Before you finish your holiday shopping this season, make sure you leave the house armed with the following facts.
1. Stores really do jack up the prices so they can offer huge discounts to lure in shoppers… and we want them to.
a. JCPenneys' pricing failure of 2012.
i. Idea - Fair prices up front and fewer sales
ii. Do away with the practice of charging markup prices, which few shoppers really paid.
iii. Previous strategy – real price is $10, mark it up to $30, and put it on sale for 50% off
iv. New strategy – offer it at "best price" of $13, cheaper than the former sale price
v. Against logic, shoppers wanted the perception of getting a deal, even when they were paying the more for it.
b. Lawsuit against Kohls for "false markdowns" and "perceived bargains."
i. Occurred in the spring of this year in California
ii. Claim is that Kohl's, by marking up their prices so regularly and by so much, deceive consumers on the original value and quality of the items being sold.
iii. Claimant thought he was getting a great discount, but actually paid the same or more than what the items are worth.
2. Stores usually price merchandise over the MSRP – Manufacturer's Suggested Retail Price.
a. Defined: How much the maker of a product recommends the product is s old for in stores
b. "Huge discounts" are usually modest savings, or cost more than the MSRP
c. Shoppers have been trained to chase markdowns and deals
3. Counteract the phenomena with research and smartphone apps.
a. Comparison shop online before you hit the stores – know what the item is really worth
i. Sites that help: Price Grabber.com and Biz Rate.com
ii. DIY comparison shop
1. Find the make and model of item
2. Compare prices on big box store sites like Kohl's, Macy's, and Target
3. Compare bricks and mortar store prices against online stores
iii. CAVEAT – Some manufacturers create different product models for different stores (Kohl's vs. Macy's)
b. Use shopping apps that save you money on top of sale prices and coupons
i. Cartwheel by Target:
1. "Stack" Cartwheel discount with manufacturer coupons and RedCard discounts
2. Shopper can use the discount over again.
ii. Joann Fabric Stores app:
1. Provides coupons and weekly flyers.
2. Shopper can use the coupons over again.
iii. Herberger's app: Coupons and store locator