Idea: 4
Sunday, 04 January 2015
By. Louis Anslow and Paul Sawaya
Alleviate
Price goods based on a person’s income. Alleviate is a payment network, like Affirm, but instead of offering consumers deferred payments, it offers them price discounts based on their income. Companies benefit from legal price discrimination, a respectable channel for liquidating excess inventory, and goodwill from positive perception. Society benefits from non-governmental poverty alleviation.
In the discussion thread for Idea #2 (“Potluck” — Simple.com for insurance), Paul Sawaya mentioned Affirm. I checked it out and was really impressed. Basically Affirm gives consumers credit, by letting them purchase goods on websites up-front, but pay for them over time in installments. Paul used their model as an example of a company assessing a consumer’s credit risk based on data from social media, and the ethical questions that raises.
In the discussion thread for Idea #3 (“Backdoor” — Priceline/Groupon but with an NDA), Louis Anslow wrote:
Couldn’t this same concept be applied to help alleviate poverty? I am assuming companies would rather throw unsold food out rather than ruin their brand and pricing power by selling at a steep discount. But I have always wondered why companies couldn’t price goods based on a person’s income. They would benefit from good press and make money. I am pretty passionate about non-governmental welfare ideas.
I wonder if, in a cashless society — where all income and expenditure is tracked — everyone will be presented with a different price for items? Companies do it based on web browsers now! Offering lower prices for users of Internet Explorer and higher prices for those using Safari.
Great points guys. So, I did some research. It seems that price discrimination is primarily an anti-trust concern, but that if it is done to match a competitor’s pricing, or in good-faith, it isn’t illegal. On this we’ll benefit from a lawyer’s thoughts. What if something like Affirm, a payment network, existed, except that, instead of offering consumers the ability to pay in installments, it offered consumers lower prices based on income and net worth. And companies a way to liquidate excess inventory, while not only saving face, but look good doing it.
What do you think?
