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The single biggest way shoppers are manipulated by retailers

macy's black friday shopping consumer
macy's black friday shopping consumer

(REUTERS/Andrew Kelly)
Women shopping for handbags at Macy's Herald Square during the early opening of the Black Friday sales in Manhattan on Thursday.

It's Black Friday, the day after Thanksgiving when Americans take a brief respite from stuffing their faces with turkey to stampede into stores to take advantage of what appear to be great deals.

But it's a mistake for shoppers to think they're somehow winning at the cost of the retailer.

Sure, it makes sense to buy a good when the price is discounted. But that feeling of confidence is exactly what the retailer wants as it bombards us with not-so-good deals.

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Last year, brand guru Martin Lindstrom explained to Bloomberg's Joe Weisenthal that this psychology was the biggest way shoppers were manipulated by retailers.

"We fundamentally think we are rational," Lindstrom said. "But the reality is when we are out shopping, around 85% of what we do is irrational. It's subconscious."

That discounted flat-panel TV you're about to buy needs HDMI cables and perhaps a hardwood TV stand, all of which come with fat profit margins for the seller. Those long checkout lines are easy ways for retailers to then sell you some batteries or a $2 bottle of water.

"When you go into a store, you are going into the soul of seduction," Lindstrom said. "And the more rational people think they are, the more vulnerable they become."

Keep in mind why we call it "Black" Friday. Back in the day, businesses used ink and paper to keep track of their profits and losses. Red ink meant losses. Black ink meant profits.

Black Friday is when retailers' red ink turns black.

Watch Lindstrom's appearance at Bloomberg.com.

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