The merchandise in the Black Card store has been a welcome change - you can now get 60" TVs, Aeron chairs, 30" monitors, Macbook Pros, Tumi Luggage, and even a Range Rover for your FT points. Unfortunately, since they started offering cash bonuses, it pretty makes offering a lot of these items useless. That's because it's cheaper to get the cash award and just buy the item yourself.
For the $5K cash bonus, you get $4.55 per 1000 points ($4.35 for the $2K bonus and $4.17 for the $1K). The Apple Macbook thru Amazon (with shipping) gives you $3.96 of value per 1000 points. The Sony 60" TV thru a number of places (with shipping) gives you $3.66 of value. See what I'm getting at? You get 10-24% more "bonus" by just getting the cash. I don't see what the point of having items in the store is, if they are going to be priced so that no one is going to buy it.
The only reason to get a merchandise thru the store is if your rate of play (to earn the cash reward) is so slow that it would take you much longer to get the cash (and subsequently buy the item yourself) than the 4-8 weeks it takes to get that item from the store (assuming getting the item "quickly" was more important than getting value). And this assumes you are some kind of busto with no money or a credit card who didn't have the means to purchase it otherwise. The only people who should want to get merchandise thru the store are people planning to move to Stars (or another site), so they do not want to "work off" a cash bonus.
Merchandise in the Black Card store need to be cheaper. If some mom and pop internet store front can negotiate with a large manufacturer to drop-ship items to its customers (and make a decent profit), I don't see why FT couldn't use its leverage to negotiate a good rate. I think there's more than enough room for the Store to be a profit center, but I've suspected for a while that there's a lot of inefficiency there. Granted, the Black Card program is new and they obviously haven't thought everything thru. I think other changes are supposed to be coming soon, so it should be an interesting few months.
WHAT'S FOR DINNER?
Mrs. Fly's interpretation of Korean bibimbop and her 10 hour beef broth. We got all the veggie ingredients at the Asian supermarket and it's a very quick and tasty meal. Basically it's a whole bunch of marinated vegetables, a little beef, egg all mixed with some red pepper paste. A Korean staple.
The broth is a work of art. Mrs. Fly befriends the local butchers and fishmongers. Mrs. Fly was going to use ox tails for the soup, but the butcher suggested to her that we should consider using neck bones (cheaper and just as tasty). Ox tail is one of my favorites, but the neck bones was a nice change of pace. Anyway, she put both ox tails and neck bones and simmered for 10 hours. TEN HOURS. Pretty much every ounce of flavor was extracted, and it was preeeety good on a chilly day.
Mrs. Fly's interpretation of Korean bibimbop and her 10 hour beef broth. We got all the veggie ingredients at the Asian supermarket and it's a very quick and tasty meal. Basically it's a whole bunch of marinated vegetables, a little beef, egg all mixed with some red pepper paste. A Korean staple.
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This interesting phenomenon is not new to the Black Card store, it's been that way in the regular FTP store (where the rate on electronics was way worse than tourney entries) and in the PokerStars store for sub-Supernova members, or prior to the Supernova overhaul. And most other older sites, too.
ReplyDeleteI think there are two economic/psychological effects you failed to mention that allow the poker sites to perhaps profitably have a markup in their store on merch over cash equivalents:
1) People like to be able to point to a tangible item and tell their friends "I got that for free, just by playing poker". So if I want a certain TV that I could buy at a retailer for $1000, and I can spend a chunk of poker loyalty points on that TV or on $1050, some people might prefer to just get the TV directly. It's less economically efficient, but the value of that story to my friends and/or the personal value of "having earned something for free by playing poker" could be worth that $50. Irrational, but almost certainly out there.
2) I expect that many tax evaders incorrectly believe that getting a $1000 TV is not taxable income, whereas getting a $1050 cash bonus is. They happen to be 100% wrong, but most people are clueless about this stuff. Criminals who are actively aiming to hide online poker income from the IRS may also believe, correctly or incorrectly, that it would be easier to fail to mention an electronic item they got sent than it would be to hide the trail of a $1050 cashout.
Both of these effects suck, and I too wish that the cash equivalent rates didn't trump all other offerings in the store, but I suppose each of these effects caters to a type of person that we should be happy to welcome as our competitors.
I see your points. The things is, before, it's very plausible that someone may have had absolutely no desire to play in a MTT, so that was not a viable option for them. And not too long ago, the selection of MTT tickets was not as broad, so I had no recourse but to buy merchandise from the store. Now tho, it really makes no sense to do anything buy buy tourney tix or cash - not that those are bad alternatives. So I think any merchandise needs to be sold at a discount to cash.
ReplyDeleteWhat's even more stupid is that the $26 and $75 tickets (not to mention the even better valued FTOPs tickets) in the regular store, are better value than every single item in the black card store.
ReplyDeleteThose tickets could be used for MTTs or SNGs and you get them instantly as well without having to clear a bonus (in addition to it being better value).