In this episode of Motley Fool Answers, Alison Southwick and Robert Brokamp are back with more warnings about the mind games that advertisers and retailers play on us -- and they play with extra intensity during this most profitable time of the year. Not that they're suggesting you become a Miser -- Heat or otherwise -- but they do want you to know precisely how you're being manipulated to open your wallet.
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For example, you can't miss the fact that Christmas sales, decorations, and advertising seem to show up earlier every year -- another decade like this and they'll overlap back-to-school sales. What gives? Unfortunately, the psychological phenomena retailers are trying to hack with those early moves are useful enough that the race to be first to the Santa starting line will never end.
A full transcript follows the video.
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The author(s) may have a position in any stocks mentioned.
This video was recorded on Dec. 12, 2017.
Alison Southwick: The second way that marketers will getcha is Christmas creep.
Robert Brokamp: What's that?
Southwick: Oh, you know what Christmas creep is. It's the idea that marketers start advertising holiday stuff even...
Brokamp: Oh, yeah.
Southwick: ... even before Halloween. There's a psychological reason why that happens.
Brokamp: Oh, I'm glad to hear it, because I'm always curious. It does seem to get earlier.
Southwick: At Costco this year they had Christmas trees up before Halloween.
Brokamp: We went to Michaels to get something for Halloween and the Halloween stuff had already been packed up and they had the Christmas stuff coming out. Crazy.
Southwick: We sound like old people complaining, but it's true. So, there's a reason why this is happening, and it comes also from the concept of anchoring. We talked about price anchoring last week. That's a slightly different concept in that we like markdowns because if we look at a tag and it says, "Originally $10 -- now for $8," we anchor to that first data point which is that it's $10, and now it's $8. We feel good because we got a deal.
Anchoring is at play, here, in that we make decisions based heavily on the first information we receive, so marketers are in a race to be the first information that you get around the holiday season. When the holiday flyer comes from Macy's babbling about their awesome sales, marketers hope you'll be more likely to go to Macy's.
Southwick: Also at work, here, is the Baader-Meinhof phenomenon... Do you know this one?
Southwick: You do know this one. It's when you notice something once, and then you start noticing it everywhere. Christmas creep means that advertisers have more time and have a longer runway to keep getting their ads in front of you over and over again. Their billboards. Their emails. Their catalogs. You're getting hit from all directions.
Because last week I went to the Neiman Marcus website to look at their holiday catalog, I am getting stalked by Neiman Marcus catalog ads everywhere I go online and it's killing me. Er!
Brokamp: You don't want that $50,000 refrigerator?
Southwick: Uh, I'll take it. Are you offering? Do you need to make a return? Don't go to the trouble of making a return on my account. I will take the $50,000 fridge. I don't have room for it in our teeny-tiny house.
Alison Southwick owns shares of Costco Wholesale. Robert Brokamp, CFP has no position in any of the stocks mentioned. The Motley Fool recommends Costco Wholesale and The Michaels Companies. The Motley Fool has a disclosure policy.