Do you get what you pay for?

Like many of you, I'm a proponent of quality over quantity. I'd rather buy one good coat that will get me through three seasons and last for years than replace a poorly-made, cheap one every year.

But it's important to consider that expense is not necessarily an indication of quality. And even when the more expensive item is of higher quality, it might not be the best buy.

The following are five examples that illustrate that the more expensive option isn't always worth the extra expense.

Kitchen Gear

While researching this post, I happened upon countless articles advising to spend big on a quality chef's knife. That's exactly what I was planning to do a couple of years ago, until I read the Cook's Illustrated review on chef's knives. (For me, Cook's Illustrated is the final word in cooking — they've never steered me wrong.) They tested brands that varied widely in price, giving the highest rating to a $30 Forschner Fibrox knife, noting that “knives costing four times as much would be hard pressed to match in performance.” I can attest that it's a good one.

Food writer Mark Bittman says in most restaurant kitchens chefs use an eight-inch, plastic-handle stainless alloy chef's knife that costs $10 at a restaurant supply store. Bittman also shows readers how they can equip a basic kitchen for $200.

It seems despite the standard advice of “investing” in a chef's knife, the pros use and recommend the cheaper ones.

Prescriptions

There are a few exceptions to the rule, but in general, generic brand medications are equivalent to their brand-name counterparts. According to the U.S. Food and Drug Administration (FDA), generics can be sold at a substantial discount because generic manufacturers don't have to pay investment costs to develop the drug. The FDA requires generic drugs to have identical purity, quality, strength, and stability as brand-name medications.

The prescription drug commercials we see on TV would have you believe that their brand-name drug is superior, but the FDA says it isn't so.

Cameras

Haje Jan Kamps from Photocritic.org on why he doesn't need an expensive camera:

All I'm saying is that at my level (and, I wager to say, at the level of many other photographers), the 450D (and any equivalent low-level SLR cameras) are plenty good. The problem with photography is that it's simply too tempting to splash a lot of money for everything and then end up bankrupting yourself on the wrong things.

I used to have a bad habit of thinking that I needed the newest and most expensive Stuff for both established and new hobbies. It's tempting to get top-of-the-line equipment, but most of it is unnecessary unless you're a professional. A pricey camera won't make you a better photographer.

J.D.'s note: April is absolutely correct. A better camera does not equal better photos. Lenses are much more important. And most folks would be much better served by paying a couple hundred bucks to take a photography class at the local community college.

Skin Care

Ever heard of Creme la Mer? It's the ridiculously expensive face moisturizer touted by various celebrities. And by ridiculously expensive, I mean $125 for one measly ounce of the miracle cream.

One beauty blogger decided to pit Creme la Mer against Crisco (yes, you read that correctly, the big, blue tub of vegetable shortening). It turns out that everyone from beauty experts to doctors recommend Crisco as a serious skin moisturizer, and in the blogger's trial, there was minimal difference between the La Mer side of her face and the Crisco side. A 16-ounce tub of Crisco is about $3.50. A 16-ounce jar of Creme la Mer is $1,350.

I can't say I'm going to try this one myself, but it shows that there are cheap and effective skin care alternatives that work just as well as the ones that cost a fortune.

Wine

In Evolved Primate, a Psychology Today blog, social psychologist Daniel R. Hawes discusses an experiment where wine tasters rated the same wine differently depending on what they thought it cost.

…when tasting the same wine, the participating wine tasters systematically reported superior taste for the wine that came out of the $90 bottle, in contrast to the wine that came from the $10 bottle.

The study suggests that we perceive the quality and likability of a wine relative to its price.

In the article Expensive Wines Doesn't Always Mean They're Better, wine critic and author Matt Kramer writes that a more expensive wine is better than a less expensive one to a degree, but not to an extreme degree, and price is determined by many factors:

…there's no “right price” for a wine. If you can get people to pay a high price, because of quality, public relations, high scores, marketing muscle, or just plain luck, well then, you've found the right price. It's that simple — and that complex.

