BeWell investigates the psychology of spending
Financial health is an essential component to wellness. To learn more about the thoughts, emotions and strategies that impact purchases, BEWELL spoke with AMBER DANFORD, chief retail and marketing officer of the Stanford Credit Union.
What emotional appeals do advertisers use that impact my spending?
Advertisers know that emotional appeals tend to sell products/services more than features and pricing. Therefore, many ads promote exclusivity; highlight the consumer’s flaws (which the product can fix); or introduce fear, uncertainty and doubt — all of which help to reposition the brand relative to competing products. An example: when Jif™ launched the “Choosy moms choose Jif” campaign, every mom wanted to see herself as a choosy mom. Therefore, the positioning worked.
When I’m feeling down, shopping often makes me feel better. Is there an alternative?
Shopping may make a person feel better for a few minutes, but the consequences of debt and living outside your means become painful really quickly. Some alternatives to shopping:
- Go to the library and pick out a (free!) book to read.
- Go to a thrift store and donate goods from home you no longer need; while you’re there, buy something for charity.
- Try a new fitness routine instead of trying on a new dress.
- Go on a shopping spree with a $20 bill and make a game out of it.
Does my spending pattern change depending on whether I’m using cash, debit or credit?
The majority of consumers walk around with little or no cash. Most prefer plastic for the sake of convenience and safety. Because it is so quick and safe, “using plastic” makes it easy to overspend. Typically, handing over cash feels more tangible and “hurts” more compared with quickly swiping a card. Making your purchases “cash only” is therefore one strategy for limiting spending, and can help you become more of a conscious consumer.
In addition to using cash, what other tips might help me become a more conscious consumer?
- Know your overspending triggers and use online/mobile tools to help you refrain
- Keep yourself accountable to a realistic budget
- Use account alerts and review spending trends
- Find alternatives to overspending that create lasting impact for you and your family
Read more on the BeWell website.