Looking for a good deal?> How s 50% off sound? Once a bargain-basement super-deal, getting half-off is now about what shoppers can and should expect from a sale, experts say. And in preparation for the holiday rush, stores have figured out how to give it to them and still turn a profit.
Markdowns have already approached that level in toys and electronics, which account for much of holiday spending, says Alison Paul, leader of the retail practice for Deloitte. Household goods and small appliances are also likely to hit that magic mark by Black Friday. If the price is already 50% off, take it and take it now, says Jeff Green, who runs a retail consulting firm.
Although half-off may seem like a boon to consumers, retailers are still profiting, says Adrienne Tennant, a retail analyst at investment bank Janney Montgomery Scott. These deep and temporary markdowns are essentially loss-leaders, designed to lure shoppers into buying more items in one visit or to generate more visits from shoppers wise to the strategy of rotating discounts. [Consumers] have traditionally been quite motivated by sales because we understand that means here today and gone tomorrow, says Kit Yarrow, a professor of psychology and marketing at Golden Gate University in San Francisco. But in the store, a deal for the shopper becomes an opportunity for the retailer to up-sell.
such as Sears (SHLD)
There are three big ways retailers are able to give you that 50% off and maintain their profit margins. But savvy shoppers can separate the real values from the deals designed to get you to mindlessly hand over your credit card.
Stores rotate which categories and brands go on sale each week, and the depth of the discount changes over the course of a month, too. To figure out when your favorite store offers its best deals, sign up for its email list. Then scan them over the next 30 days you ll quickly get a sense of the highs and lows, and how often the best discounts crop up. Borders (BGP),
Keeping sales limited to a tight window is another easy way for stores to offer the big discounts shoppers want, or to create a shopping frenzy, a la Black Friday, says Barczak. At the regular Saturday one-day sales at Macy s (M),
Even a big online discount can be offset if you pay the full price for shipping charges. Lee Jeans recently offered 50% off all online jeans orders, but someone buying one pair on sale for $21 would still pay $5.95 for shipping, which in effect reduced the discount to 36%. Some merchants will offer a big discount and free shipping together this holiday season, but not with regularity until the Monday after Thanksgiving, when people do more holiday shopping online.