When thinking of the holidays, we usually think of festivities, happiness and relaxation. However, many businesses interpret this time of the year as an opportunity to rake in cash. In fact, many companies plan around the holidays, employing various tactics to convince you to cough up your money. To illustrate the importance of seasonal sales, e-commerce corporation Alibaba made a record-
breaking $30.8 billion on 2018 Singles Day, capitalizing on a Chinese holiday to
make profits.
The first step companies take is to remind you of the arrival of the holiday season. They dress up storefronts and in- teriors with colors traditionally associated with holidays, such as red and green for Christmas, or with baubles, string lights and other festive decorations. Stores will also play holiday music through their speakers, and they might even use several familiar scents to announce the beginning of gift-giving and weeks full of spending. Unfortunately, the combination of all these sensations will commonly cause people to let their guard down, leading to a shopping spree justified by
the holidays.
And this says nothing about how prices are manipulated during the last two months of the year. For example, stores see Black Friday as a day of profit, even though prices are Non-tangible gifts more thoughtful, caring traditionally cheaper during that day. Consider a television that normally sells for a high price of $3,000. If the store lowers its price to $1,000, consumers will quickly buy out the televisions since they believe they are getting a fantastic deal. Since so many more people are buying the product, profits are greater even though the prices have been slashed. The reduction of the prices is almost always ac- companied by advertisements; ‘LIMITED SALE 50% OFF’ might be plastered in bold letters on department store windows and hung from ceilings. To customers, these kinds of ads create the illusion of a temporary and tempting deal, persuading them to buy products and goods that they otherwise wouldn’t think to buy. Otherwise, the customers think that they will regret it when the deal is gone.
Stores can also squeeze additional profits out of shoppers by play- ing psychological tricks. Ever noticed how most of the stores have prices that end in 99 cents? It turns out that customers often round down when looking at the product’s price: a product that costs $1.99 is considered to be $1.00 in the consumer’s eyes. Another classic trick involves putting an obscenely expensive item next to several similar items. Of course, the store does not expect you to buy that $300 wine. Rather, by putting it near wines labelled $100, they want you to believe that you are getting away with a great deal. The wine may be expensive, but at least it’s not $300 expensive.
Finally, holiday checkout lines are long, which allows the store to extract out even more of a profit. While waiting for the 20 other people in front of you, you might be tempted to buy a candy bar or a pack of mints from the checkout counter next to the slow-moving queue. At this point, stores know that your guard is fully let down, so why not get you to spend a little bit more?
Stores exist to make a profit, and they will try any trick in the book to maximize their profits. Of course, the holidays are a time of merrymaking, so feel free to indulge yourself if you are usually a penny-pincher. But make sure to distinguish between whether you truly want an item or whether you were persuaded to buy the item, or you might end up with $1,000 worth of goodies that you have no idea what to do with.