Why We’re Obsessed with Stuff

Enter the average American’s home and you’ll be greeted with plies of clutter. A stack of magazines on the coffee table. Old mail sitting on the bookshelf. Kids toys lying around everywhere. We’ve bought so much stuff that our houses are bursting at the seams.

When asked why we have all this stuff lying around, we make excuses like “I just don’t have time to clean with everything else going on” or “Shopping makes me happy” or “That’s just always how it’s been.” The reality is, these excuses mask the underlying truth: Our stuff makes us comfortable.

We’ve been conditioned by savvy marketers to consume every time we have a problem. Sex life not what you’d like it to be? Here, buy this Cosmo magazine. Bored? Come to our mall and buy a bunch of stuff you don’t need and probably can’t afford. Instead of being creative, we consume our way out of a problem.

In their book Your Money or Your Life, Joe Dominguez and Vicki Robin invented the term “gazingus pins” to describe the stuff we buy through unconscious habit. From the book:

A gazingus pin is any item that you just can’t pass by without buying. Everybody has them. They run the gamut from pocket calculators and tiny screwdrivers to pens and chocolate kisses. So there you are in the mall, a shopping robot on your weekly tour of the stations of the crass. You come to the gazingus-pin section and your mind starts cranking out gazingus-pin thoughts: Oh, there’s a pink one…I don’t have a pink one…Oh, that one runs on solar cells…That would be handy…My, a waterproof one…If I don’t use it I can always give it away…Before you know it, an alien arm (attached to your body) has reached out and picked up the gazingus pin, and off you go to the checkout, still functioning like a wind-up zombie. You arrive home with your purchase, put it in the gazingus-pin drawer (along with the five or ten others) and forget about gazingus pins until your next trip to the mall, at which point you come to the gazingus pin section and…

Now this book was written in the early ’90s, so their pocket calculators and screwdrivers are our e-books and cups of Starbucks. Every time we journey to the mall or the outlet stores to bargain hunt we’re bringing home gazingus pins. Of course we don’t need them. Try telling that to our subconscious.

We even have shows now glamorizing clutter. Hoarders is a show everybody has seen. These people would rather live up to their eyeballs in old newspapers and dead cats than confront their problems head on. They’ve learned to cling to their stuff because supposedly nothing else makes them happy. Then when the cleaning crews arrive, you’d think they were taking a child away.

Not only is hoarding glamorized, it’s supported by the booming self-storage industry. At $23 billion, it’s among the fastest growing areas of commercial real estate during the last 35 years. 84% of US counties have at least one storage facility. One in ten US households now rent a storage unit, up from one in 17 in 1995. This is something that really puzzles me. If you’re in between houses and need a temporary place to store your stuff, fine. But these customers aren’t the prime targets of self-storage companies. No, their target customers are the hoarders who can’t bear to part with their prized possessions. Their target customers have so much stuff that they can’t even fit it all in their houses. 

We must learn to rid ourselves of this false romance with “stuff”. It’s costing us our paychecks, our relationships and our freedom. Set up a plan with your family to go through one room each day. Set up 3 large boxes in every room: one for things that belong in that room, one for things that go in a different room and the last one for giving away. Your goal is to get your life back, one room at a time.

Photo by cbsnews.com

More Stores Pushing Loyalty Programs as a Way to Save

Your key ring could soon be very full.

Businesses are hurting. We’re just not spending at the levels we were before the recession started.

Companies large and small have tried luring new customers by offering deals on Groupon and other daily deal websites. These deals have succeeded in getting people in the door, but what they’ve found is that the deals attract mostly bargain hunters and cheapskates. These people come in once for a deal and never return.

Obviously that’s not what retailers want. We know it costs significantly more to attract new customers than to retain current ones. And studies have shown that current customers spend more than new ones. So from the retailer’s point of view, keeping current customers coming back is the gold standard.

This has led businesses to a promotional strategy that’s booming right now: loyalty programs. They come in all shapes and sizes. Among the more popular programs is also one that’s been around for a while: Amazon’s Prime, which offers unlimited free 2-day shipping on most products for $79 a year. Prime’s appeal is that it offers something we all want: free shipping. Amazon has positioned itself as the Walmart of the web with free shipping and good customer service to boot.

