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Savvy Young Shoppers Study Holiday Gift PricesSome prices went up on Black Friday, Cyber MondayKids surprised at wide range of prices, outlandish shipping costs |
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By Lisa Wade McCormick December 21, 2009
Sound advice, right? But it doesn’t come from experts with years of experience studying the marketing strategies of top retailers or those with advanced degrees in business and economics. This advice comes from some 4th graders in Missouri. ConsumerAffairs.com asked these savvy young shoppers to review a study in which our Web site tracked the prices of nine popular toys from the first of November through Mid-December. We shared our data with the Liberty, Missouri, students and reminded them to pay close attention to the prices on Black Friday and Cyber Monday. Those are traditionally the days when retailers hold blockbuster sales to lure customers to their stores or Web sites. “It’s kind of a rip-off that some prices went up on Black Friday and Cyber Monday,” 4th grader Briana said after seeing our findings. We also asked the students to keep an eye on the shipping fees – costs many 4th graders called “hidden fees.” “I think most people look at the prices and don’t look at the shipping costs,” 4th grader Jake said. For our non-scientific study, ConsumerAffairs.com followed the prices of nine toys sold in major retailers and online. We used the prices listed in newspaper ads, holiday catalogs, and on retailers’ Web sites. We did not use online price-tracking Web sites, like PriceTrace.com, in our research. The top-selling toys in our study were:
Some prices increaseWe discovered the prices of all but two of the toys -- the Dippin Dots Frozen Dot Maker and the Wizards of Waverly Place doll -- increased on Black Friday and, in some cases, on Cyber Monday. Consider:
Black Friday hypeAfter reviewing our findings, the 4th graders agreed that most of the hype about Black Friday sales is misleading. “For a long time, I thought Black Friday was a day when you got great deals,” Colton said. “But many of the prices went up on Black Friday.” Classmate Kylee now wonders if a present her family purchased on Black Friday was really a bargain. “My brother got a Transformer for his birthday and we got it on Black Friday,” she said. “I thought that was a good day to get it, but now I think we may have gotten ripped off. That’s not nice for people to do.” The prices of two of the toys in our study, however, decreased on Black Friday. On Amazon.com, the price for the Wizards of Waverly Place doll decreased from $22.48 plus shipping on November 15 to $19.99 plus shipping on Black Friday. It was the same price on Cyber Monday. The price, however, shot up to $47.60 plus $5.34 shipping on December 14. ToySoup.com dropped its price for the Dippin Dots maker from $35 plus $5.53 shipping on November 15 to $19.71 plus $5.53 shipping on Black Friday. The Web site, however, has been out of the ice cream maker since Cyber Monday.
Shipping costsDuring our study, we also tracked the fees retailers charged for shipping. The most outrageous shipping cost we uncovered -- and the one that made our 4th graders gasp out loud -- was on Amazon.com for the Dippin Dots maker. A seller named KWICKKARGO sold the ice cream maker for $45.99 on December 10. But the vendor also charged an astronomical $49.67 for shipping. That’s $3.68 more than the dot maker. “That price really jumps out of you,” 4th grader Katie said. “That’s almost $50 for shipping…it’s more than the toy.” The high shipping costs also shocked her classmate, Damian. “The price of the Dippin Dots maker with the shipping fees surprised me.” The students also couldn’t believe how much many of the toys cost. “That Transformer is a lot of money,” Damian said. Over-priced is the word another 4th grader used to describe the action figure. “That Transformer is this big,” Jake said, making a small space with his hands. “And they want like $40 for it. I’m thinking ‘what the heck is that?’” Fourth-grader Delany said it’s outrageous that some vendors on Amazon.com wanted more than $50 for the Lego walkie talkies. “I think that’s a rip-off,” she said. “It’s so small.” It’s also fragile. “My cousin got one and the box said it breaks if you drop it,” Delany said. “He dropped it and it did break.” Any advice?What advice do these students have for hurried shoppers this holiday season? “Pay closer attention to the prices,” Kenna said. “Shop around,” added Delaney, who noted that Toys 'R Us had the best deals on seven of the 10 toys we tracked. “And pay attention to the tiny little writing where it might say that shipping is not free,” said Kylee. A good gradeA marketing professor at the University of Minnesota gave the students an “A” for their shopping insight. “I think it’s great,” said Professor Mark Bergen, an expert at price wars and marketing strategies. Bergen said the fluctuating prices we documented in our study didn’t surprise him – even those we saw inch higher on Black Friday and Cyber Monday. “What you see (on those shopping days) are extremely large discounts on selected items and the rest of the products stay the same,” Bergen said. “The point of those sales is to use one thing to draw people in the stores.” He added: “What we find are a lot of games during the holidays to make certain items highly visible to get people in the stores – or to have perceived price competitiveness. But that doesn’t mean that all prices are that way. If you get a deal on a couple things, the retailers pick it up elsewhere.” This holiday season, Bergen said, many retailers offered deep discounts on less expensive television sets to lure customers to their stores. “They tried to get those aggressive shoppers in the stores by saying buy this cool TV and then they hoped they’d buy other stuff, like the wires to connect the TV or DVDs, whether or not those were on sale.” But Bergen said that marketing strategy can backfire, especially if retailers only have a few of those “door-buster” sale items in stock. “Retailers hurt themselves more than help themselves by having a limited supply of the deeply discounted items,” he said. “That’s something I wish retailers would do less of.” ConsumerAffairs.com received many complaints about that marketing practice from early-morning shoppers who went to Wal-Mart on Black Friday and discovered some sale items were already sold out. They’re consumers like Stacy of Goodman, Wisconsin: "On November 27, I arrived at Wal-mart in Iron Mountain, Michigan at 4:30 a.m. I was there to purchase a 32" Emerson TV and a laptop computer. What I found interesting is that there were customers inside shopping. I heard many complaints from those customers that all the electronics were sold out at 3:30 a.m.”
