Conscious Consumption: Getting Something On Sale is NOT a Marginal Benefit

Shoppers love a good deal. If you’re like me, the rush of getting something on sale is borderline euphoric. I was raised by a wonderful woman who lived for sales. During my childhood, I spent Saturdays with my mom hunting for bargains at yard sales, moving sales, rummage sales, thrift stores, you name it. I’m not exaggerating when I say that my mom had no fewer than 5 sewing machines at a given time in our house. A Singer sewing machine for $10 was her crowning achievement in the yard sale game. I still remember her disbelief when an older woman parted with it for half the tagged price.

Throughout much of my life I adopted this mentality from my mom. For me it wasn’t sewing machines, but clothes. I hardly ever purchased clothes full price — they always came from the clearance section or I used a coupon. I proudly exclaimed how much I paid for a dress or a pair of shoes if someone complimented me. Friends were in awe of my bargains and saw me as a person who was good with money.

I used to wish I could shop like Cher

If I consciously spent my money, I would not have purchased half the clothes I did. The “70% off!” signs distorted my logical thinking and triggered impulse spending on things I did not truly love or really needed. I never took into account my marginal benefit.

What my friends did not see were the piles of clothes in the bottom of my closet with tags still on or items pushed to the back after only one wear. Although the initial purchase left me with a high, the sheer volume of unworn clothes started to “wear” on me.

Understanding marginal cost and marginal benefit can be key for combatting the psychological marketing tactics of stores (and they are masters at getting us to buy things we don’t really need or even want). Rational, conscious consumers should perform a cost-benefit analysis before approaching the checkout counter, and marginal costs and benefits should carry heavy weight in your calculations.

A COST is whatever we give up when we make a choice — like the amount we spend when we shop. The MARGINAL COST refers to the cost of one additional unit. The example I use with my students is the scenario where $20 shirts are promoted as “buy one get one half off.” The total cost of two shirts is $30. The marginal cost of the second shirt is $10. Marginal costs are taken into account whenever you consume more than one good (the second or third scoop of ice cream, for example). Businesses sometimes make additional units cheaper in order to encourage consumers to buy multiples.

A BENEFIT is the advantage gained when we make a choice. The MARGINAL BENEFIT is the advantage gained by consuming that next additional unit. Here’s where many consumers (like myself) can go wrong, and, say it with me, GETTING SOMETHING ON SALE IS NOT A MARGINAL BENEFIT.

In the shirt example above, I ask students what is the marginal benefit of that second shirt?Without fail, a student usually says, “the marginal benefit is that it’s on sale.” This is understandable. Getting a deal may make us feel good. It may give us a rush. But is is NOT an actual benefit. Sales do not provide a tangible benefit in our lives. That second shirt itself should provide a direct benefit. Maybe the shirt is of another color we love and coordinates with several pieces already in our closet. Maybe we hate doing laundry, so a second shirt allows us to put off a trip to the laundromat. But simply getting something on sale does not actually add an advantage to our lives.

I fell into a routine where whenever I shopped I justified purchasing the second (or third) shirt by telling myself I was a smart consumer because I got it on sale. In reality, I didn’t need additional articles of clothing. I didn’t really love that second shirt, or maybe it didn’t really fit right, or it wasn’t really my style, so it ended up in the abyss at the back of my closet.

Using our head over our hearts when it comes to shopping can be difficult, especially when the mission of stores seems to be to get us to buy more than we really need. If you’re a bargain hunter like me, there’s a saying that anything you don’t buy is “100% off.” This idea provides me a little comfort when I pass on things I used to convince myself I needed. Being a conscious consumer is hard. It easy to simply swipe your credit card and take pride in those new shorts that were half off, even if they do make your butt look a little weird.

Kondo-ing my closet (using Marie Kondo’s method of decluttering) helped me see the volume of clothes I really did not even touch. The joy was in the sale, not in the actual shoe. Now I was left with a pile of clothes to donate, and some guilt and shame about the unnecessary purchases I made. This triggered a self-imposed clothing ban that helped me realize I really had enough. This notion gives me some motivation to be more conscientious about my spending.

I would love a high five from Marie Kondo! I try to only buy and keep things that bring me joy.

Understanding marginal benefit spills over into other decisions. Around Valentine’s Day my fiancé and I went to a restaurant we love for steak (don’t worry frugal friends, we used some gift cards). Like most steakhouses, they offer different sizes at different prices. I’m partial to filets, so I went to choose the size of my steak.

The menu. Yum!

I ended up choosing the 6oz filet. Why? Shouldn’t I go for the 10oz because it’s a better deal? Weighing my options, I realized the sides looked absolutely delicious. Instead of the marginal costs of $3 and $4, respectively, I determined that a side of jalapeño au gratin would bring me more joy than additional ounces of steak. I went with the side dish, which was AH-MAZE-ING. A simple cost-benefit analysis led me to making the right choice for me. It was the perfect amount of food, so a bigger steak would have left me stuffed and uncomfortable anyway.

Thinking about (and even second-guessing) our purchases on the path to more mindful spending can help us be consumers more in tune with what makes up happy. I still love sales, but only when it’s something I truly love and need. Stores try to stack the deck against us and outsmarting their marketing tactics can be difficult, but a simple step back and analysis can help us make better decisions that bring more joy.

What’s your best “conscious consumer” purchase?

Are there any purchases you regret? Would you have made a different choice if you considered the marginal benefit?


10 thoughts on “Conscious Consumption: Getting Something On Sale is NOT a Marginal Benefit”

    1. Thanks! I find it’s really easy to make economics connect to the “real world” for students. There are so many examples they encounter in their lives and hopefully they’ll be conscious consumers 🙂


    1. Yes! Me too! Having a ban really helps make the decision not to buy clothes so easy. I bought one sweater during my “flexible” ban and I instantly regretted it. Even though it was on sale, the quality was awful and I haven’t bought an article of clothing since.

      Liked by 1 person

  1. I love this piece. I find myself doing the math, both ways, sometimes–weighing out if I’m just buying extra somethings b/c of the sale or b/c it’ll actually be worth it.

    Last week I bought 5 of the $ deodorant my husband loves because I could get up to 5 Ibotta rebates. While I know they will get used–he’d got enough deodorant now for two years–my brain was still wondering if we really ought to purchase all five now for $1.25 rebate on each. 🙂


    1. Thank you so much! Second guessing purchases can be so difficult. I went to Aldi hungry yesterday and had to physically remove several things from my cart because it wasn’t “that good of a deal” for things I didn’t really need anyway.

      I do stock up on stuff like deodorant too – as long as the marginal benefit is greater than the marginal cost, you’re good to go!


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