My favorite wine is Brunello di Montalcino, but it's expensive and therefore a rare treat. I have to wonder how I'd fare in a blind taste test, though. Is it truly the taste of the wine I enjoy, or the feeling of indulging myself and the memories of the little trattoria in Florence where I had my first glass?

Good News: Consumers Aren't Morons

Even though consumers may perceive expensive products to be of higher quality, that doesn't mean we'll buy. A Cornell study found that although a more expensive product may generate a more favorable view, it doesn't necessarily mean consumers will buy it.

Cornell behavioral economist Ori Heffetz was surprised by the results, expecting larger effects:

More expensive products might be perceived as more attractive — which could increase demand — but they are also more expensive, which our study showed decreased demand.

In other words, I may think a $1350 jar of moisturizer is superior to a tub of Crisco, but that doesn't mean I'm blowing the rent on face cream. Score one for consumer sensibility.

What are some more examples of when the expensive product isn't the best option or the highest quality? What is the cheaper solution that works better?

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Writer's Coin
Writer's Coin
10 years ago

Two words: HDMI cables. This is one of the biggest scams out there and a $5 wire online is just as good as anything you’ll find at Best Buy for $65-$100.

Luke
Luke
10 years ago

April, as a recent professional cookery student, your example of chef’s knives is one that stood out for me in the post. For this specific example, I think that it’s not a case of cheaper/more expensive being better, but rather a middle ground where budget/quality/performance have to meet up in a friendly compromise. So, the $10 knife you’ve mentioned probably isn’t a keeper. Yes, in high volume kitchens I have no doubt that cheaper, plastic handled knives are the norm, as chefs will go through them more quickly than may be the case in a restaurant with lower turnover. (Very)… Read more »

Colin
Colin
10 years ago

What can be the difference with brand vs. genetic drugs is the stuff that is NOT pharmaceutically active. The filler. I have heard cases where people have reactions to the generic and have to continue to use the brand-name.

BibleDebt
BibleDebt
10 years ago

Electronics in general in the retail setting, especially when then first come out are way overpriced. If you have the patience to wait a few months or use the last model, you can save a lot of money.

Kent @ The Financial Philosopher
Kent @ The Financial Philosopher
10 years ago

There is certainly a difference between price and value! Above the level of utility, in my humble opinion, the correlation between price and value diminishes and perception (usually false) drives the purchase decision.

Cars and clothing are a few examples.

“A cynic is a man who knows the price of everything, and the value of nothing.” –Oscar Wilde

michael
michael
8 years ago

By no means am I into fashion, but there is some association between cost and how long and well clothes wear well before falling apart. It’s definitely not perfect correlation between price and durability, but I’ve bought lots of clothes at Kohl’s that start looking shabby after a few washes.

Another example
Another example
10 years ago

Baby formula is another example where the generics are the exact same thing as the brand names, for half the price. The exact indgredients are dictated by federal regulations.

ami | 40daystochange
ami | 40daystochange
10 years ago

bottled water: it’s amazing to see what people will pay for ‘designer’ imported bottled water vs. no-name. There are even bottled waters that are simply bottles of tap water.

Compare both of those to tap water, perhaps filtered, at home.

And finally, consider the cost (to someone, if not the initial user) of disposing of all the plastic bottles.

