Discount Schemes Aplenty: How Stores Lure You in and Get You to Spend More Than You Planned

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How does a 50% off discount sound? What about an extra 30% off of merchandise that’s already discounted by 40% or more? Or maybe a BOGO (buy one, get one for … free, or 50% off) is what’ll make you bite?

All of these common retailer discounts have one thing in, well, common: They’re aimed at enticing shoppers into stores, so that they’ll buy the stuff that’s on sale—and, while they’re at it, they’ll probably buy some stuff at full price as well. For the shopper, the rationale goes like this: Well, since I’m getting most of my stuff at 60% off, it’s no big deal to pay retail for a couple of other items. I’m still getting a good deal in the grand scheme of things, right?

Sorta. But if you justify unplanned spending in this way, in the grand scheme of things, you’re falling for one of the oldest retailer schemes in the book. If you agree with the above discount-shopping logic, you’ll inevitably pay more than you need to pay and buy things that you don’t need to buy. (More on Photos: Stores That Are No More)

In grocery stores, heavily discounted items are called “loss leaders.” They serve the same purpose as belts or shoes marked down by 75% at a department store. Their purpose is to serve as a magnet for shoppers, pulling them into the stores, where they’re likely to also splurge on something at the deli counter (in a supermarket) or on a new handbag (in the department store).

The NY Times discusses the spectrum of today’s discount strategies used to woo shoppers. And in today’s recession-era times, a mere 20% or 25% off “is practically nothing nowadays.” So the discounts are becoming more dramatic, though I’d argue that they are also becoming more meaningless—because nobody really pays the full price, which was listed as such mainly to manipulate shoppers into thinking they’re getting deals via heavily marked-down merchandise.

This is the game retailers play, and apparently many shoppers want to play as well. Mariana Sanchez, chief strategic officer at Saatchi & Saatchi X in New York, gives some insight into the ongoing shopper-retailer stare-down in the Times story:

The purpose of what seem to be “amazing discounts” is to offer “some trip-driving items,” Ms. Sanchez said, meaning merchandise that would spur someone to shop a store and, the merchant hopes, also buy some items at full price.

There are shoppers who enjoy “comparing the circulars, clipping the coupons,” she added, because they see it “almost like the sport of shopping, the hunt, as they’re in the pursuit of what they want for a better value.”

When such consumers make their purchase, she said, “they feel like they’ve won.”

Fair enough. Everybody wants to win. My take, however, is that if you think of shopping as a sport or a fun leisure activity, you’ve probably already lost the game being played here. If you get a thrill from bringing home stuff that you hadn’t planned on buying and that you don’t really need, the stores are the ones that are winning, not you.

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