Free turkey deals can turn some Thanksgiving shoppers into financial birdbrains.
The deals have become as much of a Thanksgiving staple as canned cranberry sauce: Spend enough money in the weeks leading up to the holiday and the store congratulates you with a complimentary bird.
But do the offers even make financial sense for consumers?
As with most cases of flashy deals, some economists say, probably not.
“If they change their behavior from what it would be, they’re usually losing,” says James Mourey, an assistant professor of business at DePaul University who studies consumer behavior.
In other words, consumers who would actually spend money they wouldn’t normally spend to redeem their reward usually don’t make out better off than they would if they just stuck to their regular habits.
One of them, 62-year-old James McIntyre of Philadelphia, will not receive a free turkey this year, and he might be all the better for it.
Shoppers at Shop Rite in South Philadelphia like McIntyre had to spend $400 this Thanksgiving season to claim their free turkey, up from $300 in 2012.
“If I was already spending $300 and they gave me a free turkey, then sure, I’d take it,” he said after a shopping trip there last week. “But you can get a turkey for $6 or $7. I’m not going to spend another hundred bucks.”
The hazard for consumers is that these incentives are everywhere: Coffee punch cards; free shipping deals if the buyer throws down more extra cash than they would have spent on shipping in the first place; frequent flier miles.
“With frequent flier miles, people will do something crazy like stop in the middle of nowhere to get the extra miles,” says Ravi Dahr, a professor at the Yale School of Management who specializes in the effects of goal-setting on consumer behavior.
Dahr says reaching those goals explains why shoppers like McIntyre might spend more money than they would have to earn their free turkeys, and why they might be as discouraged as McIntyre and not try in the first place.
Reaching a goal, he says, is a reward in itself, even if that goal is set by an entity as impersonal as a grocery store, and even if it’s not linked to a tangible reward, like a turkey.
But pair it with a turkey and people will act in ways that are often economically irrational.
If consumers are close to meeting the goal, they’ll work harder to reach it. But set that goal too high and they’re discouraged even before they start.
Grocery stores end up with customers like McIntyre, who look at $400 and see a lot of money they have to spend instead of just a short distance more before they win a prize.
By increasing the price to $400 in the past two years, Shop Rite may have lost more business than it thought.
A local Shop Rite manager referred a request for a comment to an executive office, which did not return calls seeking comment.
Laura Strange, a spokeswoman for the National Grocers Association responded to a question on whether the deals benefit consumers by saying, “Promotions vary from store to store."
Mourey doubts that many shoppers are splurging on dry goods in quantities they would never buy just to shave a few dollars off the cost of Thanksgiving dinner.
“I’m sure people who spend close to $400 might be motivated,” he said. “And then there’s the people who are nowhere near as much—they don’t care. And then there are some people who would never make that $400 mark and who still get motivated and attempt to make it."