Peggy
Peggy
10 years ago

I wouldn’t touch Crisco with a ten-foot pole. It’s full of nasty trans-fats. Your skin is your body’s largest organ and what you put on it does get in! There are other oils that work well. Coconut oil is fantastic, for example.

sarah
sarah
10 years ago

I had to laugh yesterday as I had folded a lot of laundry and had it laid out on the bed. I looked away for a second and my cat was curled up to sleep squarely on the most expensive pair of pants. I figured that goes to show they were expensive because they’re made of quality materials that feel good and not just a brand name. I doubt she (or I) could tell the difference between these $90 pants and a pair of $500 pants though. The extra $410 is mostly for the brand. I’ll throw “bikes” out there.… Read more »

Steve R
Steve R
10 years ago

You might save money in the short run with generics. I’ve spent the past decade working for a research based pharma company and I can tell you that generics kill innovation. Next time you pop a generic, the generic company pockets the cash. Pharmaceutical companies use the money to discover new medications for unmet medical needs, post marketing follow ups, etc. Generics sell cheap knock offs. Yes the active ingredient has to be similar to the real thing, but the “fillers” don’t and they will go the cheapest route possible all to make a buck for themselves.

Sunny
Sunny
10 years ago

Cat food.

Ouida Vincent
Ouida Vincent
10 years ago

First of all this is an awesome post. One correction generic drugs are not exactly the same as brand name drugs. The FDA allows some variance of up to 10% in the drug formulation. For most people this does not matter. Okay so like I have a well-equipped kitchen and I am going immediately to your link about equipping a kitchen for under 200 dollars.

Ben
Ben
10 years ago

Software – most expensive isn’t necessarily the best quality.

JM
JM
10 years ago

@Sunny: False. While we don’t feed our cats THE most expensive cat food in the pet store, we get them one that’s about $20 for 6.6lbs of food (Evo). (If you’re wondering, the most expensive brand in our store is Ziwi Peak, which is almost all pure meat and is $13 for about a pound. We feed them this as an occasional treat and they love it.) This last us about a half a month, so we pay $40 a month for cat food for two grown cats. There was a dramatic difference in their fur coat, energy level, poop,… Read more »

carmie
carmie
10 years ago

Sharpen your knives! A sharp knife is a safe knife. A dull knife will slip easily and cut you. I used to work for a very high volume catering company and we’d spend $60/month to sharpen our knives. The rate of cuts rose every month in the last week before we’d send the knives off to the sharpeners.

I have cheapie knives the equivalent of the $30 one mentioned above but I get them sharpened every few months for about .50/inch. It’s worth it!

Bananen
Bananen
10 years ago

Regarding cameras. JD wrote that lenses are much more important which is completely true. You don’t need a Canon EOS 1D unless you are a professional, but you DO need some good lenses for anything more than parties and vacations, and lens quality is highly correlated with price. If you pay more you will get a sharper image, less chromatic aberration, less barrel distortion, more zoom/wide angle and larger aperture. Sigma do make some reasonable lenses at a lower price than the original brands, but they are still expensive and you should also expect to pay a lot if you… Read more »

Beth
Beth
10 years ago

I’m going contrary here — there is something that is worth the extra money, every time: fresh roasted coffee. I live in a coffee town (Portland) and it is well worth the extra cash to buy fresh roasted beans from Stumptown in comparison to anything available in the grocery store. I have a very tight grocery budget ($250 for two adults) but I don’t skimp on the coffee!

Tim
Tim
10 years ago

A long time ago I implemented a rule for myself (well maybe my wife had some say in it as well). When buying tools I will buy the cheaper tool first and replace it with a much nicer one if it ever breaks. This does not mean I buy the cheapest tool I buy the one that is quality but still in the lower price point. @1 – totally agree. I try to support the local stores but when buying some computer cables last week I would have spent roughly $60 at the store versus $16 online. the online was… Read more »

Luke
Luke
10 years ago

Completely agree with Carmie – a blunt knife is a dangerous knife, regardless of the original cost.

A steel etc. can be good for keeping an edge on the knife, but it won’t do much for a blunt knife.

Personally I’ve had very good results using an inexpensive Japanese knife sharpener using small ceramic wheels.

