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Some Ways How Firms Can Increase the Happiness Consumers Gain From Their Purchases

Friday, June 30, 2017 - 10:34
Publication
Observador

Some have argued that happiness is the highest and ultimate goal towards which individuals strive. If so, then the business manager has much to gain from learning about consumer happiness and, more specifically, what advances consumer happiness. Research in this area is still in its infancy, but significant strides have been made nevertheless. A finding that may be of special interest is that consumers tend to gain more happiness from their experiences than their material possessions. That’s right, spending your discretionary income on a restaurant dinner, a visit to a museum, or a sports event increases your happiness more than investing that money in the acquisition of a new electronic device, a new piece of furniture, or a jewelry item. But why is that?

Following Van Boven and Gilovich’s initial investigation into this topic in 2003, a number of psychology and marketing researchers have revealed the reasons, which can guide decision-making at the management level. A team of researchers (Leonardo Nicolao, Julie Irwin, and Joe Goodman) found that consumers tend to adapt more quickly to their objects than their experiences. In other words, that new object quickly loses its appeal and capacity to increase the consumer’s happiness, while the memories of an experience seem to keep it’s luster for longer—in fact, some people say (and research confirms) that the memories of past experiences only get rosier overtime. According to researchers Kumar and Gilovich, a reason why objects lose their appeal so quickly is that consumers tend to compare them to the objects of other people. Once a neighbor buys a newer, nicer, bigger car, your dear one appears less interesting. On the other hand, consumers don’t tend to compare their visit to a museum or their dinner at a restaurant with those of their friends. This happens because the tangibility of objects makes them more amenable for comparisons. Managers therefore are well-guided to discourage consumers from comparing their material items to those of other people by, for example, creating unique products, which are less amenable to comparisons.

My own research in collaboration with University of Arizona Professor Merrie Brucks has pointed to another explanation for why experiences foster happiness more than do material objects—i.e., experiences have greater conversational value. Put simply, you are likely to tell more friends about a music concert you attended than a new laptop computer you acquired. The larger number of conversation interactions that experiences create thus help explain its superiority in advancing consumer happiness. This suggests that the manager selling material products can increase the happiness consumers gain from their objects by motivating them to talk more about the objects. In other words, give consumers something about the object to talk about—e.g., information about how the product was designed and put together, the history of the brand, or creative ways of using the product. All of that allows the consumer to sound like an expert, which is likely to encourage her/him to share about the object.

The curious manager may however ask: but some objects are almost an experience themselves. For example, when a consumer purchases car, a musical instrument, or a BBQ grill, is she acquiring an object or an experience? The answer would likely vary from person to person as these items can be seen one way or the other. And here is where the manager may again be influential. The results of my research indicate that, by focusing the consumer’s mind in the experiential aspects of a purchase (“Experience what it is to prepare the perfect meat”) versus its material aspects (“Get all the functionalities and elegance you have always expected from a grill”), the manager can influence the consumer’s likelihood of talking about it and, ultimately, the amount of happiness she derives from it.

In sum, the knowledge of what drives happiness can equip managers and make them a powerful agent behind the happiness their offerings afford to consumers. 

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