Diana Clement 's Opinion

Your Money and careers writer for the NZ Herald

Diana Clement: Going shopping Keep your wits about you

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Marketing strikes to the core of your psychology and is hard to resist.

Beware of one-day sales. They're a great way to get you to spend. Photo / Sarah Ivey
Beware of one-day sales. They're a great way to get you to spend. Photo / Sarah Ivey

Ve haf vays of making you spend money. All over the world marketers are studying our behaviour and devising new and increasingly devious ways of emptying our wallets.

It's almost impossible to leave a supermarket or shopping mall without buying something you didn't intend to.

Retail marketing strikes to the core of a person. Marketers look at how we think, how we feel when faced with certain triggers and how we act in different situations. Researchers do things such as putting GPS devices on shopping trolleys to watch how we behave. Study of the psychology of shopping is applied directly to retailing.

The marketers even know where our eyes move when we look at a display. The concept of triangular balance is all about drawing your eye to the centre of a display where high profit items sit.

Likewise the high-margin stuff hits you in the face while you walk around a typical fashion outlet and the real bargains are hidden down the back.

Shopping is a contact sport. Consumer psychologists and marketers mess with your head when you're shopping. You may not use what you buy. Or you may fall for something excessively priced when a basic model will do.

Cunning shoppers fight back and spend wisely - whatever that means for the individual.

Kiwi shoppers have become more disciplined since economic times got tougher. We are spending less than we used to for each dollar earned. We want better deals and may not be willing to buy unless something is "on sale".

Yet it's impossible to always outwit the marketers. They're playing on our emotions almost without stop, says Helene Wilkinson, senior lecturer at AUT University business school.

There are ways to stand up to marketers and deflect their arsenal of weapons. They include:

• Don't touch or test drive. Once you've touched something, tried it on, taken it for a spin, or loaded the trial version, you're done for, in plain English. A concept called the "endowment effect" means we take ownership of the item in question and we value it more once we've touched it. The Wisconsin School of Business found that merely touching an item made you willing to pay more for it.

• Beware of the accessories. "Do you want fries with your new phone, Madam?" It's all too easy to buy the car charger, the phone cover, screen cover, spare cables and second battery on the spot. You won't necessarily need all of them and they're usually cheaper elsewhere. A Samsung Galaxy S3 desktop phone charging dock, for example, costs $59 at JB Hi-Fi. Don't fall for the fries line. A USB-powered S3 dock can be bought from DealExtreme.com for less than $10, including postage from China. Anything I've bought from this website has turned up and worked.

• Ask yourself the hard questions. Do you really need it? Why am I really buying it? Will it really make me look sexy? I wish I'd done a better job of asking myself the right questions when I bought a new GPS device for the car. If I'd waited a few months until I upgraded to a cheap smartphone, I wouldn't have actually needed the GPS.

• Set a time limit for your shopping trip. The longer you browse the more likely you are to buy extra things that you don't need. This applies online as well. I can report that spending too much time surfing DealExtreme.com is not good for the overall bank balance, even though virtually everything this website sells is a stonking bargain. Perusing Trade Me affects other people in the same way. Plan your trip to the mall. Go only to the shops you planned to visit. Don't surf websites that sell things just on the off chance. It's dangerous. I read in the UK's Retail Week publication that for every 1 per cent increase in the average amount of time spent shopping, sales increased 1.3 per cent across the mall.

• Beware of time-limited offers. Time pressure is a great way to get shoppers to buy. It's why dodgy salespeople give you an offer that's only available if you sign up that day. It's why one-day-sale websites work so well. You know if you don't buy it now, you'll lose the opportunity. I use these sites myself. I interrupted writing this article to buy a $15 meal-for-two offer at the Dhosa Plaza. It's important, however, not to buy something you wouldn't otherwise, says Wilkinson. If you go out for dinner, by all means buy a cheap voucher. Don't buy them just because they're there.

• Ignore other shoppers. One day deal websites, Trade Me, DealExtreme.com and others such as Amazon.com convince us to buy things because others have. They also ply us with reviews, which have a similar effect. The one-day sale sites show how many other people have bought the item already, says Wilkinson. Websites such as Amazon.com and even Trade Me show items bought by people who viewed the same items as you.

• Watch out for emotional blackmail. Never shop on an empty head. Last week's Herald on Sunday had a great article about how parents are conned into buying things that might even impair their child's development. Marketers now call toys "educational aids" and if you don't buy your child that baby gym you're failing as a parent. Or are you? Check out the article online at: tinyurl.com/ParentsAnEasyTarget

• Ignore the pictures of beautiful women. Men, this one is for you. Items being marketed primarily at men often use pictures of lithe young women to market their products. That's because the marketers are trying to fool you into thinking you'll be more attractive if you buy this phone, car, boat, or hair dye. Sorry, guys, but you're the same geeky, middle-aged bloke with a bulging stomach or wrinkled old man after you've parted with your money.

• Always shop with a list. If you have a list it's harder to get waylaid and buy things you don't need, whether it's groceries or other consumer goods. I use this one on my children. "Sorry, it's not on the list." Limiting supermarket shopping to once a week also helps counter the marketers' mind games. Fewer visits equal fewer spur-of-the-moment purchases.

• Don't shop on an empty stomach. Of course you'll buy more food than you should if you go to the supermarket feeling hungry. Or, like me, you'll make a quick trip to the mall to buy one thing and come out loaded up with some sushi because you're hungry. I'm a really sucker for sushi. Hopefully everyone knows that supermarkets con us by pumping the smell of baking bread into the store. Rotisserie chickens can be irresistible as well.

• Beware of lighting and atmospheric conditions instore. Lighting in a Bendon or Victoria's Secret store is designed to make women feel sexy, says Wilkinson. They're more likely to buy in those conditions. Or if a store is warm on a cool day, or vice versa, you're encouraged to stay there longer. Whenever in a store that has had more than the onceover by interior designers beware that you are likely to act irrationally. Who hasn't got a kitchen gadget in their home from Stevens or similar stores that they don't actually use?

• Don't buy now and pay later. If you do, says Wilkinson, you may find that when you need to pay for the item in three or five years' time it has devalued. Who wants to pay full price for a 5-year-old TV? Marketers also con us that interest-free HP means the credit is free. It's not. You pay an establishment fee, and you also buy on the weeks when the store isn't offering the best price deal.

You'd think that rational human beings could see through the obstacles marketers throw at us. Yet we fall for this stuff over and over again. If not, malls would have more exits, prices would never end in .99c, and supermarkets would have bread, milk and eggs at the entrance. Keep your wits about you and make your money go further.

- NZ Herald

Diana Clement

Your Money and careers writer for the NZ Herald

Diana Clement is a freelance journalist who writes about personal finance and careers. She has worked as a journalist for more than 25 years in both New Zealand and the UK. Diana has contributed to a large number of local and international publications. Her pet topic is the secrets of saving money.

Read more by Diana Clement

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