Tyler Style
Tyler Style
10 years ago

Definitely software! Depending on your needs, free software will be your answer 99% of the time. I work as an IT consultant for three large call centres, and use free software extensively. Microsoft Office is a prime example. Most people will never use 80% of the features in MS Office. They just want to type letters and suchlike. OpenOffice offers nearly all the same functionality as MS Office, but is free. WinZip can be replaced with 7zip, which offers a lot more formats to boot. VLC can replace any other media player you care to name. Paint.NET for picture editing.… Read more »

Nancy L.
Nancy L.
10 years ago

I used to always insist upon the “best” that I could “afford” (which usually meant the best that I had room for on a credit card). When I bought a new computer, it would be the highest end computer with the professional grade accessories. (Note: I *do* use my computer for professional work, so this was a legitimate concern, not a pure indulgence) In the past 5 years, as I worked to gain control of my finances, I’ve learned to try out the entry level products first. Without exception, I’ve found that the basic consumer level products serve my needs… Read more »

Luke
Luke
10 years ago

The software comments are spot on! I switched from Microsoft Office to OpenOffice after losing my original CDs and it’s perfectly decent for basic office functionality and a little more.

Greg C
Greg C
10 years ago

When I cooked in a restaurant, we rented our knives from some company that came in periodically and traded them out for “new” ones, sharpened them,etc. I am not really sure about the $pecifics, as I was not involved in the business side of things.

Melissa Gomez
Melissa Gomez
10 years ago

Crisco works alot better than diaper cream.
Put it on overnight and the rash will be gone by morning.

Esther
Esther
10 years ago

I am all for generics but not when it comes to medicines or supplements. Unfortunately, I’m one of those people that has a body that reacts to the fillers and/or the the things that are left in them. My health is important enough to me that when I do need to be taking something I’ll work my budget around the real deal. Fortunately, I haven’t had to stay on an expensive drug or supplement for a long period of time.

Ryn8tor
Ryn8tor
10 years ago

Anything where you need to go to one source for proprietary replacement parts to fix or maintain, do not go cheap on or make certain you read the manual completely. A friend and I bought the same gas grill, him a year before mine and we both went the cheap route. I noticed after I bought mine I spotted some bad reviews saying the burners, which were stainless steel, were rusting and requiring expensive replacement parts & the shipping of said parts. Upon closer reading of the owners manual, I think it said to keep the burners lubricated, so I… Read more »

Nate
Nate
10 years ago

Video games is a good one. I get satisfaction from seeing ads of the new $50 games and $300 systems…. I just imagine myself playing them 2-3 years from now after I get them used off ebay for a small fraction of retail.

It’s a far more effective birthday gift to my kids to buy a last generation system and 20 quality games for like $100 when that same money might get me 3 games on a current platform. It’s new to us and every bit as fun!

Laura
Laura
10 years ago

I also react to fillers in medicines but luckily have not needed medicine since discovering this.

We will be needing new pots and pans soon as we are using a really old set currently. I am going to check into the resources you provided in the article!

Brian
Brian
10 years ago

Another example on the software side is movie script writing software. I write and draw a webcomic centered around movies, and I use screenwriting format to write each strip. I thought long and hard about buying Final Draft ($250) and Movie Magic Screenwriter ($250) until I found Celtx, a free screenwriting program (Mac only).

Since I’m writing four-panel comics and not Gone With The Wind, this has been a great program for me. So next time you think about writing The Great American Screenplay, I highly recommend Celtx.

Erika
Erika
10 years ago

Totally agree with buying for quality. I can’t find it now, the the team of Freakonomics also did a wine comparison study…they did it with professors who claimed to be wine experts, but they were unable to tell the difference between the cheap (around $10) and expensive. The authors did say though, that a very small portion of the population, professional wine tasters, can definitely tell the difference.

Nicole
Nicole
10 years ago

I like using http://www.consumersearch.com before making many purchases.