Watch for changing pricesDuring the holiday season, Bergen said, retailers also shift their prices around to see how consumers respond. “Almost all retailers will move prices to see what it does to demand,” he said. “They might raise them or lower them to see how consumers react. If people don’t react to the changes, it doesn’t make sense to have the prices lower.” Bergen said our study affirmed his suspicions that some retailers decided to start their holiday sales season earlier this year -- weeks before the traditional launch on Black Friday. “Your data suggests the holiday sales period is moving earlier,” he said. “Look at the Toys 'R Us catalog. It arrived in early November. Toys 'R Us may have done that to get people to look at the prices and spur them to the stores. That’s not inconsistent with what we’re hearing that the sales period is moving earlier and earlier.” Our study also illustrated the importance of keeping tabs on shipping fees, Bergen said. “They’re often hidden and people who buy online -- where shipping matters -- should always pay close attention to those costs,” he said. “That’s a place where retailers can hide high prices. “The case you had where the shipping was more than the price (of the toy) is a wonderfully vivid example of that,” he added. “That was shocking to me.” Where to lookAsked where consumers can now find better deals -- online or in stores -- Bergen said: “If you’re looking to find items on sale and at really low prices, you probably want to search both online and in stores. On any given day, you may find a better deal online or in a store. Some Web sites may have special discounts on certain items and deals on shipping.” Consumers shopping for books or DVDs this holiday season definitely found better deals online, Bergen said. “This year there were huge Web-based price wars on those items.” Shoppers looking for specialty items will also have better luck tracking them down online, Bergen said. “The Web has a greater product selection.” But some online vendors may gouge consumers on hard-to-find items, he warned. Consumers have already seen that happen this holiday season with Zhu Zhu pets, the interactive hamsters that are out-of-stock at most retailers. The regular price for those robotic hamsters is $10, but some Amazon.com vendors are selling them for $50 or more. “When there is more demand than supply, the price will increase,” Bergen said. “It’s what the market will bear. But there’s a limit to that. When a product (for a child) is around $10 during normal times and then someone charges $90 that offends our sensibilities. And rightly so.” As we move closer to Christmas, Bergen said, consumers will likely see the prices drop on overstocked items or those that didn’t move quickly off store shelves. “I heard an ad today for a store that was offering 10 percent off each day until Christmas on all its Christmas items and toys,” he said. “Web sites will also stop offering sales before brick and mortar store because, at some point, they can’t get the items shipped in time for Christmas delivery. “But the prices for items that are in short supply probably won’t go down.” Consumers who couldn’t afford -- or find -- one of the hot ticket items this holiday season shouldn’t be too disappointed, Bergen said. Those products should return to store shelves in the next few weeks – and the prices could be much lower. “I’m aware of the pressure parents feel to get a special Christmas present,” Bergen said. “But most of the items in short supply will pretty quickly re-adjust. Store may be out of Zhu Zhu pets now, but pretty soon they’ll be packed with them.” Parents might consider giving their kids a “rain check” for those hard-to-find items, he said. “Promise your kids that you’ll do more when the product is in stock. Instead of buying one toy, maybe buy three because the price will likely have come down.” Smarter shoppers
“I get $20 a month for allowance and I’m now going to take a look at prices and see what I can afford,” Kenna said. Classmate Colton added: “Once I see my presents for Christmas or my birthday, I’m going to hope that my parents got them on clearance. And if I get one of those toys (in our study), I may ask my parents where they bought them…and hope they didn’t get ripped off.” If you've had a bad experience -- or a good one -- with a consumer product or service, we'd like to hear about it. All complaints are reviewed by class action attorneys and are considered for publication on our site. Knowledge is power! Help spread the word. File your consumer report now.
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The cost of the medieval castle rose on Black Friday at Toysrus.com and Amazon.com. At Toysrus.com, the price increased from $79.99 on November 15 to $99.99 on Black Friday. It stayed the same on Cyber Monday, but then dropped to $63.99 on December 14 if consumers used PayPal for their purchase. If not, the price was $79.99. 
At Walmart.com, the price of the Nerf game increased from $29.97 plus .97 shipping on November 15 to $39.96 plus .97 shipping on Black Friday. It stayed the same on Cyber Monday and then dropped to $19 plus .97 shipping in December. The toy, however, was out of stock at Walmart.com on November 8 and 15;
At Toysrus.com, the Transformer action figure rose from $29.99 on November 15 to $34.99 on Black Friday. But the price dropped to $24.99 on Cyber Monday. That’s the same price listed in a November 29th ToysRUs newspaper ad touting “Our Lowest Prices of the Season.” That’s true. When we started following prices on November 1, the toy chain’s “Biggest Book Ever” advertised the Transformer for $29.99. In December, the action figure’s price jumped back up to $34.99 online.