Another example is McDonald’s monopoly game. Who doesn’t love Monopoly, right? You go back time and time again, peeling off those little game pieces and filling out your game board. If you’re lucky you’ll win a free Big Mac along the way. I’m not even sure anybody’s ever won the big prize, but that’s beside the point. When businesses make loyalty fun we gladly come back for more.

A final example is the airlines’ frequent flier programs. Many of them have several tiers based on how much you spend each year. The more you spend, the greater your access to benefits like early boarding and plush airport lounges.

Large companies aren’t alone in the game. Over the coming weeks and months you’ll start to see mom-and-pop stores and independent restaurants offering simple loyalty programs to encourage return visits. As an example, a pizza shop might offer a free pizza after you buy seven. You could see spas offering free services after so many visits. These programs will be built to reward existing customers for coming back.

Compare these programs with other types of loyalty I talked about recently: loyalty based on habit or inertia. Your loyalty to a business should be based on how you’re treated and the value you receive.

Some companies actually penalize customers for their loyalty. Among them are cable and cell phone providers, banks, and most auto insurers. They routinely reward new customers with discounts while sticking it to their long-time customers. It’s funny (or sad?) that companies with horrible customer service reputations are most often guilty of this.

Ask yourself why you’re loyal to the companies you do business with. Are you getting a good deal or is inertia at work?

Loyalty programs are a good way for companies to reward repeat customers and maintain their customer base. You benefit too, but only if you’d buy the product or service anyway. If not you’re just throwing money away.

Bottom line: Don’t assume you’ll benefit from loyalty. Use these loyalty programs to sweeten the deal for things you already buy.

Photo by homemadeville.blogspot.com

Is Black Friday Really Cheaper? The Truth About Why We Wait in Lines

It seems Black Friday countdowns start earlier each year. We were barely into October this year and I noticed them cropping up.

For the dedicated bargain hunters among us, the lead up to Black Friday involves making a shopping list, coordinating with others and planning a route. Then, on Thanksgiving night, waiting in lines in the freezing cold.

Last year I participated in the Black Friday mayhem for the first time. I was in the market for a new laptop, and figured Black Friday was the time to strike. The cheapest I could find was at a big box store for $159.

So when Thanksgiving came I grabbed my gloves, hat and scarf and ventured out. I must have been out there two hours, but it felt like five. When they let us in at midnight the real chaos started. Everyone (including me) was sleep deprived and zombie-like. Manners were apparently left at home, as people bumped against each other and ran over anything in the way.

I made my way to the electronics department and stood in yet another line to get my ticket, which would then allow me to claim my laptop. About a half hour after entering the store I had my prize in hand. After waiting in yet another line at the checkout, I made my exit.

Why do millions of Americans put themselves through this every year? I only went to one store, but some people visit several into the wee hours.

It’s all about the deals, right? Well what if I told you that Black Friday isn’t necessarily the best time of year to find bargains?

That’s precisely what the Wall Street Journal found. In their article The Myth of the Black Friday Deal, they explain that most items are cheaper earlier in the shopping season, while some go down in price as you get closer to Christmas Day. Flat screen TVs, jewelry, watches, and toys are cheaper in October, while stuff that didn’t sell well during Black Friday is discounted closer to Christmas. Household items like blenders and mixers are often in the latter category.

Now that we’ve proven good deals aren’t a reason to stand in line, how else might we justify it? Let’s turn to our brains to find the answer.

After our basic needs of food and shelter are met, we aim to be accepted by others. One way we’ve found to do this is to seek social proof: We stand in lines so others will see us standing in lines.

Because consumption is king in our culture, people who consume are “cool”. We believe that others’ opinions of us will be positive if they see us in line to buy the newest iPhone or a 55 inch flat screen.

Aha! Who knew a basic concept of psychology could explain one of our culture’s most popular rituals? MarketWatch calls it “queue chic”, and explains that waiting in line is a shared experience. This fits in with another basic human characteristic: We are social beings. It’s in our nature to associate with others and share our lives with them. In our quest to gain their acceptance, we want to be seen as making the right buying decisions.

So if you’re going shopping on Black Friday to prove how cool you are or to share the experience with others, fine. But if you’re going for the deals, don’t bother. As the Wall Street Journal says, you’re probably wasting your time.

As for my laptop, it turned out to be a dud. It froze up every time I played a video, so I returned it a week later and bought an iPad instead. Last year’s Black Friday excursion will be my one and only.

Are you going Black Friday shopping this year?

Photo by paulhorton.wordpress.com