Enoch Root
Enoch Root
10 years ago

Regarding spending on photo equipment…. I spent a whole bunch of money on a cheap tripod and ball head. Then they didn’t perform very well. So I had to buy another set (see reallyrightstuff.com), and sell my old stuff at a loss, to someone who will use it and be disappointed and also have to spend more money. If I were truly frugal, I would have realized this dynamic earlier, plunked down the real money for the tools that are really worth using, and been happy. In both cases, I didn’t get what I paid for, because I paid for… Read more »

Jacob
Jacob
10 years ago

I Love playing less and getting more. However I was in a unique situation, when I was in high school I was scammed into selling cutco knives. Part of the deal was you get demo knives for about $130 back in 1998. I was a horrible salesman but I still have the knives and they are probably the best knives I have ever used. The best part is that if they ever go dull or anything happens to them you can send them back, half the time they charge you 5 dollars for shipping and they last another 2-4 years… Read more »

Alex
Alex
10 years ago

I totally agree with Sarah (#9). Unless you are already super fast, a $5-10K tri bike will do pretty much nothing for you.

However, one thing to definitely save for (anyone who exercises) is running shoes – you don’t need to get the $300 ones, but don’t spend only $25 a pair – you’ll end up hurting yourself and waste your money and time…

Michael
Michael
10 years ago

As far as kitchen knifes go, I work in a restaurant and we buy the cheap 10 dollar wooden handled knifes (kiwi brand). They typically last about 2-3 years, and the only reason we get rid of them is because they cannot be sharpened any more. My advice would be to buy an ok knife, and a wet stone, and learn to sharpen your own knife. It takes 1 minutes on a wetstone(which will last forever) and lasts an entire week of constant use. My other advice, after sharpening said knife, do not say out loud that “this knife is… Read more »

Jason @ Frugal Real Estate
Jason @ Frugal Real Estate
10 years ago

For me, buying something of a higher quality, even if it costs more, is what separates being cheap and being frugal. Cheap people are only interested in price, whereas us frugal types will pay more for quality. And yes, sometimes you do get what you pay for.

I typically research all major purchases starting with Consumer Reports, and then reading a number of review sites, etc.

Avistew
Avistew
10 years ago

@Colin (#3) absolutely. The active ingredients are the same but the “filler” ones are not. In my case, I am allergic to many generic medications. As a result I need to stick to the brand ones, and I’ll be more likely not to even give the generic ones a try when taking a new medication. Unfortunately, they don’t usually list what they use as a filler so I’m unable to pinpoint what I’m reacting to in order to be able to avoid it. However, for people who do not have such a reaction, I have no doubt that generic is… Read more »

Nate
Nate
10 years ago

@Tim- Hey that’s a good rule about tools! I’ll have to remember that. For those of us who don’t use them professionally that would be a good compromise. I get a lot of satisfaction pulling out tools that I got cheap over 10 years ago that STILL are functioning well. As far as maximizing utility per last dollar spent though… a person could drive themselves crazy! Like I just bought a $.99 plastic spatula. I know it’ll last several years, just like the last plastic one did. And if you look at the utility per penny spent… there is no… Read more »

JM
JM
10 years ago

@Nate (27): I am a huge video game fan so I couldn’t do what you do, but I think this is the perfect idea for someone unlike me who doesn’t have to have the latest, greatest games, which is most people. Game prices go down faster than ever these days, and even I am finding myself waiting a few months after a new game releases to save some money if I don’t have to have it the day it comes out. I also sell any games I don’t foresee replaying in the future on Amazon Marketplace to recoup costs.

