that it has become meaningless. Highlights include:

• In the 16^th century the term ‘artisan’ wasn’t a compliment. It meant that you did your job and weren’t of much importance. Over time it evolved though.
• In 2001 the New York Times awarded a restaurant called Artisanal two stars. This was the beginning of the end.
• In 2006 Quizno’s and Wendy’s became the first fast-food restaurants to co-opt the term ‘artisan’ to describe their breads in an attempt to compete with Subway.
• In 2007 Starbucks became the biggest chain to use the term to describe their chocolates and then their breakfast.
• The term ‘artisan’ was formally declared dead by Merwin, in 2011, when Burger King used the term to describe its Chef’s Choice Burger. Burger King was using a term that royalty would originally scoff upon.

To read more about the timeline of the word, the role that Dominos and Panera played in its demise, what artisan tortilla chips taste like, the person who warned of the looming problem, and what Benjamin Franklin had to say about artisans, click here.

Source: New York Magazine

Via: Newmark’s Door

Michael Clemens reports on some fascinating numbers coming from sub-Saharan African countries:

• Child death across these countries are in decline.
• Not only are the numbers declining – the rate of decline has massively accelerated in the past few years.
• Senegal tops the list. The country went from 121 under-5 deaths per 1000 births in 2005 to 72 in 2010, a decline of almost 10%.
• This is a very recent trend. It only started to happen in the second half of the decade.

To read where you can find these numbers, why this is awesome news, why the numbers are so stunning, and how this relates to the Millennium Development Goals, click here.

Source: Center for Global Development

Via: Marginal Revolution

Ken Auletta took a comprehensive look at Stanford University, its recent history, and its management. He found that there was a slightly troubling relationship between Stanford and Silicon Valley. Highlights include:

• Notable names such as Eric Schmidt of Google often mingle with the students and make appearances in some of the classes.
• Stanford is in many ways the farm that produces the engineers that Silicon Valley harvests. 5% of Google’s employees are graduates of Stanford. Stanford proudly states that companies that can be traced to the university include: Hewlett-Packard, Yahoo, Cisco Systems, Sun Microsystems, eBay, Netflix, Electronic Arts, Intuit, Fairchild Semiconductor, Agilent Technologies, Silicon Graphics, LinkedIn, and E*Trade.
• One former dean believes that this close relationship between education and industry mirrors the history of Stanford itself. It was formed while the gold rush was still on going, and just a few decades after California had actually become a state. The university had to attract pioneers who were willing to challenge established norms, and were willing to work with business.
• Faculty at Stanford frequently invest in the start-ups of their students. Auletta reckons that there are more millionaire faculty in Stanford than at any other university in the world.
• The wealth that is generated by Silicon Valley often comes back to Stanford. In the past seven years Stanford has raised more money than any other university. After Google went public, for example, it made over 300 million dollars.
• More than half of all Stanford Graduate students are engineers. At Harvard it’s just 10%.
• The current President of Harvard sits on the board for Google. People have criticized this because it encourages university faculty to make pro-Google decisions in an effort to please the President.

To read many more details, including why Tiger Woods remained unknown at Stanford, the ways that Google has tried to influence the university, why Stanford won’t be opening a New York campus, how HP got its start, the diversity at Stanford, the threat that online learning may pose, and the innovative T-student model, click here.

Source: New Yorker

Via: Freakonomics