If you buy a $100 shirt at half price, did you save $50 or spend $50? The psychology behind discounts and getting the best deals today is nothing short of fascinating.
Here we take a look at how spending money makes us feel, and why many of us enjoy getting a discount more than eating a slice of pizza.
How we find deals in 2020
Shoppers score bargains and the best deals online through lots of savvy methods in 2020. There are plenty of ways to save, from signing up to club cards, using e-voucher-searching apps or bookmarking websites that let you know when products go on offer.
We also use timing to find deals by targeting our favourite stores at certain times of the year, such as at the end of a season, Black Friday shopping or hitting the sales after Christmas.
Those who don’t want to wait for a specific time of the year have the option to visit a website (or even sign up to their newsletter) that lists all the best deals. Yo! Free Samples is one of those sites and a popular choice for consumers wanting to find the best deals today at Amazon, Walmart and other household names.
But, why is finding a deal important?
Finding a deal is crucial because spending money has been scientifically proven to make us feel guilty. The more we spend on an item – whether it is something necessary or not – the more guilty we start to feel.
Interestingly, women tend to feel more guilty about spending money than men. But young people are feeling far worse than their older counterparts for spending. This is logical considering young people are expected to save for their house deposits and their future, whereas older generations may have already paid off their mortgage or be well set up.
Therefore, finding a deal is important to mitigate these feelings of guilt. In fact, discovering an offer can make us feel a rush of adrenaline and excitement. Just less than 20% of people surveyed said that finding a deal felt better than eating pizza – and who doesn’t like pizza?
How long do we wait for a deal?
Americans will wait around two months on average to find a deal. This length of time surprisingly does not reduce significantly with more income, but it does when you get older.
People over 55 are not as likely to wait around to score a deal as they just want their product or service instantly. This makes sense if they have fewer financial commitments or do not feel as guilty because they already have a home, car, etc.
Forbes has also pointed out that millennials are really good at saving, with 39% of them now classified as supersavers. This may also make them more patient to wait for a deal.
How retailers play on your psychology: the Decoy Effect
Your natural feelings of guilt when spending money is not something marketing departments will enjoy. They need to find a way of turning this feeling on its head – and they do that by providing you with deals.
But what if the marketing team cannot offer you a discount right now? Well, they can use another tactic called the Decoy Effect. Marketing grads know all about this little trick. It works by encouraging a consumer to choose one product/package/service over another option, all by placing it next to less appealing options (i.e. the decoys).
For example, if you were to choose from three different video streaming packages. The option that the marketing team really want you to choose will be put next to other options that are significantly less good.
One may be cheaper but terrible value for money while the other is overpriced, leading you to believe that you are scoring a deal by picking the middle package. The marketers helped you kick the guilty thoughts to the curb without even offering a discount. All they did was change your perception and thought processes.
So, are we sharing the wealth?
Millennials and Generation Z will tell their friends and family about deals they found online. They do this around one-third of the time, and it generates a bond between their group.
Therefore, deal hunting is not just a way to mitigate guilt, but also to enhance social experiences and close relationship.
Discounts on products and service are more likely to be shared with friends and family, such as deals on medical expenses. For example, lots of Americans are now talking about apps that can cut prescription costs by as much as 75%. Let your grandparents know next time you visit!
You may have never considered the psychology behind hunting for the best deals online today, but now you know why you feel the way you do!