November 24, 2022
By: Ploy Tanomvorsin
‘Tis the season to be jolly (and shop holiday deals). Fa-la-la-la-la, la-la-la-la.
Thanksgiving break is quickly approaching, and many of us are looking forward to taking a break from class, reuniting with hometown family and friends, and, most importantly, snagging those Black Friday and Cyber Monday deals. Some will take this as an opportunity to replace the ancient brick-sized laptops they have treasured since grade school. But, for others, these sales will trigger an impulse purchase of something they never needed.
Now, do you really need new clothes to stuff into your cramped NYC apartments? At 40% off for a limited only–it must be a steal!
Courtesy of Best Buy
The questionable actions we make during these large sales can be credited to a systematic error in thought caused while our brains are simplifying information processing to get through large amounts of information quickly. The phenomenon, loss aversion, is caused when human beings experience losses more severely than equivalent gains. In layman's terms, the sadness ellicited from losing $20 is stronger than the happiness that ensues from being given $20. So, we participate in the sales because if we don’t, we feel that we have lost.
Courtesy of Kernel
The companies that make the most persuasive Black Friday deals frame their offers in terms of losses, according to Khalid Saleh, a co-founder of Invesp, a consulting company specializing in conversion rate optimization. Mr. Saleh believes that the conditions of having deals last “for a limited time only” make the consumer feel that they are losing out on an opportunity if they don’t utilize the offer before the sale period ends. This technique is paired effectively by communicating with the consumers an explicit amount they are losing, usually written in red with something like “save 41-51%.” As a result, framing the amount of savings in terms of losses makes the consumer feel like they are losing this money.
Courtesy of Alo Yoga
As the next few days will consist of companies competing to throw the flashiest deals at you, remember that more likely than not, you probably do not need it.
Ploy Tanomvorsin is a Sophomore at NYU’s Gallatin School of Individualized Study and a member of the Fall '22 Content Committee. Her interests are photography, filmmaking, economics, and creative writing.