Please strike the one word which does not fit here:
- cotton
- jeans
- digital media
Right. Jeans is the wrong one. Because cotton and digital media are commodities, but the jeans a value added product.
Exhibit 1
As Joe Weisenthal insightful question in Business Insider: Guess What Surging Cotton Prices Do To The Cost Of Blue Jeans. In the last year, cotton prices almost doubled. As jeans are (or: should be) mostly cotton, what would be the effect on the retail prices of let’s say a Levi’s Ex-Girlfriend Jean (no kiddin’).
The effect is actually: zilch.
Levi’s bill of material rose from $1.41 to $2.53 – the final product cost $65.
Exhibit 2
Remember this infographic?
It tell’s you one thing: musician’s are cultural cotton pickers. Under current conditions, the (monetary) value is created elsewhere. And there’s not even a commodity bubble for music in sight.
gert.is 