Well, we're seeing people spend equal as much. Now, Remember people have
less disposable income than they did last year, So on average, the average
family has five to seven thousand dollars less as a family to spend than they
did last year. So here's where That's why we're seeing credit card debt go
up, and that's why buy now, pay later is going to be a
strong trend for this holiday season. You're listening to Carrie Lutz's Financial Survival Network
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Go to Financial Survivalnetwork dot com and get your free newsletter and gift. Financial
Survival Network now more than ever, and welcome. You are listening to the
Financial Survival Network. I'm your host, Carrie Lutz. Well, it's a
tough Christmas season in looks like the country is heading into a potential recession,
could be a deep one. Got a lot of problems out there in the
horizon. What are we going to do? Uh? Well, the buy
now, the buy now, pay later plan is back in vogue. Everybody
seems to be offering it. Carl Gould is with us Now, Carl,
it's great to have you back on the show. He you've got a question
for Carl and myself. Kl at Kerrie LEDs dot com is the email address,
and Carl, you are president business management firm Seven Stage Advisors. So
buy now, pay now for some people, it's buy now, payever,
right, it could be Look, it's you know, with all that's going
on right now, companies have to get more creative as to how to bring
in a customer. It's the most expensive thing that they do when it comes
to fulfilling. You know, their services and products to their customers is getting
them in the first place. And so and it's eight times more expensive to
get a new customer than keep an existing one. So they've got to get
creative. So they say, all right, well you come and buy now,
pay later. It's almost like an in house finance program. And it's
a way to attract more customers and get more foot traffic into their locations.
Well, you know they've got this zero percent financing. They've got you know,
make no payments until January twenty twenty five, like at furniture stores.
You know, is this going to make any difference? The people take advantage
of it. Oh, it will, it will because we you know,
we very much appreciate the impulse buy. We will. We will spend money
on things that we that we see or if we run out of budget,
but there's still something really important to us that we want to get, especially
during the holiday season, We're going to make that purchase. So it's genestly
people put more on their credit cards. This is another form of that.
So yeah, you'll you'll see an uptick in purchases as a result. Just
need to be careful. Mm hmmm. Hey, well, one nice thing
is when you do the buy buy now, pay later plan doesn't go on
your credit report, does it generally, right? So that is one of
those nice things. Now, yeah, you want to check the fine print
to make sure that it doesn't because a larger store that already has its own
credit department, like a home depot like L's, like a Macy's. In
the fine print, it could say that if you miss a payment, it
goes on your credit report. So you do want to be careful about that
because if you're going to buy one hundred dollars item and you do buy now,
pay later, you think you're going to spend one hundred dollars. But
maybe there's an admin fee to get onto the program, maybe there's interest,
maybe there's a convenience fee. Maybe there's a penalty if you don't pay on
time. These are the sorts of things that you want to make sure are
not part of the program, or you least know about them before you get
into them, right, So, I guess some people will take advantage of
it. Huh. What other innovative ways to bring customers into the stores of
the websites are you seeing now? Well, they're doing a lot of bundling.
You know, when times are tough, it's hard to just charge a
retail price for something. So what they might do is they might put a
bundle together. Instead of buying that T shirt in that hat, they'll put
the two together, They'll put a they'll put a band around it, and
they'll and they'll say, hey, two for twenty instead of buying them separately
it would be thirty. They're also using clearance racks. If you noticed,
did you notice Black Friday started right after Halloween? It didn't start on after
the damn Thanksgiving. It started then it went all the way through the weekend.
It's still going on. Yeah, Black friend is a month long now,
yeah, exactly, Friday is a state of mind. I think it.
Well, you're right, because it's no longer a day. So even
Black Friday even starts on Thanksgiving in some places. So people are you know,
companies are using a lot of promotions, they're using a lot of discounts,
They're using a lot of very clever tactics to make it appealing. So
you think you're getting a good deal and you and you patronize their particular store.
Amazon is giving free delivery. There's a lot of different hooks to get
somebody to start buying. Hey, so it looked like there were less riots
this Black Friday too, Maybe spreading it out as a good thing, you
know, it could be, you could be. It's hard. It's hard
to know if that's the case. But what we have definitely seen is retailers
are upping their security and more importantly, their security presence. So someone's less
likely to, you know, to grab and run if they see security right
at the door. You know, the stores that were getting hit, you
know, look, no one deserves to be robbed, but the store is
that we're getting hit. Were the ones that not only were vulnerable, but
they looked vulnerable. They looked as though they didn't have a security presence,
and so that emboldens somebody who's going to try to snatch stuff from your store.
