ClassX Video Lessons 3 brain hacks to control your Amazon addiction (from a neuroscientist) | Your Brain on Money
Have you ever wondered why you sometimes make impulsive purchases? According to Terry Wu, a neuroscientist and marketing consultant, the human brain is more of a “feeling machine that thinks” rather than a “thinking machine that feels.” This means that our emotions often drive our decisions, especially when it comes to spending money.
From an evolutionary standpoint, our brains evolved to feel first and think later. The limbic system, or the emotional brain, is responsible for emotions like joy, anger, and anxiety. On the other hand, the frontal cortex, or the rational brain, handles reason and logic. These two systems can sometimes conflict, leading to complex decision-making processes.
During stressful times, such as the onset of the COVID-19 pandemic, people often resort to irrational buying behaviors, like stockpiling toilet paper. This is because stress can impair the frontal cortex, allowing the emotional brain to take over and drive impulsive actions.
In today’s world, the abundance of products and the convenience of online shopping make it easy to seek instant gratification. Companies like Amazon thrive on this by offering quick and easy purchasing options. However, our brains are not naturally equipped to handle the constant barrage of online shopping ads and one-click purchases.
Credit card companies also exploit this by creating a disconnect between our present and future selves. When we use credit cards, we don’t feel the immediate pain of spending money, leading us to spend more than we would with cash.
While it can be challenging to resist the emotional brain’s influence, it’s not impossible. Wu suggests creating barriers between the desire to shop and the act of shopping. For instance, designate specific days for shopping and allow time between the impulse to buy and the actual purchase.
Reducing stress can also help strengthen our ability to resist shopping impulses. Physical activities like running or seeking social support can lower stress levels and improve the functioning of the frontal cortex, making it easier to make rational decisions.
Online shopping is now a predominant way of purchasing goods. The key question is whether we will adapt to this trend in a positive or negative way. By understanding the emotional forces behind our spending habits, we can make more informed decisions and potentially develop healthier shopping behaviors.
Engage in a debate with your peers about the roles of the emotional brain and the rational brain in decision-making. Divide into two groups, with one group advocating for the emotional brain’s influence on spending and the other supporting the rational brain’s role. Use examples from your own experiences to support your arguments.
Keep a diary for one week, documenting any impulse purchases you make. Reflect on the emotions you felt before and after each purchase. At the end of the week, analyze your entries to identify patterns and discuss them with classmates to gain insights into emotional spending triggers.
Participate in a simulated shopping exercise where you are given a virtual budget. Practice mindful shopping by pausing before each purchase to consider whether it is a need or a want. Share your strategies for resisting impulsive buys and discuss how this exercise can be applied to real-life shopping.
Attend a workshop focused on stress reduction techniques such as meditation, yoga, or deep breathing exercises. Reflect on how these practices can help improve your decision-making abilities by enhancing the functioning of your rational brain. Share your experiences with the group.
Conduct an analysis of how credit card usage affects spending habits. Compare scenarios of using cash versus credit for purchases and discuss the psychological impact of each method. Present your findings in a group discussion, highlighting strategies to minimize overspending with credit cards.
Emotions – Complex psychological states that involve three distinct components: a subjective experience, a physiological response, and a behavioral or expressive response. – Understanding consumer emotions can help marketers tailor their strategies to better connect with their target audience.
Spending – The act of using money to purchase goods or services, often influenced by psychological factors such as emotions and social pressures. – College students often need to manage their spending habits to avoid financial stress.
Impulsive – Acting on a whim or without careful thought, often driven by emotional responses rather than rational decision-making. – Impulsive buying can lead to regret, especially when consumers purchase items they don’t truly need.
Rational – Based on logic and reason, often involving careful thought and consideration of the consequences. – Rational decision-making in marketing involves analyzing data to predict consumer behavior accurately.
Gratification – The pleasure or satisfaction obtained from fulfilling a desire or need, often used in the context of consumer behavior. – Instant gratification can drive consumers to make quick purchases without considering long-term effects.
Stress – A psychological and physical response to certain life events or situations, which can influence consumer behavior and decision-making. – High levels of stress can lead to impulsive buying as a coping mechanism.
Decisions – Choices made after considering different options, often influenced by cognitive biases and emotional states. – Marketers aim to understand the decision-making process to better influence consumer choices.
Shopping – The activity of purchasing goods or services, which can be influenced by psychological factors such as mood and social influences. – Online shopping has become increasingly popular due to its convenience and the ability to compare products easily.
Habits – Regular practices or routines that are often performed unconsciously and can significantly impact consumer behavior. – Developing sustainable shopping habits can lead to more mindful consumption.
Behaviors – The actions or reactions of individuals in response to external or internal stimuli, often studied in psychology to understand consumer patterns. – Analyzing consumer behaviors helps marketers create more effective advertising campaigns.
