Ferraris, Italian Tax Cops and The Psychology of Choice

Why do people make the choices they make? As a marketer, it's the one question that’s always fascinated me.

Back in 2011, the Italian Government was losing an estimated 150 billion euros a year to tax evaders. And Italy’s new Prime Minister “Super” Mario Monti promised to fight tax evasion.

On December 30, 2011, Italian tax authorities raided Cortina d’Ampezzo, Italy's most fancy ski resort, and hit the jackpot.

80 tax inspectors targeted restaurants, bars and luxury stores.

And owners of luxury cars were pulled over while the Tax department cross referenced their motor registration with their tax records.

The tax authorities checked 251 “super cars”. It turns out, 42 belonged to people who declared annual incomes of less than €30,000.

16 belonged to people who declared incomes of under €50,000/year. 19 super cars belonged to companies that declared a loss in 2009 and 2010. And 37 by companies reporting annual revenue below €50,000.

It was a PR win for a new Government under fire over austerity measures.

But this raid wasn't a one time thing.

Traffic and tax cops set up checkpoints in some of Italy's wealthier cities. To stop any really nice cars on the roads and ask their owners how much tax they paid the previous year.

Suddenly in Italy, owning a luxury car became "almost a crime". And Italians were desperate to get rid of their Ferraris and Lamborghinis. Not necessarily because they were all tax cheats. But because the police was harassing them all the time.

And almost instantly, the second-hand car market was flooded with Ferraris and Lamborghinis. And prices were down at least 20%.

As Rory Sutherland says, "if you change the focus of consumer perception, you can make something bad, good."

Or something good, bad.

Your pal,

Miguel Ferreira
Founder & Chief Copywriter, Teardwn + Nishi

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