Continuously opining, intermittently publishing.

The Wedding Racket: A Response (Part 1)

Posted by oshane | Leave a comment at the end of this post.

The antecedent post at FaithFoundry is here.

The Market Analysis
Charles Revson of Revlon stated, “In the factory we make cosmetics, in the store we sell hope.”  See endnote α.

Clearly, as in other industries, a primary thrust of the business owner in the wedding industry is to sell hope to the couple.  This sentiment of salespeople everywhere is particularly powerful in industries where hope has been interwoven with tradition over centuries.  Specifically, what the couple hopes for on their wedding day is often preconceived, because traditions surrounding marriage are so old that they have become standards nearly unquestionable to the conscious mind.  A couple’s hope, therefore, is often a manifestation of the desire that those particular traditions will be fulfilled in a perfect way.  For example, how often does the bride in our culture want beforehand to wear blue jeans and a blouse?  Not only is she looking for a white wedding dress (the tradition), she aspires to find the perfect, most fitting, unique white dress which will cause all of her loved ones to awe in her beauty for the day (the hope).

Moreover, because marriage is so important and fundamental to the health of a family, which is the atomic unit of society, the couple already has a built-in hope that the wedding and celebration will be excellent as a predicate for an excellent marriage.  This is not necessarily a good proxy, but the hope is potent, because the wedding and celebration are precisely meant to be metaphors for the marriage itself.

With such hope already present as couples shop for services to plan their weddings, it does not take much to convince them of the high value of the enterprise of the wedding day.  Further, it takes only a little bit more to convince the couple that this high value is appropriately represented by the seller’s high prices.  Candidly, there is nothing wrong if both parties believe their contract represents a correct valuation to both of them.  But, hope certainly commands a premium on the services if not for the services themselves, because hope is a primary predicate for demand.

Another way to summarize this is to think of wedding planning as event planning for the most important life event that most people go through.  Because of the importance the buyers attach to the event, the seller commands a premium in exchange for the implicit (sometimes explicit) consideration that the wedding vendor will provide services and products with the utmost standard of care and high orienation to detail.  The catering will be ordered, accommodating to all food-allergies and quiet.  The flowers will be a certain species of Bird of Paradise and appropriate filler flowers of complementary color.  So on and so forth.

From the seller’s perspective, while some of the value is demand (hope) driven, some of the value is also a premium for the compensation of risk inherent in the hope.  If something goes wrong, there could be hell to pay to the couple, but if everything goes right the worrying about everything going right and the extra labor required to ensure a successful event requires such a premium.

Of course, we also tend to highly value beauty, design and prospect (“the view” of the mountains or ocean, etc).  Wedding venues, in order to serve as an appropriate metaphor for the aspirations of the couple and the couple’s loved ones about their marriage, often incorporate exquisite views or thoughtfully designed beauty.  If not, given the hope couples usually have for the representational effects of their wedding, they may be choosing a venue for convenience, which can also command a higher premium.  In fact, this premium is exacerbated or increased (vis-a-vis buyer or seller), especially because real property, land, is unique and not fungible (one thing of the same type is as good as another).  A ton of scrap metal is the same as another ton of scrap metal.  A wedding venue is not the same as any other.

Moreover, the market pricing signals for wedding planning are not as smooth and predictable as for other services or commodities.  People do not get married often enough to be able to iteratively judge value.  The lack of the number of signficant digits in pricing is indicative of this.  A venue might cost $5,000 (or the moral equivalent, $4,999), but were demand in society more pervasive and frequent, the market might make the pricing much more precise, e.g., $3,826.23.  Here, the risk the vendor is requiring for lack of pricing signals is $5,000 – $3,826.23.  More complexly, wedding vendors actually still do have more signals available to them (many customers constantly) than the buyer has (pricing from only several competing vendors one or a few times in her life), which means they will be able to extract a premium for buyer ignorance as well.  Of course, little of this is usually conscious to the seller or buyer, but is reflected in normal principles of human action, because pricing is often done intuitively until there are many many more pricing signals with which buyers and sellers interpolate.

The “racket”, thus, is the buyer’s  indignation arising from their intuitions that the vendors are extracting a premium based on their hope and ignorance.  Buyers usually concede to the rationality of premium-for-risk, which is why high cancellation penalties are usually not argued.  But, because the hope the buyer-couple has with respect to their marriage translates into expectations about their wedding, they easily conflate the two and can irrationally but intuitively respond to the seller’s premiums as profiting on their marriage.  No, the seller is rightfully profiting from the wedding, but it is so easy to mix the two up that it frustrates many couples looking to wed within a budget.

The market is amoral, but at least in a theoretically free market, the buyers have the choice to walk away from the deal before the contract is signed if they feel the value is asymmetric.  And with respect to the market only (as opposed to other non-economic considerations about weddings in the next upcoming post), frustration with pricing is an asymmetric internalization of value.  The buyer can be frustrated, “You want me to pay $35,000 for 40 seats in a boat house?  No.” and the seller can be frustrated, “You want me to provide my oceanview beachside mansion in Monterey for $500?  No.”  In both cases, the frustration is legitimate with respect to the individuals who are negotiating, because they perceive the value received does not equate to the value given in consideration.

Thought experiment: Couple finds the perfect wedding venue for $20,000 but only wants to spend $5,000. They may express frustration at the pricing for a value they just don’t perceive and chalk it up to the wedding racket.  Conversely, let’s say the couple’s demand-pricing is really elastic, and they are willing to pay $20,000 for a venue the vendor knows is usually worth $5,000.  He’ll be thrilled!  On the other hand, if Couple finds the perfect wedding venue but because of very low demand might be able to get it for $1,000 where its previous going rate was $20,000, the seller might resent the fact that they are “getting a steal while the same Couple in the first instance will stop complaining about “the wedding racket” and take the deal.

In a free market, again amoral (and justly so), resentments and thrills are always based on asymmetries of perceived value exacerbated by the underlying or circumstantial hopes that the buyers and sellers bring to the table.

α Stephen M. Feldman, Free Expression and Democracy in America 299 (U. Chi. Press 2008).

6 Responses to “The Wedding Racket: A Response (Part 1)”

  1. […] oshane:blog Continuously opining, intermittently publishing. « The Wedding Racket: A Response (Part 1) […]

  2. Gian Smith says:

    Hmmm… will someone be doing some pro-bono work drawing up wedding contracts between couples and vendors in the future? The world has too many divorce lawyers and not enough wedding agents. Make it so!

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