The Dark Side of Black Friday
Black Friday is a time of the year that many of us look forward to with big discounts from our favourite stores where you can snatch up some great deals. But like most things, there are always two sides to the stores and for some, it’s an unnerving time that continues a dangerous cycle of debt and overspending.
During Black Friday, we’ll all be included in the media storm by retailers and brands who’ll bombard us with flash sales and limited time offer adverts to create a strong sense of urgency to make you feel like you will miss out if you don’t get involved in the available discounts.
Only having been around for a few years in the UK, consumers have ramped up their spending each year to over 3 billion across the four days through Black Friday to Cyber Monday. Over 3 million every single minute.
The winners and losers
While some come away believing they have secured some great deals - almost 25% of Brits feel some sort of regret surrounding their purchases. Often people get sucked into the spending and end up with a load of items they don’t need, and more importantly can’t afford.
Brands in the digital age have learnt how to tap into consumer psychology, so whether you set out to buy a flash discount or not, you can often fall victim to getting sucked into the trap.
Let’s explore how brands tap into our psychology across Black Friday
Each year psychological pressure & FOMO created from marketing campaigns pushes people to make panic purchases. This leads people to spend money they don’t have on things they don’t need.
The result? 25% of Brits end up making purchases that they later regret.
Now let’s learn a bit about why we almost lose all self-control when presented with sales and offers (and for reader digression, we are by no means psychologists here at Punk Money).
Words like ‘limited sales’ have an interesting effect on our brains. These phrases trigger the natural reward system in our brains, which turns off the region in our brains that usually decide whether a purchase is necessary or not. Pretty much telling your brain to make the purchase.
On top of this, the whole excitement around Black Friday is centred around the event being exclusive and time-limited. If we don’t make the purchase now, we’ll miss it forever. This pushes consumers into making snappy decisions that aren’t always calculated.
De-mything Black Friday
The fear of missing out and the happiness created by the big deals you can get are what trigger purchase, and often the ones which are regretted the most.
Now this doesn’t seem so bad, right? You’ve managed to bag yourself a hell of a deal.
Well, that’s where retailers and brands have learnt to adapt their strategy. Often in the weeks and months before Black Friday, prices are inflated. So when Black Friday comes around they can advertise huge discounts, which are around the price they should have been anyway.
FOMO is a big driver we know that. But Black Friday isn’t the only time where retailers offer deals, is it? Christmas is just around the corner and only a few years ago Boxing Day discounts are what drove people (and still do) out of their beds the morning after Christmas straight to the shops to get involved in savings.
In reality - discounts are available across the year in today’s age, and if not you can just always find yourself a discount code.
We are not completely anti-Black Friday though, at Punk Money we love a good deal too, and it can be as good as time as any way to make some savings on something you wanted for a long time.
So here are a few tips to help you zig-zag your way through the advertising campaigns and make good financial decisions across the period.
Tips & Guides Questions to avoid overspending
Set a budget
It doesn't have to be complicated. Just take a look at your finances and come to an amount of money you can afford and are comfortable with spending across the Black Friday period. When looking to make a purchase, weigh it up against your budget. Use this to decide whether it’s a smart purchase, something you’ll later regret.
Make a list, and stick to it
Black Friday can be a great time to buy something that you have wanted for a while and can allow making great savings. But more times than not, it leads us to buy things that we didn’t need. If it’s not on your list, it wasn’t needed and it’s best to leave it for now.
Avoid Buy Now Pay Later
Buy Now Pay Later services like Klarna and ClearPay look great on the surface. But their an easy way to work your way into debt because just like any other credit line, if you miss payments you will rack up interest payments and will damage your credit score.
Don’t stress, the deals will crop up again
FOMO can lead you to make a purchase that you’ll later have regrets over. The deals will come around again, and making purchases based on this can lead you into a negative spending cycle. If you can’t afford it today then avoid finding ways to justify it.
Turn off your emails
We all are subscribed and get too many marketing emails as it is, and that’s just another avenue to receive deals and offers from brands that you don’t need to buy from. So now would be a great time to de-clutter your inbox and avoid extra ads.
Ask yourself, do you need it
Let’s be honest, most Black Friday purchases we make aren’t all that necessary. Everyone just loves a bargain right. So ask yourself this question every time you’re putting something into your basket, it might change your perspective.