9 Sneaky Ways Online Retailers Get You to Spend More Money
Buyers, beware: From one-day-only sales and countdown clocks to free shipping and returns, online retailers have a variety of ways to get you to buy more.
From one-day-only sales to free shipping to countdown clocks, online retailers have a variety of ways to reel you in, get you to load up your cart, and spend more than you had planned. You've seen these tactics before and you'll see them again, so how can you actually online shop and stay on budget? According to Jason "Retailgeek" Goldberg, host of the top-rated e-commerce podcast, The Jason & Scot Show, you should "be a hunter, not a gatherer." That means having a specific purchase in mind before you head to a website. "Don't go to sites looking for ideas. That's like shopping in a grocery store when you are hungry." Read on for nine common tactics that online retailers use to get you to spend money.
"Free shipping remains the most effective tactic for e-commerce," says Goldberg. Retailers understand that offering up free shipping is a draw. That's why you'll often see messages like, "free shipping with a $35 minimum purchase" or "next-day delivery on orders of $50 or more" on various retail sites or promotional emails. Getting shoppers to hit a spending threshold—oftentimes by adding things they don't really need to their carts—and waiving shipping costs helps companies increase sales. "Most people would rather spend more money buying things they don't need than pay for shipping costs," money-saving expert Andrea Woroch told Business Insider.
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According to Business Insider, the scarcity principle—pressure that gets shoppers to buy something if they think it will sell out soon—is a legit way that retailers get you to buy. The sense of urgency creates an undeniable call to action, and you wind up snapping up an item because it seems like a "must-have." Luckily, "customers have the convenience of product reviews, inventory research, and competitive pricing comparisons more so than ever before," says Reyhle, "and as a result, this positions customers to make smarter purchase decisions." Just because an item might be selling out on one site doesn't mean it's not available somewhere else—or that inventory won't be replenished soon.
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You probably saw countdown clocks just about everywhere on Cyber Monday. Retailers displayed huge banners with the exact hours, minutes, and seconds left—with time slipping away right before your eyes—for shoppers to get the most out of their sales event. There is a method to this madness. The feeling that time is running out, also playing on the "scarcity principle," creates anxiety and pressure to get a good deal while you can. The trick? "Try not to feel rushed or pressured when it comes to making decisions, despite the strategies retailers use to make you feel otherwise," says Nicole Leinbach Reyhle, founder of RetailMinded.com and author of Retail 101: The Guide to Managing and Marketing Your Business. "That said, the holidays do have a time limit so recognize that a deal may be available one day it may not be available the next." Psst—here's how Cyber Monday actually became a thing in the first place.
Beware of websites that allow you to check out faster than you can brush your teeth. While there's nothing wrong with a fast checkout process, retailers know that this eliminates time to reconsider the items in your cart. In fact, in a recent survey 89 per cent of shoppers say they're more likely to buy items on Amazon, which has a quicker "Buy Now" option than most websites. So what happens if you made a purchase that you do regret? Before buying, it's a good idea to "know what a retailer's return policy is and to keep receipts should you decide you want to make a return," says Reyhle.
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Buy more, save more discounts
Five dollars off a purchase of $50 or $10 off when you spend $100—it may seem the more money you spend, the more you'll save, but it's the retailer who wins. When you see these types of buy more, save more discounts or similar promotions, Goldberg warns to comparison shop first; don't "exclusively trust the site you're shopping on."
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Many sites show reviews and recommendations, which can be helpful, but don't give too much credence to badges calling out Top Sellers, and the like. According to Goldberg, "badges like 'hot seller,' 'staff pick,' and 'top reviewed'" are there because they get consumers to buy more. But what do these badges really mean, and who chooses these products? You have to read the fine print. "Don't drink and shop," says Goldberg. "A shocking amount of e-commerce happens at 2 a.m. after the bars close," he adds.
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Reminder ads and pop-ups
You're not imaging it—you really are seeing ads for products that you just looked at (and maybe already purchased) as well as things your Facebook friends are buying too. (According to this surveillance expert, your phone is spying you, too!) "Retailers are able to track customer engagement online and in stores alike thanks to modern technology," says Reyhle. "As a result, they are also able to react to customer behaviour with strategies that encourage customers to stay engaged with their brand—ultimately aiming to lead them to make a purchase. From using email to remind customers of a purchase they 'should' make to popping ads up into your social media feeds, there are a lot of ways retailers persuade customers to buy." And while the jury is still out on how effective such ads really are, it isn't going to stop retailers from targeting you this year.
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Online shopping purchases hit new highs this year, with a recorded $7.4 billion in sales on Black Friday alone. But with those sales comes the inevitable returns. "UPS expects to process 1.6 million returns per day in the week before Christmas, and nearly 2 million on January 2," reports Fortune. The fact is, easy return policies are another way merchants get you to buy more. Odds are you'll feel more confident buying something if you know that you can send it back if it doesn't work out. But the fact is, you may never get around to returning anything. Score for the store!
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One last way retailers try to get you to spend more money is by adding irresistible product recommendations on your screen, increasing the odds of an impulse buy. Actually, simply pausing to take a breath is proven to help you avoid an impulse buy.
Next, find out how mindful shopping can save you money—and make you happier!