Wednesday, February 23, 2011

Cupcake, Coffee and a Condom for $4

Bob's the coffee shop at Grinnell College has a new offer a cupcake, coffee and a condom for $4. Sometimes goods are bundled so that people will buy more. For example suppose half of people at Grinnell will pay $2 for a cupcake and $1 for coffee and the other half will pay $1 for a cupcake and $2 for a coffee. If Bob's sells coffee or cupcakes for $2 a piece it will only sell each to half the students. If it bundles a coffee and a cupcake in a single value meal for $3 then everyone will buy it.

Now back to offering condoms as part of a bundle. Freakonomics has talked about a store that offers free condoms to anyone buying diapers. I also remember in the late 80s or early 90s a brand of hats that included a condom tucked in a pocket.

Now the problem at Grinnell is that we all learned in first orientation that condoms are free at the health center. However, Bob's is open hours the health center is not so willingness to pay goes up. If I recall though there are condom vending machines in the laundry rooms, so there is competition.

Of course the best part of crazy bundles is the press you get. Although I'm not if my post will increase sales at Bob's.

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