By Kevin Gibbons
Have you noticed that there are some retailers, brick and mortar or on-line, where it is easy to go in, pick your items, make your purchase and leave, while other stores seem to suck you in, not releasing you until you’ve spent two weeks’ salary?
Did you ever wonder why you can get in and out of your local grocery store and stick to your list while it is virtually impossible to do so at Target? In this article, we’ll take a look at what stores do to distract you and persuade you to spend more than you had planned, and what you can do to stick to your budget.
Efficiency and Association
Many stores hire professional psychologists to help them determine the best way to get you to spend more time in their store or on their site. This makes sense. The longer you shop, the more likely you are to buy. Physical stores do this by putting the most popular items (determined by sales research) at the back of the store, and separated from each other. They want you to wander through the aisles as much as possible, where they have the chance to catch your eye with something new. We talk about a classic example of this strategy in our Shopping Webinar: Grocery stores inevitably stock milk in the far back of the store, forcing you to go through the entire store to get this most common staple.
Have you ever noticed that most Target stores do not play music? Music enjoyment is subjective. Whatever music a store plays is going to attract some people, possibly encouraging them to spend more time in the store, and repel others, encouraging them to leave. If your store has a specific demographic, like Forever 21 or Joseph A. Banks, you can tailor the music for that group. If you rely on appealing to a very broad demographic like Target or Walmart, you may be better off avoiding music altogether. Studies have also shown that listening to music while performing tasks can make you more efficient. If a store wants its shoppers to be less efficient and spend more time, maybe turning off the music may help.
On-line stores take a different approach. If they were to make you click through too many pages to get to your desired product (analogous to walking to the back of the store to get the milk), they run the risk of you getting frustrated and just going to another website – which is much easier than getting back in your car to drive to another store. So they get you to overshop by following the Amazon model. As soon as you make a selection, they start showing you other “things you might like.” This type of associative marketing is incredibly effective, because you have already made the decision to purchase the principle product. It doesn’t take all that much encouragement to persuade you to buy a closely related companion item.
Avoiding the Black Holes
The first step to avoiding this type of marketing is to be aware that it exists. If you just understand what stores are trying to do, you can guard against falling prey to those types of manipulation. Here are four tools to help you avoid these black holes.
- Be in the Right Frame of Mind
Exercising will power and good judgement is tiring. So make sure that you are fresh, fed, awake and comfortable when you go shopping. (Avoid shopping in your business clothes!) Who wants to compare prices and package sizes on an empty stomach, after a hard day’s work? If you are a morning person, schedule your shopping early in the day when you are physically and mentally prepared for the task. If you are not, pick the time of day when you are at your best and not rushed, so you can focus on what you are doing and make the best decisions.
- Look Up and Down
Distributors pay retailers for premium, eye-level shelf space. This means that the biggest companies with the largest marketing budgets will pay to put their products right in front of you. Look at the top and bottom shelves for better deals from the smaller distributors of equivalent products.
- Know the difference between a “Sale” and a “Promotion”
Retailers often run “End Cap Specials,” where they feature products at the ends of shopping aisles. They will advertise these selected products with large banners, but if you regularly track prices you may find that these “specials” offer no real savings. These may not be real sales; they are just promotions with fancy advertising at the regular prices.
- The Shopping List
The most effective tool to sticking to your spending plan is to have a spending plan. The key is having a physical list, whether it is a paper page in a notebook or an electronic page on a cellphone. Keeping the list in your head is not enough, no matter how good your memory is. That is because the list in your head tells you what to buy, but the physical list also tells you what not to buy.
Does this mean that you can never be spontaneous, or that if you forgot to put “toothpaste” on your shopping list, you have to go without brushing your teeth for the next week? Of course not. What it does mean is that if it is not on your shopping list, you have to ask yourself two questions before the item ends up in your physical or virtual shopping cart:
- Do I absolutely need this now?
- Am I madly in love with this item and will I use it?
If the answer to either one of these questions is “yes” and you can afford it, then, by all means, buy it! Life is full of opportunities for spontaneity and good deals. The solution is to be purposeful in all your spending, both planned and unplanned.
Kevin Gibbons is a Cash Flow Planning Expert, the Vice President of The Savvy Life and co-author of the international bestseller Living The Savvy Life. For the past eight years, Kevin and Savvy Life Founder Melissa Tosetti have worked with over 545 individuals and families to create Spending Plans.
They also work with financial advisors and their clients doing cash flow planning as well as giving Savvy Living presentations via webinar and in-person to audiences across the U.S.
To learn more about how Kevin and Melissa work with clients, visit The Savvy Life’s Programs Page.
If you’d like to learn more about how they work with financial advisors and their clients visit: The Savvy Life Advisor’s Page