Beige Rage: Gap Sale Tool Justifies Crazy Khaki Cravings

Sprize offers credits for any purchase you've made that later goes on sale.

Sprize

Gap has launched an intriguing experiment in Canada: a service called Sprize, which promises to end the irritation of buying something, only to watch its price fall a few days later in a sale.

The program starts when you register for a Sprize account. Then you get a card, which you can show during purchases at The Gap in Vancouver (they'll also look your account up, if you don't have the card on you). If what you purchased goes on sale within 45 days, you get credited the difference, and you can spend it at The Gap. Everyone seems to benefit: Consumers can feel more confident in their purchases, and, just as with Orbitz and its Price Assurance discount, The Gap captures fickle consumers that are always hunting for bargains.

And the real genius stuff lies just a layer below. The Gap is encouraging impulse buying, by eliminating one of the chief downsides—the possibility of paying too much. And, since your Sprize money can only be spent at The Gap, they're making it more likely that you'll spend it on a small, high-margin, non-sale item. (As Polaine points out, Sprize credits feel like free money, so you're probably less careful with it.)

Finally, the program encourages repeat customers, who have always been the golden geese of retail. What retailers used to do with in-store credit cards with built-in discounts, The Gap is now doing with a clever hack of consumer behavior.

Interestingly, the Sprize approach actually has a parallel with the year's hottest retail success-story, Gilt Groupe. Both are tapping the animal instincts of Homo Economicus.

Gilt, an online fashion discounter, offers frequent sales that expire after only a day—and which go live at a set time, after a mass email announcement. The effect is kind of like lining people up outside a store for a Black Friday sale—knowing the sale will end and making customers feel as if they're first in line only encourages them to get a little crazy with their purchases. (Behavioral economists have shown that artificial deadlines create all sorts of wacky behavior—including speculative bubbles.) Just like Sprize, Gilt doesn't accept returns, only retailer credit.

How soon until we seen behavioral economists trucked into retail chains, to work on incentive programs and purchasing patterns? Or have we seen the first fingerprints already?

[Via Polaine]

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