Are You Falling for Sales Traps on Amazon Prime Day 2022?


We’ve all been there: whether it’s a Black Friday buzz or a cleverly targeted social ad, the appeal of a sale can be hard to resist. The promise of massive savings tempts you to click “buy” on those items you’ve been looking at, and even on some that you haven’t been.

Of course, e-commerce giant Amazon is well aware of this and, since 2015, has made the most of it with its Prime Day sales event. Initially established as a 24-hour sales extravaganza to celebrate the online retailer’s 20th anniversary, Prime Day has grown substantially each year, spanning 48 hours in 2019 and racking up more than $ 11 billion in sales during its June career. of 2021. This year, Prime Day will take place July 12-13.

With savings on everything from household items to expensive electronics, Amazon’s two-day sale may seem like the lifetime offering. But is it, really?

Entrepreneur spoke with Utpal Dholakia, professor of marketing George R. Brown at Rice University’s Jones Graduate School of Business, to learn more about Amazon Prime Day’s psychological sales tactics and how consumers can get the best deals without falling victim to excessive spending and momentum. purchase.

Related: 6 shopping tips for saving Amazon Prime Day

How do sales leverage consumer psychology to encourage buying?

According to Dholakia, sales have a couple of different purposes. On the one hand, at the most basic level, sales help to vary consumer behavior. Many retail buying behaviors are common, Dholakia explains, and most people resort to simple, routine buying patterns. But sales have the power to interrupt this cycle.

“Regardless of what the terms and conditions are or how good the offer is, just the fact that there is a sale indicates that something different is happening,” Dholakia says. “This is the fundamental value of a sale, both from the perspective of the seller and the consumer.

“Then there’s the functional value,” Dholakia continues. “Most of the time you’ll get a much better deal when there’s a sale than when there isn’t. And all of us, as experienced buyers, are conditioned to this rule: ‘When there’s a sale, I’m probably going to pay less.’ money”.

We are conditioned to believe that sales mean we get something for less. That’s not always the case, of course, but on Prime Day, Amazon wants you to think so.

Related: 6 ways to leverage consumer psychology to drive more sales

The size and scale of Amazon Prime Day

There’s no denying the control Amazon Prime Day has over global consumers. Total sales of $ 11 billion in Prime Day 2021 even surpassed Black Friday and Cyber ​​Monday sales combined.

“There is no parallelism,” Dholakia says. “I know Target and Walmart also tried to replicate this, but simply considering the scale of online shopping and considering the fact that this is a few years ago and shoppers are conditioned to expect it in the summer. , all this makes it a significant event.

“They have deliberately positioned it as an alternative to Black Friday,” Dholakia continues. “The scale and duration, the number of different offers, the way these offers are displayed sequentially. All of these things make it a hard event to ignore for most buyers.”

Amazon positions Prime Day as a monumental event not to be missed, and then goes out of its way to make sure you spend a lot.

Related: What Prime Day means for Amazon and other e-commerce brands

Belonging to Prime and the fallacy of sunk costs

You must be a member of Amazon Prime to participate in Retail Prime Day. For $ 14.99 a month, the subscription includes free, fast shipping to Amazon products, plus access to TV, music, exclusive deals, and more. By making Prime subscription a prerequisite for Prime Day participation, Amazon creates a lucrative sales trap.

“You have to be a member to participate in these offers, and obviously that’s a great incentive to sign up for Prime,” Dholakia says. “So it reinforces each other: it encourages people to become Prime members and encourages them to buy more on Prime Day because of the idea that you get free shipping and all those deals that aren’t available to anyone other than a non-member. of Prime. “

In addition, paying a subscription to Prime in advance makes consumers susceptible to the fallacy of sunk costs. “In Prime’s case, when you pay $ 139 a year, that expense is a sunken cost from a psychological perspective,” Dholakia explains. “When consumers actually make purchasing decisions later, they don’t consider the cost of this subscription to Prime. You think you’re only paying the price that Amazon has indicated for an item; you’re ignoring the additional shipping costs that you pay in advance as part of your Prime subscription “.

Once you’ve accepted the fact that your “free” shipping isn’t really free, there are a couple of other strategies you can use to make sure you get the most out of Prime Day, not the other way around. around.

Related: A Guide to Finding Offers Online Outside of Amazon Prime Day

How to Get the Most Out of Amazon Prime Day

We know that sales create the perception that you’re getting a good deal, even if that’s not the reality, so how can you take advantage of Prime Day without spending more than you’d like?

One key thing to keep in mind is that Prime Day deals aren’t necessarily the end of it all. “If a particular item is on sale on Prime Day at Amazon’s site for $ 50, you want to make sure it’s not available for $ 45 at Target or Walmart or elsewhere,” Dholakia says. “Just because Prime Day is on sale at a certain price doesn’t mean it’s the best price you can get, even at that particular time.”

It’s also important to keep in mind where you’re spending money, as some items require more deliberation than others. “If it’s a relatively cheap thing or things you buy often and that doesn’t matter much to you, that’s fine,” Dholakia says. “But if you’re buying a home appliance or a big screen TV or something, you want to research and take your time to shop instead of getting caught up in that idea that you’re going to miss.”

And for impulsive shoppers, Dholakia has a few extra words of wisdom: “To avoid impulsive shopping, especially for something like Prime Day, it always makes sense to have a plan of what you want to buy, what your budget is, and to set some settings for your pre-shopping experience. This will fix a lot of problems; it doesn’t make sense to keep buying things at random. “

You already have it: As a lively and explosive sales event, Amazon Prime Day sets the stage for record sales by altering consumer behavior and making you feel like you’re receiving a theft. But if you have your heart set on some Prime Day shopping this summer, be sure to do your research first and make a plan.



Source link

Leave a Reply