Budgeting

5 Psychological Quirks That Make You Spend More

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Ryan Ong

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Have you ever gone shopping with $800 and come home with, oh, negative $1,000? No? Then clearly you’ve never been to Comex. But it’s not just trade shows and discounts; there is a  whole host of ways your brain tries to bankrupt you. Somewhere in a primitive corner of your noggin, you hold the subconscious belief that we’re still dodging Tyrannosaurs and scavenging berries. That results in some bizarre consumer behaviour:

 

1. Your Ears Make Purchasing Decisions

So you’ve got a planned budget, expert opinions, and two frontal lobes to make a purchasing decision. There’s no reason why’d you’d make a bad choice.

Except for the fact that you’re not deaf.

That’s right: Your hearing is a disadvantage when it comes to buying decisions. There’s a study that store music messes with your reasoning, at least when it comes to purchasing.

 

Orchestra
“You can stop now, I maxed out he credit card at the sonata.”

 

It shouldn’t be much of a surprise; I mean, Nirvana can make you feel your life’s a joke, and the Black Eyed Peas makes you vote in favour of abortion (Because no one should raise kids who listen that crap) Likewise, songs can alter your buying habits:

  • Classical Music – Compels you to buy more expensive things
  • Easy Listening (Especially 80’s Music) – Makes you prone to impulse buying
  • Music Without Lyrics – Causes you to mentally “sing” the lyrics, and distracts you from conscious purchasing
  • Slow Music – Anything around 20 beats per minute makes you slow down and stare at things (read: products) longer. Hence, you’re more likely to buy.

One possible counter is to wear headphones, and listen to loud, fast music. Then go in with a prepared list. Odds are, you’ll move in and out the store faster. As an aside, sales staff seldom talk to people with headphones.

 

2. Being Offered a Cart or Hand Basket

 

Shopping cart
Keep loading it. There’s an emptiness I have to fill here.

 

This used to be exclusive to supermarkets. But today, you’ll find carts or hand baskets in accessory stores, book stores, CD stores…and it’s not just for convenience. I spoke to a space planner and retail consultant, who only wanted to be known as Aaron:

Based on our surveys, we know that if the staff smile and hand you a basket, you’re 60% more likely to make a purchase. That’s due to the social contact.

Besides that, the basket makes you inclined to buy more. If you’re shopping for nail polish and you have two hands, you filter out the colours you don’t want. When you have a hand basket, anything that catches your interest, whoosh, into the basket.”

There is also an argument that the size of the cart or basket gets you to buy more. But Paul is dismissive of this:

I don’t know where that comes from. I don’t think it matters. What we do know is the simple act of accepting a cart or basket, regardless of its size, will impel you to buy, and probably to buy more.”

 

3. Budgeting Can Make You Spend More

 

Budget in a jar
I said I HAD a budget. Emphasis on the HAD. Now come pick me up, I can’t afford bus fare.

 

Ironic, I know. It’s like a burglar alarm that showers you with lock picks when it goes off.

The study is from Brigham Young and Emory University. When you go shopping with a pre-set budget, you tend to spend 50% more than people who don’t.

Aggregate budgeting seems to escape this effect. For example, deciding to spend $500 on “games this month” or “meals this month” works fine. But when you focus the budget on one specific product (e.g. a new tablet), that’s when the trouble starts.

Once we’ve filtered products based on budget, the part of our brain dealing with price comparison shuts down. Just like a NParks officer buying bicycles. After that, we’re looking solely at features and quality. And if it turns out the eventual purchase is over-budget…meh, never mind.

The best way around this is to work out the quality or features you want first. Filter the products based on that. After that, you can filter further based on price.

 

4. Store Mazes Make You Stupid

 

Two people at IKEA kitchen
“Thank God you’re here! I’ve been lost since last Thursday!”

 

It’s called the Gruen Transfer, named after Austrian architect Victor Gruen.

By arranging the store in a maze-like pattern, retailers can actually make you dumber. In Singapore, two retailers stand out as absolute masters: IKEA and Cold Storage.

Have you ever wondered why it’s so damn hard to get out of an IKEA store?

Or why Cold Storage shoves all the essentials (milk, vegetables, meat, etc.) all the way in the back?

It’s to slow you down, so you shuffle like a zombie through the aisles. In the process, you’ll spend more time in the store, get distracted, and buy more stuff.

Aaron says:

When you need to navigate their little labyrinth, you’ll end up spending more time. You’ll feel justified in buying more stuff, because you’ve been there for hours. It’s a waste if you go home empty-handed, right?

IKEA is great at this. They even set up play areas and cafeterias. In which other furniture store would you spend two to three hours? Pure genius.”

Aaron adds that the Gruen Transfer isn’t just about mazes. It involves a combination of colours, sounds, and even smells (that’s why Cold Storage has the bakery or deli in front). The cumulative result brings your concentration level to that of an excited puppy.

So walk fast, don’t get distracted, and you should be able to keep those brain cells awake.

 

5. You Suck At Maths…Under the Right Conditions

 

Sign says 50%, Ass Picnic Kurve furniture
“…and see if we can insult the morons while we’re at it.”

 

Most of us know the old trick with the number ‘9’, like pricing something $1.99 instead of $2. That’s how it works, right? We’re not fooled by that any more.

Not exactly,” Aaron suggests, “there are ways to use that trick that still work. For example, if you have a series of items next to each other that use ‘9’s, it’s still easy to get confused.

A classic example is to have one product priced $219.99, and another priced $199.99, as Microsoft does with Windows versions. Most people feel the product priced $199.99 is cheaper, they’re not thinking: It’s just around $20 difference.

Now if look at how Windows versions are priced: $199.99, $219.99, $119.99…it still manages to disorient most buyers.”

Aaron also mentions that shoppers, who are in a distracted environment, are easily led with big numbers. If you have a product priced at $200, a label that reads “$100 off” is better received than one that says “50% off”. They mean the same, but odds are you won’t do the maths.

So whip out that phone calculator before you buy. And follow us on Facebook, for more on retail tactics.

Image Credits:
Keng Susumpow, Daehyun Park, zoovroo, Tax Credits, jeremyfoo, Lars Plougmann

What little quirks make you spend more? Comment and let us know!

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Ryan Ong

I was a freelance writer for over a decade, and covered topics from music to super-contagious foot diseases. I took this job because I believe financial news should be accessible and fun to read. Also, because the assignments don't involve shouting teenagers and debilitating plagues.