Happy Halloween! Today’s a day for tricks and treats, but no one likes getting tricked by retailers who make you spend more money! I’ve spent most of my working life inside retail stores starting way back in 1972. That’s when I began a job as an assistant buyer at R.H. Macy’s, a real learning experience for me as to exactly how a retail business is run and how it makes lots of money. Some of that knowledge was valuable then and is still just as valuable today. There’s an old saying “the more things change the more they stay the same”, and that couldn’t be more true in the world of retail.
Retailers, marketers, sales professionals, and CEOs are determined to make you buy more than you planned when you shop. In addition, retailers have an arsenal of sales tactics that may seem silly, but serve as heavy-duty artillery when it comes to persuading you to part ways with your cash. Remember the phrase accredited to P.T. Barnum when he said “a sucker is born every minute”? That’s where the tricks come into play.
Psychological warfare is the term I would use to describe what we all face every time we shop. Since we are entering the biggest shopping time of the year, the “holiday season”, it’s a good time to remind yourself not to fall for their “tricks” when you shop for your “treats”. While these retail tricks are not illegal, they are used to tip the scale to favor the retailer.
10 Retail Tricks That Make You Spend More
So to help you prepare, here are 10 especially cagey tricks retailers use.
1. Multiple-Purchase Pricing
My go-to grocery store loves to run a 10-for-$10 promotion. Not only are the sale items a mere dollar each, but sometimes you also get the 11th item free. That’s almost a dozen products included in one purchase on sale and you can mix and match items! How cool is that? Well, maybe it’s cool.
It’s really awesomely cool for the grocery store when we load up on 11 items we really don’t need. It’s even better for them when those items regularly sell for only $1.09 anyway. Clearing out their inventory for a fast turnover means quick profits and doesn’t tie up their cash flow.
I’m not saying that multiple-purchase pricing is always a bad move. It’s just that when we see something like 10 for $10 or 4 for $5 sales, we tend to buy more items then we really need. That means a big ca-ching for the store! Sometimes you just need only one, not 10.
2. BOGO, B1G2, and B2G1 deals (Buy 1 get 1 free, etc.)
These deals work similarly to multiple-purchase pricing. They entice you to buy more than you normally would.
Now, if you’re already planning to make a purchase with which a second item is free, then, by all means, take the freebie. But if you find yourself suddenly justifying the purchase of unneeded new shoes because of a BOGO ad, the marketers can pat themselves on the back for a job well done.
B1G2 and B2G1 deals involve, respectively, buying one item and getting two free, or buying two items and getting one free. There is also another common variation that involves buying one item and getting the second for half off. So just use good judgment. I always say that if you buy something that you won’t ever use, it isn’t a bargain at any price!
3. Psychological Pricing
You would think by now we would be savvy enough not to be tricked by seeing the number 9 at the end of a price. And yet, we continue to think something priced at $19.99 is a better deal than an item priced at $20.00. Known as “charm pricing”, ending sales tag prices with a 9 is only one way businesses use psychological pricing to their advantage.
When I operated my flea market venture I originally priced all of my products at prices like $20.00, $30.00, and $40.00 each. I then switched to the $19.99 trick with a really big 19 on the sign and a very small .99 next to it. Sales doubled from one week to the next and in almost every case I had customers saying things like, “Wow, its only $19.00, what a deal!”
Some stores may also try to trick you into spending more by dropping the dollar sign or even putting a per-customer limit on how many you can buy to make your sense of urgency increase.
Who knew we could be so easily manipulated by a price sign or tag?
4. Bundled Purchases
Another silly way retailers persuade us to buy more is by bundling purchases. So as part of a special sales bundle, for example, you might get a printer and office software along with a laptop. If you need a printer and software, this could be a cheaper option than buying all three separately.
However, you might have a perfectly good printer at home, and maybe you only plan to use the laptop for Facebook and World of Warcraft. You don’t need Microsoft Excel for either of those things, so why spend a lot more for that trio when you really only want a laptop? Buying $1,200 worth of computer gear for only $900 sounds great, but if all you need is a $700 laptop, you’re $200 poorer for no good reason.
