How Much Are You Really Saving With Holiday Deals?

December 1, 2007

Although retailers are facing their worst holiday season in five years they aren’t necessarily resorting to lower prices across the board to increase sales.  An article in Smart Money shows how stores are being smart about giving discounts that will not only increase sales but also benefit them in the long run.  

Smart Sales Strategies
Retailers are offering sales announcements, special deals, and exclusive coupons to people that sign up for their email newsletter, rewards program, or store credit cards. When a customer signs up for any of these, the retailer increases their chances the person will spend more money, more frequently since the retailer now has the opportunity to market directly to their postal or email inbox.  Although the store may not make as much on the initial discounted purchase they hope to continue to sell to those people over time.

Online Shopping
One thing many of the retailer newsletters will do is direct customers to deals online where they can save money with coupon codes or reduced/free shipping.  Even if the customer never sets foot in the store again, they can still make the retailer money by shopping online.  Instead of making a person come into the store and wait in line to make a sale they can offer them the ease and convenience of clicking a Buy button on their home computer.

Gift Card Promotions
Another tactic that stores are using to prop up sales without cutting as deep into their bottom line is the use of gift card promotions. The Smart Money article gives the example of DSW Shoe Warehouse that offers a $10 bonus gift card for use Jan. 14 through Feb. 3, when a person purchases a $50 gift card.

Since a percentage of gift cards go unused or under-used, retailers can increase sales without actually selling merchandise in some cases.  In another example, Best Buy is giving $10 cards to those who buy the “Spider-Man 3” DVD and videogame. People pay full price for the item but still feel as though they saved $10 on their purchase.  The retailers come out ahead when that customer never uses the card or maybe even uses it towards buying a $20 – $30 item they wouldn’t have purchased without the gift card.

Smart Shopping
As a consumer, you can still take advantage of the sales, discounts, and promotions offered over the holidays, just make sure you use them to save money, and don’t fall into the trap of spending more because of them.


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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One Response to How Much Are You Really Saving With Holiday Deals?

  • JB @ GetRichOrDieTrying

    I think consumers just need to be smart about things. We all have to buy things, we just need to realize the actual price we’re paying and decide if that’s worth what we’re paying for.