• by Jackie Stone , Columnist, November 7, 2017

A few weeks ago, I was speaking with a friend who squarely fits into the Boomer market. He’s still working and hopes to retire in the next decade or so. We were discussing his plans for the Thanksgiving holiday. This conversation jogged his memory, and he said aloud, “That’s right. I need aluminum foil. I’ll have to go to the dollar store.” Being curious, I asked him why he chooses to buy foil at the dollar store instead of at a big-box retailer or grocery chain. “Well, because it’s only a dollar there,” he replied. 

This is a perfectly logical and common thought among Boomer consumers for whom value is very important. In their minds, why would they pay $3 for a box of foil when it could be purchased at the dollar store for a single dollar? 

I decided to do some digging and identified a national dollar store chain as an example of the kind of store my friend would shop at. According to InfoScout.com, the store’s strongest shopper demographics are those under age 24 and those aged 55 - 64, which is all Boomers. 

Marketers have become wise to this. They understand that, for value-based consumers — like many Boomers — price plays an important role. Obviously, you can’t sell a $3 box of foil for $1, as you’ll lose money. However, if you repackage the foil in a smaller quantity, you can actually charge slightly more per unit and still capture that value consumer in the $1 package.

Here’s the real-world example:

At the dollar store, you can buy a package of “Ultra Heavy-Duty Aluminum Foil” for $1. For that price, you’ll get 27 square feet of product. 

Let’s look at a well-known big box store, in contrast. A package of store brand foil costs $2.08 when purchased in the store. The package contains 75 square feet of foil. 

Doing the math, we find that the big box store’s foil costs 2.7 cents per square foot. Meanwhile, the dollar store foil costs 3.7 cents per square foot. That’s a cost difference of nearly 37% between the two products! 

Armed with this knowledge, I went back to my friend and shared my findings. After reviewing the costs with him, I asked him where he was going to buy his foil from now on. His answer: “the dollar store.” 

I was dumbfounded. “But why?” I asked him. 

“Because it’s still only a dollar,” he replied.

I find this insight especially helpful when I’m trying to sell a product that might initially be less desirable. Who wants an efficiency or one-bedroom apartment when they could afford a two-bedroom model? By showing the customer the value and savings they could achieve with the slightly smaller model, I can help guide them to a sale that is beneficial to both parties.

Therein lies an important insight into human thought. We may rationally understand something — such as foil costing more in the dollar store — but the impact of feeling like we got a deal can largely overcome rational thinking and drive consumer behavior in unexpected ways.