MONEY consumer psychology

Hey, Impulse Spenders: Here’s a Solution to Your Bad Habit

shopping bags
Martin Barraud—Getty Images

If you make too many impulse purchases and later regret them, there is a simple cure: gratitude.

A study recently published in Psychological Science shows that an attitude of gratitude tempers impulsive urges. In the study, participants had the option of receiving $54 now or $80 in a month. The researchers then induced moods of happiness, neutrality, or gratitude. Participants in the happy or neutral groups preferred the smaller sum immediately—the typical response in delayed gratification experiments.

The surprise came from those who felt grateful. They preferred to wait for the larger sum, which is the smarter, if less immediately gratifying, option.

The authors don’t say why gratitude forestalls impulsiveness, but their findings make sense within the context of my own research. I’ve found that people typically purchase impulsively for one of two reasons. They do so 1) to counteract a sense of emptiness, boredom, or void in their lives; or 2) because they are not fully focused when making a purchase. Gratitude can be the antidote in both of these scenarios.

Fill the Void
Impulsively snapping up a bargain or a trinket (or more) can provide an emotional boost, even a genuine momentary thrill. A void you feel—which can range in magnitude from simple boredom to a deep emotional need for human connection—is temporarily filled in the act. Sometimes the pleasure of some new “find,” or just the distraction of the transaction is subconsciously more what people are shopping for than whatever it is that’s actually being purchased.

People that “fill up” with impulsive purchases in this manner are often thought to be motivated by simple greed. What I’ve found, though, is that the catalyst is not so much greed or materialism, but emotional relief. Momentary lapses of impulse control are frequently fueled by an urge to feel something different—to get out of a funk and change your mood.

Feelings of gratitude, not just for possessions, but for almost anything—a friendly encounter, a cool breeze, a tasty lunch, a nice text from your kid, a beautiful landscape—are nourishing. It’s harder to feel a void or sense of emptiness when you pause and notice how much you have. It makes sense that everyone, not just shoppers, exhibit greater levels of impulse control when they feel thankful.

Get in Focus
Consumers’ minds nowadays are drawn in different directions by nonstop multitasking, and anxiety and sleep deficiencies are on the rise as a result. Focused decision-making, particularly on seemingly non-urgent tasks such as shopping, is on the decline, as is truly focusing on anything, it seems. No wonder I increasingly hear, “What was I thinking when I bought this?” from shoppers I interview. An exhausted, distracted brain pays less attention to everything and therefore has less bandwidth to forestall impulsive purchasing.

The calming focus of gratitude can help. A few seconds of thankfulness is not only a mood elevator, it’s a fast and simple mindfulness exercise that improves focus and can stave off mindless, impulsive spending.

But if you’re trying to rein in impulse spending, wouldn’t it make more sense to simply force yourself to pay closer attention to purchases, rather than trying to focus on feelings of gratitude? Well, no. Focusing on purchases is actually harder than it seems. Why? It’s boring when compared to the thrill of the purchase, and therefore consumers are apt to forget they’re supposed to be mindful and think twice about what they’re buying.

Also, paying close attention to purchases comes with the possibility of arousing negative emotions—feelings concerning problems with debt or budgeting, or pressures about responsibility and what you should or should not do. Our self-protective, irrational brains are likely to look for an easy “out” to get rid of these bad feelings, ironically often by simply losing focus and doing things mindlessly, impulsively. That’s why so many consumers experience a mismatch between their good intentions and ultimate actions when it comes to shopping.

Gratitude is a gentle way to force focus, and it creates a sense of abundance that transcends the need for a momentary shopping boost. As a bonus, there are lots of other benefits to feeling and expressing gratitude—most notably, happiness.

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Kit Yarrow, Ph.D., is a consumer psychologist who is obsessed with all things related to how, when and why we shop and buy. She conducts research through her professorship at Golden Gate University and shares her findings in speeches, consulting work, and her books, Decoding the New Consumer Mind and Gen BuY.

MONEY consumer psychology

Why We Always Fall for Products Making Outlandish Claims

140620_EM_Suckers_Skechers_1
Chris Weeks—WireImage

Who would be foolish enough to fall for "shoes" that make it feel like you're running barefoot, or cookies that promise to make women's breasts bigger? Lots and lots of people, apparently.

Even the smartest consumers can be tempted to buy a product based on some marketing claim that, deep down, everyone knows can’t be true. Why?

We live in a time when modern-day snake oil, in the form of not-so-miraculous “miracle” products that are misleading if not worse, is around every corner. For example, based on sales totals, it looks like more than 70 million Americans believed Vibram’s claim that running in “shoes” that brought you a step closer to jogging barefoot would improve their “foot health.” Vibram, creator of the thin-soled FiveFinger running shoes that fit each toe like a glove, was unable to substantiate that claim, and the company settled a $3.75 million lawsuit this spring, entitling buyers to refunds.

