Austan Goolsbee worries that sellers have found ways to "trap" us. Branding is, of course, the name of the game. As sellers, we want to stand out from the crowd. Some succeed in standing out; others cannot. As buyers, many of us choose to become attached to a brand or a seller. Many choose the closer retailer and a spend few extra bucks. I have driven Toyotas all my life and choose that brand at the car rental desk for the obvious and simple reason that it will be an easier and simpler adaptation.
Albert Hirschman's Exit, Voice, Loyalty makes the point beautifully. When it comes to our shopping, we can complain (voice) or we can walk (exit) or we can choose to hang around -- all things considered (loyalty). It is always a three-option. game. What do sellers call the programs that Goolsbee worries about? Loyalty programs.
Switching away from comfortable brands can be hard. It carries the risk of moving into unexplored territory. Attitudes to risk-bearing, we know, vary tremendously among people.
Tech and platforms make loyalty programs possible. Goolsbee seemingly worries that all of this suggests a decline in competition and consumer choice. Or does he not like the choosing he sees? "Trap" is dramatic. But tech and platforms also give us a world of apps and choices.
How many choices do I have? And are they "good" or not so "good" choices? Do I see them as "good" or "bad". Or are third party observers the unhappy ones?
Most of us have great choices when we shop. It's not as good when we vote. Not surprisingly, we shop much more often than we vote. Shopping is where the interesting choices are. Clinton or Trump anyone? Feel trapped?