Marketing paradox

Few things in life are either all good or bad. Maybe nothing is. Most things have obvious pluses and minuses. Close human relationships are very good for us (the evidence from the field of positive psychology demonstrates, if it needed demonstrating); but being in a close relationship exposes the individual to the risk of emotional distress (go see Romeo and Juliet if in any doubt). Spending public money to help out members of the community who are in need is a good thing (cf. The Guardian); but as soon as you have a system in place to do this, you run the risk that the undeserving or criminal will exploit it (cf. The Daily Mail).  

So it is perhaps not surprising that marketing has both its good side and its bad side. The good side is that the practice of responsible marketing brings together people who can achieve mutual benefit through voluntary exchanges; you have something that I value more highly than you do, I have something that you value more highly than I do, we exchange the somethings and, as if by magic new value has been created. The bad side of marketing is that some people may not be so responsible; they may try to manipulate or bully or lie or cheat or confuse or ... well you get the picture. Examples? Well, IMHO, those would include changing the interest rate on a savings account from 3% to 0.01% and not bothering to tell the savers, phoning up a million people using an automatic dialler in the hope that one out of the million might be remotely interested in what you have to say (meanwhile annoying 999,999 people), conducting some fatuous piece of pseudo-research on a new face cream and then selling it on the basis that a particularly biassed interpretation of your hopelessly unscientific research suggests that it might make someone look a bit younger, and so on. Actually, in the UK, 'Which?' magazine is a great place to look for such examples.

Close human relationships are definitely a good thing, despite the flip side. Helping out the needy is also a good thing, despite the exploitative few. And marketing is broadly a good and beneficial activity, despite the dark side. Worth remembering?

Economic literacy at the BBC

I worry about a certain lack of elementary economic literacy evident in the media. The most recent irritant came with BBC TV reporting of the latest inflation figures. I heard the same thing several times, so have to conclude that whoever wrote this was deemed to have nailed it first time. I quote: "The Consumer Price Index for May is 2.8 per cent". No, it isn't. In fact, the CPI at the end of May stood at 122.8 (the base for the index is 2005). The annual rate of inflation as measured using the CPI was 2.8 per cent for May.Yes, I know that's what they meant, but it's not what they said.

Shouldn't someone writing economic copy for the national television station know the difference between an index, and the annual percentage change in an index? (Actually, I have a dreadful feeling that they don't even know what an index is, and that's the basic problem.)

By the way, something interesting, that I did not see commented upon in the media, was that the CPI actually declined from April 2012 to May 2012. Admittedly, only by 0.1, from 122.9 (April) to 122.8 (May). So, using the CPI measure, the UK experienced negative inflation in May. If you use the Retail Prices Index instead, prices were unchanged from April to May. Not a terribly big deal, perhaps. But an interesting curiosity, nevertheless: prices were static or possibly slightly falling in the UK in May 2012.