Last summer, Skechers began paying out a $40 million class action lawsuit to more than a half million people who believed it when the company (and spokesmodel Kim Kardashian) said the shoes could not only tone muscles but also help them lose weight and improve their cardiovascular health. Reebok and FitFlops have also lost lawsuits on behalf of millions of other consumers who believed similar overstatements about the power of shoes to basically do our workouts for us.

Though consumers apparently have a soft spot for supposedly miracle-performing footwear, we’re not just suckers for hyped-up claims about shoes. Millions have purchased weight-loss potions that promise users they’ll lose fat without changing the exercise and eating habits that piled on the pounds in the first place; or lotions that can sprout new hair on bald heads. (It certainly doesn’t help that medical experts like TV’s Dr. Oz sometimes seem to endorse dubious weight-loss products.) This spring, the FTC announced that Lice Shield, a “lice-prevention” shampoo, deceived customers and exaggerated claims, and ordered the company to pay $500,000 and stop pretending that the product was “scientifically shown to repel head lice.” Another recent FTC settlement will stop the company that makes a supplement called BrainStrong Adult from claiming it has clinical proof the product “improves adult memory.”

Sometimes, the claims are downright laughable, like the F-Cup Cookies sold in Japan that are supposed to make your breasts bigger.

How could anyone fall for such claims? How can people not know better? What’s behind our will to believe when common sense tells us otherwise? There are four particularly strong forces at work: one is human nature, and three are unique to our times.

1. We are hopeful. If we’re lucky, we have a healthy dose of a charming, positive and essential human quality: hope. Add a dash of that particularly American characteristic, optimism, and we have the potential to be led astray. Hope gives us the will to try, while optimism gives us fortitude. Untempered by common sense and logic, though, hope and optimism can devolve to gullibility. The solution is not to decrease hope—it’s to blend in wisdom, and a bit of skepticism.

2. We see miracles in action every day. One marvelous technological advancement after another, from GPS systems to smartphones, has taught us to believe in innovation. “New” has never been better, and we eagerly await the next bit of wizardry. We’re more trusting and less skeptical of innovation, and therefore more likely to believe that the next big thing is really all that—the next big thing. That puts a damper on an age-old adage that’s kept us on the straight and narrow for years: “If it sounds too good to be true, it probably isn’t true.” Today’s gadgets and innovations sometimes actually are as good as advertised. Which means consumers have to be craftier in ferreting out potentially false claims and examining the reputation of the source.

3. We have no attention spans. Evaluating products, and product claims, is harder today because of another side effect of technology—saturated with stimulation, we increasingly skim and rely on visual cues such as photos and symbolism to get the gist of what some hot new thing does. Nobody has ever been a fan of “fine print,” but today we’re less tolerant than ever. Nobody has the time or interest to dig deeper. Shorter attention spans have resulted in less patience to temper hope and optimism with thinking things through.

4. We are manipulated by marketers. Lastly, consumers are up against some brilliant marketing minds—professionals who are now armed with reams of data and psychological insights. Marketers increasingly use psychology to understand the deepest motivations of consumers and create the most resonant messaging. Most apply those insights to more fully satisfy consumers and gain an edge in a fiercely competitive marketplace. But some are less honest. Marketers have always been some of the best communicators in the world, and today they’re more aware and arguably better than ever.

Deep down, we want to believe in magic. Human beings always have. Thanks to the spectacular increase in innovation, from smartphones to self-driving cars, there’s proof that products can do seemingly magical, miraculous things. But the existence of amazing gadgets isn’t an excuse to lose grasp with reality. Smart shoppers temper hope, optimism, and awe with critical reasoning. It seems like a downer, but it’s never been more important.
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Kit Yarrow, Ph.D., is a consumer psychologist who is obsessed with all things related to how, when and why we shop and buy. She conducts research through her professorship at Golden Gate University and shares her findings in speeches, consulting work, and her books, Decoding the New Consumer Mind and Gen BuY.

MONEY Shopping

The Three Cardinal Rules for Father’s Day Gift Giving

Homemade I Love Daddy sign
Courtney Weittenhiller—Getty Images

Dads like being acknowledged, but they can do without elaborate displays—and certainly don't want money being wasted. Follow these rules and you'll be OK.

Su Young Kim, a 30-something owner of a salon in California, was surprised by what her father asked for as a Father’s Day gift. “He said that if I was going to waste my money on something he didn’t need or want again this year, I might as well just give him the cash and save us both some trouble,” said Kim.

