Friday, 6 April 2012

Source of Coupons That You May Not Have Thought Of

Trying to get your hands on more coupons? See if you've thought of these sources:

1. Receipts
Before you stuff that grocery receipt into your pocket or purse, take a second to see if anything is printed on the back of it. You may just find a coupon for your favorite hair salon, restaurant or oil lube.

2. Free Samples
Request a free product sample, and your loot is likely to arrive with a high-value coupon attached to it. Now that's a great deal!

3. Phone Books
Need a coupon for an area business? Check the phone book. Most have a special coupon section, but you'll also find coupons built into ads.

4. Ticket Stubs
The next time you attend a sporting event or play, be sure to flip your ticket stub over. A coupon for a freebie or a cheapie could be waiting for you on the back.

5. Instant Win Games and Sweepstakes

Want to get your hands on more free product coupons? Then, try entering sweepstakes. Lots of instant win games offer coupons as prizes:

Sunday, 1 January 2012

Coupon And Discount as "Mental Credits"

Consider this. You get Rs 500 discount coupon at a book store for buying products worth Rs 4,000. You decide to use the discount coupon on your next visit to the store.

How would you spend the coupon? If you are typical consumer, you will most likely use the coupon to indulge on a fancy or a costly product in the store that you would otherwise not buy! Why?

Suppose on your next visit to the store, you decide to buy 5 books to help you with your continual professional education. Assume that these books cost Rs 3,500.

You then spot a music CD that costs Rs 1,500. The CD contains good music but is expensive. You might still decide to buy the CD. Why? You rationalise that the CD is a great buy at Rs 1,000. You, hence, use the Rs 500 discount coupon to buy the CD.

Your decision will seem irrational to classical economists. After all, your total invoice amount will be Rs 5,000 less Rs 500 discount- whether you use the discount coupon on the CD or on the books! But you would be “mentally” unwilling to use the coupon on the books. Why?
Right to indulge

It is easier to justify the purchase of the books, as they are part of your continual learning.

The same cannot be said of the music CD. You, therefore, feel guilty of spending on the music CD. Using a discount coupon on the CD helps you dull the pain of paying for it! Importantly, it gives the “right” to indulge.

Behavioural economists would argue that you are suffering from a bias called mental accounting.

It refers to how we create “mental accounts” to rationalise our decisions. In this case, you “mentally” debit your education account with Rs 3,500 towards cost of five books.

You are, however, unwilling to “mentally” debit Rs 1,500 to the music account. You, hence, “credit” the discount coupon directly to the music account, lowering the cost of buying the CD!

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