UPDATED: October 5, 2013 at 10:28 a.m.
As almost any Harvard student can tell you, Yogurtland is the place to go for economical yogurt. Why? Because the first three ounces are free every time with a Harvard student ID, with no per day limit. After recovering from this pleasant news, the question that you might be asking is: how can they offer this deal and hope to stay in business? We at Flyby wondered the same thing, so we got in touch with Professor Jeffrey A. Miron, a senior lecturer on economics, to see what he had to say on the subject.
Miron wrote in an email to Flyby, “Yogurtland has made a mistake!”
So why would Yogurtland management have made this decision? As Eddie Barrios, Yogurtland Regional Operations Manager, told Flyby in September, "We just want to tell everyone that we're here, and we're open. Come try us out."
It is conceivable that the chain hopes that if they attract new customers with this deal, Miron wrote, these customers will keep coming back even after Yogurtland has eliminated the deal.
It might also be the case that the cost of yogurt is small compared to other expenditures. Miron wrote: “If the bigger costs for Yogurtland are staff, space, machines, etc.,” it may not be that significant to give away some yogurt to all student customers. But does this analysis underestimate the student appetite for free yogurt?
Perhaps the best answer is that most people just don’t know how much three ounces really is. Weight adds up quickly, especially when one starts adding heavy—but delicious—toppings. Even the most cost-effective customer may end up with more weight—and therefore a higher price—than intended.
In Professor Miron’s book (his figurative book—his actual book can be found here), this deal might turn out to be too generous. Yogurtland might do better to offer it for a limited time only. The other possibility is that a limit could be put in place. Instead of giving students a free three ounces every time they visit, Yogurtland could offer the deal only some of the time, making it difficult for people to benefit to the same extent as they do now.
Thanks to Professor Miron for his advice, but all the same, as students, let’s hope that he doesn’t take over Yogurtland any time soon!