Most fathers aren’t quite as blunt, but according to my annual anecdotal survey of dads, they pretty much want what Kim’s dad wants. Not cash, necessarily, but for their kids to not waste their money.

No wonder Father’s Day is the tiniest American gift-giving holiday, accounting for $12.5 billion in consumer spending this year, according to the National Retail Federation. Spending on Mother’s Day, by contrast, was estimated at more than $20 billion.

And no wonder Father’s Day can be a frustrating holiday for gift givers. Most want to surprise, delight, and honor their dads, for good reason. Instead, however, too many sons, daughters, and spouses end up either spending too much money, getting something off the mark or silly, feeling guilty because they didn’t put in much thought or effort beforehand, or some combination therein. To avoid the pitfalls, here are three cardinal rules, endorsed by dads, for fool-proof Father’s Day gift giving:

1. Keep it Simple

This year, and every year that I’ve surveyed fathers, what I hear is that their identity as fathers doesn’t mesh well with lavish Father’s Day celebrations. It seems there’s something unmanly, or “undadly,” about being pampered. Dads pride themselves in providing for others, and they can feel uncomfortable when the tables are turned.

Even though most dads downplay the significance of Father’s Day, there is nothing more important to them than being fathers. According to the 2014 Dove Men+Care Dad Portrayal Research Study, 94% of American fathers prioritize their families over their careers, and three-quarters say they organize their lives around family so they can spend more time with their children. So, regardless of how “undadly” it feels to be celebrated, fathers are likely to feel hurt if they’re not feted on our national day devoted to fatherhood.

Dove also posted this video celebrating dads that made me cry, and then made my husband cry when I made him watch:

How do you balance the need to honor dads without going overboard and making them feel uncomfortable? The solution is to keep it simple. Katy Short, a financial advisor and mother of two children under 5, wrapped up her brilliantly simple Father’s Day plans in one sentence: “We’ll give him lots of kisses, some cologne he wants, and then we’ll dance.”

2. Spend Wisely, Not Wastefully

When I ask dads what they’d like for Father’s Day, many start their response with something they want that’s in the best interests of their kids. “I want my son to get a job,” is a common answer, usually followed by laughter or eye rolling. “I want my kids to be happy,” is another one I hear regularly.

Or like Kim’s father, they respond in a way that essentially says they want their kids to spend their money wisely. Evidently, fathering doesn’t take a holiday. In some ways, the gift a son or daughter picks is a measure of the lessons they’ve learned (or not) from their father. When you spend wastefully on Father’s Day, dads are likely to think that they’ve failed to teach you to not spend wastefully. Your dumb spending reflects poorly on their roles as fathers, even if what you’re spending money on is your dad.

Most dads are gracious when receiving gifts. But when handed presents such as flashy sunglasses or expensive cufflinks, they are probably thinking something along the lines of What did I do wrong? Didn’t I teach this kid about the value of a dollar?

It’s not that dads don’t want budget-busting lavish gifts—they just don’t want them from you. Instead, if your father has been needling you to read a particular book or try a sport, make a Father’s Day gift by showing him you were listening. Then wrap it up in a bow by asking him to discuss the book or play the sport with you. Above all, for heaven’s sake demonstrate that your father has done a good job raising you by not wasting money on something he doesn’t need and will never use.

3. Be Thoughtful

This is the golden rule for all gift giving, of course, but it applies big time for Father’s Day. For the most part, dads want to feel appreciated, and to spend some quality time with their families on Father’s Day. When pressed for an actual gift they’d like to receive that costs actual money, the top choices I hear from fathers are typically celebratory events like sharing a special meal together or tickets to a ball game. Evidently, kids know their dads pretty well. Of those who are purchasing gifts for fathers (or husbands on behalf of younger kids), the top two categories are greeting cards that thank dad for all his does (63%) and special dinners or outings where the crew can be together and have fun (43%).

Russell, a father who preferred not to use his last name for fear of offending his less-than-perfect gift-giving son, summed up what he wants and what he thinks most dads want this way: “It has to be something personal. They have to spend time thinking about what their dads would really like, or spend time with them–like making a breakfast in bed or spending the day fishing.”

Russell got a gushy handmade card and a bottle of wine from his adult daughter last year, and he said both were perfect because they were so incredibly thoughtful. His daughter had taken the time to learn about wine, and had researched his tastes to pick out just the right bottle. And Russell told me that he still has the gushy card – along with every other one he’s received since his daughter was old enough to draw.

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Kit Yarrow, Ph.D., is a consumer psychologist who is obsessed with all things related to how, when and why we shop and buy. She conducts research through her professorship at Golden Gate University and shares her findings in speeches, consulting work, and her books, Decoding the New Consumer Mind and Gen BuY.

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