Financial deprivation prompts consumers to seek scarce goodsApril 12th, 2013 in Other Sciences / Social Sciences
In a recently published study in the Journal of Consumer Research, assistant professor of marketing Adam Alter and Ph.D. student Eesha Sharma at the Stern School of Business reveal why people who feel financially constrained might be lured to purchase scarce or rare products.
The authors suggest that consumers who feel financially disadvantaged counteract feelings of financial deprivation by acquiring these scarce products, precisely because they seem unavailable to others. Although limited goods are generally more appealing than mass market products, the study shows that the desire for scarce items is particularly pronounced when customers feel financially disadvantaged.
Over the course of five studies, the authors examined the relationship between how financially comfortable consumers felt and their preference for scarce goods. The authors both measured and manipulated this sense of financial wellbeing, and found that consumers who felt financially deprived preferred scarce products. Specifically, those people detected which of two goods was more scarce in a series of visual scenarios with greater accuracy, chose scarce rather than abundant but otherwise similar goods (e.g., candy bars that varied in availability in a vending machine) with higher frequency, and consumed a larger amount of goods that appeared to be scarce rather than abundant (e.g., M&Ms of two different colors, presented in different proportions in a cup).
"Our findings suggest a novel route along which deprived consumers unwittingly travel as they attempt to alleviate the discomfort that follows deprivation," the authors write. "These findings further suggest that society's poorest consumers are the most vulnerable to predatory marketing practices that capitalize on this foible. On a more positive note, this study may provide insights to policymakers who want to increase the frequency of beneficial behaviors, such as consuming healthy foods, participating in physical exercise, and adopting long-term savings plans."
Provided by New York University
"Financial deprivation prompts consumers to seek scarce goods." April 12th, 2013. http://phys.org/news/2013-04-financial-deprivation-prompts-consumers-scarce.html