Wednesday, November 20, 2013

Law of Diminishing Returns

I was thinking that a way to spend responsibly for makeup is to use proceeds from a blog sale.  It makes a lot of sense.  You buy, try, and then sell so you can buy, try maybe then keep or sell again.  It's the ciiiiiiiircle of life.

Then I got to thinking about the actual cost of ownership.
From my last blog sale
Say I buy a lipstick for $48, a Tom Ford one with nearly 9% in New York City sales taxes, I've spent about $52 for this thing.  The moment I walk out of the store, without having even tried it on the lips, or swatched my new tube on the hand, the value of that item drops.  It's like walking out of a car dealership with a new vehicle.  Even selling it brand new, with a box, in a blog sale, I would never be able to sell it for $52.  Maybe I give an incentive to US-based buyers by offering it for $45.  Nice deal for a brand new Tom Ford.  (On a related note, I must really consider returning makeup.  Thanks, Gummy!)

Keeping track here?  $52 sold becomes $45 BNIB!  I've already lost $7 in this imaginary transaction.

Knowing how I must try a brand new item right away, perhaps I try it once or twice, write a blog post, thinking about how I really really like it.  And realize I don't like it.

I sell now used.  Who is going to spend $45 for a used lipstick?  I then ponder about my overseas friends, who are probably paying a higher marked up price for Tom Ford, perhaps they can be persuaded to buy this?  $45 would still be too high to sell a used makeup, overseas makeup lover or not.  Maybe I sell it for $40?

$52 lipstick becomes $40, and I've only tried it on 2x.  That's $12 out of my pocket!

How about this scenario?  I like it well enough to keep using it for a while.  But over time, it becomes neglected and rolls around in my Muji drawer, dolefully staring back at me.  "Love me, use me!" it pleads.  (What, your makeup doesn't talk to you?)  I've already turned my eyes (and lips) to other new pretty things.  By this time, I've used it a few more times, owned it a few more months.  And since I can't stand the lipstick giving me that guilt-inducing looks, I decide to sell it.  Who is going to buy a used lipstick, no box, for $40?  Then I adjust the price accordingly lower.  Maybe $35?  But then by the time I'm posting a new blog sale, it corresponds to a Sephora event, a Beauty.com event, et cetera et cetera.  I need to price in a way to compete out there.  You know, with companies that don't sell used makeup!

Here is my math: a $52 lipstick, maybe used a handful of times, is finally sold for $28.  I've lost $24 in the transaction.  That's one cost associated with using this Tom Ford lipstick a few times!  If I used it 4 times, I spent $6 for the privilege of smearing it on my duck lips.  (also Paypal fees!)

Blog sale theories I've developed has that, if you price lower, you sell it faster.  Duh.  I found over the course of many weeks, things will sell maybe at a higher price, but then I need to deal with the blog sale dribbling along.  It's also hard to quantify what it costs to conduct the sale.  After all, time is money.  The work in photographing, listing, Paypal invoicing, going to the post office, conversing with customers, it is all work.

At the end of the day, I've only recovered about 50% on my original investment.  Using that as a guideline, a $52 lipstick becomes a $28 recovered cost which with the next blog sale becomes $14 which becomes $7, and so on.  While a couple of hundred dollars sitting in my Paypal account feels nice, it hurts to think about what I actually spent plus all the efforts associated with then selling it.

Makeup is not a good investment.  While conducting blog sales allows me to get rid of unloved things and then fund future purchases, over time, it becomes a big money pit.  This gives me something to noodle over as I ponder future purchases.  If I buy something I don't absolutely LOVE, do I want to pay $6 each time I try it on?  Most likely not.

Also, thank you for BUYING from my blog sales!  It helps make room in my drawers and helps me think though more makeup math.

Do YOU conduct blog sales?  I would love to hear your experiences and how you feel about doing them.  How about the buying side?  Do you buy from blog sales?  What's your motivation to buy from them versus buying things new.

20 comments :

  1. We don't have the option to return makeup (used or new) in the UK, so we just have to take the hit by selling it at a lower value through a blog sale and/or eBay. I normally do eBay for fragrances, skincare or higher-value BN items and blog sale the rest, although they don't move as quickly as I am not a popular blogger. It's almost a no-win situation! :P

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    1. Gah! In the US, we are SO lucky that we have an option to return. I really must take advantage more (or stop buying so much!). I adore your blog! <33
      I only run this blog only for the purposes of getting rid of makeup! :PPP

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  2. Haha, my blog sale has been a huge flop so far - no one wants to buy anything :D But I would definitely second Gummy's suggestion to try and return it (which is why I quite like shopping at Sephora). I don't do it often enough myself and then end up with strange items rolling around for ages... but I guess that's the price for my addiction :)

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    1. I am shameless about promoting my blog sale (i.e., tweeting incessantly)! I really do need to return more often especially if I hate something about the product's formula. Is exactly why I have random things rolling around, too!

