Save Money By Knowing the Games Stores Play
Who wouldn't like to save money when shopping? But looking for sales is just a start. You also need to be aware of the games that retailers play, starting with the two common ones explained here.
Reference Price Advertising
You have seen advertising like, "Was $119. now only $89!" Similar signs will confront you once you get to the store. Interestingly, regardless of whether the retailer ever sold a single unit at the $119 price, you feel like you are getting a deal, and that is the point of this game.
States often have laws requiring that these be honest advertisements, meaning the store must have the item for sale at the stated price for a certain amount of time before they can claim that it was the "normal" or "regular" price. Of course, not surprisingly, many have it at that price for the absolute minimum time required by law. They may not actually expect to sell any at the "regular" price, since it is solely there to make you feel good about the new "sale price."
One way some retailers use this tactic is by having many similar models of a product. A furniture store might have several mattresses that are very similar, for example. Which one is on sale is rotated, so there's always one that looks cheaper than the others. If you notice this, certainly don't pay the regular price, but wait until the one you want has its turn on sale.
You can also save money in this situation by buying one of the "sale" items. Alternately, since they never expect to sell the items at that price anyhow, the store manager may give you a similar discount if you ask (or insist) for it on the one you really want.
Price Matching Scams
Stores find that it costs nothing to guarantee the lowest price in town. It may be true that they'll match any competitor's price, but then again, they will only match the price on the exact same item - and they may not carry the same models as other stores do. They're also very aware that we rarely check the prices in other stores before buying - and almost never after buying.
Consumer research shows that when a store advertises that it will match competitors advertised prices, we generally think they have lower prices than other stores. Interestingly, this impression is there even when they are one of the higher-priced stores. This is because we often just don't check the prices at other stores.
There are some customers who actually compare prices and demand a reduction. This doesn't cost the store much, and meanwhile, they can sell for more than other stores to all the "average" consumers who don't check other stores.
You might wonder if comparison shopping worth the trouble and time. A study done by the Consumer Literacy Consortium in 2002 found that buyers who spent 16 minutes comparing prices online save an average of $100 on a television. Does that sound worthwhile?