Everywhere we go we are bombarded with temptation. It’s estimated that Americans are exposed to around 5,000 ads every day. Whether we are aware of it or not companies across the nation are trying to influence how and what we buy, and some of them have gotten pretty good at it. While it might be impossible to block out all external influences, being aware of some will help you save money by resisting the allure of consumerism. Over the next few weeks I will be explaining some simple yet effective ways in which companies are getting you to spend your money when you don’t need to. Today’s topic is: choice architecture.
The concept is simple enough: companies physically and verbally construct things in a way that get you to make the choice they want you to. A perfect example is grocery stores (which I'll write more about next week). Have you ever noticed that the items you always need are the farthest away from the entrance? This is no coincidence. If you need milk and it’s all the way in the back of the store you have to pass by every other aisle just to get there. While making your way to your intended destination you’re bound to be enticed by something frivolous. It never would have occurred to you to buy that item, but you do anyway. By merely exposing you to the more enticing products they have to offer, products you most likely don’t need, the store is getting you to spend more than you intend or need to.
What about the arrangement of shelves? There is a reason certain brands are on the top shelf and others on the bottom. Companies pay a lot of money to have their products placed on shelves that are at eye level; that’s why you’ll always find the generic brands placed on the bottom where you’re less likely to see them. This also goes for items placed near the register. You’re about to check out and you have everything you think you need (and more), but then you see it. That candy bar that you never wanted more than you do right now. It’s a last-ditch effort to get you to spend, but it’s effective. While you’re waiting in line you’re forced to stare at that delicious candy bar, or that gossip magazine you splurge on once in awhile. The more you stare, the more you want it, until eventually you cave in.
Influences aren’t always as obvious as ads that scream “buy our product!” They can be as simple as how a store is laid out or a way a message is conveyed. Hopefully with this information you will now be able to recognize the attempts to get you to spend and regulate your expenditures based on what you actually need, rather than what the store tells you to buy.
The next time you find yourself being tempted, do your wallet a favor and ImpulseSave instead!