Wednesday, December 13, 2006

The Great Christmas Giveaway

I may be naive, but I think i still remember when "Sales" in shops really were a way of moving old stock lines to make way for the new ones, and before they were just another means of driving footfall and pushing volume.
Wine on the sofa
Sales have now become so common, for everything including wine, that we have become sale junkies. There is never a need to buy something at full price because if you hold off a short while it will almost certainly be on sale. In fact, consumers must feel cheated if they buy it a the normal price, then see it on sale the next week.

Can this continue?

Look at the DFS model. They seem to have a permanent "sale" at 50% off. They obviously rotate the models on offer so as to have them at the full price for the required period of time, but you'd be pretty daft to actually buy one at full price.

This goes for kitchens too. And clothes. And electronics. ...

So we are always seeking a bargain, that's fair. However, we used to have to seek one out and the reward/effort ratio was such that many people would not bother and would therefore buy products at their 'real' price. Now the effort is minimal (in fact try avoiding a sale!) and the rewards are massive (Buy One Get One Free, etc.).

You would have thought, therefore, that time critical events such as Christmas would be an opportunity for retailers to avoid sales as consumers cannot just wait and buy cheaper alternatives in the sales. Instead we have the great Christmas Giveaway, where even the products we must have and are prepared to buy in volume, are discounted.

As a consumer I can see how this is benefitting me, but it feeds the habit and I wonder how we can break the cycle? Do we even want to?

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