Yeah, well you know they would like be fighting each other off for
toaster ovens and stuff. Then remember that guy in Long Island got trampled to
death, like takes to go and it's just was out of control. So
if you could spread it out and keep them away from the stores, maybe
that's not such a bad thing, right right, Well, look, the
retail is going to continue to be under pressure. It's it's changing. The
retail world has changed since the Amazon effect really accelerated during the pandemic, so
that really did change things. Retail still has its place and people still do
like to come out and look and touch things and consult this with the sales
reps so they make sure that they're buying the right thing. There's still a
place for that and there always will be. But the retail shops have to
create a compelling experience in order for people to come back. Okay, so
an interesting item that popped up here, I just want to run it by
you. In Europe, Amazon was hit by multiple strikes because they're not it's
mainly working conditions. You know, they do some things over there that might
be acceptable here but are not acceptable in Europe, and they're kind of like,
I mean, look, two thousand workers struck across six Amazon fulfillment centers
in Germany. You know, what are they doing wrong here? KORL.
Well, you do need to know your audience, and you do need to
know what is acceptable, you know, labor practices in each of these states
now in these countries. Now, you know, Amazon is a very is
a company that has a lot of accountability in its workplace, and not everybody
likes that. And you know, they are very data driven and they're very
accountability driven, and you know, you're you're going to have that issue.
I don't know that they're doing anything wrong, but how you institute things like
that sometimes is the difference. And they just need to make sure that they're
communicating the expectations properly and you know, and enforcing what they say and not
enforcing what they don't say. Yeah, yeah, well they're still popular though,
sure, sure, amazing amazing company. You know, I wonder what
modern life would be like without them sometimes, you know, Yeah, I
just do it sometimes just because I'm lazy, I don't want to go to
the store. It's not so much I don't want to go to the store,
but I know that a certain product I'm looking for I have difficulty finding
at the local supermarket. That's the point right there, Kerry. Amazon has
engendered trust that if they say they have it, they have it, and
you can't always rely on your local store or to have what they have historically
had on the shelves. And Amazon makes it super easy to find out.
You go right on the site, you do a search, they have it,
they don't have it. They tell you when you're going to get it,
and they just manage your expectations, I think, as much as anything
else, that's what they're good at. You know, if I told you
something that you really wanted was going to come in three days instead of two,
I don't think you would care, but you would want to just you
just want to know is it there or not? Right? Am I buying
the thing that I'm am I getting the thing that I think that I'm buying.
So if I were, if I need a gift and last year they
had it at that store, but I'm not really sure, and Amazon,
I know, has it. You know, do I want to invest an
hour of my life to go find out when I could do it at the
click of a button and if the prices are reasonably close, Amazon's going to
win. Yeah, so true. I mean, hey, something like Terryoki
sauce. I can never find it where I think it should be in the
supermarket. So I just gave up and I said, you know, I'll
just order it from Amazon. They'll have it to me in two days,
need it right this minute. And that's what I've taken it doing with a
whole host of items that I just trun't be bothered going out to the to
the local stores for it. You know, if I buy it from Amazon
or I buy it from the cvs, who cares, right right, Yeah,
exactly exactly. And that's and that's where you know, Amazon has always
wanted to be a customer centric person company, and they wanted to be one
of the most customer centric businesses on the planet. And that's they've placed their
focus there. And it's it's clear that they have. You know, Target
has done a really good job and Walmart, for that matter, where the
same day pick up and curbside pickup. Again, that's been a very very
customer centric move. Target and Walmart are doing actually have the advantage over Amazon
because they have stores in your local market, whereas Amazon does it. So
Target and Walmart actually have an advantage there over Amazon. And that's something that's
very valuable to people. They say, I need to so on my way
home from work, I'm happy to just stop by and pick it up if
you could just have it ready and we can do a curbside delivery. That
has proven to be a tremendous value added service for customers, and they really
like it is curbside delivery. I had them delivery a package to me Walmart
in like it was like in less than a day, like two hours after
I it was dropped off at my door. It was amazing, you know,
and Mazon had never done that before. So I think I got to
look more closely at Walmart, you know, right right, well, the
convenience now you can look on the website, you can look on the app,
you could see if they have it, and you know, they're all
three of these companies were talking about. Their logistics are so sophisticated that if
they say they've got it, you could trust that they have it and they'll
get it to you. Yeah, it's pretty it's pretty cool. Definitely pretty
amazing. So what other trends we're seeing here for Chris miss in terms of
what people are buying, how much they're spending, anything that's raising alarms with
you. Well, we're seeing people spend equal as much. Now, remember,
people have less disposable income than they did last year. So on average,
the average family has five to seven thousand dollars less as a family to
spend than they did last year. So here's where that's why we're seeing credit
card debt go up, and that's why buy now, pay later is going
to be a strong trend for this holiday season. You know, it's funny
because when we were kids growing up, buy now, pay later, that
was like, you know a lot of people did it. It was like
the Christmas Club, right, yep, that's right, Yeah, no doubt
these so people they're reviving some of these older products and services, but just
under a new knee. So every old is new again, right, exactly.
