Whether it’s extreme couponing or group-couponing, the idea of saving money has the country frantically searching for deals and spreading the word through social networking. I’ve had to hide a number of friends whose total social discourse has been reduced to posts about their favorite deals — and WRITING IN ALL CAPITAL LETTERS when they’re sharing a deal that benefits them if their friends sign up, too. The fact that “couponing” is an accepted word in a culture that doesn’t frequently verb nouns unless the words truly speak to the zeitgeist indicates that we may be working so hard to save money that it may have the opposite effect.
Don’t get me wrong. In general, saving money is a great idea. Most people need to do more of it. Although the trend seems to be embedded in today’s social consciousness, perhaps due to the recession and the struggling middle class, couponing does not always coincide with saving money.
In fact, couponing encourages consumers to spend more than they would have otherwise. Getting new deals every day in an email inbox lets marketers walk in your home and sell you products you don’t need and wouldn’t have purchased if you didn’t willingly invite them in. Spending hours scouring for coupons or driving miles out of your way to save a few dollars is an inefficient use of time and money. Your time spent attempting to save $0.50 on a can of beans could be better spent earning several dollars with a quick task or more working overtime at your job, helping you afford beans at the everyday price — and more.
Furthermore, certain deal sites are known to make deals appear more attractive than they are. For example, one coupon I saw recently looked like a great deal: $200 off a notebook computer, for a limited time, through a deal website. A price history check showed that the deal was only $50 off that retailer’s normal price — and another major website without a special deal was offering the same computer for $100 less than the “deal” price.
The deals propagated online — especially those that persist from the same retailers — are only popular because they work for the retailers. Retailers pay fees to companies like LivingSocial and Groupon, so if they weren’t profiting from the arrangement, they would stop offering the deals. Merchants are profiting because consumers respond to these marketing tactics with the belief that they’re saving money. According to the latest government surveys, consumer spending is increasing. The increase may be due to the perception of deals or due to an improving economy, but regardless of the reason, retailers are not slowing down their relationships with deal-broadcasting services. This is an indication that people aren’t just shifting purchases from a non-deal to a deal; they are purchasing more than they would be otherwise.
From a retailer’s point of view, a deal that goes viral is great at first. It brings in a good profit right away — but these customers don’t stick around. In fact, many retailers complain that these are some of the worst customers they have. These buyers will be off looking for the next deal. No retailer would be able to afford creating once-in-a-lifetime deals every month to retain extreme bargain hunters, and some don’t want to.
I’m not calling for an end to the frenzy over the possibility of saving money. I do think it’s best to be an educated consumer, and that means taking a second to ask yourself a few questions rather than blindly jumping on the deal bandwagon.
- Is this something I need, or am I only buying this because it was marketed to me?
- Is this really a good deal or does it only look like one?
This may be too much to ask for many people, but any pause filled with a short burst of mental activity before a purchase can’t hurt.