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  3. I am a make up junkie/ hoarder, so if I can get some make up I am lurking on for a while, for cheaper, yeah, I am gonna buy!!!

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  4. I try to only buy what I think I love. But unfortunately love is fleeting. If I can I usually return, and no I don't feel bad, the mark up on mu is astronomical. Great timing on your post, I just took pictures for my first blargsale. Those items are the ones that I thought I loved for a while, but I don't, and it has been to long to return.

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    1. Returning within a reasonable frame of time seems ok to me, too. My high-flame love tends to die down often, too, vampy! It always feels good to be rid of excess though, right?

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  5. I've had one and getting ready to do my second. It is a HUGE undertaking! It's a lose-lose scenario because I will have bought the stuff at full €uro prices and have to sell at what might be reasonable for US prices (typically 30-40% lower to begin with) then subtract the usage factor...and there you have it; basically the way I see it; blogsale is a step up from throwing it in the recyclables. I don't expect to make any money from it; more like give someone else the chance to experience that product.

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    1. I imagine those of you in EU really have it bad, along with our friends in Australia. Everything is so much more expensive there that offering blogsales to US folks makes it impossible to recover much money. I never think about blog sales as making money, just a money recovery mechanism. I'm just learning that it does that funciton rather poorly! :)
      I like your sentiment A LOT, about giving someone else an opportunity to experience the product.

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  6. My dear Belly, you really get me thinking with your honesty & math.
    Well, I've never done a blog sale nor buy from blog sale. I used to be a MUA junkie with swaps and OA galore, so I've been there (I guess back then there were no blog sales..). So yes, I can relate to the lure of owning a piece of high end makeup at a mark-up and selling things to fund future purchases.
    Now, buying and returning also creates endless cycle. It's almost the same as buying and selling, but more addictive because there is not associated "work" to be done in selling, and the return is 100%. It's like using without the responsibility of owning..
    But of course, I don't always heed my own advice/thought :-)

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    1. I had this brewing in my noggin for a while, realizing how eeeeh unproductive this whole exercise of selling is. It's kind of a necessary evil. Committing the vague thoughts to paper really opened up my eyes!
      I did a few swaps, but it's kind of hard these days! Returning/Buying is another cycle for sure! I feel largely like a hamster in a hamster wheel. It's very endless, kind of a futile exercise in consumption. Thank you always for your thoughtful comment! You know how much I appreciate you.

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    2. And how much I appreciate you!
      I do think that maybe blog sale is a lesser "evil" than returning because the items go to people who really want them. It's like recycling, really. I don't know what happen to the returned items, my hunch is that they ended up in landfill :-( So, from that perspective, you can feel good that you've conducted a blog sale which ensures all your items go to good homes. *pat pat Belly's belly.. err, I mean.. Belly's back*

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    3. *rolls around and enjoys the pat pat pat*
      I'm sure used makeup that are returned gets sent to landfill via return to vendor or directly. I always wondered what happens to unused but returned makeup. How would stores 100% verify the item was never used?

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  7. Thank you for the shout out, big red!!!! LOL!! Are you feeling any better yet??

    I absolutely looove that you did this post!!! Totally with you…it's really nice to be able to recoup some of the cost back of the initial product purchases, but overall I'd be much better off money-wise if I had never purchased them in the first place. Especially since I've outright given away tons more than I've been able to sell. I'd like to say I really think about purchases. I do to an extent bc I do read reviews all the time…but being completely honest I impulse and panic buy way more than I'd like to admit lolol

    Anyhoo…

    Far as blog sales…personally I don't shop blog sales because I find the prices way too high. The only time I'd consider shopping a blog sale is if it was bnib and/or something that I have wanted forever and/or was very hard to find or something unavailable to purchase anymore. Like for instance…if they ever started making wulong refills and then suddenly stopped making them I would totally scour blog sales bc I love it that much.

    There have been quite a few items I would love to buy, not to mention support fellow bloggers. But seriously even if something is BNIB, bottom line is that it's not brand new from the store. It's already exchanged hands. And only a few dollars is being taken off?? I realize I'm also saving a bit on tax, but I do have to pay shipping so part of that savings is negated. Include the fact that I am able to use ebates for a majority of my online orders, that makes my savings on a blog sale purchase even less. Plus I generally have no recourse if I don't like the item, if it is damaged or is not as the seller described. Again, it's not brand new from the store…it's been opened and looked at, even if only for photos.

    I haven't even talked about used items. I'm ocd about things and how my beauty items are stored and kept, so I probably have a different take than most people. To continue…even if an item is only used, swiped or swatched 1-2x's there is no way I think it's worth even close to what the original price was. It's been used!!!

