What a great concept! Richard Branson’s Virgin Galactic is launching a spaceship project where they’ll apply to space flight the principles from Open Source software development – ie shared development by community without the encumbrances of profitable ownership. Profit works best for some things, but in a space as innovative as space this is probably the best approach to get the job done faster. Space Kudos to Branson!
ABC’s reporting on how successful Head On has been: Six million tubes of wax at $6-8 per tube. Since the product obviously has no medical value, is this a marketing miracle? You bet it is! There’s a HeadOn sucker born every minute!
Let’s do the math:
Wax sells at about $2 per pound I’m sure HeadOn paid less but that number will do for now. That amounts to 12.5 cents per Ounce of wax.
HeadOn tubes have .2 oz of wax and a few tiny amounts of other effectively worthless ingredients. Thus their cost for the HeadOn itself is no greater than 2.5 cents per tube of HeadOn. Packaging and production costs? Let’s assume it’s 5 times the product cost, or 12.5 cents per tube.
Therefore a tube of HeadOn costs HeadOn approximately 15 cents.
HeadOn tubes sell for about $8, though there are discounts so let’s use $7 as the average sale proceeds per tube.
$7 proceeds from a $0.15 investment in the product and packaging! This is a markup of 46.67 times. A “four thousand six hundred sixty seven percent” markup. Microsoft Xbox 360 eat your heart out.
Their largest cost is likely the advertising campaign, but you can spend a lot for ads when your product is marked up over 46x your cost. I’ll try to find out more about what they spend on advertising later.
ABC Report:
With no science to back it up the ad was changed to stop implying (something?), though it seemed to me HeadOn has always been careful not to claim much of anything.
Cooling sensation may distract people from the pain. A doctor at the headache center suggests.
HeadOn claims to act homeopathically, with the wax containing tiny amounts of some homeopathic extractions . Homeopathy is one of the silliest and most ridiculous approaches to medicine, based on the notion that water imbued with unmeasureable amounts of substances has it’s molecular structure changed into powerfully curative “extractions” (hey, is there one to stop me from gagging on pseudo-science?) Like any quack remedy you’ll get placebo effects which have “real” curative powers.
The debate over quack cures is clouded by this placebo effect. Unlike real medicines which generally have potential side effects and rarely work in all cases, placebos, which only need the gullible participation of the user, can offer real relief, especially from minor symptoms.
I’m confident that HeadOn does nothing medical, but that does not mean it’s worthless.
However, prudent shoppers will choose my alterative “even better than HeadOn” emedy – one of those short stubby 29 cent Wal Mart Candles used for religious offerings. This will save you over $7 AND give you a religious infusion (but only if if you BE-LEEEEEVE!).
Send the $7 you saved vs buying a “real” tube of HeadOn to the charity of your choice, and you’ll not only get the benefit of the placebo effect you’ll actually do some good.
Non-disclaimer:
I have NO stock in Wal-Mart.
I don’t work at Wal-Mart.
Wal-Mart is NOT paying me to blog about Wal-Mart.
I don’t Work for Edelman, Wal-Mart’s Advertising Agency.
I’m not getting paid by Edelman to Blog about Wal-Mart.
I’m not getting paid by Wal-Mart to say I’m not getting paid by Edelman.
I did buy several gallons of paint and some brushes at Wal -Mart, and …
I plan to shop there … again.
Hey, I like Wal-Mart, mostly just for the selfish reason that they are convenient, open most of my waking hours, and have many products at very low prices. I also like the fact that it’s much easier to return things to Wal-Mart than to mom and pop shops.
I’m intrigued that none of the many Wal-Mart detractors I’ve read seems to come up with criticisms that take all factors into account. I want to see people in China, Canada, and Mexico working as well as my fellow Americans. Clearly Wal-Mart’s low pricing, somewhat low wages, and hyper-efficiency make products, and jobs, accessible to those who would otherwise have less. Does the Wal-Martification of commerce lower our averages here in the USA? Perhaps a bit, but not nearly as much as it raises them elsewhere. I’m happy to give up 10% of my standard of living so that India and China standards can rise by 50%. If somebody can direct me to a study showing that Wal-Mart *just looking at the USA job market* puts more people out of work than into work please let me know.
Yes, Wal Mart is going to put some businesses that would charge more for the same stuff out of business, but I think that’s part of the grand plan that’s been working well in the USA for over 225 years. I’ll take a Wal-Mart to a Kim-Jung-Il-Mart any day, any time.
With all the furor surrounding the disclosure that Wal-Mart, via Edelman, funded the “already planned” cross country trip by some bloggers you’d think they’d funded Bonnie and Clyde in a murderous rampage.
I reviewed the controversial blog (now taken down) using cached pages in Google and found it was not only tame, the blog was a high quality, nicely done travelog that reflected the spirit of the road and of American Travel. I’m sorry it’s been taken down!
I think I’m basically in agreement with the points made here by Andrew Young who *does* work for Wal-Mart.
Hey Andrew, when you have a minute can you mix a couple of cans of paint for me?
Whoops – he wound up resigning over wilted lettuce.
I’ll be shopping Wal-Mart, and guess what? So … will …. you.
Joe Duck 