Monday, October 20, 2014

Money Monday: 4 Tricks Supermarkets Use To Make You Spend More

Last week we talked about the tricks online retailers use to encourage spending.
This week, we're talking about some similar tactics used by grocery stores. 

Over the last few years, I've gotten much better at planning my grocery trips (i.e. using meal plans to create my grocery lists). There were plenty of times in the past when I would go stop at the grocery on a whim, and those were the times I would end up going slightly over budget. Though you may not have any issues with recalling your full grocery list from memory, there are several psychology tricks supermarkets enlist to trick you into spending more money than you plan.

1. Location, location, location.
This article isn't about real estate, but this phrase can also apply to the importance of product placement in the grocery store. Ever wondered why your store is constantly changing their layout? If you don't know where things are, you spend more time inside the store. The more time you spend inside the store, the more time you have to browse the shelves, and the higher the chances are you'll be tempted into making an impulse purchase. Ever wondered why there is a gap between longer aisles? Store designers want to encourage you to go down the aisles. Stores also tend to place (pricier) name-brand items at eye-level on shelves, moving the (less expensive) store brand items to lower levels. 

2. Sneaky circulars
Whether in print or online, many people rely on store ads to help plan their grocery list. The trick here? Despite being advertised, every item in the circular may not actually be on sale. Manufacturers may have paid to have their items featured, even without price reductions. Items that are sold at or below cost to tempt shoppers (a.k.a. "loss leaders") are typically featured on the front page of the store ad.
Source: Huffington Post
3. Color-coding (practically everything)
Companies use the psychology behind color-coding to influence your purchasing behavior. Our subconscious associations with colors influence how we understand prices, value and quality. Blue is often used to target budget-conscious consumers, who associate the color with trust and stability. Red creates a sense of urgency, which can trigger impulse buys. Purple is often associated with luxury or royalty, and promotes a sense of high quality.
4. Odd digit psychology, and the power of "9"
The method of not pricing items in round numbers (i.e. 69 or 99 cents) is also known as "odd pricing" (and the practice has been in use for over a century). For several years there's also been a theory that consumers pay the most attention to the first digit of a price. Basically, if an item is marked $1.99 instead of $2.00 the consumer will be more likely associate the price with $1 instead of $2.

Notice anything about the methods your local grocery store uses?
Does learning any of this change make you reevaluate your shopping habits?

Send your thoughts to:

Happy Monday!

xxxx Alyssa Marie

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