7 Tricks Merchants Use to Make You Pay More
Think You’re Getting a Deal? It may be wise to shop around. The only way to make sure you’re not paying too much for anything is to compare prices from several sellers. Companies use an arsenal of marketing tricks to convince customers they’re scoring bargains, often duping them into spending more or paying right away without checking the competition. While many of these tactics have been used for centuries, the methods are increasingly sophisticated and the dishonest claims are bolder.
Here are 7 sneaky pricing and selling strategies to guard against (beware that some companies employ more than just one):.
1) Inflated Anchor Prices
Fake “regular” prices, referred to in the industry as “anchor prices,” enable misleading sales. Sellers show prices that are crossed out, with lower “sale” prices splashed nearby. Those crossed-out higher “list” prices are rarely charged by the store or its competitors; they’re gimmicks to make that day’s prices seem like bargains.
2) Drip Pricing
Similar to bait-and-switch, some companies tout only part of a total price you must pay. Cable TV operators have long promised new customers low prices of $79 a month, but once they add in fees, taxes, and rental fees for things you’d think would be standard—like routers, remotes, or converter box—you’ll pay $150 a month. Airlines also artificially price lower since basic economy fares may not include baggage fees, seat selection, ability to accrue frequent flyer miles, or the right to cancel your trip (even for a fee).
3) People Also Bought…
A cardinal rule for salespeople is to always have something to sell. If you decide the item you’re considering isn’t for you, websites and stores keep on hand lots of other options you might buy instead. Sites like Amazon are masters at showing you stuff related to what you’ve searched for to motivate you, to keep adding items to your shopping cart.
4) Add-ons
At checkout, sellers often warn about big risks like expensive repairs for breakdowns or accidental damage—and then offer to sell you a solution in the form of insurance to protect against these losses. these “peace of mind” policies, like home warranties or extended product warranties . . . help sellers make money, but don’t provide much value to consumers. A better practice would be to buy insurance to protect against risks that could be financially catastrophic—house fires, auto accidents, or medical care. Not repairs or replacement products you could easily afford.
5) Renewal Discounts
Many drivers pay too much for auto insurance because they stick with the same company year after year. Often it’s because they think they’re getting big price breaks for their loyalty. Don’t assume the rate you’ve paid in the past is still a good price; every few years, shop around.
6) Bundles and Package Deals
Package deals work based on paying one price for several different products or services, rather than paying for each separately. Vacation packages, for example, are attractive because of their simplicity: In our minds a single all-inclusive price “shrinks” the price of the whole deal, making it seem more affordable. Online retailers often offer bundles, especially for electronics. Once you’ve agreed to pay $1,500 for a new laptop, you’re easy prey for them to push a docking station, printer, or software.
7) Clearance!
We often read advice that argues there’s a best time of the year to buy something because sellers need to clear out old inventory—for example, waiting until the end of summer to buy a new grill or lawnmower. These claims are generally without merit. Often shoppers can find “clearance” items available for the same price, from the same sellers, months later.
This article is condensed from Consumer Checkbook’s 30 Tricks Sellers Use to Make You Pay Up and Pay Too Much.
