HerMoney Classic: The Psychology Behind Our Shopping Habits

HerMoney with Jean Chatzky

Did you spend too much this Labor Day weekend? Yeah...us too. Marketers are smart and they're only getting smarter. These days, there is so much targeted marketing based on what we like on Instagram, what we're watching on TikTok, or even (more creepy) the conversations we’re having with friends. Sometimes it can be really difficult not to just click buy when the recommendations are SO spot on.

So, how do we resist? And how do we know when it's really the best time to buy the mattress, or the TV, or the couch, or whatever is featured in that back-to-school special? Mindy Weinstein, marketing and psychology expert, and author of: “The Power of Scarcity, Leveraging Urgency and Demand to Influence Customer Decisions,” says it's all about figuring out if you actually need that thing or if you're a target of what she calls scarcity marketing.

Takeaways:

• Scarcity is a powerful marketing tool that taps into our primal instincts and influences our decision-making process.
• Scarcity triggers a sense of urgency and fear of missing out (FOMO), leading to impulsive purchases.
• There are four types of scarcity: demand-related scarcity, supply-related scarcity, limited edition scarcity, and time-related scarcity.
• Scarcity can be used by individuals to improve their personal and professional lives.
• Understanding the tactics of scarcity marketing can help make smarter financial decisions.

Chapters:

00:00 The Power of Scarcity

03:19 The Science Behind Scarcity in Our Brains

09:11 Four Types of Scarcity

23:31 The Influence of Scarcity in the Economy

25:00 Transition to Mailbag Segment

26:00 Mailbag Question 1: What are the pros and cons of maintaining a long-term care policy?

32:00 Mailbag Question 2: Should I leave my full-time job and take on multiple part-time jobs?

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The HerMoney with Jean Chatzky podcast is sponsored by Edelman Financial Engines. The podcast team and its host are neither employees nor clients of EFE, however, the show does receive fixed compensation and is a paid endorser and therefore has an incentive to endorse EFE and its planners. To learn more about the sponsorship, please visit PlanEFE.com/HerMoney.

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