I do not like shopping for clothes. However, I do enjoy purchasing and wearing T-shirts produced by Life Is Good. I am sure that you have seen these quirky shirts with either a screen print of a stick figure named Jake or his dog Rocket. The Life Is Good T-shirts retail for around $25.
I have alternatives to the Life Is Good T-shirt. However, I didn't think twice paying $25. I actually enjoyed the transaction and I profited because I valued the shirt more than $25. There must be many more people like me because Life Is Good has grown from $80,000 in sales in 1994 to a projected $55M this year. To read an article on the company click here.
As consumers we often look at transactions through a periscope instead of through binoculars. Our periscope view analyzes the cost to produce an item less the price being charged, or seller's profit. A binocular view includes the other side of the transaction, buyer's profit.
In the firm it is vital for us to understand that transactions are not zero sum games. We need to use our binoculars and not our periscope. To create real long-term value, both the buyer and the seller have to profit.
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