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Sunday, July 6, 2014

The Economics of Hada


Lately, there was a controversy about the price increase of model X from Datu. So I have decided to introduce the concept of the "Hada Graphs" to better illustrate the dynamics of service, looks and economics.

So please bear with me. I will be using these two graphs from now on in FRs.

Hihihi!


Graph 1. Level of Performance vs. ES Fee

The first graph is what I would call the "Level of Performance vs. ES Fee" graph which shows the direct relationship between the two variables. 

The yellow curve line is the happiness curve. Anything that goes in the area under the curve makes the general population "happy", while those that go above makes the general population "unhappy".

A curve was used instead of a straight line because, let's face it, there is exponential increase in ES fee with level of performance in the beginning, but eventually the relationship plateaus. They can't go around asking for more money infinitely, am I right?

HAHAHAHA!!!


This is Model X's graph before the price increase. Given the level of performance he can provide, which is mediocre, an asking fee of 1.5k may be pushing it but still falls on the line and can therefore still render the general population "happy".



This is Model X's graph after the price increase. His plot now goes above the happiness curve. This goes to show that he simply can not increase his price given the same level of performance because this makes the general population "unhappy".

Hahaha!

Now, service is not the only measurement that matters. Appearance, sex appeal and overall X-factor sometimes play an even bigger role. It depends on the type of consumer you are. I believe that there are two kinds of clients: the service-inclined or the looks-inclined. Of course each of us have varying degrees of both but usually we place more value in one or the other, which explains the creation of the two graphs. The service-inclined may concentrate more on the first graph while the looks-inclined may give more attention to the second.

Graph 2. X-Factor vs. ES Fee

This is the second graph which I will call the "X-Factor vs. ES Fee" graph. This graph compares looks and how they charge their price. Models will be classified into E, D, C, B, A, and S.

I put the cap at 3k because I have observed that this is the most a model can push for and only in very special circumstances will they still thrive after this barrier has been breached. Also, this is not a dictation of their prices, this is merely what I have observed on how they charge their fee. It is also what I have observed from consumers whether they feel they were overcharged or not. 

Take note that these only pertains to masseurs. Varsity players and actors are not included.

Graph 2.1 X-Factor vs. ES Fee with corresponding asking fee

Model classification "E"
   Think blessedblessedcain! Hahaha! Char! Models in this category are only considered in the following conditions: 1. The Earth just suffered an apocalyptic event. You are hungry and in desperate need for any kind of sustenance so you grab at any "meat" you can find. 2. The performance is so fantastic that you are sent to the moon and back, enough to forget the misshapen creature that sent you to orbit. 200 to 500.

Model classification "D"
   Models in this category are not bad-looking, but they are not handsome either. They are the ones you will not go out of your way to get, but may be considered if it is at your convenience. 1k to 1.5k

Model classification "C"
   This is where debate whether a model is good-looking or not begins. These are the ones that after looking intensely for a while, you discover "Hey! He's actually cute!" They are not the head-turners, but after awhile, you notice their hidden charms. 1.5k to 2k

Model classification "B"
   These are the models capable of catching your attention in the sea of choices. They are generally good-looking. The only question is whether they fit your taste or not. Models that may have been classified higher but fell short for some reason such as an out-of-shape body, reggie tool size or height less than 5'8 also belong in this category. 2k to 2.5k

Model classification "A"
   Universal appeal. They have the face, height, body and tool size. They are the ones capable of commanding the ceiling price because they have it all. 2.5k to 3k.

Model classification "S"
   The outliers or the anomalies. These are models that breach the ceiling price, yet the queue never ends because of an undeniable X-factor. Models in this category are extremely rare. But it also does not mean that they are the best choices, because sometimes, they can fill you with buyer's remorse. Above 3k.



Model X is what I would consider a Class B model, because, true enough, he is good-looking and easily noticeable from the crowd, but he does not have the universal appeal. These models usually ask for a 2.5k rate, so he falls well within the area under the graph and may render most "happy".

Now it becomes a toss up:


Will appearance or performance prevail? Are you willing to forego performance over appearance? Or simply put, does he make you "happy" or "unhappy"?

