Stores everywhere are competing for your hard-earned money (or easily acquired credit) this Christmas shopping season, and they're pulling out every sales pitch they know. Here's how to identify some of the most manipulative and resist them.
Photo by Sir Millard Mulch
Personal finance blog Smart Money takes a look at a number of traditionally irresistible sales pitches and why they work. Here are a couple on their list and a few of our own.
"Limit five per person."
The idea that you need more than one of an item is generally pretty ridiculous, but limits make us competitive and think that we better grab up as many of this soon-to-be-unavailable product as we can. This pitch is designed to prevent us from thinking rationally when we think about quantity and often times it isn't even applied to a product that's any good:
This year, limits are showing up on anything a store wants to get rid of. You'll even see limits on items that might seem absurd to purchase in multiples, Shrum says. In its early Black Friday sale, Best Buy limited sale items -including $US120 Blu-ray players and $US280 laptops - to one per person. The two-day sale was too short to have a big impact on quarterly sales, but likely piqued shoppers' interest, says Michael Pachter, an analyst for equity research firm Wedbush.
If you see a limit on any particular item, take a moment to think before you act. Consider how many you actually need, for starters, but also look into the product and make sure it's worthwhile before you buy. Just because there's a limit doesn't mean you're necessarily getting a good deal, so grab your smartphone and compare prices, features, and reviews with similar products before you commit.
"Save $250! (New price: $500.)"
Sure, saving $US250 sounds great, but you might end up spending more on a seemingly highly discounted product just because you're interested in a great bargain. Recommended retail prices (RRP) can often be a lot higher than you see in a store. For example, if a dryer's RRP is $750 and the retailer normally sells it for $550, when a sale comes they can discount the normal price by $50 and claim a $250 discount. Even if the discounts aren't misleading and you're truly saving $250 (or whatever the markdown is), such a discount is designed to coerce you into spending a little more money on a more expensive product that you may not need. When you run into this sales pitch, consider how much more the discounted model costs and if you gain anything from purchasing it instead. If it's only a little more and you get some welcome features, it may actually be a good deal for you. On the other hand, you could end up with a new drier that costs more and does nothing extra for you. Before you act on a big discount, be sure it's actually worthwhile. Saving money isn't really saving money if it actually means spending more on something you don't need.
"Get a free gift with your $50 purchase."
The gift-with-purchase trick is a great way for stores to get rid of crap they can't sell and you don't really want. Nonetheless, this sales pitch is particularly appealing because who doesn't want a present?
It's the retail equivalent of finding money on the ground. And shoppers equate added value with a discount - even if they're spending extra money to get a freebie they wouldn't have otherwise purchased and might not even use, says Yarrow. That mindset is why stores have brought back the gift-with-purchase this year, as an alternative to big discounts.
Before you get too excited and start filling up your shopping cart to get a free gift, find out what it is and try to imagine yourself using it regularly. If you can't, don't buy anything extra just to get the discount. We often do the same thing with loyalty/rewards programs, because it's easier to convince ourselves to spend more just to earn a prize. This is one of the most manipulative and effective pitches, so unless that free gift is something particularly awesome (which is pretty unlikely) you should run in the other direction.
Two for $24
Oftentimes with two-for sales, or anything that involves buying more than you necessarily want in the name of getting a discount, you'll find the discount isn't that great. Some stores will even give you the discount if you buy fewer than the number required. This sales pitch is designed to make you pay attention to the deal and not to the price tag. Always check the price tag with these deals, because sometimes you'll be saving very little or even nothing at all.
Our 3-Day Sales Event Starts Now (as in Early)
Online stores — and even some brick-and-mortar retailers — love to get started ahead of time to get you to buy with them early. This pitch appeals to your impatience and your desire to avoid the rush of crowds on Boxing Day. Getting these sales out ahead of time is a great way for stores to get you buying early. The thing is, despite the sale starting early there's really no guarantee the bigger discounts aren't going to come on the actual sale day. Competition can change things, and some stores even plan bigger discounts on the day so they can not only be early but provide a "new" sale the day of. Unless you're getting a really good price on something you want (or can't get elsewhere), you might want to hold off on buying early. You may lose out on a better deal if you give into your impatience and anxiety over missing out on what's available right now.
For more manipulative sales pitches explained, be sure to check out SmartMoney's full post. Know a few of your own? Share 'em in the comments.