Nuffnang Reads is back! And it IS all about money money money this time.
Besides our propensity to spend and even splurge, producers and companies also have some tricks up their sleeves to maximise their profits too.
Case Study: IKEA 50 cents ice cream
Recently published on Quora were several mind tricks used by retailers in recent years to maximise their profits. And specifically, IKEA’s example had been singled out.
According to a chef who previously worked at an Ikea food-service operation, the objective of IKEA’s quick-service restaurants is to “reinforce their low price profile”. Everyone has a rough idea how much a meal or an ice cream should cost. Seeing cheap food available in IKEA would lead people to assume low prices are offered throughout IKEA. On the other hand, consumers often have no idea how much furniture cost, and with the assumption that IKEA prices would be wallet-friendly, consumers would have no qualms purchasing over-priced IKEA furniture.
Also, what is the likelihood you would leave IKEA with only food in your tummy? Most IKEA outlets are too out of the way. To make your trip worth, you are likely to grab some items on your way out too, whether you need them or not.
Hence, IKEA is more than willing and able to sell you 50 cents ice cream and $1.50 hotdog combos!
The Power of Advertising Consumers
Speaking of marketing and advertising. Did you know, we are more likely to respond to an advertisement in our first language?
That’s because our first language is the more emotive language and thus we can be less rational when perceiving and using our first language. That would increase the likelihood to fall for any advertisements played out in our native tongues.
Shopping online also reveals to retailers your purchasing patterns. This allows them to customise the ads placements as well as check-out pop-ups to entice you to make impulsive purchases.
Watch ABC’s The Checkout’s comparison of groceries shopping online and at the supermarket itself.
Still think that advertising is power?
Not really. YOU, as a consumer, are the power.
Saving for the Rainy Day
Now that we have gained some knowledge in spending, we should get started on saving too. Here’s what SG Budget Babe has to share about saving. Saving is not only important, it is something we can all do everyday.
From staying away from vices, to choosing the right company. Saving up can be incorporated into our daily lives!
And just to pick your brains a little :)
Ever wonder about the stereotype that the Chinese save a lot more and are ever so stingy?
Source: Tumblr. Leave it to Jessica Huang to save and stretch every penny under the Huangs roof!
It is as true as it can be. Studies have shown that culture and language spoken influence perceptions.
In this case, the Chinese language does not mark time differences, while the English language does through the use of tenses. This makes the future “nearer” for the Chinese thus having greater risk aversion, and also fuelling their need to save. On the other hand, English speakers would perceive the future to be further away and thus have less incentive and motivation to save.
Aren’t you glad Singlish throws tenses out of the window too?
Mo’ money, Mo’ problems
Sometimes we have the privilege to suffer from first-world problems.
With the money kept safe and saved, how do we watch it grow?
Again, SG Budget Babe has some advice on investments. She suggests taking up classes and also getting registered with the SGX, for not only it is a requirement, investment without any knowledge is as good as gambling!
Nuffnang Reads June 2015: