Harry Potter and the Deathly Hollows: Which Version Do You Want?
During the last decade, multiple generations have had a common addiction. Do you remember your excitement when a new Harry Potter book was about to be released? Those were the good old times of impatiently awaiting the release date for months, and then finishing the new volume within two days. However, which version of the books did you buy? Were you determined to obtain an adult version of the book, or a children’s version? And how much did you pay for it? Did you pay any attention to the price difference between the books?
One might wonder how it is even possible that the adult and children’s version differ in price. After all, the only differences between those versions are the covers and the fonts that are used (Difference Between, 2014). More specifically, the children’s version has a cover of colourful illustrations, whereas the adult version has a more sophisticated cover with darker colours (Difference Between, 2014). Furthermore, the font of the children’s version is larger than the adult’s version. But is this really enough to charge Harry Potter fans a different price?
The answer to this question lies in that books in general, and therefore also the Harry Potter books, are information goods. Information goods are goods that are easy to replicate, and easy to distribute (Li, 2014). A concept that is related to information goods, is the versioning of information goods. The versioning of goods, in this case books, entails that different prices are charged for essentially the same products, which is also called vertical differentiation (Bhargava & Choudhary, 2001; Li, 2014). In this case, the publisher of the Harry Potter books (Bloomsbury) offers its consumers two versions (adult and children) of the same Harry Potter book. Then, the consumers can choose themselves which of the versions satisfy their personal needs. Yet, by means of this self-selection, the publishers uncover the customers’ willingness to pay for a different version (second-degree price discrimination) (Li, 2014). Hence, the publisher can obtain valuable information about the type of customers from the Harry Potter book sales, which can then in turn be used for marketing etc.
Having read this blog, the next time when you will buy a (Harry Potter) book, you will be aware of the business tactics that underlie the book assortment.
Bhargava, H., Choudhary, V. (2001). ‘Information Goods and Vertical Differentiation’. Journal of Management Information Systems. Volume 18, Number 2, pp. 89-106.
Difference Between. (2014). ‘Difference Between Harry Potter Series for Kids and Adults’. Difference Between. Available from: http://www.differencebetween.net/miscellaneous/entertainment-miscellaneous/difference-between-harry-potter-series-for-kids-and-adults/
[Accessed on: 12 October 2014.]
Li, T. (2014). ‘Slides Lecture 6: Information Goods’.