Photo (cc) by jakerome
You just bought the handbag or tech gadget of your dreams and you’re feeling pretty happy about scoring 10 percent off. That is, until a friend or relative lets you know he saved 30 percent on the same product, got free shipping and a cash rebate to boot.
Distressed by the size of your own discount? Relax. It’s just “deal envy,” and it happens all the time.
Nearly three-quarters (72 percent) of the shoppers surveyed by online coupon site Retail Me Not say they’d be disappointed if they missed a price break. The stakes are higher during the winter holidays, when nearly 9 in 10 (88 percent) are upset if they miss on any kind of discount.
“Deal envy occurs when people [don’t] save at all,” says Trae Bodge of Retail Me Not.
As a nation we’re obsessed with getting the best prices, especially around the holidays. Blame it on dopamine, a brain chemical associated with (among other things) reward and motivation.
Recent research at the University of Cambridge indicates that it isn’t the actual prize that stimulates dopamine but rather the anticipation of the reward. Thus we’re primed for those retail highs even before the turkey has been carved.
“If you found a bargain at a store last Thanksgiving, your brain will be bubbling with that wallet-opening hormone before midnight even strikes,” notes Mark Ellwood, author of the recently published “Bargain Fever: How to Shop in a Discounted World” (Portfolio/Penguin).
It’s a jingle out there
However, some of those “deals” aren’t what they seem. NerdWallet compared 2012’s Black Friday ads with leaked 2013 Black Friday ads for 25 retailers and found, among other things:
- Nearly all of the stores list at least one product at the exact price as in 2012.
- Some of the deals aren’t as low on Black Friday as they are at other times. (For example, Target is advertising a KitchenAid stand mixer for $199, an alleged savings of $30 – but earlier this month the same product sold for $183.99.)
- Retailers may use the manufacturer’s suggested retail price rather than the store’s current price, to make the “sale” more spectacular.
- Ads sometimes list an after-rebate price in big numbers, with small print explaining the deal.
- Store ads provide “the bare minimum of technical specs” on e-devices and televisions, to keep shoppers from researching them in advance. Such items may be “derivative” products manufactured specifically (and cheaply) for the holidays.
“While retailers often bill Black Friday as a unique day of great deals, the data [indicate] otherwise,” says senior analyst Matthew Ong.
So yes, it’s not your imagination: It’s a jingle out there! With so many ads and so many lowest-price claims, which ones should you believe? Where to go? When to start?
Pushing our buttons
Meghan Stuyvenberg of Savings.com says this swirl of information adds up to “deal clutter,” saying that shoppers “are overwhelmed and don’t know where to look.” Show of hands: Ever felt like blowing through your gift list at a single store/shopping center vs. reading all those ads?
If you do that, you’ll likely overpay. Fortunately, you don’t have to make that choice because others are willing to sort the deals for you:
- Money Talks News writer Karla Bowsher filters thousands of e-deals to publish the best sales, coupons, promo codes and freebies here several times per week.
- Online coupon/deal sites like Retail Me Not, Savings.com, BradsDeals.com and CouponCabin.com post up-to-the-minute sales info, unadvertised specials, clearance or flash deals, and coupon codes good for discounts and free shipping.
- Mobile deal apps – those from the above-mentioned sites or others such as ShopSavvy, ShopKick and RedLaser – let you comparison-shop on the fly. No reason to pay more for that handbag or tech gadget in the store if you can get it cheaper and with free shipping online. “Stop before you shop and make sure you are getting the best deal,” Stuyvenberg says. (Note: Some brick-and-mortar stores might be willing to match the deal. It can’t hurt to ask.)
- Price-comparison websites such as Pricegrabber.com and FindersCheapers will find the lowest prices (including those at lesser-known or specialty retailers), offer additional discounts and possibly even let you know how to get a refund if the price drops.
- Special apps for Black Friday, like the ones put out by FatWallet, BFAds, CouponSherpa and DealNews.com will highlight the best prices and may provide other perks, such as alerting you if a deal is about to expire or letting you know when a particular price is available.
Still feel like paying retail? If so, shame on you. Don’t give stores any more of your money than you must. Remember, marketers are good at getting you to buy all year long but our buttons are particularly pushable during the December holidays.
Full disclosure: I consider myself a smart shopper, but when I hear Christmas music playing in a store I turn into a sentimental idiot who wants to buy another round of gifts for everyone. Fortunately I’ve identified holiday music as a weakness so I skedaddle at the first strains of “Silent Night” or any other song I sang in the junior choir.
A sense of urgency
Another major emotional trigger is the passage of time, according to Ross Steinman, a Widener University professor of psychology. The holidays are “a forced moment for us to reflect,” he says.
We look back at our own childhood memories. We consider the holidays we’ve given our children thus far. We panic a little when we realize that our babies aren’t babies any longer. We look at elderly relatives or about-to-graduate teens and wonder if this will be the last holiday that the whole family celebrates.
All these feelings swirl into a Category 6 tornado of emotion: If the holidays aren’t perfect I’ll be letting everyone down. Retailers are very good at capitalizing on this “sense of urgency,” says Steinman, whose specialty is the psychology of consumer behavior.
“In our society, ‘make it special’ often has material aspects to it,” he says. “That’s the drive of the marketers: to take those wants and make them into a need.”
How to avoid buying in, so to speak? A few tips:
- Create a budget, including expected costs for decorating, special events (e.g., tickets to “The Nutcracker”) and traditional foods as well as gifts.
- Determine whether this is realistic. (Hint: If it took three months to pay off the 2012 holidays then no, you can’t afford it.)
- Look for ways to trim costs, such as setting gift limits, cutting an expensive indulgence (maybe the kids are tired of “The Nutcracker”), or suggesting that only those under 18 or over 80 get presents at family get-togethers.
- Don’t do all the cooking. Instead, provide a turkey or ham and ask guests to contribute. According to Discover’s annual holiday shopping survey, 62 percent of hosts will request that visitors bring a favorite dish to share.
- Watch those small expenses – takeout because you’re so busy, say, or fancy coffees to reward yourself for having made it through another mall. “Don’t spoil your careful planning by spending too much on incidentals,” says Suzanna de Baca, vice president of wealth strategies at Ameriprise.
- Pay with a discounted gift card, for an additional layer of savings on any hot deals you find.
- Got a history of overspending? Pay in cash – it’s more “real” than using plastic, Steinman says.
- Shop with a buddy. Friends don’t let friends overbuy, no matter how cheap those DVDs are.
Do look for deals – just make sure they’re really good deals, and that you can afford them. But don’t let either ads or marketing ploys determine how you spend this holiday season. Your bottom line will thank you – and how many times does a family need to see “The Nutcracker,” anyway?