It's not vegan, it's plant based. You know, you're not on
a diet. You have a meal playing, right, you're not. It's
not in house financing. It's buy now, pay later, right, all
right, But it all amounts to the same thing as the same idea,
you're going to buy more than you can afford, right in some cases,
yes, in some cases, Look, if you managed the if you manage
the program properly, you'll be fine. But you just want to be aware
of what the fine print is for one of these programs so you're not caught
off guard, right, Yes, OHI it's the devil is in the details,
right, Yeah, sure is it? Sure is you you know,
because you're If you manage the program right and you set up your payments and
make sure you're not getting hit with fees and interest, then this program could
work really well. But if you're playing if you're using the program to play
catch up. You know, some people either are getting a bonus at the
end of the year or they know they're getting a tax refund, and they
say, you know what, I'm going to pay this off when I get
my bonus or I get my tax refund, and they've already planned that out,
so I'll take advantage of the buy now, pay later, And that's
cool. That works fine. But if you're saying I have no idea,
how I want to pay this and I really want to get this gift,
and your payment schedule extends, that's when it's going to be a little bit
more painful. I just find it fascinating that, you know, the creativity,
the brain power that goes into these companies to get you to buy more,
and it's it's all scientific, you know. It's like things that they
do in the casino to get you to gamble, like getting rid of the
clock correct, all those things are all geared at how do you make people
spend more money than they plan to write? Yeah, it's true. Look,
it's the hardest thing to do in business. Marketing and sales is the
hardest thing to do in business, and so that's why so much time and
effort and energy is placed on it. Because it's expensive, it's hard,
it's ever changing, it's ever evolving, and you need to stay. If
you miss a you know, consumer purchasing trend, it could be catastrophic for
your business. I mean, these companies make up to forty percent of their
revenue in the holiday season. They can't afford to have this miss right forty
percent. How did they become so dependent on one season? Really, literally
let's call it two months, but really it's like forty five days. Isn't
that a mistake? Well? I think it's just you just have three major
holidays within sixty days of each other. You have Halloween, which does billions
and billions in circles, believe, Yeah, Thanksgiving and Christmas. If you
think about it, it's within just under sixty days. Those three holidays.
They are the biggest consumer holidays. There are other big ones Mother's Day and
Easter and New Year's right, but nothing compares to those three. Those are
the big three. They're within sixty days of each other, and we have
built our social, family and business calendars are on those those three holidays.
So it's not a tremendous surprise that they have become as big as they habit.
But you know, like I always, you know, would like to
buy things off season, like Christmas decorations, buy this sure the day after
Christmas? Right, and you know, breeding cards, things like that,
things you can buy. So with a little strategic planning, a consumer really
can save way more than they would save on Black Friday or any other designated
sales holiday just by buying off season. Yep, that's right, and that's
why Boxing Day internationally or December twenty sixth is so important because these retailers have
now you know, have looked at what didn't sell and they realized that it
is better for them to deeply discount it and get it off their shelves rather
than carry it into the new year where the trend might not be as as
strong, or people might not want it or might go out of style.
So it's better for them to sell it right there on the spot then have
the carrying costs of it sitting on their shelves. Right. So that's why,
that's why December twenty sixth through say January fifteenth is so it's such a
good time because this is when these companies have to clear, literally clear their
shelves. So buy your Santa suits on the December twenty sixth. It's right,
it's coming. God, it might have a little black marks on it
from the going down the chimney, but you'll still get a much better deal,
right, much better deal. So, hey, Carl, tell us
where we find you, how we connect with you on the web, and
what you can do for us. So for anyone that wants to reach me,
you can find me at Carlgould dot com or Carl three sixties CURL three
six zero dot com. All right, and the link is in the show
notes and yeah, Carl, appreciate as always you coming on. We'll talk
to you again real soon. Happy holidays. Don't get caught up on too
many buy now, pay later programs. That's that we're watching. To be
solvent for the coming year. Absolutely, you got it. Talk to you
soon, Happy holidays. Thanks for listening to carry Lenz's Financial Survival Network,
your solution to today's trying times. For the latest, go to Financial Survivalnetwork
dot com. Financial Survival Network now more than ever,