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You Really Do Get What You Pay For

Well, another week comes to an end. It seems this one was faster than ever. Monday seemed to butt up against Friday with nothing in between. Where did it go?

One reason it went so fast is that we were on the road again, and one of the interesting stops was NYC where we taped an MSNBC Show that we appeared on as guest experts. We flew into NYC the night before the show, and veered off our regular routine of staying at our "home away from home" hotel which we’ve come to count on and love. This time, we thought we’d try something new. It had been reviewed as a very nice boutique hotel and came highly recommended. There was one catch that bothered us though, and that is that it was priced well below market value for a hotel "of this quality". For a brief moment, we thought we might be onto something. Maybe we were beating the system and getting a great room at a great hotel at a rate well below market rates for NYC.

But then….reality first began to set in when we learned that one of our rooms had the window wide open to the nighttime winter air, yet the room felt like it was a sauna. The other room faced a huge neon sign that was flashing bright orange just across the street, and there was no curtain on the window. And of course, we had the midnight to 4am garbage collection activity going on up and down the streets bordering the hotel, and it seemed like the entire four hour collection period was spent picking up garbage right outside our window because the banging was so loud.

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To make a long story short, we saved a couple hundred bucks, but arrived at the MSNBC studios needing a whole pot of coffee to get us going and lots of makeup to cover up the bags and dark circles under our eyes from the lack of sleep. It clearly was a case of truly getting what we paid for, and it just goes to show that in today’s competitive business world, market conditions generally force prices to the point of stabilizing at the highest dollar the market is willing to bear.

NYC’s hotel market is in hot demand these days. It’s hard to even come by a room in NYC, and the hotels are getting top dollar rates for rooms. So, why would a hotel need to price its rates below market when they could be pricing the rooms at comparable price levels? Because that’s all they could get given the step down in quality. In a competitive market, where demand outweighs supply, if there is a low cost option, there must be a reason, and in this case, the reason was because the quality just wasn’t there. While every other hotel commanded a premium price, they had to under-price their rooms in order to do business. And that should have told us everything about the experience we were about to have, in spite of any fancy reviews we may have read.

The bottom line, in this case, we got exactly what we paid for….and nothing more. Lesson learned.

About the Author: Rich Sloan

Rich Sloan is chief startupologist and co-founder of StartupNation and host of StartupNation podcasts. He is also co-author of the acclaimed how-to book, StartupNation: America's Leading Entrepreneurial Experts Reveal the Secrets to Building a Blockbuster Business. Rich encourages you to [...]

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