I don’t shop often but when I do, I go to outlet malls. The one closest to me is a sprawling 1.3-million square foot space filled with 200 retail stores eager to sell me last year’s fashion trends at bargain prices. And I go for it! I don’t really care about the latest fashions and often find great pieces that become wardrobe staples. It’s a win-win situation.
A friend joined me on my most recent pilgrimage to this shopping Mecca. I was thrilled to find a coveted pair of shoes on sale and promptly bought them. On our way home, my friend scored her own victory when she filled up her tank at $0.04 per litre less than the gas stations in her neighbourhood.
Settling into bed that night, book in hand, the self-satisfaction from the day’s successful bargain hunt was knocked right out of me. The book I was reading, “Dollars and Sense” by Dan Ariely, a prominent figure in the field of behavioural economics, explores how we make spending mistakes—like getting hooked by bargain hunting.
Ariely gives the example of drivers going out of their way to save a few dollars on gas prices when it’s actually our household utility bills that are usually much higher. Ask someone what she recently paid for gas, Ariely says, and most people would have a vague recollection. Now, ask them what about their home gas bill, and most people would not have a clue.
Ariely says that our seemingly irrational behavior in this case is because we frequently seeing posted gas prices but only rarely come into contact our home’s utility meters. Were we as frequently exposed to the price per kilowatt hour (or even understand what a kilowatt hour is!) of heating our homes, we might make different decisions.
Already feeling humbled, I read on. Ariely says that our love for bargain hunting is partly due to the way the prices are displayed. Because it’s not the sale price itself that tempts us but the relative price. His research shows that the $100 pair of pumps marked down to $60 is more appealing than the same pair of shoes regularly priced at $60.
Lesson learned: As a busy, working mother and wife, I can’t promise that I’ll stop trekking to the outlet mall or be tempted by the special price for the 30-pack of toilet paper, but I have recently taken a keen interest in my utility bills. I’ve also started turning lights off when they’re no longer needed and unplugging some small appliances. After all, someday soon Mama’s gonna need another pair of shoes.