Selling Coals in Newcastle
Not long ago, we took our kids to Hershey Park in Hershey, Pa. We stayed at the Hershey Lodge, which is an official Hershey Park hotel.
My 5-year-old daughter, Anya, had heard from a schoolmate that Hershey Lodge gave away free Hershey bars — big ones — whenever you wanted and as many as you wanted. My wife and I were pretty sure that this was 5-year-old wishful gossip — but, lo and behold, we were handed four candy bars when we checked in, and when Anya went back to the registration desk five minutes later and asked for another couple of candy bars, they obliged.
As you can imagine, acquiring free candy bars soon became the favorite and most common activity of our stay.
Inside the hotel, there was a snack shop a few steps away from the main lobby. From my perspective, the shop had three noteworthy elements:
1. It had good Wi-Fi and lots of comfortable tables and chairs to sit with a computer. (This was important to me since I was actually on a reporting trip, which we married to a quick Hershey getaway.)
2. All the food and drinks in the shop were aggressively health-conscious: soy chips instead of potato chips, “natural” sodas instead of Coke, etc. I guess this fits in with the claim that chocolate is also good for you.
3. The strangest part was that the shop was selling Hershey bars, stacked up next to the cash registers. Granted, these were not the same standard bars available for free a few steps away — one was an “antioxidant” bar, the other a “whole bean” coffee-flavored bar — but still, I wondered how they could get away with selling something in one location that was free of charge a very short distance away.
The clerk was a nice teenage kid, so I asked him about it. “Yeah, nobody ever buys them,” he said, laughing. “Well, sometimes kids do because they don’t know about the free ones at the desk. Their parents never tell them.”
You’ve got to love a story that lumps together information asymmetry, price discrimination, and parental chicanery.