Holiday shopping habits can lead to a fear of missing out, says one marketing professor
The constant hunt for the best possible product inevitably gives rise to a feeling of missing out among consumers.
Caroline Roux, an assistant professor of Marketing at the John Molson School of Business (JMSB), explores what she calls the “maximizing mindset.” Roux says this mindset can lead to consumers temporarily casting aside values like honesty and other moral codes in their hunt for the best bargains.
Marketers have long known the power of scarcity
Your research looks at issues around consumerism and resource scarcity. Can you explain how these phenomena work?
Caroline Roux: Being exposed to reminders of resource scarcity, or cues about “not having enough,” triggers a scarcity mindset, which prompts consumers to become more competitive and to act in ways that advance their own welfare.
As a consequence, consumers tend to behave in a more selfish, and potentially dishonest, manner in order to try to gain resources and help alleviate their feelings of scarcity. Feelings of “not having enough” also trigger an acquisition mindset, which prompts consumers to acquire more resources of any kind, and which can manifest in increased consumerism.
What are some of the causes or triggers of this sense of want in consumers?
CR: A scarcity mindset, or feeling as if one “does not have enough,” can be triggered by cues present in the marketplace that make consumers feel as if there is a perceived discrepancy between their current and desired levels of resources.
For instance, seeing an ad stating, “Have you saved enough for retirement?” may prompt consumers to think about their financial situation and may make them feel as if they are lacking money to meet their current and future needs.
As another example, seeing a promotion available “for a limited time only” in a flyer for a coveted product may prompt consumers to think about whether they will have the time to take advantage of this promotion, and may make them feel as if they are lacking time to do all the things they would like to.
Why deliberately create scarcity in a world of plenty?
CR: Because it prompts consumers to act! Marketers have long known the power of scarcity marketing appeals, such as limited quantity and limited time promotions, and of limiting the supply of products, such as limited editions, has on consumer behavior.
Marketers may however, deliberately or not, use scarcity-related cues in their communications in good faith, such as when pictures of empty fridges and pantries are used to encourage people to donate to a food bank, or when questions about one’s future financial situation are used to encourage people to increase their retirement savings.
It is important to note that it is so easy for marketers to create a sense of scarcity in the marketplace because the concept of abundance is hard to grasp for most people.
Even if an important part of humanity now lives in a world of relative abundance, humanity’s history has been defined by scarcity and having to compete for resources until fairly recently. As such, people are still “programmed” to respond to scarcity-related cues, whether real or perceived, which marketers tend to take advantage of.
Are companies deliberately using resource scarcity as a marketing tactic to promote overconsumption?
CR: Yes, unfortunately. Black Friday and Boxing Day are prime examples of companies trying to get consumers to buy more, and oftentimes more things they do not really want or need.
Indeed, the popular press has often shown that companies use deals on highly coveted doorbuster items (e.g., newest iPhone model), offered in extremely limited quantity, to get consumers in the store.
Once consumers are in the store (or on the website), companies then try to convince them to buy a product substitute of the coveted but out-of-stock item, which also conveniently happens to be on sale.
However, most of the deals offered during those days tend to be on products that companies want to get rid of to clear out their inventory (such as older models), and these products are often offered at an even better deal at different times of the year.
Consumers thus often end up buying products they did not really want or need simply because they got caught up in their acquisition mindset.
What are some behavioural techniques consumers can adopt to mitigate mass consumption over the holidays?
CR: The holidays often end up being stressful for consumers because they tend to focus on the things they “do not have enough of.”
For instance, we tend to worry about not having enough money to buy all the gifts we would like to give, or not having enough time to do all the holiday shopping and attend all the social events we are invited to.
We do not have enough energy to carry us through shopping and socializing, or we do not have enough food in the house in case guests show up unannounced, etc. One way to reduce or eliminate this vicious scarcity mindset cycle is to try to focus instead on the things that are plentiful during the holidays.
For instance, we tend to stock our homes with more food, to reconnect and spend time with more family and friends, and to have more time for rest during the holidays than most of the rest of the year.
Consumers can also shift away from a scarcity mindset when they practice gratitude, or think about things that are thankful for (e.g., having a roof over one’s head, having loved ones that care about us, etc.), which helps them realize that there is also abundance in their lives.
What risks do households run if they do not curb their consumption habits?
CR: The main risk is to create a vicious scarcity mindset cycle that will, at best, negatively impact consumers’ well-being and life satisfaction and, at worst, severely impact their financial and personal situation.
For example, consumers may be stressed during the holidays because they constantly think they “do not have enough” food, alcohol, decorations, gifts, etc. To reduce their sense of scarcity and stress, they may try to buy more: more food, more alcohol, more decorations, more gifts, etc.
However, they will again experience scarcity when receiving their credit card bill in January, which may again prompt them to use consumption to relieve their sense of scarcity, or even to behave dishonestly in an attempt to regain resources (e.g., slipping a personal expense in an employee’s expense report, “forgetting” to report some sources of revenues on one’s tax report, etc.).
Find out more about the Department of Marketing at the John Molson School of Business.