This holiday season, American shoppers plan to spend an average of $831 on holiday gifts for friends and family, $121 more than they spent in 2010, according to a new report by American Express. But despite the noted increase in spending, shoppers are no less interested in scoring a deal.
With that in mind, interest in Black Friday shopping (which saw a dip in 2010) is back in full-force this year, meaning the majority of American consumers, some 42 percent of them, will be hitting the stores and the web post-Thanksgiving, up 11 percent from 2010. In fact, according to Deloitte, 12 percent say they’ll get the majority of their holiday spending over with on that single day. But the savviest of holiday spenders will get started much sooner, planning budgets, finding the deepest discounts and taking advantage of mobile and social campaigns that can help them save even more. “There’s an art to conquering Black Friday and it doesn’t always include joining the pre-dawn stampede,” says consumer expert Andrea Woroch. Above all, she says, it’s about doing your homework.
“Not every person on your list needs a $20 present,” says financial expert and founder of LearnVest Alexa von Tobel. That may be true — but while some acquaintances will be happy with a homemade batch of cookies, others' gifts will put a much bigger dent in your budget. “Set a top-line budget and work backwards,” says Woroch. Prioritize your gift list with those you know you’ll spend on and any others — like coworkers and acquaintances — you can spend on if you have room left in your budget. Put a dollar amount to each person and be sure to keep your list on-hand as you research pricing and hit the stores.
Credit expert Todd Mark, VP of Consumer Credit Counseling Service of Greater Dallas warns that planning your method of purchase for each item can be as important as setting a budget. “If you plan to use credit,” he says, “only use your cards with the lowest interest rates and don’t charge anything you can’t safely pay off in three months.” Many shoppers will also be able to take advantage of points and cash-back rewards associated with their cards on bigger purchases, so brushing up on fine print is also a good tip, he says. However, if you lack the discipline to stick to your budget and use your credit responsibly, he says, “It’s best to withdraw your budgeted amount of holiday cash and leave your credit cards at home.”
A 2011 survey by DailyDeals.com shows that 52 percent of consumers spend a considerable amount of time — more than an hour per purchase — researching the very best deals. But as retailers notoriously keep them under wraps until the last minute, this can be a tricky practice around the holidays. “If someone is waiting for all the ads to come in the day before Thanksgiving, they’re giving themselves just 48 hours to go through and digest a tremendous amount of sales information,” says Michael Brim, the cofounder of BFAds.net, one of many low-profile websites where holiday deals are leaked. Chances are good that hot items or great deals will be lost in the shuffle. Best to know (long) before you go.
But how? Officially speaking, Black Friday deals are not released to the public until the Thanksgiving week. But shoppers with ingenuity — and internet know-how — can find deals much sooner at hubs like BFAds where Brim posts deals and discounts leaked straight from the gift-horse’s mouth (pun-intended). “Most of the time the release date of an advertisement solely depends on our source,” he says. “If the source is involved in the design process, we’ll generally get the ad earlier than if the source were involved with the distribution process.” Last year, for example, BFAds posted the ads of most major retailers more than two weeks early.
Woroch stresses that while sourcing deals early is a good step, don’t consider your homework done once you’ve found “deals,” as some price strategies can prove nefarious. “Check prices against manufacturer’s suggested retail pricing as some markdowns can be misleading,” she says. Think inflated “original prices” to make the discount appear to be a better value. Tricky, no?
The naughty side of America’s biggest shopping day gets worse: Black Friday deals are meant to do one thing this holiday season — get your body (and your credit cards) into stores. But with deeply discounted “door-busters,” retailers look to other strategies to keep revenues up. “Stores may mark down the price of the big-screen TV but push to sell you the accessories at full cost,” says Woroch. Avoid extra costs by skipping the add-ons like cables or add-ons like Internet-TV boxes which she says can often be found for a steal on sites like eBay or Amazon. “Just buy the TV on Black Friday and buy any extras online a few days later to save costs. Those additional items might not be marked up, but they’re definitely not going to be on sale and can break a budget for sure.”
Other troubling purchases to avoid: the eye-catching displays nearest to the registers boasting $10 scarves, jewelry or kid’s toys. It’s easy to grab one or two things as stocking stuffers, Woroch says, “But tacking $40 onto every check-out will really add up.”
If you’re not Facebook “Friends” with your favorite retailers, now’s the time to make nice. Mark says that more retailers are going social, offering special discount codes to preferred friends on Facebook and Twitter. “It’s a good idea to add your favorite stores to your friend list — at least for the time being,” he says. Scott Silverman, cofounder of marketing firm ifeelgoods agrees, explaining that leading retailers like the Gap are even providing Facebook Credit as rewards to users who sign up for its email newsletter. “Because of Facebook’s Open Graph, “shares” are automatically embedded into user’s newsfeeds and visible to friends,” he says, “thereby multiplying its viral effect. Brands will be leveraging Facebook’s strong viral nature to strengthen brand leadership and engage with fans.” The savings can add up, making letting retailers piggyback on your social activity seem an inexpensive trade-off.
Another new trend consumers can take advantage of to make the most of leaving the house Black Friday is the explosion of mobile apps that enhance the shopping experience. Woroch says to keep your smartphone at the ready on the big day to fact-check any deals before purchasing. Her pick for price-scanning? Red Laser. Mobile coupons? CouponSherpa. With Holiday Gift List you can track your spending and stick to your budget while FourSquare can help you take advantage of local sales and deals based on location, or even freebie restaurant offers of cheap coffee breaks during your shopping spree.
© 2012 Forbes.com