Alexandra
Alexandra
10 years ago

Jacob # 31 – I love my Cutco knives. They are awesome! I didn’t know about the gaurantee – my husband got them back when he was a Citco salesman. I think I will send them my paring knife for sharpening – thanks for the info. The Shopping Bags (a Canadian show) did a segment on knives and found that chefs did indeed use the cheap knives in the restaurant kitchens – but only because the extremly high use meant that they were replacing them all the time, and it was much more cost effective to use a cheap knife.… Read more »

Shara
Shara
10 years ago

People complain about the price of brand name prescription medication, but very few people seem to care about why they are so expensive, sure development costs are high, but the patent process combined with the FDA certification makes it a nightmare. A patent only gives a company exclusive rights for a couple years longer than the typical FDA process. That means a company has to make as much money as possible on that new drug before the generics move in and glut the market, forcing prices down. When I buy knives I don’t look at the brand, I look at… Read more »

Turling
Turling
10 years ago

Another confirmation as to why I never spend more then $8 on a bottle of wine.

Michele
Michele
10 years ago

I have to agree about the Cutco knives. They are expensive, but the guarantee makes it worth it. If they need repair or sharpening just send them back to the company, no questions asked. As far as other kitchen stuff goes, I always try to buy a good middle of the road appliance. I have a friend who buys a new dishwasher every 3 years. She buys cheap (about $400), and has to go through the hassle of getting the thing installed again and again. but for about twice what she spends, I have a dishwasher that is nearly 20… Read more »

Liface
Liface
10 years ago

“Food writer Mark Bittman says in most restaurant kitchens chefs use an eight-inch, plastic-handle stainless alloy chef’s knife that costs $10 at a restaurant supply store.”

I’m so surprised at this. All the cheap knives I have bought have been terrible, and J.A Henckels that I bought has worked out amazingly.

Maybe I need to check out a restaurant supply store.

jeffeb3
jeffeb3
10 years ago

In a different direction, prices for goods are set by the market. Which means it’s a balance between supply and demand. Some things, like generic drugs, have a lot of supply (because they are being made cheaply, without research costs). Kitchen knives are an example of the average person adding perceived utility to something that’s basically the same. The key is to find something that you value differently than the general public. If you don’t care what color your car is, or how much status it brings you, you can find a bright pink Toyota Yaris for much cheaper than… Read more »

Money Reasons
Money Reasons
10 years ago

I usually check Consumer Reporter first before making any purchases…

@Tyler Style
I agree with Tyler, and would even like to add Ubuntu Desktop for an older PC… It’s fun and free, and of course WordPress software 🙂

Honey
Honey
10 years ago

Sadly, the best shampoo and conditioner I have found costs about $90 (for an 8-oz bottle of each). But it actually lasts a long time because you have to use so little of it, and since I have curly hair I only use shampoo once a week and conditioner twice a week. The rest of the time I just re-wet!

GayleRN
GayleRN
10 years ago

The FDA allows 20 percent variability in the activ ingedients of generic versions. Guess which way that 20% will go. We found this out the hard way when my husband switched to a generic version of Dilantin. After he started having seizures again we tested his level and he was 20 percent below his previous levels. The problem was that he started having those seizures while he was driving. Imagine my horror to be sitting next to him and realize that nobody was driving. The money we saved was definitely offset by the accident, fortunately no one was hurt. For… Read more »

Karen
Karen
10 years ago

Bed linens and bath towels—I have been burned and learned to pay for quality on these items! Towels that are essentially all lint and that become thin after a year of washing, towels where the binding comes off or the loops get snagged out–not worth it. I’d rather pay twice as much as have towels that last and look good for 5 years or more. I recently purchased a cheap comforter and sheet set–& I bitterly regret it. The sheets were too small for my (standard size) bed and wouldn’t stay on, the pillowcases were also too small for my… Read more »

Karen
Karen
10 years ago

I agree re knives. I’ve had Henckles (wedding presents) and they didn’t last very long. You have to really know how to properly sharpen knives like that or you can easily wreck the edge (my husband did so almost immediately while trying to use the steele to sharpen them.) Now I use Chicago Cutlery from Target. Very sharp, long-lasting edges even though I don’t bother trying to sharpen them. Wooden handles so I just hand wash them. I’ll probably replace them in 5 yrs or so, but they’re not very expensive. I’m an enthusiastic home gourmet cook, so I use… Read more »

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