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Imagine you’re wearing an old coat that you haven’t worn in a while, and you’re surprised to find a crumpled $20 bill in your pocket. How good does it sound? Do you go up half a notch on a mood scale of one to ten, or maybe a whole notch?
Let’s imagine a different scenario. You are buying ice cream from an ice cream cart, and take out a $20 bill to pay. Suddenly, a gust of wind swept it out of your hand and into a nearby sewage grate. What does it do to your mood on a scale of one to ten?
If you’re like most people, you feel a lot worse about losing $20 than you do about gaining $20. This tendency is called loss aversion, one of the many dangerous judgment errors that behavioral scientists call cognitive biases.
Avoiding losses in Black Friday and Cyber Monday sales is one of the three main reasons our brains suck — and suck. Retailers know that our instinctive response is to avoid losses, research shows that this drive can be twice as powerful as the desire to make a profit. By offering short-term sales only available on Black Friday or Cyber Monday, they tap into our deep instinct to protect ourselves from missing out on the opportunity presented by sales.
Black Friday: A Brief History and Little-Known Facts
Let’s imagine a different scenario. It’s Cyber Monday, and you decide to check out the deals on an e-commerce website. You go there, confident that you’ll only find one or two great deals.
But once you visit the website, you’re hooked. All those deals look great, the prices are much lower than usual. You can not pass them! So you take advantage of a bunch of deals, and end up shopping way more than you originally intended.
Why did this happen? Why couldn’t you control yourself? This is due to a cognitive bias called tolerance bias.
We tend to overestimate how well we can control our emotions. In other words, we have less self-control and weaker willpower than we like to think we do.
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The final important psychological reason why you get sucked into Black Friday and Cyber Monday sales is that you’re reading this article. Here’s the thing: With the abundance of news, ads, and social media posts surrounding Black Friday and Cyber Monday, it seems like everyone is thinking about sales these days and looking for good deals.
As a result, our minds make us jump on the bandwagon to join Black Friday and Cyber Monday sales, a phenomenon scientists call the bandwagon effect. When we see other people aligning around something, we are likely to join them. After all, they wouldn’t be doing it if it wasn’t a good idea, right?
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Loss aversion, restraint bias, and the bandwagon effect are mental barriers that affect decision-making in all areas of life, from the future of work to mental well-being. By knowing about them, you can work to identify and solve these problems.
For example, a useful strategy for Black Friday and Cyber Monday involves deciding in advance of the purchases you want to make if they are on sale and buying them online instead of in a store. For example, you might decide to buy a certain laptop if it’s more than 20 percent off, or a certain big-screen TV if it’s more than 30 percent off. Save the website pages for the laptop or TV you want to buy, and then check them on Black Friday and Cyber Monday to see if they’re on sale. If they aren’t, be disciplined, and don’t buy anything else, because you’ll likely end up buying more than you want. Instead, wait for the Christmas sales.