- Spaving is encouraging consumers to spend money to save
- ‘Buy one, get one free’ is a classic method used by retailers to encourage spending
- Splashing can lead to you buying extra food that spoils, for example
Money-strapped Americans are falling victim to clever marketing ploys that cause them to spend more than planned, experts say.
The “spaving” phenomenon occurs when “buy one, get one free” deals trick consumers into thinking they can save money by spending more money.
Other examples might include “limited-time offers” or promises of greater savings or free shipping if you reach spending thresholds.
“Spaving means we justify our desire to buy more,” says Brad Klontz, a psychologist and certified financial planner based in Boulder, Colorado, told CNBC.
“Teams of scientists have figured out how to get more money out of you,” he added.
Brad Klontz, a psychologist and certified financial planner based in Boulder, Colorado, said: ‘Spaving means we justify our desire to buy more’
‘Buy one, get one free’ display at a Winn-Dixie supermarket in Orlando, Florida
Spaving can lead Americans to buy too much food that then spoils, or buy an extra item of clothing that they don’t need and thus never wear.
Offers offered by many retailers can only be claimed by spending money – and that can sometimes lead to bigger problems as shoppers take on credit card debt to finance.
“We continually spend more than we can afford and then we experience stress related to our financial health,” says Klontz.
Other marketing tricks that can lead to sparing are as simple as putting items up for sale.
Even if an item is half price, it may only be a wise purchase if the item is needed in the first place.
Consumer savings expert Andrea Woroch gave CNBC several tips on how to avoid falling prey.
Ultimately, she said, consumers must exercise restraint and consideration.
“Delete shopping apps on your phone that alert you to the latest sales and unsubscribe from shopping newsletters,” she said.
“Instead, only look for coupons when you need them.”
Woroch added that paying in cash can make it easier to avoid credit card debt and minimize impulse spending.
“You’re less likely to give away your hard-earned money on something you didn’t plan to buy or don’t really need if you’re sitting on the actual bills,” Woroch said.
Offers such as ‘buy one, get one 50 percent off’ are designed to entice consumers to spend money they otherwise wouldn’t spend
Age-old tricks to reduce expenses also apply. She said consumers can put barriers between themselves and potential purchases.
They can also take time to think about purchasing decisions.
“Give yourself 24 hours to think about a purchase before you hit the buy button,” she said.