Hahaha!

But just because a model may charge a given price, it does not mean it is smart to seek the maximum. For instance, if Model X were to maintain his original pricing, then his mediocre performance becomes passable, but observe what happens to his X-Factor graph.


The shaded portion is what I would call the "Satisfaction Surplus". It is the discrepancy between theoretical ES fee and actual ES fee. In layman's term, it is the feeling of satisfaction a consumer feels when he perceives that he had the better end of the bargain and overall, feels a higher level of satisfaction. It is like purchasing a Rolex watch for the price of a G-shock. Of course, the larger the difference between theoretical ES fee and actual ES fee becomes, the higher their value for money also becomes. Most masseurs are forgetting that the higher their value for money becomes, the higher the customer satisfaction they can provide and in effect, the more they are sought, especially since the concept is sorely missing in this industry. This is how they can keep their competitive edge. It is the notion that they should strive for. In the end, it is what will keep them relevant.

I hope I have not scrambled everyone's brains too much!

Hihihi!

That's it for now.

P.S. A reminder that these graphs are on the go general assessments because sometimes as you spend time with the masseur, his X-factor may increase or decrease. 

Thank you to Tony, owner of blog businessman-2-man and alena_gosiengfiao, owner of blog Goddess Alena for your valuable inputs. 

13 comments:

  1. Great job! There you have it... Alena's Fair Price Index manual - Manila Spanatic style. hehehe ^_^

    ReplyDelete
  2. Your Blog is not only titillating to the libido but also to the minds.Kudos!

    Your friend James

    P.S. vivid na vivid sa akin ang pag hagikgik mo tuwing na kakabasa ako ng "hihihihi" sa blog mo.

    ReplyDelete
  3. Nakakaloka ang graph bagay na bagay ito sa pabagonbagong takbo ng atik ekonomiya

    ReplyDelete
  4. Satisfaction surplus is the shaded portion below the happiness curve. The shaded portion above the happiness curve should be satisfaction deficit.

    ReplyDelete
  5. True this! The satisfaction surplus keeps you coming back for more kasi nga sulit. Or rather, you have that notion na sulit ang experience and therefore, babalik-balikan. Very cerebral ang entry na ito... I like! Kudos po!

    Now, who will be the next victim...este model who shall undergo the new standard of evaluation. Antabayanan ko po...

    ReplyDelete
  6. Error Not Found na po 'yung Lalaking Palaban site? :o

    ReplyDelete
  7. Grabe MS! I am so into Economics and this is a really funny and logical read. LOL
    -TopGun

    ReplyDelete
  8. Si Model X ang ginawang sample! Tsk! Tsk! :-)

    Very nice entry. Kumuha lang ako ng tissue after reading. *Nosebleed* LOL

    ReplyDelete
  9. Babala po sa lahat.Ingat po kayu kay Vincent fhrixx ng lalaking palaban..hingan kayu ng pamasahe,pagnaipadala nyu at natanggap nya un pera..hindi po cya darating sa inyu..manloloko po yan..tnx

    ReplyDelete
  10. I love the Economics x Hada connection! Oh eto oh Multiple Regression Model pang stata.

    happiness = given service + massage skill (x1) + size (x2) + EsSkill (x3) + price (x4) + u

    where u is unobservable factors; E(happiness|x) = 0

    charot lang!

    ReplyDelete
  11. Statistics and tabular representations like these are interesting. However, in real life it does not apply to all situations.

    Case in point: I had (July to November 2010 before I took a study leave in Georgetown) a regular masseur from a "used-to-be-popular" spa in Makati City whose ES and "happiness" factors (based on the table) are below the "standard rates" stipulated in the graph. During the eight times that I had him as a "therapist," he charged PhP1,250.00 per hour for the massage and the "big event". Sadly, when I returned to Manila last year, I cannot contact him anymore. The spa is closed; his number is not working.

    In the end, at least I had the "E.S," the massage, and was happy with it (He was humorous and "passably good-looking" - in my view - aside from being frank about his displeasure with the spa during his tenure there.). Those were my "glory days".

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  12. ilang hours usually ang service ng isang masseur?

    ReplyDelete