Ah, the sales season. I have a love-hate relationship with the sales season. Very occasionally I will be very pleased with something that I got on sales. But, overall, it is a depressing time, when otherwise bright people make the silliest of purchase decisions (me included).
Here are some of the most common tricks used to lead us into buying things that we would otherwise not give a second look at.
When we compute the savings, we place more emphasis on the ‘percentage’ information, than the absolute value saved. We feel great that we are saving 50%; it doesn’t feel so great when we realise it is, say, £14.
Now or never
The offers are limited in time, which plays into our loss aversion. Because we hate losing something (money, an opportunity, …), we jump into action to avoid that loss.
Only a few units left
Offers are not only limited in time, but also in the number of units available. As Robert Cialdini explained, limited availability (i.e., scarcity) increases the perceived valued of the objects in question. It makes them more desirable.
We like to think of ourselves as having unique tastes and being different from the crowd. However, we have an urge to comply with the behaviour of those around us (that we identify with). Moreover, if a large group flocks to a particular shop, or we see a large number of shopping bags from a given store, we wonder if they know something that we don’t. We want to check it out, too, in case we are missing something important. More on observational learning here.
Where we start from
We tend to compute information in terms of reference points. It’s a time saving technique, as we can not compute everything. In sales, the reference point is the initial price – how much it used to cost. Because we start from that higher point, the new (lower) price sounds like a win. A saving. It would be a whole different story if we focused on how much we are spending.
And this is how I ended up with yet another pillow.