Stories | August 13, 2018

How window-shopping can bust your budget

Just browsing? Believe it or not, this can still be hard on the wallet, says Garrett Meccariello.

Whether you’re a casual shopper or a shopaholic, it’s likely that you enjoy shopping. Buying things can be really pleasurable and make us feel happy. But achieving this satisfaction is harder if you don’t have the money.

Rather than choosing to go into debt by purchasing unnecessary items, some people may window-shop as an alternative to actually buying something.

Window-shopping involves browsing in store or online, without the intent to purchase. And as more people shop online, window-shopping has gone digital – with resulting effects that can actually be worse. In stores, it can be easy to simply walk out and go somewhere else, but those online ads and websites can sit in front of us until our device’s battery dies.

Window shopping can actually encourage people to commit to purchases in the future. So much for the original good intention – to browse without spending more money.

Attached to our “options”
The root of the problem lies with what psychologists call option attachment: an unpleasant feeling that can result when a person compares one potential purchase to another, and has to put one of the items back on the shelf after it was already in the trolley. This feeling of “almost owning” an item can lead to trouble down the road.

One of the main reasons that option attachment is such a strong force is another psychological theory called the endowment effect. The endowment effect states that when we have something, we value it more than when we didn’t. This can be by almost twice as much in some cases.

Coupling this with the idea that we hate to lose things we have, we typically overvalue items that we browse in store or online due to the emotional “connections” that we formed with them while shopping.

Possessed by our desires
Our natural desire is to avoid the unpleasant feeling of losing an item from our “possession”, regardless of whether we have actually purchased it or not. A future purchase may not help our long-term financial goals, but it satisfies the desire to own the item.

This may seem surprising. It does not make obvious sense that thinking about an item while shopping could create a sense of ownership similar to buying that item.

We typically overvalue items that we browse in store or online due to the emotional “connections” that we formed.

But the human brain has been described as still in beta testing, meaning that it is still in development, and therefore not quite perfect. So these feelings of ownership arise because of a range of systematic biases, including option attachment.

How to buy only what you need
When window-shopping, the brain can be in a “hot state”. This means that shoppers will think more about what they want in the moment than what may be best for them financially long term.

In this way, just popping in for a look often leads to a “hot” choice sparked by desires which are later regretted, instead of being a well thought-out decision. Luckily, there are ways to avoid some of these temptations: we can do things that reprogram our brains away from forming attachments to items we don’t really need.

One simple way to avoid a “hot” state while window-shopping is to get out of the situation – it is only too easy to become attached to an item seen while browsing the offers. Instead of window-shopping, why not go for a run or spend time with family instead? This will increase the levels of satisfaction hormones in the brain.

Staying cool in the moment
Any activity that distracts us from momentary urges can be helpful. Inserting a cool-down time into the decision-making process, slowing down how we choose, can also help shoppers avoid unnecessary purchases driven by option attachment. Those looking to “cool down” might increase their personal happiness levels, simply by avoiding regrets.

And a quick dose of happiness can in itself reduce the urge to purchase, while the brain moves from a hot browsing state to a “cold” version with a longer-term focus.

The road to better financial decisions is a long one, but by strategically avoiding moments when we can act without thinking, we can take a step in the right direction. And this can also help us save for the things we do really need. It might be as simple as going for a run: a choice that can stop us wasting money on clothes we won’t wear in a year.

eZonomics team
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