T.G.I.F. takes on a different connotation when talking about Black Friday. Are the deals really worth all the hustle and bustle?
This (very American) holiday that exploits our (consumerist) way of life is showing signs of hope. It’s no surprise that Black Friday has been and is still known to be the top shopping day of the year. However, with the rise in behavioral economics, retailers and consumers have realized that it is also known as the biggest day for irrational behavior.
We’re not talking about the Darwinist behavior of trampling small children to get that little thingy for your nephew for Christmas, but in regards to spending our hard-earned money.
We Ain’t So Rational After All
The Black Friday ritual of camping out in the middle of the night, waiting for the retail store to open has a strong hazing effect. The whole point of hazing for fraternities or exclusive clubs is to create an even stronger commitment. The pain and struggle in this “shopping hazing” process make the deals look that much more attractive. To follow, losing sleep, whether it’s for a test or any other activity, is never ideal, and it sure doesn’t help when the activity involves the spending of lots of money.
Dan Ariely, behavioral economist and psychology professor at Duke University, brings to light a number of our “predictably irrational” behaviors. In his book, appropriately titled,
Predictably Irrational, he explains how much it hurts for us to spend the initial $20 but how easy it is to spend $10, $20, or even another $100 after that initial purchase. The amount of pain we experience actually goes down with every extra dollar after the initial act of having to pay in the first place. This phenomenon, on top of little sleep is a recipe for disaster for our GenFKD audience that goes shopping on Black Friday.
This irrational behavior also has a tendency to make us assume all “sales” are excellent bargains. The US is known for being rather financially illiterate, but in addition, it is currently ranked 21 for numeracy levels across developed countries—a.k.a., we suck at basic math. When sales consist of items that are marked down through fractions and percentages—let’s just say, it’s not pretty for our wallet.
Smoothing Out The Deals Let’s Us Breathe Easy
With online stores making the shopping experience much easier, brick-and-mortar stores have needed to adjust. That’s good news for us as Black Friday deals are now spread out across several days, even weeks. Retail stores noticed that weeks before and after the big day the store would be a ghost town. As a result, instead of competing on Friday, sales have started much earlier and later. These deals can also be seen throughout the year. This allows revenue to come in for a longer period, making the holidays slightly more profitable for retailers as well. It also lets us breathe easy knowing that the deals will be there for a little while longer.
With many deals staying put through the early weeks of December, retailers haven’t needed to hire as many seasonal workers for Black Friday. However, as stores still want to make the extra buck, technology will be a big part of the shopping experience. Technologies like Vend, which allow customers to pay using a cloud point-of-sale system, are coming into play. It’s like self-checkout, but on your phone.
So, if you do decide to shop on Black Friday, be happy that retailers, unlike our presidential hopefuls, are accommodating the largest consumer demographic—millennials. By exploring technological features like Vend, making use of social media, and holiday shopping apps galore, they are making the shopping experience much more pleasurable. Nonetheless, we are still susceptible to irrational behaviors that can really hurt our wallet. Let’s make use of the extended deals and really plan out our holiday purchases. If you’re just out for the deals, the hustle and bustle is really not all that worth it. Nevertheless, if you’re in it for the hustle and bustle, rest assured, there will be plenty. Just do us a favor and bring a calculator and a couple cups of coffee.