How Businesses Trick Customers Into Spending Money

The Psychology of Spending Money - Advice on Debt

Due to the COVID-19 pandemic, online and digital marketing has been more than prevalent. Companies, therefore, are taking advantage of that aspect to swindle and persuade customers into buying unnecessary products and wasting excess money. So here are some steps consumers can take to save up to $5000:

Create a shopping list and abide by it: According to a survey conducted by Field Agencies, 75% of customers buy more items at a store than they had originally planned to. This is a phenomenon businesses refer to as “impulse spending”. Companies enhance impulse spending by offering discounts, and creating pleasing aromas that further convince customers to spend money on their products. Therefore, by creating a shopping list, customers become more self-conscious of their budget and will be less likely to indulge in impulse spending.

Ignore limited time offers: Limited time offers are another tactic businesses will use to trick consumers out of spending excess money. Limited time offers are mostly used by online companies such as Amazon and eBay to purchase a product within a specific amount of time to get the product for free. “The simple truth is that the shipping is most probably free anyway, but you didn’t know that and businesses will use it against you to close your order as fast as possible”, says reporter John Doe. Moreover, according to psychologist Victoria Vassella, limited time offers pressure our mind and increase the likelihood of impulse spending. So the next time a limited time offer comes up on the company’s website, it is best to ignore it as it is probably a fraud.

Pressure the company into offering a discount: While it has been stated that companies like to pressure customers through discounts, there is a practical technique that customers can use to pressure the company instead. Do not immediately complete an online order. What businesses will often do is offer 20% to 30% discounts on loose items in a shopping cart. Therefore, the next time a consumer uses Amazon, he/she should place their desired items in their shopping cart, provide their information and shipping address, but do NOT click the “Pay Now” button. This action will fool the company into thinking there are abandoned items in the shopping cart and, after a few days, the company is likely to offer a discount. It is kind of satisfying having the company lose profit for a change!

Do not be fooled by the “99 Cent Pricing” tactic: Ever wonder why companies price their products at $9.99 rather than $10 or at $99.99 rather than $100? According to reporter and psychologist Kenneth Burke, “ending your product prices with 99 will yield 24 percent more sales than if you priced it at an exact amount”. This is because people are likely to spend money when they see a one digit number like $9.99 rather than a two digit number like $10.00. This is a phenomenon that businesses refer to as “99 cent pricing”. Therefore, the next time a business utilizes this marketing strategy, remember that it is only a $0.01 difference and a make a rational decision about buying the product.

Bring money within the budget when shopping: Before going shopping, the consumer should create a list of items they intend to buy. The consumer should then create an approximation of how much money the items will come to. For example, if the items on the list come to about $50, the consumer should only bring about $60 with them when they go shopping. By bringing money within the budget, it eliminates the possibility of impulse spending and so the consumer will save money.

The purpose of businesses is to make profits, even if it means fooling the customers into wasting money. However, by following these steps, customers can be wary of these business practices and, hopefully, spend money more wisely. Business is an intricate and cunning concept so do not be “sold” into thinking otherwise!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s