5. Free Shipping Offers
Online retailers know that many of us have an aversion to paying shipping costs, so they often offer free shipping deals. However, these may come with a catch: you might have to spend $30, $50, $100, or some other minimum amount to get the free shipping deal.
How many times have you spent precious time searching for extra items to add to your order just to reach the amount needed for the free shipping? I’ll raise my hand and admit to spending an ungodly amount of time looking for a $15 item (that I really didn’t need or want) to add to my $35 purchase in order to get free shipping. In hindsight, I should have just stuck with my $35 buy, paid the $5 in shipping and come out $10 ahead. Lesson learned in hindsight.
6. Coupon Savings
I love coupons, so I obviously I’m not advising you to ditch them. That said, coupons have a sneaky way of making you buy items you would never purchase at full price, or even sale price.
Bottom line: coupons make it feel like you’re getting a deal even if you aren’t. Double-check and make sure the after-coupon price is in fact a bargain. If you’re looking for a break on a specific item, check out coupon websites. Again, be clear about whether the deal on the item is what you really need and it is really a bargain.
7. Upselling Everything
Whenever you’re asked whether you want an extra shot of espresso with your coffee or a bucket rather than a bag of popcorn at the theater, you’re being upsold. In fact, even the language they use is finely tuned to maximize your chances of saying yes. Employees are trained and even required not to ask, “Do you want anything else?” Instead, they were told specifically to ask, “What else would you like?” By using those words, they created the expectation that you would, in fact, like to buy more. There is a science and an art to this and it has proven time and time again to be successful.
8. The “Super Sale” Events
I actually worked for a department store that used the term “Super Sale” once every quarter to dramatically grab customers to shop! It was so successful that it produced results like increasing sales for a normal day from $50,000 to an incredible $1,000,000 for the sale day!
The fact that a store declares a sale to be phenomenal does not necessarily mean that it is, in fact, a great deal. You could walk into a store that has announced sale prices “as much as 75% off” and discover that everything except for one lonely rack is only 20% off. There are specific state laws about sales and what retailers must do to make them legit but it isn’t false advertising when they do the kind of thing like I just mentioned. The ad clearly includes the qualifier “as much as.”
Remain skeptical of sale claims, and don’t get caught up in the hype of a supposed once-in-a-lifetime deal. Trust me there will always be another deal, and probably an even better one to boot coming soon.
9. Rewards Programs and Loyalty Cards
Rewards programs are how retailers get you to keep coming back to their store again and again when you have other options.
Maybe there is a better sale at Kohl’s, but you have a Shop Your Way rewards card so you don’t even bother checking Kohl’s. You head straight for Sears instead. It works the same way if you have a loyalty card for a gas station, grocery store, coffee shop, or hotel chain.
Despite the fact that they can help you save, the real danger is that then may make you stop comparison shopping and simply go to the business offering those rewards. That’s really good for them, but it could be costly for you.
10. Point-of-Sale Last Minute Add-ons
The final silly sales tactic that drains our wallets is the point-of-sale add-on. These are all those gum and candy displays you see at the cash registers and the nice sales clerks who ask if you’d like to save 25% by opening a store credit card.
At a gas station in my town, the sales clerks are rather shameless about promoting the monthly candy deal, informing each customer that they are competing for who can sell the most candy that month. That tidbit is followed by an appeal to help them out by making a purchase.
The only thing missing is some slight whimpering and big puppy dog eyes. I’m sure some heartless folks can say no to their pleas, but it takes a lot of willpower to resist.
Ultimately it is you who is responsible for your decision to spend or not. Just stay aware of how the retailers are shaping the environment to encourage you to spend, and resist!
Do you fall for slick tricks that encourage your spending? Are you a focused shopper or are you distracted by the shiny objects and bells and whistles retailers use to get you to buy? How will you make sure that you don’t fall prey to these tactics this holiday shopping season?