I want to start this article off by getting something off of my chest: I am a bit obsessed with sales.
I think the source of this goes back to my childhood days. My father has always been a genius at finding the best sales all around Istanbul, and I think it rubbed off on me a little bit too. Using the internet and store catalogs, we would find TV’s, couches, phones and anything else a family could need for ridiculous prices, and it was more so a bonding activity between us rather than just shopping for goods.
I wouldn’t say I am a shopping addict, really. I am successful at knowing my limits and staying on course with my budget, and it is something that I have to be careful with since I am a university student with no real income. However, a nice looking pair of shoes for half the price always leaves me in a dilemma which usually gets me frustrated, but in the last few years I’ve seen clearly that this is exactly what companies are aiming for. Not just products that are on sale, but for any product that caters to my likes and interests.
The main objective of a sales promotion is to increase consumer demand, which is crucial for the well being of a business. Products are being pumped out of factories and are filling the shelves for millions of stores all around the world, and in the era of marketing, stimulating market demand has become more of a science than a business plan for companies.
So why exactly does a sale improve consumer demand?
The easy answer would be to say that it is because the discounts make it easier for consumers to buy a product that they were not willing to pay the initial price for. However, it is a bit more complicated than that. When you buy a product at a discount, or when you receive a coupon for the discount, you are likely to experience a higher increase in your oxytocin (which is one of the hormones that are responsible for your mood) levels than you would by buying the product for the regular price.
Buying a new product is supposed to make the consumer happy, and in the age of instant gratification, consumers are likely to resort to stress relieving activities, which makes them a primary target for companies to take advantage of.
Production capabilities have never been higher, and this situation combined with the state of the modern consumer have created segments in which companies can specialize. While some companies focus on creating a brand that offered decent quality goods for very favorable prices, some companies specialize in creating differentiated products that are sold for premium prices, which create an opportunity for every buyer from every demographic to be intrigued by the idea of purchasing something new and satisfying that is in their price range.
However, the satisfaction from buying a new product is likely to last for a rather short amount of time, and it must be the consumer’s priority to manage their finances in a balanced manner. While most readers of this article might be more informed and educated about the burden of debt and overspending, many individuals from even the most powerful countries are facing problems with poverty caused by being uninformed regarding credit card debts, bank credits, taxes or covering the basic costs of living for a whole month.
Another factor that fuels the spending craze is the dazzling appeal of luxury being advertised very heavily through many mediums. Companies now have a broader reach to their customers thanks to mediums like the internet and specifically social media platforms. This situation causes problems for uninformed consumers, as they resort to activities such as taking loans from banks or filling up their credit card limits to degrees there they will not be able to eventually afford to get a taste of the “rich life”.
The situation at hand creates a big problem for the “little people”. While universities and private schools may provide fundamental information to students regarding money management, the service they provide is not accessible enough for an important portion of the population, especially in underdeveloped and developing countries. Therefore, finding ways to educate the average buyer is becoming more and more important by the day, which is a problem that must be tackled by governments and organizations.
In conclusion, because of the current shape of the society we live in, being an informed customer is becoming more and more important by the day. Therefore, the next time we find ourselves peeking through a shoe store that has a sale, we should ask ourselves:
Do I really need that?