Why we buy useless stuff
When you read this, you are still in the sales-campaign week. If you didn’t notice, the run-up to last weekend’s 11-11 sale or Singles day sale was quite intense (With a lot of creative marketing going-on). And when you are reading this, there’s probably a sale going on to target those who will be receiving their salary on the 15th.
Do you ever wonder why the money you just received ended up being spent even if you didn’t plan on spending it? It is not an isolated incident. Psychologists have found that there are several forces that govern our consumer behavior and cause us to make decisions that are not necessarily rational or in our best interest.
However, understanding why we buy what we buy can help us make better decisions in the future.
Why We Spend
A fundamental reason we enjoy spending money is that it allots us feelings of being in control or the perceived restoration of lost control. Other times, we’re also a victim of how our minds work and end up being psychologically manipulated by marketing tricks.
Retail Therapy – Consumers typically shop while feeling sad, an emotion strongly linked to feelings of lack of control. Retail therapy—not only reduced feelings of sadness but also restored a sense of personal control. A bad mood can lead to a lot of impulse buying and in effect clean out your bank account.
Keeping up with the Joneses – An idiom that describes the need to measure financial success to that of our peers, becomes an issue when we spend money we don’t have so we can feel that we measure up. This competition can drive us straight into debt if we simply compare “things” rather than financial situations. Why are you living your life based on other people’s opinions? (Family, Friends, Neighbors..etc..)
Diderot effect – It is the term for when you buy something new, but then it makes your other possessions look worn out by comparison, so you end up replacing them too. This effect was named after the French philosopher Denis Diderot. He was never rich, but he once received a big amount of money and bought a gorgeous scarlet dressing gown. This item of clothing was so different from his other clothes that it forced him to replace all his old clothes with new ones. Which could become a never-ending process.
Trends and Bandwagons – It happens when a person buys an item because it’s fashionable and everyone else has it. This item may not suit your lifestyle but you still purchase it to be on trend.
Sales & Marketing Strategies – If you have no background on this, I suggest you learn more about it. There’s a lot of things to mention here, like odd pricing (9.99) – where because it’s not 10, you justify that you’ve saved money; or discounts – sometimes if not most of the time, discounts are a form of marked-up pricing strategy (original price is 100, +15 mark up = 115 then they’ll say it is discounted by 15).
There’s more strategies and Subliminal retail tricks (cool colors, comforting music..etc..) as well. Sales people telling you that it’s the last one when really there’s a lot in storage, just so you will buy.
Perhaps there are still many reasons out there but how do we fight this?
The answers are simple: create goals, positive habits and discipline yourself. But the question one must answer is, are you willing to do these?
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Vernon Joseph Go is an RFP®–Registered Financial Planner | Licensed Real Estate Broker | Content Creator | Podcast-on-the-go Producer & Host
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