• Tricks of the retail trade are outlined by retail expert Paco Underhill.
• Poll shows more women than men make impulse purchases.
• Sign up: AARP offers seminars on how to save more and spend less.
Shopping for clothing, I encountered a classic retail ploy to get me to spend more. Buy one six-pack of undershirts for $40, and get a second six-pack half off. Seemed like a bargain—12 undershirts for $60. But was it really?
Not according to renowned retail consulting expert Paco Underhill, who says you’re only getting a bargain if you’re buying something you actually need. Buying in bulk, he said, “we think we’re getting a bargain because the per unit price is lower. But that money could be sitting in our wallets or the bank.”
“Upselling” is one of many marketing tactics that consumers fall for. AARP Washington is teaming up with Underhill and other experts for a series of free seminars and webcasts, called “Money Smarts,” to help people spend less, save more and outsmart the marketers in these tough economic times. Preregistration is required.
Register online for the free Money Smarts seminars to be held May 26 in Kennewick, June 16 in Spokane, and July 21 in Lacey or call toll-free 1-877-926-8300.
“We’re not saying don’t buy anything, but there are things you can avoid, things that make you less disciplined as a shopper,” said Doug Shadel, AARP Washington state director. “Before talking to Paco, I didn’t realize the smell of fresh-baked goods as I walk into the grocery store makes me want to buy more stuff. If you can see it coming, you can counter it.”
Underhill’s firm, Envirosell, studies shopper behavior and advises major retailers on store design. He stressed that everything about a store is designed to get consumers to spend more. “Nothing is accidental, everything has a purpose,” he said. Underhill’s tips will be presented at the Money Smart seminars. If you can’t make the seminar, they are available online in an interview with him on the AARP Washington channel on YouTube.
Theatrical lighting at the department store makes jewelry glitter brightly. At the supermarket, more expensive food is shelved at eye level, with cheaper items above and below. At the clothing store, mannequins dressed in stylish ensembles seduce customers to buy more than a single item. At the electronics store, buyers are lured by large photos of happy families watching big-screen TVs together.
These and other marketing techniques work well in parting you from your money.
- Eight in 10 said they had made an impulse purchase in the last 12 months.
- The average cost of a department store impulse buy was $127.
- Women were more likely than men to make a purchase on impulse.
For consumers 50 and older, retailers know that a lot of purchases are for other people—spouses, children and grandchildren, and friends. “I may not necessarily buy for myself, (but) I want to show my wife or sister or grandchildren that I’m thinking of them,” said Underhill.
Laura L. Carstensen, director of Stanford University’s Center on Longevity, said her behavioral research has found that as people age they focus more on positive information than negative. Marketers use that insight to sell products based on positive emotional ties. A TV ad for an arthritis drug depicts the importance of being able to play with a grandchild, for example. Carstensen said people should be aware of this tendency to focus on the positive, and try to balance it.
She said positive information can benefit mood but it can lead to negative consequences like overspending. Her research will be shared at the AARP seminars.
Back at the store, I struggled with my undershirt dilemma. Then I noticed the same sale—half off the second item—applied to three-packs. So I bought two three-packs for $36 instead of two six-packs for $60 and left the store smiling, with $24 still in my pocket.
Some shopping caveats and rules from Paco Underhill:
- Never go grocery shopping when you’re hungry or tired.
- Make a list and stick to it.
- Be realistic about how much fresh food you can consume.
- Grab a handbasket instead of a cart; you’ll buy less.
- Don’t bring children to the supermarket or the mall because you’ll be tempted to give in to their requests.
- Don’t assume that items in end-of-aisle displays are on sale; the distributors paid for that prominent placement.
- When buying consumer electronic items, decide ahead of time what features you really need.
- Consider buying store-brand products—they’re generally cheaper and of the same quality as brand-name products.
- If you own a Web-enabled phone, use it to compare prices while you’re shopping.
Harris Meyer is a freelance writer based in Yakima, Wash.