How Retailers Get You to Spend More

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Published December 21, 2012

| FOXBusiness

It happens all the time: You stop at the grocery store for a gallon of milk, visit the mall to pick up a birthday gift for a friend, or duck into a store to replace your broken earbuds and ... you walk out with an armful of bags. 

Getting more than you’d planned or bargained for when shopping isn’t totally your fault. In fact, retailers work hard to get you to spend more than originally planned.

 “The reality is the average income dropped over the last four years,” says Pam Danziger, CEO of retail marketing company Unity Marketing. “That is real money that people don’t have to spend at Christmas and that puts the onus on retailers to squeeze that discretionary spending out of people struggling.”

Retailers envision every detail of your shopping trip to entice you to buy more than planned, and if consumers aren’t careful they can fall right into these carefully-laid traps.

Danziger explains there are two driving factors that relate to how much consumers spend: the time they spend in a store and the amount of interaction with products and store workers. 

“That is why the milk is located all the way in the back of the store: You have to pass all the items that you also might need," she says. 

The more consumers can touch and interact with a product the more likely they are to buy it, but when it comes to retail employee interaction, there’s a fine line between too much intervention and not enough. 

“Workers should be easily available when needed, but they don’t need to approach customers every couple of feet or every time they turn around -- that can be annoying and make them walk out,” Danziger says.

Retailers might entice you with low prices to get you in the door, but once you’re there, the real tricks come out to get you to spend more than planned.

First See, First Buy. Manufacturers pay a premium for prime shelf locations, according to personal finance expert Jennifer Streaks, so you are more likely to see more profitable, higher-priced and name-brand items at eye level with the less-expensive private label products on the bottom and top shelves.

Streaks says that studies show consumers are attracted to the first item they see so retailers will put the higher profit margin items at the entrance of the store. “The tables at the front are going to display the Burberry scarves -- if you want a regular scarf you have to walk to the back. That’s not by accident.”  

Pretty Packaging. Certain colors, like black and gold, connote a sense of luxury, according to Tod Marks, senior project editor for Consumer Reports, and manufacturers will adorn products with fancy ribbons and nice font types to make products look more sophisticated and attractive.

“Retailers know the outside of an item is equally or more important than what it actually inside in terms of getting a consumer to buy. They need your eyes to gravitate and respond to an item in order for you to be intrigued enough to pick it up,” he says.  

The Complete Package. It’s fun to relax around the living and bedroom displays at stores like Ikea, but they didn’t create the setups for your lounging convenience.

“Retailers work hard for the up sell,” says Nikoleta Panteva, senior retail analyst at IBISWorld. “Whether it’s an entire outfit showcasing one shirt or a sofa as part of living room display, you won’t just buy the initial piece you set in for, you need the matching chair or belt, after experiencing it and seeing the whole look put together for you.”

Music to your Ears, Their Wallets.  Knowing that the longer you stay in a store, the more you are likely to spend, retailers work hard to create an attractive ambiance that fits with the store.

“The music will always match the retail environment, that is why at Starbucks (SBUX) you will hear more mellow music and jazz that puts you in a more relaxed mood and want to linger and buy things after you finish your coffee,” explains Panteva.

The Christmas music isn’t just festive, adds Streaks. “It gets your defenses down to relax your mood and gets your mind off why you are there and to look around more and to put you in that giving spirit.”

The Bait and Switch. It’s hard to pass up a mega deal, but often retailers advertise items priced below or at cost just to get you in the store and then hit you with the bad news: they sold out of that item, but just happen to have a different (and more expensive) model that you might be interested in.

“They get you in the door and will work to up sell you on a more expensive item when the one you want isn’t in stock,” says Marks. “People are sheep, they follow the leader and when someone tells them something is out of stock with no rain checks, they will  be steered to something that is more profitable for the retailer.”  

Time is Running Out. “Never get sweaty palms over missing a sale, there will always be another,” says Marks. Granted, presents do need to be under the tree on Dec. 25, but don’t panic and buy items just because they are on a limited-time sale.

“Retailers like to make consumers feel like they will be left out of a sale if they don’t act now and create a fake sense of scarcity that forces people into buying more,” he says.

Bigger Means More Stuff. Studies show the size of shopping carts have grown up to 37%, making it easier to rack up a big bill without even noticing.

“If you only have a few items on your list use a hand basket or a small cart,” recommends Streaks.  “Don’t get caught up in the shopping mentality, make a list, impose a time limit and go with the smallest possible cart size.”

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