The Magic Trick of the RRP

When a product is marked down from its RRP, are you actually getting a deal—or is the discount itself the product? This episode unpacks the behavioral economics behind the manufacturer's suggested retail price. We explore how RRPs serve as psychological anchors that shape our perception of value, even when we know they're arbitrary. From the FTC's case against record labels to the furniture industry's perpetual sales, we reveal how the RRP is a tool for positioning, coordination, and margin management—not a measure of worth. Plus: practical strategies for evaluating whether a price is fair, from historical pricing data to understanding cost structures.