March 28, 2013
Store, Online Browsing Can Be Dangerous
Impulse purchases – new spring clothes or an expensive dinner out – can create a rush. But a few minutes of pleasure can blow a hole in the budget for a month. If it’s chronic, it can eat into savings for a down payment or retirement.
The reason for these rash decisions is obvious: see it, want it. But for people who want to better understand – and prevent – their impulse buys and remain on budget, FinCapDev, which is hosting an online competition for a financial literacy app, recently posted a reading list of three research papers that explain why we can’t resist buying stuff.
- One study has confirmed that store browsers actually are vulnerable to impulsive purchases, because the act of browsing through a store’s merchandise produces positive feelings. “It is a state of high energy, full concentration, and pleasant engagement,” researchers wrote in a 1998 paper that is probably relevant to online browsing. Can you relate?
- Impulse buys can also be driven by a specific product. Consumers can get “involved” in a product – Apple gadgets come to mind. If they do, they will more often buy them on impulse.
- Cultural differences also come into play. “Asians engage in less impulse buying” than do whites, for example, a third study found. According to the researchers, one reason may be that Western culture places “emphasis on the self, individual needs and desires,” while Asians emphasize “interdependence, emotional control and moderation” that discourages impulsive purchases.
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