Fashion Retailers Know What Makes You Spend, Do You?

Let’s play a game. It’s called Name that Mission, and you have to identify which mission belongs to which fashion retailer. Okay, go….

1.       To create a unique retail experience with an eye toward creativity and a singular focus on pleasing our customer.

2.       To deliver great value to our customers every day.

3.       To give customers what they want; and get it to them faster than anyone else.

4.       To connect people with the joy of luxury and fashion that lasts a lifetime and beyond.

5.       To make effortless silhouettes that celebrate the feminine figure and pioneers sustainable practices, focusing on people and progress each step of the way.

 Fashion Retailers: Net-a-Porter, TJ Maxx, Reformation, Zara, Anthropologie

 Were you able to figure it out? If not, the answers are at the end of the post.

Okay, so why did I have you do that exercise, you say? I want to emphasize that each fashion retailer has a vision for their business, all with a slightly different focus that may be more or less appealing to you. Personally, I find them all quite appealing, and I think that’s the point—to be able to develop a mission that is attractive enough to as many people as possible. Because of course, the bottom line is to be able to make sales. And in order to do so retailers have to understand their customer. In fact, they spend a lot of time and money doing so.

Many books and blog posts are dedicated to helping retailers understand how to get customers to their store; and much of this knowledge relies on an understanding of psychology or human behavior. While this is great for retailers, and us too if they offer us what we want, it can be a problem when retailers have a better understanding of us as customers than we have of ourselves. Without self-awareness, we place ourselves at risk of overspending as a faulty way to cope with personal issues. So here are three closely related triggers that cause us to overspend; and some ways to offset them. 

1.       Dopamine

It seems dopamine has become the new buzz word, but in case you aren’t sure what it is, it’s a neurotransmitter. Neurotransmitters sends messages between neurons, nerve cells that send messages from the brain to the body so that the body knows what it’s supposed to be doing (that’s how your body knows to click on the link to this post). Dopamine specifically, is involved in pleasure; and research shows it is released whenever we anticipate a reward. So if you are excited about going shopping for an event later in the day, dopamine is released as soon as you made the plans. Once you find that perfect outfit, dopamine reinforces the desire to shop which keeps you looking forward to doing it again. On the other hand, if you don’t find the outfit you were looking for, your dopamine levels drop, and this increases your motivation to find what you want. In fact, when a situation becomes unpredictable, your anticipation increases, and releases more dopamine than if you found what you were looking for. This can explain why we shop til we drop looking for what we can’t find (or at least I do, ha!).

 So what role does dopamine play in overspending? Well, a closely related concept to overspending is impulsive buying; and according to researchers it is “a sudden compelling, hedonically complex purchase behavior in which the rapidity of the impulse purchase decision precludes any thoughtful deliberate consideration of alternatives or future implications.” So basically, you buy things you didn’t intend on a whim.

 Some researchers say online shopping increases impulse buying because of easy access, and other researchers say in-person shopping increases impulse buying because there is more sensory stimulation; and then there are researchers who suggest it is more dependent on personal factors. Either way marketing strategies such as easy online payment and free shipping; sales and discounts; and visual merchandizing are all enticing and used by retailers to increase impulse buying. These eye-catching tactics can all lead to an influx of dopamine if it causes us to anticipate a reward. Since so many of us shop online nowadays, just the act of anticipating a package increases dopamine which in turn reinforces us to shop online.

 2.       Boredom

 It’s something we all experience from time-to-time, but did you know that research shows being bored can have an effect on impulse buying? According to researchers some people shop online for clothing impulsively to avoid the monotony and frustration of boredom, particularly if they are into fashion. And these people are particularly vulnerable to the marketing strategies mentioned above. Social media also triggers them to buy as they compare their bored state to others who seems to have so much more fun and look great doing it. Some feel the need to reward themselves for the boredom they have endured, and thus an impulse purchase feels like the right thing in the moment. Altogether these examples show that a negative mindset may cause people to feel they deserve to buy something on impulse; and just the act of filling the shopping basket can lead to a burst of pleasure (thanks to dopamine). While many of us may shop for clothes to alleviate a negative mindset from time to time, be aware of making it a habit as it can lead to overspending, making it more difficult to process and manage negative feelings.

 3.        A Desire to Feel Good About Ourselves

Research shows that boredom contributes to the feeling of being meaningless. When we are bored, we are often looking for something that interests us, and often the lowest hanging fruit is social media which is full of people in beautiful clothes, and ads that feature the beautiful clothes. Research shows that boredom tends to be complicated by context (e.g., being alone) which can lead to feelings of meaningfulness, and an unsatisfying social identity. So we buy impulsively to verify our identity through clothing. And while we want our clothes to be self-affirming and support our identity, we don’t want to buy impulsively as a way to feel better about ourselves. This makes us more likely to buy clothes we regret later, and does not lead to lasting self-esteem. Because if the right clothes can give us our self-esteem, the wrong ones can take it away.

Some ways to offset these issues and avoid overspending is to be aware of the way our brain responds to anticipation and perceived rewards, negative mood, and feelings of inadequacy; and adjust our behaviors accordingly. So for instance, while sales tactics and visual merchandizing may be pleasing to us, and reinforce the desire for perceived rewards (i.e., a great outfit); be clear on what it is you need in your wardrobe, even if you have to carry a reminder with you. And if it doesn’t fit what you need, don’t buy it.

Answers to Name That Mission: 1. Anthropologie 2. TJ Maxx 3. Zara 4. Net-a-Porter 5. Reformation