Have you ever wondered what it is that makes you purchase certain items that you didn’t even know you needed? Why do we spend impulsively at times?
The truth is that retailers and their marketing and advertising gurus have done their research into what makes our brains tick. They’ve spent millions of dollars and hundreds of hours conducting and analyzing market research in order to sell us more stuff.
Because we want our customers to make the smartest financial decisions this holiday season, Raccoon Valley Bank has done a little research of our own to shed some light on the tactics you’ll see when you’re out shopping.
The most common colors for sales and displays to draw your attention are red and yellow. Why? Warmer colors signal the brain to get excited; when you’re brain gets excited, the likelihood that you’ll spend money goes up. Pay more attention to the words and numbers on displays and price tags instead of the color to determine the real value.
Prey on your desires and fears
Humans all have the same basic fears, needs and desires:
- Fear of rejection
- Need for affection
- Desire for wealth
- And so on…
Retail companies know which of these fears, desires and needs motivate us into action. Holiday ads on television, in print and online are all aimed at “helping” us fulfill a need or desire, or avoid a fear.
Try to keep you in the store as long as possible
Ever wonder why stores are so big? The simple answer is that retailers want to keep you in the store for longer. They’re banking on a very simple math equation: the longer you are in the store, the greater the pressure is for you to actually purchase some to make your shopping trip worth it.
What you can do to break the cycle
- Use the ultimate weapon against overspending: a list. Before you head out the door, handwrite a list and slip it in your pocket. By hand writing the list, you engrain what you actually need better than if you type it into your phone.
- Set a time limit. Set an alarm on your phone or watch when you set foot into the store. When it goes off, head to the checkout line with what you have, or leave if you don’t have anything.
We’re not saying retail companies are evil; they’re just doing their jobs. But by being aware of these tactics, making a list and setting a time limit you can avoid making additional purchases that kill your budget.
As always, Raccoon Valley Bank is here to help you with your finances. If there’s a way we can help your holiday season go smoother, simply call or come by the bank office near you. We hope to see you soon!
Raccoon Valley Bank, member FDIC