If you’re going to charge me $23 a bottle for vodka instead of $9, shouldn’t the more expensive stuff taste at least twice as good?
One would like to think so.
But I recently held a blind taste test comparing super-luxury Grey Goose (I paid $22.99 for a bottle), a brand favored by conspicuous consumers, to another French vodka I happened to see in the liquor store—little-known Pinnacle.
Pinnacle’s cost? Just $8.99 a bottle. (That day there was a money-off voucher, too.)
My handful of tasters couldn’t tell much of a difference.
If anything, they slightly preferred … the cheaper stuff.
But do people pay more for an expensive brand of drink because it tastes better—or do they say it tastes better because they just spent a lot more for it? Liquor companies spend a fortune building brands. And brands, of course, are just a way of charging more for the same product. Two years ago a study by the American Association of Wine Economists (“Do More Expensive Wines Taste Better?”) found something similar even for wine.
The money quote: “Individuals who are unaware of the price do not derive more enjoyment from more expensive wine. In a sample of more than 6,000 blind tastings, we find that the correlation between price and overall rating is small and negative, suggesting that individuals on average enjoy more expensive wines slightly less.”
The bottom line? Expensive, luxury alcoholic drinks are a really great deal—for those in the business of selling them.
Full story: ROI: A Stock for Cheap Drinkers – WSJ.com
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