Tag Archives: discount pricing

I Was Inspired, I Messed Up, I Was Surprised, and Have An Idea

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I was inspired: On December 7th, someone walked into the Walmart in Bedford, Pennsylvania and dropped off a bank draft for $46,265. It was an anonymous Christmas present in paying off 194 layaways at the store. Clearly, layaways are done by people who can’t afford to pay the full balance of something at the time and thus pay it in small installments before taking possession. It’s not the first time this person has done it, and sure made the Christmas of 194 people.

I messed up: We all know better, but make the number one rookie financial mistake, so I’m not alone. I was in a national retailer last week and saw AAA batteries on sale at 50% off. Half price for a package of 10. I grabbed them, paid, and left. The next day I was at Home Depot and saw the same brand of AAA batteries at the same sale price, but a package of 48 and not 10! YIKES. The first chain’s 50% off may have been legit, but they were still charging 480% more than Home Depot! How often do we look at the 50% off sign and buy without having a clue if it’s a good price or not! I did return the first ones, but it was a good lesson to learn over and over again: It’s the price you pay, not the discount you think you’re getting!

I was surprised by a survey last week that found 63% of us admit to re-gifting something. I think it’s probably way higher, but at least a lot of us are prepared to admit it. I’m in that group and there’s nothing wrong with that. If it’s a gift that you don’t need or want, it’s new, and it’s something another person would really enjoy, why not? Plan B would be to throw your gift out or give it to the thrift store and then buy the same thing again at retail price? That’d just be dumb…

And my big idea for the week will work great if you have young kids. Change one of the names of your friends in your phone to read Santa. Then have the person send you the odd text asking how the kids are behaving. I bet it’ll work like a charm…maybe even year round…

When Is A Sale A Deal?

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I was wondering the other day when a great deal is really a deal? Is it only when it’s on sale, or when it’s priced right, even without a so-called sale? How conditioned are we that it’s only a deal if it’s advertised at 25, 30 or 40% off?

What got me thinking was trying to buy a TV for my brother at Future Shop. Tuesday two weeks ago, the one I wanted was $319 – I just didn’t have the room in my car. Two days later, when I was a buyer, it was in the flyer and $20 higher! It was now an advertised deal, but at a higher price. When I asked the salesman what the story was, the response he gave me was that “that happens all the time.” There was more to his explanation, but I had already stopped listening.

Chevy in the U.S. has now started something called Total Confidence Pricing. It’s another attempt to get away from rebates and temporary sales such as employee pricing, clearance, or the likes. In Canada GM has tried that two or three times in the last decade or so. How successful will they be this time around when other manufacturers advertise so-called sales? Saturn was based on that concept and never did get much market share with their one price and no haggling and…well, they’re gone.

The giant retailer JC Penny, roughly equivalent to our Bay, last year went to something called everyday value pricing. No more screaming deals for the day or the weekend. They are trying to emulate WalMart-type pricing. As of now, it’s a total failure. Sales were down 19% in the last year and another 21% in the last quarter which just ended. For a retail giant, that’s staggering and frightening. Honest and fair pricing all week and all month isn’t working. Their new CEO is from Apple, but I’m not sure he can turn around a 102 year old company.

We’re not that interested in fair pricing it seems. While the deals at JC Penny, Saturn, and maybe Chevy were fair and good, we want the SALE sign screaming at us. We’re suckers for a sale. As long as it says 40% off, or has a $2,000 rebate, we’re all excited and pull out our credit card, or want to know where we can sign up for the financing. We don’t really know if that’s now a good deal or not, but that sign sure makes us buy.