De-premiumization

So many organizations today are seeking the exalted premium segment of customers. Premium of course requires a regular or mass segment to distinguish itself from. Perhaps nothing is a more damming illustration of the perversity of the current system and the need for After Capitalism. It has become a desirable goal to create a system that panders to the few at the expense of the many. This is not seen as unfortunate, but rather as the objective. It reflects the current stratification of societies.

• The 0.1% is the golden ticket.
• There is money to be had from the 9.9% knowledge elite serving the 0.1%, but they are too busy working to enjoy it.
• And then there is everyone else, the 90%, who are to be set apart from.

Beyond the obvious high-end luxury goods, services, and stores, are the various loyalty programs, mostly aimed at the 9.9%. They are a blatant illustration of of tiered systems, with elite, super-elite, and doubleplusgood elites. Once one is hooked, the climb to the progressive harder-to-reach next tier for increasingly stingy benefits ensues – they also offer an aspirational view to the 90% of what they too might one day get.

Ironically, they are positioned as “loyalty” programs, but they are really anti-loyalty programs — with the supreme irony being the whole goal of loyalty is to lock you in so you can’t leave, not because you’re loyal, but because you’re locked-in by your status. If you provided good service, people might be loyal – without the handcuffs – but I digress.

A sad truth is that it is only with the premium segment that the bean-counters in organizations actually allow adding cost, since they can get it back with the premiums. For most everyone else, every penny is scrutinized and the result is putting out a minimum viable product

Why de-premimization?

There is the moral argument of why deliberately set out to set ourselves apart, which appeals to supporters of After Capitalism.

But to appeal to capitalist logic, there is the numbers argument. Just a little bit of math raises questions about this approach. Population growth is down just about everywhere on the globe. Immigration is a challenging strategy. Economic prospects are not looking so great. And the exclusive premier segments aspire to be every more exclusive. All this suggests more and more organizations fighting over fewer and fewer people. Premiumization is just not good business.  De-premiumization is much more aligned with the emerging future. – Andy Hines