An affront to impulse buying
Buying electronics used to be pretty cut and dry: see something shiny, pay a lot of money, experience buyer’s remorse for spending too much money on something shiny. Since Internet shopping became popular, though, it’s become easier to just click and spend loads of money on something you don’t really need.
Because a trip to the store isn’t required anymore, it is becoming easier and easier to be an impulse shopper.
Websites like www.woot.com have made this kind of impulse shopping even easier.
Woot is a popular website that sells mostly electronics, such as televisions, MP3 players, and hard drives. The items may be new or refurbished, and the prices adjust based on that factor. The website offers lower prices on electronic items than at standard stores and websites, but there are only a limited number of those items available. Once the item sells out, it is gone for good and buyers need to find the item somewhere else for a higher price.
Currently, these deal-of-the-day websites are dominated by the technology industry. There are sites that specialize in software as well as sites that sell a variety of technological items. These items can range from computers to vacuums to headphones.
While Woot is the most popular of these sites, other sites have broken into this sort of selling. The benefits are that buyers have the chance of finding an item for a much lower price than they would pay at the normal retail rate.
The bad side of this (besides the increased chance of impulse shopping) include not always being able to find what you need and missing out on a low price because you didn’t know the item was on sale.
Now, the next step has been taken toward online impulse shopping. A new website called Hoopstick (www.hoopstick.com) has launched a beta system that uses dynamic pricing. This means that the price of a given item changes based on demand for the product being sold. Like Woot, there is only a limited number of the given item available, but unlike Woot, the price of the item is not set in stone. When more people show an interest in the product by visiting the site and buying it, the price goes up.
The price on Hoopstick’s item of the day changes every 15 seconds. As such, an item’s price can change by $5 in less than 15 minutes.
This basically means that impulse buying — albeit in a more refined form — is almost required to succeed in the world of Hoopstick. That is, if you wait, you might end up paying more than you’d like, so there’s the urge to buy the item immediately to lock in, or “stick,” the price of the item.
The flip side to this impulse buying, however, is that if you do wait, you might get a lower price.
Because Hoopstick is such a new website (it launched on Friday of last week), it is hard to say what kinds of items the site will be offering in the future. Their debut item caused a ton of Internet shoppers to flood the website, slowing it down and making it extremely difficult to register for the site or to buy the item.
The first item sold was a sticker with Hoopstick’s logo — and with the sticker came a free 500-gigabyte hard drive. What users were really buying, then, was more the hard drive than the sticker, but the price at its highest barely reached $2.
This new website style is a huge step toward the future of online buying: If one website is now using a dynamic pricing system, chances are that other websites will eventually do so, too. Using the economy as a guide, the website has established a system that allows buyers to determine what an object is really worth.
This kind of system allows the buyer to feel like he or she is not just buying a hard drive or set of headphones based on impulse. Since the buyer knows that the price may change, a decision based on predictability of the market will determine whether buying the item at a certain time is beneficial.
Hoopstick encourages this kind of deliberation before buying by allowing users to see the price trends for the product of the day. Each day, a graph of the trends is posted showing the average price for every half hour of deliberation and selling time. Buyers can look at the graphic to see whether the price is increasing or decreasing, and then make an educated decision (or guess) about buying the given product.
Even though this kind of dynamic pricing website is dominated by the technology industry for now, it is only a matter of time before deal-of-the-day and dynamic pricing websites carry over into other industries as well.
In the future, it’s likely that everything from appliances to fashion accessories will follow this kind of trend, allowing shoppers to gain access to lower prices.
This kind of website changes the face of Internet shopping. Rather than just allowing for more impulse sales, buyers may soon be able to better evaluate and determine what all items are worth. Granted, this may be several years — or decades — in the future, but at least buyers have the option until then to help determine what they’ll pay for items like headphones and hard drives.