Today we’re going to visit with Mr. & Mrs. Shopper.  They are interested in buying a new sofa, and have already decided on a style that they saw online, the SuperSofa.   In preparation, they have been reading all the newspaper inserts, and watching the TV commercials. They are especially interested in a 50% off sale advertised by their local Store A.

So Mr. & Mrs. Shopper go sofa shopping. Because they have 2 kids, Sally and Sammy, and a limited amount of time, they split up to go to 2 different stores.  Mr. Shopper takes Sally and goes to store A.  As he heads in the door, Sally, who is 2, has a temper tantrum, and he only has time to ask if they carry the SuperSofa.  They do, he learns, and by golly it’s on sale for 50% off!  He loads Sally back into her carseat where she falls asleep immediately, and he heads back home to tell the Mrs. the great news.

Mrs. Shopper, meanwhile, is at Store B with Sammy.  The salesperson tells them the store is offering 5% off the tagged prices.  As they start to sit down on the Super Sofa, which is tagged at $699, Sammy, who has just turned 3, has a typical toddler accident, so they too head back home.

That night after the kids finally go to sleep, they compare notes.  Mrs. Shopper says that Store B is having a five percent off sale, and the SuperSofa which was tagged at $699 will now only cost them $664.05.  Mr. Shopper snorts, and says that Store A has the same sofa, and it’s 50% off.  Since Grandma Shopper is coming to watch the kids tomorrow, they decide to go back to Store A together and save a lot of money by getting the SuperSofa at 50% off.

They get to Store A the next night, and tell the saleperson that they want to buy the SuperSofa.  He gladly writes them up, and tells them what a great deal they are getting at 50% off the reference price, and hands them a sales slip for $699.50. Whoa! Sticker shock!  This sofa is 50% off?  But it costs more than the same sofa at Store A, and that one was only discounted 5%!

What Mr. & Mrs. Shopper didn’t realize was that Store A was not  taking 50% off the regular selling price, they were taking it off a reference price,  described as a dollar value based on non sale prices of similar quality furniture available at major retailers.  And not knowing what that reference price was, there was no way to know whether 50% off was a good deal or not.  Thank goodness Mrs. Shopper had gone to Store B and found out the actual price of that sofa before they pulled out their plastic.

The moral of the story is this:  Stores advertise to get buyers into their stores.  But it’s up to the shopper to make sure that the deal that sounds better will actually cost them less money at the checkout counter.

Of course, there’s a happy ending to this story.  Mr. & Mrs. Shopper went back to Store B, bought their SuperSofa, and they all lived happily ever after…  until Sally spilled strawberry soda all over their brand spanking new sofa.  But that, my friends, is another story entirely.