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Business philosophy: On ridiculousness of sales


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A quick sort of philosophy question for the smart guys on this forum.

I was just reading this article about Elon Musk when I stumbled upon this paragraph:

Musk spends two to three days a week in Palo Alto, flying in late on Tuesday mornings. He works pretty much nonstop until he flies back to Los Angeles, where he lives. When he must pause to eat, he does so with amazing efficiency. I twice saw him consume an entire meal -- chicken, a vegetable, bread, and a Diet Coke or two -- in under five minutes, all while holding forth on topics such as how best to fix a rocket vibration problem or the ridiculousness of sales as a business function. "In the early days, when Elon would have lunch meetings, I used to have to tell people that they shouldn't worry if he'd already finished before they even sat down," says Mary Beth Brown, his longtime assistant. "He just doesn't realize how fast he's moving."

That notion of ridiculousness of sales intrigued me, coming from a businessman. What do you think he meant by that?

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  • 2 weeks later...

Something else to consider (that is sort of touched on somewhat in the Extra Credits video): Sales are essentially a marketing tactic designed to lure you into the store. In addition to what the video explained, they bank on the fact that a lot of people will think to themselves: "Hey, I saved all this money by buying this on sale! Since I've saved all this money I otherwise would have spent, I should use it to buy something else that I want." Then they're hoping that you'll spend that money on something that's not "on sale," or one of the aforementioned "perpetually on sale" items.

Sometimes, if a given item is both expensive enough at its average list price and in demand enough that they know customers are going to seek out the best value they can get, they might intentionally sale-price it to take a small per-unit loss on that particular item in the expectation that they'll make up those losses from all the customers they've attracted using the money they've "saved" to buy other things in the store -- and they wouldn't do it if it hadn't been proven to work reliably in the past.

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"Sales as a business function" refers to having a "sales" department as a traditional branch of a company. What he is suggesting is that marketing and sales should be pervasive throughout the entire organisation.

I think that it really depends on what you are selling, who you are selling it to, and what your sales channels are.

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