Christmas shopping: What’s cheaper before Christmas?

Christmas is the time when people want to give others a big treat or treat themselves. Those who are looking for Christmas presents or want to buy something new for themselves are lured by supposed special offers in the run-up to Christmas. But are they actual bargains or do sellers use clever discount strategies to increase the desire to buy with a pretended reduced price?

High-turnover days

With Black Friday, sellers ring in the discount battle before Christmas at the end of November. The online giant amazon usually starts with Cyber Week beforehand with daily and flash offers.

There is a lot of triggering during this time, and probably not without reason. After all, most people do their Christmas shopping during and after this time. 28 percent of all gifts are bought in November and 37 percent in the first two weeks of December.

To put customers in the right buying mood, retailers resort to many other discount strategies. RAJA has taken a closer look at the most common discount strategies and shows what is really cheaper before Christmas and when artificial discounts are meant to entice customers to buy.

Black Friday

Black Friday is virtually the epitome of discount campaigns and offers. The bargain day originated in the United States and has been adapted in Germany for several years. Black Friday always takes place on the Friday after Thanksgiving and Thanksgiving is always celebrated on the fourth Thursday in November in the USA. This year, Black Friday falls on 29 November.

The retailers promise huge discounts and rock-bottom prices: 60, 70, 80 and even up to 90 percent are supposed to be saved. In the end, the percentages often do not correspond to reality. The discount price always refers to the recommended retail price (RRP) and does not always have anything to do with the current market value.

Example: Playstation 4 Pro with 1 terabyte

The market launch took place in November 2016 at an RRP of €399.99. Although the product has been on the market for almost three years, its price remains relatively stable. And according to black-friday.de, there is hardly a product that is searched for more often on discount day.
If you look at the price development at geizhals.de, you can see the value-for-money advantage of Black Friday:

Shortly after the launch in 2016, hardly any discounts are given. In the following years, however, savings can be made on Black Friday:

• 2016: At a price of € 397, a discount of 0.75 percent can be shown.
• 2017: After one year on the market, the discount rises to 14.25 percent at a price of € 343.
• 2018: The offer price of € 314.10 corresponds to a discount of 21.47 percent.

So this is an offer that is worthwhile. What is also noticeable, however, is that the cheapest Black Friday offer from the previous year is not per se the cheapest offer ever; the Playstation was already available at a cheaper price before and also shortly after. You can also see that prices are usually raised a month before Black Friday and no big discounts are available.

Artificially raising prices

Those who want to please children or grandchildren often pay more for toys before Christmas. Prices are often artificially raised in the run-up to Christmas. Last year, this was exemplified by the product Schleich Horse Club – Large horse farm with living quarters and stable.

The RRP is €119.99. In the period before Christmas, there were several price fluctuations. Already in November, the price settled at 119,90 € and hardly changed. On 8 December, the price was raised to 149.95 €, which is 24.97 per cent above the RRP. The very next day, the price dropped again by 31.98 per cent to 101.99 €. Compared to the RRP, however, this is only a discount of 15 per cent. The low price is only available for two days, after which the RRP of €119.99 will apply until 2 January 2019. A natural price development will therefore only take place again in the new year.

However, the artificial price increase for the festive season does not only affect toys. In the past, higher prices were also registered for other popular gifts such as perfume or game consoles.

Time countdowns

Some retailers use timed countdowns to make products more attractive and create pressure to buy. Amazon uses this strategy all year round and specifically with even more Cyber Week offers.

Time-limited offers are available every day, accompanied by a countdown.

Travel portals or hotel booking systems also show that the principle works: Only three rooms left! The user is told: “If you don’t buy now, you’ll miss your chance! So don’t think twice and save immediately!

However, if you look at the price history of the toothbrush, it quickly becomes clear – this price is available more often, in the month of September 2019 already for the third time.

Vouchers and discount codes

A common method is to (re-)activate existing customers or newsletter subscribers by offering reduced prices through vouchers. Action days or certain seasonal occasions are ideal for this. In this way, the vouchers can be limited in time and thus ensure a shortage, similar to time countdowns. In combination with the discount, there are two incentives that convince you to buy. The discount can be applied in different ways:

• Percentage on purchase value
• Fixed amount from a certain purchase value
• Free delivery
• Gift from a certain order value
• Quantity discounts, such as three products for the price of two

Depending on the assortment and offer, scales are also possible:

• 10 percent discount on purchases over 30 €, 20 percent discount on purchases over 70 €
• 5 € discount on purchases over 25 €, 15 € discount on purchases over 100 €

The consumer’s heart beats faster: only those who buy a lot can also save! In such thought processes, the desire to get the best bargain often outweighs rational thoughts: Do you really save money when you order? Do you really need the number of products to get the higher discount? Is the product even needed or is the offer just so tempting?

How do you find the best bargains?

Many retailers try to make offers more attractive by artificially raising prices, time countdowns or further discount promotions. However, consumers should by no means let themselves be rushed or put under pressure by this. Otherwise, something will end up in the shopping basket that is not actually needed at all or a supposedly excellent offer that, on closer inspection, is not a bargain at all.

In the run-up to Christmas, retailers make the highest turnover of the whole year. On average, more sales are made in the Christmas months of November and December than in the other ten months. 15 per cent more turnover than in the other ten months – with the right discount strategy, retailers do not give anything away, but ensure additional profits.
Now, how can consumers find out whether offers are really saving money or just a feeling?

Always compare offer prices!

Attractive offers on promotion days such as Black Friday, Cyber Monday or Cyber Week should always be treated with caution. On these days you can get hold of real bargains, but it is always worthwhile to observe the price development. Price comparison portals like Geizhals or idealo help you find the current lowest price and look at the overall price trend. This quickly shows whether the price is really as low as advertised.

What is cheaper before Christmas?

According to idealo, it is worth buying technology products such as televisions, game consoles and tablets. But gift classics such as women’s fragrances and wristwatches are also cheaper before Christmas. In the third week of December, savings of around 35 euros were made on TV sets, which corresponds to 3 percent compared to the first week of December. For tablets, the savings even reached up to 26 euros.

Buy Christmas leftovers cheap in January!

January is the bargain month par excellence. Everything that is still in stock from Christmas is offered at a special price. Electronic items in particular are available at low prices: notebooks and smartphones tend not to be discounted before Christmas.

Those who shop anticyclically save!

If you invest in winter sports equipment in spring, you save money compared to buying in the winter season. So there are product groups in every season where you can save a lot.

Save despite fake offer

With the above tips, you can navigate safely through the price jungle. Only those who actually compare prices can tell the difference between fake offers and real bargains. Price alerts that can be set on price comparison platforms are also helpful: As soon as a product reaches or falls below the stated price, an e-mail is sent and the offer can be claimed immediately.