Black Friday Psychology: Why We Go Mad for Deals

Stephanie Pappas

Date: 24 November 2010 Time: 06:38 AM ET

The high from shopping til you drop can quickly fade for shopaholics, who's spending can wreak havoc on their relationships and wallets.
CREDIT: Dreamstime.com.

For many families, it's a Thanksgiving tradition as rich as turkey stuffing or pumpkin pie: Rise before the crack of dawn the morning after the holiday, wait for the mall to open, and start hunting down Black Friday bargains.

It's a red-letter day for retailers, too, many of whom depend on holiday shoppers in order to turn a profit for the year. In some cases, holiday purchases make up 25 percent to 40 percent of a retailer's annual sales, according to the National Retail Federation (NRF). This year, the NRF is predicting a growth in holiday sales of 2.3 percent, which would put sales at $447.1 billion.

The Black Friday crush isn't for everyone, but the allure of a bargain speaks to human nature, consumer psychologists say. The limited-time-only nature of Black Friday triggers an innate fear of scarcity that drives people to buy, buy, buy. As long as these tactics aren't overused, marketing experts say, they can be very effective in luring holiday shoppers to the cash register with cartfuls of goodies. [Read: Even Tightwads Cut Loose for Holiday Gift-Giving]

"People truly want to get a good deal, and so they might be less rational… when they can look in the environment and find different cues that make them think they're getting a good deal," Kenneth Manning, a professor of marketing at Colorado State University, told LiveScience. "The decision-making can be somewhat emotional."

Evolution and emotion

Because of their dependence on holiday shoppers, retailers pull out all the stops on Black Friday. Stores open at midnight; malls entice customers with fresh-baked cookies. This year, low-price chain Walmart is promising to match competitor prices all weekend. The company is also one of many aggressively pushing "Cyber Monday," an online shopping boom that takes place the Monday after Thanksgiving. [Read: How Did Black Friday and Cyber Monday Get Their Names?]

Shopping is often compared to hunting or gathering, and for good reason, said Gad Saad, a professor of marketing at Concordia University in Montreal. Saad, the author of "The Evolutionary Bases of Consumption" (Psychology Press, 2007) and the upcoming "The Consuming Instinct: What Juicy Burgers, Ferraris, Pornography, and Gift Giving Reveal About Human Nature" (Prometheus Books, 2011), has found that biology informs shopping decisions. Men who engage in conspicuous consumption, like driving around in a fancy Porsche instead of an old sedan, experience a testosterone surge, Saad reported in 2009 in the journal Organizational Behavior and Human Decision Processes. He's also found evidence that men and women navigate shopping situations in ways consistent with the hunting and gathering behaviors of our savannah ancestors.

Seen in that light, holiday sales could be playing on innate mechanisms like the desire to hoard resources, Saad said.

"You can immediately respond to this stimulus, so people hoard, they buy a lot of stuff," Saad told LiveScience.

Creating a sense of urgency is one trick retailers use to get people into the mood to spend. Other enticements include giveaways, free gift-wrapping and similar services. Retailers also strive to set a holiday mood, said Lisa Cavanaugh, a consumer psychologist at the University of Southern California who researches holiday shopping.

"They think, 'If we make the holiday prominent in consumers' minds, they'll buy more,'" Cavanaugh said. "Make the holiday important, make the holiday focal… the rest will take care of itself."

There are a number of tried-and-true tricks to keep people in a store, Cavanaugh said. Slow-tempo music, for example, encourages browsing. Making sure consumers are happy may also open their wallets. One study, published in February in the Journal of Consumer Research, found that, overall, positive feelings make products seem more desirable. But different moods can actually change which products consumers want to buy. Inducing feelings of pride makes people prefer personal adornment products, like clothes, shoes and watches, the researchers reported. Contentment makes people want home products, like furniture, appliances and cozy pajamas.

In some cases, the deal itself is reward enough. Marketing professor Peter Darke of York University in Toronto carried out a study in which volunteers were given $10 and asked to make a purchase at a university store. Some of them got to keep the change, while others had to give it back to the researchers. The researchers arranged it so that some volunteers would pay full price for the item, some would get 25 percent off, and others would get 50 percent off.

Unsurprisingly, those who got to keep the change were happier the better deal they got. But even those who didn't get to keep the money got a charge when the discount was big enough. When those people got a 50 percent discount, Darke said, they were just as happy as the people who got to keep the money.

"This was a very emotional kind of reaction people had," Darke told LiveScience. "They would come back and say, 'I got this great deal! Fifty percent off!'"

The elation seems to stem from two places, Darke said: People's perception that they'd been treated fairly, and people's self-evaluation.

"There's some evidence to suggest that it reflects back on them as a sort of rational, good, effective, skilled shopper," he said.

When sales backlash

But deals don't always leave people thrilled. If consumers don't know why a product is discounted, they may assume it's somehow faulty, Darke said.

In one study, Darke asked volunteers to rate the value of a pair of headphones. Some saw that the headphones once cost $60 and were now $40, while others saw only the higher or the lower price. Those who saw the before-and-after comparison rated the headphones' value at $40, the same as if they'd never seen the $60 price at all.

There are ways to get around such devaluation, Darke said. When the $20 discount was framed as a free phone card with purchase instead of a price cut, people rated the headphones just as highly as they would have if there were no sales promotion at all.

Black Friday sales don't generally fall into this trap, Darke said, because people know why the discounts are happening. But there is such a thing as holiday sales fatigue, said Cynthia Jasper, a professor of consumer science at the University of Wisconsin, Madison.

"A lot of times, consumers become so accustomed to it, that either they don't respond or they keep on waiting for a better sale, or a better deal," Jasper said. "If it's overused it does have a tendency to backfire."

Given the fragile economy, sales started earlier than ever this year, Jasper said, with some retailers touting "Christmas in July."

Retailers are also making extra efforts this year to expand hours. For example, Toys "R" Us will be open at 10 p.m. local time on Thanksgiving Day, enabling families to proceed directly from turkey to toy shopping.

"It's interesting, because there may even be a consumer backlash to having stores open on a holiday that is considered as important as Thanksgiving," Jasper said.

While plenty of people have opinions on how to get the best deals on Black Friday, keeping a clear head in the midst of the excitement is key, Cavanaugh said. Seeing other people grabbing goods can trigger our scarcity-sensitive brains, leading us to buy more than we need, she said.

"Having a list, knowing exactly who you're shopping for and what your budget is for each of those people is really important," she said. "It's really easy to get swept up in the craziness that is after-Thanksgiving shopping."

You can follow LiveScience Senior Writer Stephanie Pappas on Twitter @sipappas.