Money Psychology

Would You Buy This Fridge For Ksh17,000?

December 7, 2022

The holiday season is around the corner and the good old Christmas mood is in the air. You can see it when you turn on the TV and nearly every brand has something on offer.

You are bombarded with sweet promotions on your way to work, colleagues in the office are already talking about their Christmas plans and asking the boss when the end-of-year party will be and, most importantly – the last working day before that much-deserved break.

It feels as though the more things change, the more they remain the same. Who would ever have thought that the festive mood would still survive the harsh economic times that have put all our pockets on the edge? But then again, I had the same feeling as we approached Christmas in 2020 and amid the lockdowns and the salary cuts, the festive season still found a way to feel special.

Now, you are probably wondering where the Ksh17,000 fridge is – but you will have to wait longer. After all, good things don’t come easy, right?

I want us to first talk about that strong urge to buy things that we neither need strongly nor had planned to purchase. It is more commonly known as impulse buying.

Almost every human has experienced some form of impulse buying – although it affects different people to different degrees. As you are walking in town and you notice a nice pair of shoes from the evening hawkers and you decide, “I must have this even though I had not planned it!”. Or when you are in the mall and you feel the sweet aroma of grilled chicken, you decide – I must try this even though I just had lunch.

Such indulgences are common to human behaviour, but they threaten your financial stability and freedom when left unmanaged.

For example, if you had Ksh17,000 to spend until your next payday and instantly decide to purchase this promised fridge, you will probably have to borrow some money to sustain yourself in the meantime.

Some purchases will come with consequences that, if left unchecked, will compromise your financial situation.

For example, a friend of mine came across an ad on a popular social media program – selling an air fryer for Ksh5,000. The sellers were a leading e-commerce platform in the country.

She had no plans to buy an air fryer, but she felt the deal was too good to be true. It was a time-limited offer – those that have a timer to the “resumption” of normal prices.

In the haste, she did not realise that the ad was an impersonation of the big e-commerce brand. She only realised after the order took too long and she decided to call out the “big brand” on Twitter – only to realise that she had fallen victim to a dummy account - lost Ksh5,000.

Marketers and psychologists have studied the concept of impulse behaviour and found some of the common causes and ways to avoid them. These tips may be particularly helpful during this festive season when we will be flooded with the so-called shopping mood.

Why We Impulse Buy

1. The urge to save

One of the greatest forces behind impulse buying is the urge to save. People have a natural urge to buy products and services at lower-than-normal prices. Marketers, however, have taken advantage of this weakness and will give you the illusion that you are getting a deal - or making a saving - while you are in reality you are helping them sell their products.

A common trick is the “offer price”, which will often show something has been selling for Ksh1000 but is now going for Ksh799. In most of these cases, the Ksh799 is usually the normal rate - which basically means that you are not saving or getting the deal of a lifetime as the seller would want you to believe.

2. Retail therapy

Have you ever faced emotional or psychological turmoil and decided to lift your spirits by buying yourself something? I bet you felt some tinge of excitement or pleasure while shopping.

Psychologists agree that shopping, even when it's window shopping, has a lot of psychological and therapeutic value to the brain. The idea of shopping, seeing, or acquiring new material things for ourselves releases dopamine, the brain chemical responsible for allowing you to feel pleasure, satisfaction, and motivation.

However, this only works when shopping is done in moderation and if the urge to shop is left to roam wildly - it has a countereffect and will leave you beholden to your moods and, ultimately, adversely affect your finances.

3. Loss aversion

If you attended a local boarding school, you might recall how students often overeat on visiting day - especially in schools where there is no great meal variety - or the portions are wanting. I am one of those who underwent this phenomenon.

The reason we would eat until our stomachs hurt was partly because we did not want the pain of remembering that we left behind that chapati or drumstick - in the githeri-full days that would follow the visiting day.

Loss aversion involves buying things to avoid feeling bad in the future about skipping this good deal. People are risk averse and marketers and advertisers leverage this to sell their products. This manifests commonly in situations where you are told the “offer” is extremely time sensitive, say a day or a month.

4. Twisted Heuristics

This is particularly relevant in the festive season. Some buyers will go to a retail outlet without a specific shopping list – say when traveling upcountry.

Retailers already know some shoppers have difficulty rationalising the most important purchases and will therefore create a package where you buy X and Y and get Z for free.

You will naturally be drawn to the gift hampers but in reality, you probably only require item X. When you buy the hamper, you end up with 2 more items that you do not need and which, in reality, are not free.

The concept has become common, even in travel marketing. Sometimes you plan to have a 3-day holiday and the agent will explain that they have an offer for spending 4 days and you get an extra day for free. Of course, there is nothing free in the business world - twisted heuristics!

Tips to Overcome Impulse Buying

The era of online shopping and digital advertisement has resulted in a situation where you are ever-bomabrded with promotions and all manner of deals. If you have a tendency to impulse buy, it would be helpful to find a specific credit card or mobile money account dedicated to online shopping.

Load it with the amount you have budgeted for shopping – do not reload it until the other month.

Further, it is advisable that even with a shopping budget, always have a shopping list. This includes your personal shopping as well as gift shopping, as is common with Kenyans in the festive season. The shopping list will make you more objective and focused - and veer you off the trap of impulse buying.

Another important strategy is to make a habit of visualizing yourself holding the money in one hand and the dream purchase in the other hand.

For example, you can ask yourself, would I rather have the Ksh17,000 fridge now or have the Ksh17,000 in cash to clear my other financial needs (rent, fees, a loan repayment)?

Take time when doing online shopping – make a habit of spending at least 10 minutes on online shopping sites – this may give you a perspective on the things that you may not need

If you are prone to retail therapy, make a habit of not shopping when you are emotionally vulnerable. Being vulnerable does not necessarily mean being sad. Sometimes we are happy and decide to pass by somewhere and treat ourselves to something nice. That is generally okay but do not engage in serious shopping when your emotions are on a rollercoaster.

Wrapping Up

Human beings are naturally prone to impulse buying. However, impulse buying can be a major hindrance to financial stability and freedom when left unchecked. For example, if you spend your rent on unnecessary purchases, you will most face emotional distress and risk your relationship - say with your family.

It can also affect other parts of our lives, including mental health, social relationships, and in some cases - even our careers.

It is important to be self-aware when you are an impulse buyer and develop a mechanism to protect yourself from ever-aggressive marketing techniques. This is particularly necessary during this festive season.

Happy holidays!

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Tony Mukere is the branded content lead at Money254. He is a trained journalist with a passion for impactful storytelling. Before joining Money254.co.ke, he worked as an editor at Kenyans.co.ke, and as a reporter at Pulselive.co.ke. Connect with Mukere on Twitter.

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