Why is every consumer startup trying to sell me what I already own for 10 times the price?

Why would I pay $36 for a pair of underwear?

I’m always curious about new companies and take note of advertisements. I try to make a point of checking out any new brand I encounter to get a sense of consumer taste and new businesses. I live on the NY metro area, so some of these are billboard advertisements on subways and some are online ads. Regardless, these companies have come across my radar without me actively looking for them:

• $36 pair of underwear (Tommy John)

• $16.50 pair of socks (Bombas)

• $700 - $2,500 “eco” mattress (Avocado)

• $3.43 per ounce chocolate truffles (No Chewing Allowed)

Compare that to the Walmart alternative:

• $3.24 pair of underwear (Fruit of the Loom)

• $1.25 socks (Hanes)

• $150 - $400 mattress (various brands queen size)

• $0.30 per ounce (Hershey’s Kisses)

I get it, maybe Tommy John is better than Fruit of the Loom. Or maybe not! I don’t know, Fruit of the Loom has been making underwear for a long time. They’re probably pretty good at it. But Tommy John offers a “quick draw” fly opening, which I guess is worth paying 10 times the price?

Bombas offers to donate 1 pair of socks to a homeless person for every pair bought. I hope they take off the price tag when they distribute their socks. It would be awkward for a homeless to receive a 6 pack of socks with a $100 price tag still attached. One alternative would be to buy a 12 pack of Hanes and send over 11 pairs to someone in need.

Avocado mattress is interesting because it conjured up demand out of nowhere. I never asked if my mattress is “eco”. Who knows what other products that I use are not “eco”. Their mattresses also boast being made from nontoxic material. Who knows how long I would have survived on my toxic mattress! Oh, they’re also Fair Trade® certified and Certified Non-Toxic to Made Safe® Standards. I just want something I can sleep on that won’t kill me. Crazy I had to wait until 2016 for Avocado mattress to be founded for this product to exist.

No Chewing Allowed is actually pretty good so at this point I’m just curious why they cost 10 times Hershey Kisses. Maybe its meant to pay for the stand in the World Trade Center Oculus station. But they use practically the same ingredients. But come on.

I get it, things aren’t priced based on the cost to make them, although I’m almost fairly certain all these companies are losing money. For instance, Avocado Mattress brings in annual revenue of $16.9 million. With 90 employees, that means revenue per employee of $188k, which sounds good if you ignore every other expense required to sell mattresses including shipping, returns and marketing to people like me.

And they’re not even making their products. Take a look at the career section for Tommy John. They’re all sales, graphic designers or manager jobs. They outsource the production elsewhere and are essentially marketing companies. The only thing they’re innovating is marketing copy and price segmentation.

These are all relatively new consumer brands and they all equate to essentially selling me things I already own for ten times the price all while losing money. Sure they donate 1% of their revenue to some charity or give out free samples to homeless people. But come on.

How many new consumer start-ups have this model? What does this say about innovation and the economy in a broader sense? I don’t know but it’s uninspiring.