Shoppers warned over Click Frenzy sales
Shoppers have been warned to watch out for sale traps during Click Frenzy and Black Friday sales.
The Associate Professor of Finance, School of Economics, Finance and Marketing at RMIT University, Angel Zhong said: "While Click Frenzy and Black Friday lure consumers with eye-catching bargains and deals, you may end up spending more than you actually want to.
“Businesses strategically advertise their sales to exploit potential buyers’ limited attention and capacity to process information.
"That's why consumers tend to be attracted to deals labelled with a huge discount, but ignore other aspects of the deals, such as the original price or terms and conditions such as return and refunds.
"Fear of missing out (FOMO) is also at play. Consumers tend to think that they may miss out if they don't buy anything due to the increasing popularity and the hype of Click Frenzy and Black Friday. Due to FOMO, some consumers may buy what they don't need.
"It’s incredibly important to plan ahead and work out what you need to buy and how much you can afford as your financial situation can become very stressful when credit card bills are due after the sale.
"Consumers should also be extra cautious of being lured into buy-now-pay-later (BNPL) products to pay for your items. While they can benefit from an extra channel of payment over a longer period of time, BNPL can add up if used on multiple purchases and may give you an extra debt hangover. Steep late payment fees are also a risk of BNPL if not paid on time."
To avoid short-term excitement turning into overspending and long-term financial pressure consumers should:
1. Budget wisely before sales start and stick to the budget.
2. Look up and list the items you’re planning to buy before the sales start.
3. Check the original price of the item - some businesses jack up the prices before applying a huge discount.
4. Pay attention to terms and conditions such as returns and refunds.
5. Be cautious of BNPL products and plan ahead for future repayments.
