Avoid Overspending by Understanding The Tricks of Consumerism

Consumerism Explained

Consumerism is about acquiring goods and services that go far above and beyond what's needed, emphasizing trends and status. Need an example: peek at your cup cupboard. Do you have Stanely's, Yetis, Hydroflasks, S'wells, Nalgenes, and more? Then welcome, friend, you've been a victim of consumerism. No judgement! I've been there (pans to all of my trusty Camelbak water bottles and Contigo coffee thermoses).

You might be familiar with how grocery stores use end caps to trick you into buying more than you planned, but do you know how to protect yourself from the Diderot Effect and things like Eco-washing? In this post, not only will you learn how marketers have been leveraging behavioral psychology to trick you into spending more, but you'll also learn ways to practice your version of ethical consumption intentionally so when it's time to shop, you can be confident that you're only buying what you need and want. 

Known Consumerism Tricks and Overspending

In traditional retail settings, marketers strategically place items to entice you to impulse purchase. "End caps" are the curated sections at the end of the shopping aisle that showcase things that go together, like chips and salsa, that have you toss the snacks into your cart without thinking. Front-end racks show up at most retail stores, where you throw in a greeting card or pack of gum when you check out from your favorite bookstore. These are consumerism tricks you likely know about.

Even still? They work! According to USA Today, the average American spends about $400 monthly on impulse purchases.

Understanding the Diderot Effect

The Diderot effect, a phenomenon where getting something new triggers a desire for additional new stuff, plays a significant role in consumerism and overspending. Need a Diderot Effect example? I recently experienced the Diderot effect when purchasing two new nonstick, non-toxic pots and pans. While these upgrades were necessary to replace my formerly nonstick (and now flaking) cookware, the Diderot effect quickly came into play. After getting these new pots and pans, I "needed" additional items to support my new cookware, such as scratch-free utensils and gentler dish soap.  This example highlights how buying one item can create a domino effect, luring you to buy more than you want or need.

Online Marketing Tricks

Now that you understand the Diderot Effect and strategically placed items, you'll start to see these online marketing tricks show up online. Stores leverage the Diderot effect by pre-populating online shopping carts or suggesting other items you might like. Think of the last time you shopped online–did the store recommend other items that customers bought or include a "complete your purchase with" item? If so, they were leveraging the Diderot Effect on you.

Other Consumerism Tricks: Buy One, Give One

"Buy One, Give One" is a common marketing technique designed to tug on your little heartstrings and make you hand over your money. In the aughts, a popular shoe brand gained attention and loyalty for adopting this model. The premise was simple: for every pair of shoes purchased, the company pledged to donate a pair to a country or region deemed in need. This seemingly virtuous approach, however, had unintended consequences. While the initial intention was to provide shoes to those less fortunate (something most of us can get on board with and understand), the reality was more complex.

While well-meaning, the influx of free shoes disrupted local economies and practices. Local artisans and refurbishers had developed small-scale industries, and businesses centered around repairing and reselling donated or thrifted shoes. The "Buy One, Give One" company inadvertently disrupted these practices by flooding these regions with free shoes.

The lesson? It's great to want to support ethical brands, but digging deeper is equally important. Stay away from eye-watering ad campaigns and feel-good promises. Ask yourself if these initiatives genuinely bring about the positive change they claim. 

Greenwashing and Rainbow Washing

Consumers today are increasingly drawn to ethical and sustainable brands. 80% of Millennials and Gen Z say that a brand's ethics and mission impact their purchasing decisions. However, some companies engage in greenwashing, promoting environmentally friendly practices without actually adhering to them. Greenwashing might look like a large coffee chain touting the "green" change from straws with lids to a new straw-less lid. But? The new lid contained more plastic than the original lid and straw combination. Another example is a big "build it yourself" furniture company that loves to talk about sustainability that was busted for illegal logging practices. You can avoid greenwashing by channeling your inner skeptic when you see vague language or have a sense of "Is this too good to be true?" Take an extra second to look up a company's claims before shopping because an item is "eco-friendly."

Similarly, rainbow washing exploits the LGBTQIA+ community and causes during Pride Month without contributing meaningfully to the cause. Rainbow washing happens when companies mislead well-intentioned consumers through strategic queer-coded marketing. For example, a brand may sell branded rainbow merch without engaging in inclusion and equity efforts. To avoid rainbow washing, it's essential to scrutinize brands that suddenly "go rainbow" in June but are radio silent the other 11 months of the year. 

The Trend of Minimalism Washing

Minimalism, a lifestyle advocating intentional simplicity, is often exploited by marketers. Minimalism washing can show up by brands selling pre-packaged "minimalism" kitchen goods, living room sets, or outfits, contradicting the essence of minimalism, which encourages conscious consumption and reduces unnecessary clutter. 

As a capsule wardrobe fan, I've seen minimalism washing show up with the branding and packaging of this minimalist method, too. For the uninitiated, capsule wardrobes are the idea that with 30 or so pieces, you can intentionally create many different outfits. The idea is to reduce decision fatigue (no more "what should I wear?" moments in the morning), streamline a uniform of outfits, and reduce the amount of shopping you have to do each season. However, I've seen companies "sell" curated capsule wardrobes. This practice goes against the idea of them in the first place: to be intentional about what clothes you own and what pieces you need, fill in the gaps, and re-wear pieces throughout the season. 

Combatting Consumerism with Intentionality

You can practice intentional spending habits to resist falling victim to consumerism traps. Supporting local businesses creates economic sustainability; for every dollar spent locally, between 80-83 cents of each dollar continues to circulate within that local community. When creating a minimalist wardrobe or household, alternatives such as thrifting or online second-hand stores (I love ThredUp; use my link for 45% off your first order) align with minimalism's core principles. When it comes time to shop, by all means, purchase from a company whose values speak to you when possible; know that not all companies are practicing the message they advertise. 

The Minimalist Packing Party Challenge

Curious about practicing minimalism without spending a lot of money? Try the "Packing Party Challenge." I heard of this through the Minimalists. This involves packing all your belongings as if moving and only unpacking the items you need for a month. At the end of the challenge, you'll be able to see the things you need visually and what you don't. They suggest donating or tossing unused items after a month, but I live in an area where some items are only used seasonally (I'm looking at you, bulky winter coat), so modify as needed.

Avoid Overspending

If you've asked yourself, "Why do I always want more stuff?" remember that consumerism is tricky. Consumerism is deeply ingrained in modern society, but understanding companies' underlying tricks can help you make intentional choices. Awareness is key, from the Diderot Effect to the pitfalls of minimalism washing. By adopting intentional spending habits, supporting local businesses, and embracing challenges like the Minimalist's Packing Party, you can navigate the landscape of consumerism, aka the aisles of Target, with intentionality and purpose.

Let's extend this conversation about overspending and consumerism beyond the individual. Consider bringing in a seasoned speaker like myself to dive deeper into the psychology of consumerism and the strategies to create mindful relationship with money. As a speaker with a passion for empowering individuals to make informed financial decisions, I offer insights grounded in research and practical experience. Reach out today to explore how I can tailor my expertise to inspire your organization, community, or team toward a more mindful approach to consumption.

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