You’ve heard the saying, “If it’s too good to be true, it probably is”, right?  There are a number of bargains that don’t actually end up saving you money.  There is an actual field of economics that studies the behaviors of consumers and why they buy what they do (behavioral economists), and it’s been found that many of the so-called bargains are really gimmicks and tricks used to get unsuspecting consumers to spend more than intended!

Auction Deals

Who doesn’t love a good auction?  After all, eBay continues to be one of the top 5 websites based on the number of daily visitors.  Auctions get people all excited, and people who are excited are more likely to pay more.  You’ve probably seen things on eBay selling for more than what you can buy the same item for at the store… or wondered why someone would pay as much or more in shipping as what they paid for their item.  The typical cause is last-minute bidding from people who want the item.  As the time for the auction comes to an end, watchers start trying to outbid each other in a fast-paced environment and often end up overpaying.

Rebates

Rebates that you actually receive are a good deal, but studies have sohwn that less than half of all rebates are ever redeemed successfully!  When you see items being sold with “rebates”, make sure you aren’t choosing a particular brand just for the rebate – chances are you can get the same item with a different brand name for a lower price, and without having to wait and hope the rebate shows up.  Companies offering rebates make it difficult for consumers to receive them.  For example, you may only have 10 days to send your rebate form and receipt in after your purchase, or they may give you a short window of time that doesn’t start until three weeks after the purchase date for redemption! 

Sometimes consumers get their rebate checks, but forget to cash them before they expire – which is money lost.  Other times, rebates are mailed in envelopes that look exactly like all of the junk mail that you get, so it’s possible people are just throwing them away unopened.

Credit with 0% Interest

How many times have you purchased something on a credit card or store credit offer just because you can get 0% interest?  Researchers from MIT have conducted studies of people buying with cash versus people buying with credit and foudn that the credit card group always paid more for the same items as the cash group; and that they spend far more money than they would have if they had to pay cash.  Another downside of paying with plastic is you tend to forget exactly how much you spent… until the bills start coming in, that is.

Mid-Range Products

Have you ever shopped online at a website that offers several similar products of different price ranges on the same screen?  Companies can actually exploit a consumer’s general preference for the mid-range item by presenting a more expensive item next to the one they are really trying to sell.  So if the company has three types of cameras, one a cheap model, one in the mid-range, and a very high-end model; consumers will naturally select the mid-range camera more often than either of the other choices.  Compare products based on their features and what you actually need rather than based on price comparisons alone to be sure you aren’t being swayed unknowingly to the middle priced item.