    I price items on my blog sale according to what I think is fair if I found the same items on someone else's blog sale.

    Hope anyone reading this doesn't think I'm bashing other blog sale owners and what they charge…beauty of having a blog is that you can do what you want!! Only saying I have yet to be enticed to buy anything from a blog sale because the prices don't fit with my personal tolerance level for what I'm willing to pay for a not-new-from-the-store item.

    When I think about everything I've given away, and all the $$ I've spent on items I ended up not liking or didn't want anymore or even all the $$ I DIDN'T recoup in my blog sale…well, it hurts. BUT but but I love beauty products and I consider that the cost of pursuing something I love. As Mr. Gummy says…everyone has their thing…like Mr. Gummy's things are snowboarding, biking, and general having a love for all things outdoors…so that's where he spends his $$. I'm sure he'd love to have the $$ back on all the old gear he no longer uses or didn't like!! But he doesn't even think about it because that's just what it takes to enjoy his passions :-)




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    1. Gummy! Thanks for your awesome comment. Dood, your return to sender post was like O.O Why don't I ever return anything?! I'm totally realizing never buying is wayyyyy better than buying something I kind of like and then paying the downstream costs associated with temporarily owning it and then getting rid of it. Like that Tom Ford lipstick in my example, no WAY is that lippie worth $6 a wearing. No way, no how.

      I totally know you're not bashing blog sales because you recently conducted a really awesome one. Regarding pricing, I think many people are looking to recoup as much of the original purchase price so much that they do price it so high. I am sometimes surprised when very highly priced things do sell because the same item can be easily purchased brand new (never touched, never photographed, or opened) and maybe even with an ebates deal. I use to have major heebie jeebies about used makeup in general, but I must have gotten more lax in my old age! :D I did recently try Girly on from a tester inside Sephora (after dousing the crap out of it in alcohol), so I can't be too germphobic afterall.
      I've personally bought a couple of nice things from blog sales but they tend to be impossible to find items and also from very trusted sellers. (Thank you Dragon Ballz seller! I <3 you!)

      RIghtly said about the cost of enjoying a hobby. It's impossible to expect all hobbies (like makeup loving) to be cost free. I just wish it didn't cost so much!

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    2. Love this comment Gummy, and Belly what a great post!! <3

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    3. We love our Gummykins and Bronzer Bunnies! We do.

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  8. Ha, I'm late for the discussion, but as a frequent shopper from many blog sales (hello, Belly and hi, Gummy!) here are my two cents:

    - A lot of cosmetic brands are not accessible in Quebec, due to the Language Charter which requires French in all the package. So even when we have Burberry in Toronto and British Columbia, it's just not a Quebec thing, the same can go for Tom Ford...
    - The highly mark up before tax (10-20%, depend) and the even higher tax (~15% in Quebec) kinda kills any lemmings of high end brands. The only exception to me is Chanel, which has more or less the same price as in US and usually runs different collections at the same time; the Asia exclusive collections are more accessible here.
    - Online shopping from a source outside Canada incurs a risk of paying duties AND taxes over duties, which is like a suspense game...
    - So if I see something that I really really want on a blog sale, at ~25-30% off their original US tag, I normally jump up to buy it and even think "that's cheap!"
    - Yet, I only bought things from my trusted blogs ;), where the selling ladies may have the same feature as me (Asian, normal to combination skin, medium tone), similar lifestyle (working, enjoy beautiful bits, live in the northern hemisphere) and more importantly share the same aesthetics (color, texture, makeup style, conscious comparisons between brands). What I bought are usually color powders and brand new cream, which are more sanitary if gently used, and occasionally, used lipsticks <--- it's a matter of trust!!!
    - However, I wouldn't buy everything from blog sales. There are some point programs here from which I can benefit by buying my skincare freshly from store. There are bi-annually warehouse sales of brands where I can stock up some past-season goodies or old-formulation bits.

    If anything, money is always lost during the process of satisfying ourselves with makeup extravaganza. It is more so when we have the urge to buy something unseen, untried or unswatched. My only grief is to let something go to waste because I no longer use it. That is my only motivation if I ever have to purge my stuff and stomach whatever cost entails.

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    1. Hi, Thao! Geesh, it makes it awful hard to buy makeup in Quebec with its extra strict language requirements for brands. I was nodding along with all your "reasons" which made all sorts of sense, but why Northern hemisphere? :DD

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I would love to know what you think! What say you?

Feel free to link to your own or other blogs posts that are relevant to our discussion here. That is always encouraged. I love finding new great blogs to read! Relevant is the key word here! I reserve right to delete!

But for all our sake, no promotions or referrals to your blogsales, swaps, contests and the like.

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