Black Friday 2010, If You Must

by Kevin on November 19, 2010

Ah, Black Friday. That joyous occasion where you risk life and limb to wake up at 2am to go stand in line in the freezing cold in front of a store that’s offering a super amazing deal to the first 17 customers to race to the back of the store with a shopping cart to throw said item into cart and navigate the just-now-waking up masses back to the front of the store so that your item is one of the first 17 scanned so that you get $100 off.

Phew! Just thinking about doing anything remotely close to that exhausts me.

But to some of you the thrill, the lack of sleep, and the amazing bargains are part of an annual ritual.

A ritual called Black Friday.

It’s only one week away… are you ready?

Black Friday and Cyber Monday 2010

Black Friday and the following Cyber Monday are the bargain and Christmas shoppers’ dream come true. Stores offer insane deals to get folks in the door in an attempt to get them to buy other items. They’ll gladly take a loss on the 17 televisions that you might be able to purchase if it means the large group of shoppers behind you buy lots of other things.

In short Black Friday is the ultimate use of loss leading.

As a financially sound reader you might be skeptical, and that skepticism is healthy. As much as I hate to say it, you can actually save a good deal of money on Black Friday and Cyber Monday. As long as this spending is part of your financial plan — in other words, you saved up money specifically to buy that certain item — then it is fine.

Where people get in trouble is right about the time the adrenaline is starting to wear off in the check out line. Suddenly it dawns on you that you’ve got $743 worth of items in your cart, and you’ve put no thought into how you’re going to be able to afford those gifts.

Shopping Online versus Buying In Store

In 2008 my wife and I spent $500 on Black Friday buying a new laptop for her. We had saved up the money and were anticipating this purchase. All that was left was to find the best deal.

As I did my research I slowly discovered that those Black Friday deals might not be the best purchase to make. You might be able to find a better price elsewhere.

There a few factors to consider:

  • having the item you want in your hands today
  • how much you trust online retailers
  • how much you value your time

Let’s take a look at those in greater detail.

Do you absolutely need the item today? In other words can you wait a little bit in hopes of the price going down, or are you willing to pay a premium to buy it today? You might be able to find a better deal online… and you wouldn’t have to get up at 2am to buy it.

Do you trust slightly lesser known online retailers? The major retailers that have big box stores aren’t going to offer significantly better deals on their websites. They want people in the stores physically picking up items, touching them, getting connected to them. But there are other reputable online-only stores that offer amazing deals and great customer service to boot. You could get your items there at a potentially lower cost. And again, you’d be able to sleep in on Black Friday.

How much it your time worth? Let’s say you save $200 off the listed price of a television at a big box store. Now let’s also say you woke up at 2am to get to the store and stand in line starting at 3:30am. You buy the item at 7:30am. You’ve been “working” to save $100 for 5 and a half hours. Essentially you’ve worked for yourself for $18 per hour, you’ve lost sleep, and you’ve only saved $100 on a big ticket item.

That kind of math just doesn’t add up for me. I like to avoid the traffic, sleep in, and go about my regular day.

What about you? Any big Black Friday fans out there?

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