‘Third of holiday purchases bought impulsively’: Steer clear from TikTok Shop with these tips

Control your impulses this week. That is the advice Bankrate is giving consumers.

New data shows that last year Americans spent more than $71 billion on impulse purchases and half of us regretted it. Alex Gailey, an analyst for Bankrate said shoppers may end up with a case of buyer’s remorse this week if they aren’t careful. One in three purchases over the holidays are made on impulse.

“It’s a very emotional process. And most people impulse spend because it feels really good at the moment and they get that instant gratification and then immediately after that they regret it or they feel guilty or bad about it,” Gailey said.

Impulsive spending is driven by a sudden irresistible urge to buy. And nowhere is impulse shopping more impulsive, than online.

“The checkout process is so seamless on a lot of these social media platforms. When you see something on social media, there is almost an envy there of wanting what that person has,” said Gaily.

TikTok’s Shop, for example, creates a vortex of influencer promotions and flashy deals that can spell trouble-- especially for younger consumers.

“TikTok came out with a shopping functionality over the last year called TikTok Shop. It’s very easy to be on an influencer’s page, and maybe they’re pushing a product that has gone viral that’s trendy in the moment and you can instantaneously buy that product off of that influencer’s page,” Gailey explained.

We know social media masterfully uses our ‘fear of missing out’ to entice consumers. But brick-and-mortar stores do it too. Kevin Brasler from Consumers’ Checkbook said one thing retailers are doing is conducting fake sales.

“They’re using these inflated list prices that they rarely ever charge and making it seem like they’re giving you this deep discount. But it’s not a legitimate deal if they rarely, if ever, charge that original price,” he said.

Brasler said the industry has a name for these prices they are called “anchor prices.”

“We’ve been tracking sale prices at major retailers for more than ten years now. The last time we did this was for 33 weeks at 24 major retailers and found really that all but three were conducting these fake sales. The problem just continues to get worse and worse,” he said.

Another marketing tactic Brasler said retailers use is creating a false sense of scarcity.

“Well, you know, maybe they only have three left in inventory that moment, but they’re not predicting that they’re going to get another truck in the next day,” he said.

Here are some tips to avoid impulse spending these last few shopping days:

• Delete your credit cards off social media shopping sites so it’s not quite as easy to purchase.
• Unsubscribe from marketing emails.
• Stick to your budget with detailed parameters for each person.

On top of the aggressive marketing, some retail credit cards are charging a record 33% interest, so control those impulses or you may be feeling that buyer’s remorse well into the new year.

Bankrate said the way to calculate your holiday spending budget is 1% of your annual salary. If you make $100,000 a year, your holiday spending budget should be no more than $1,000.

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