Beyond Deals & Discounts: How Retailers Are Luring in Holiday Shoppers

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Low prices are sure to draw in consumers during the ultra-competitive holiday shopping season. But cheap deals are hardly the only strategy being used by stores to woo consumers.

It’s never been easier for holiday shoppers to find cheap prices. Huge, across-the-board discounts have been appearing daily, and are expected to keep popping up through Christmas (and beyond). With smartphone in hand, consumers can compare prices anywhere they please—most notably, while standing in a store eyeing the merchandises—to make sure that the deal in front of them is at least as good as what’s available from competing retailers. If necessary, the shopper can invoke the robust price-matching policies introduced this season by several retailers, PayPal, and at least one credit card to ensure that he’s getting the best price.

For retailers, however, constantly competing on price is a race to the bottom, in which profits disappear due to the need to avoid losing an immediate sale. As one expert explained to Bloomberg:

“You just can’t all keep competing on price all the time,” Barbara Kahn, a marketing professor at the Wharton School of the University of Pennsylvania in Philadelphia, said in a telephone interview. Luring consumers outside major shopping days takes exclusive products or “customer experiences or ‘gifts’ that encourage people to come in,” she said.

(MORE: The Hottest Section of the Department Store May Be Online)

Here are a few of the strategically placed “experiences” retailers are employing to attract shoppers lately:

Freebies & Perks
Sam’s Club handed out free pastries and Starbucks coffee on Black Friday. In lieu of nonstop holiday sales, JCPenney has been trying to win over customers with free haircuts and free family portraits. The troubled retailer is also giving out holiday buttons to shoppers, who may be eligible for free gift cards worth $5 to $500, as well as other prizes.

The Wall Street Journal reported that upscale malls around the country have been enticing shoppers into the stores with a range of VIP perks available for free or a nominal fee, including valet parking, package-holding services, and lounges with free candy hot chocolate. Many retailers are offering layaway services for free during the holidays too.

Speaking of layaway, Kmart, one of the few retailers that offers the service year-round, gave consumers another reason to use layaway with a series of special giveaways: For several weeks, at every Kmart store, one layaway account was selected to be paid off by the store. For the first 12 days of December, meanwhile, Banana Republic stores are giving away Ghirardelli chocolates and six brand-new Fiat 500 automobiles, according to Bloomberg News. The winners get to pick out what color car they’d like best.

(MORE: Cyber Monday Was a Monster — But We Still Love Shopping in Stores)

Exclusive Goods
One popular way to counter the common practice of “showrooming” (browsing an item in a store, then buying it at a cheaper price online) is for a store to sell goods that simply aren’t available anywhere else. It’s impossible for a consumer to comparison-shop, after all, if there’s only one shop selling the merchandise.

Exclusive merchandise deals can do more than eliminate the possibility of showrooming, though. They can also serve as magnets for shoppers, who have no choice but to buy from the lone retailer that has the goods. A dealnews post rounded up some of the major retailer exclusive merchandise offers, such as the Tabeo kids tablet (available only at Toys R Us) and Target’s Neiman Marcus Collection.

(MORE: By Matching Online Prices, Are Best Buy and Target Doing Exactly What Amazon Wants?)

Cheap Gas
In a “Great Gas Rollback” promotion that started in August and lasts through December 24, Walmart is knocking off 10¢ per gallon if filling up with a Walmart gift card, and 15¢ per gallon if using a Walmart money card or credit card. The discount is available only in participating states (there are 20, mostly in the South and Midwest), and only at Walmart and Murphy USA gas stations. And hey, if you’re already in the parking lot getting gas, you might as well take a walk through the store aisles to check out the latest, right?