When the Top Dog Isn't Tops

摘要

Buying the stock of industry leaders doesn't always create best-in-show returns. Why looking further down the line might pay off. IT PAYS TO BUY THE BEST, I OFTEN HEAR, but I usually prefer second- or third-best. Corporate pricing strategists like to use tiered product lines to collect maximum sales from diverse customers: ones who can't pay much, ones who'll pay plenty only if they get good value and ones who don't especially care about price - more the impetuous than the rich. Gillette, for example, sells a low-end, serviceable two-blade razor, a much better three-blader, a barely better but much more expensive five-blader, and a comically overdesigned five-blader with an "onboard microchip," not to mention an onboard battery like those sold by corporate sibling Duracell. I'll stick with three unpowered blades, thanks. Also, give me the car wash without the wax, the just-shy-of-signature dress shirts and that $30 syrah beckoning from halfway down the wine list.