For years, a conclusion from the field of consumer psychology has been widely circulated: buying experiences makes people feel happier than buying physical goods. So if you have some spare money to spend, it’s supposedly best to put it toward experiential consumption—travel, concerts, meals at restaurants, that sort of thing—rather than immediately using it to buy a new sofa.
Is this conclusion actually correct?
Based on new research from the past few years, we’ve found that this conclusion is actually far too crude.
During this year’s Spring Festival, I produced a special issue on holiday spending for NetEase Cloud Music, titled “Experiences or Material Goods: Which Is Better Value? How Can We Avoid Post-Purchase Regret?” (See “Further Reading” below for the link). In it, I mentioned a subtle factor that affects how consumption feels: if people recall the purchase shortly afterward, they feel happier about buying an experience; but if they recall it after a fairly long interval, satisfaction with the material good eventually pulls ahead. Buying an experience seems to offer instant gratification, while material goods are a bit like “the longer the road, the better you know the horse”—their value reveals itself over time.
And in a new paper published not long ago in Psychological Science, researchers identified another factor that matters: income level.
Put simply, the research found that people with higher incomes (rich people) are happier buying experiences, while people with lower incomes (poor people) are happier buying material goods.
The researchers conducted three experiments in total. In the first two, participants recalled their recent experiential consumption and material-goods consumption, then rated how happy each had made them on a scale. Both experiments consistently found that rich people were happier with experiential consumption, while poor people either felt happier buying material goods or felt no difference between the two.
In the third experiment, participants were asked to imagine that their monthly income had increased or decreased by 50%, and then to evaluate how consumption felt. When imagining a decrease in income, high-income participants were more inclined to buy goods, although their preference did not pull far enough away from their willingness to buy experiences to reach statistical significance.
The researchers speculate that the difference—“poor people are happier buying material goods, rich people are happier buying experiences”—may be caused by differences in leisure time. Experiences all require time to enjoy. Compared with poor people who are exhausted from working to earn money, rich people have more leisure time, such as paid vacation, and therefore have more “spare capacity” to enjoy the pleasure that buying experiences brings.
Juliet Hodges, a writer for the Research Digest website, commented that the biggest weakness of this new study is its reliance on participants’ memories after the fact. We know that, for the same experience, the “experiencing self,” which evaluates how we feel in the moment, and the “remembering self,” which evaluates it afterward, often give very different assessments. Future research might want to consider how to collect participants’ real-time feelings as they complete a purchase.
Further Reading:
Experiences or Material Goods: Which Is Better Value? How Can We Avoid Post-Purchase Regret? | Psychological Punk No.032
References:
- Lee, J. C., Hall, D. L., & Wood, W. (2018). Experiential or Material Purchases? Social Class Determines Purchase Happiness. Psychological science, 0956797617736386.
- Juliet Hodges. The “experiential advantage” is not universal – the less well-off get equal or more happiness from buying things. t.cn/RsioprS
Note
- The articles in this “New Knowledge in Psychology” series were short popular-science and miscellany pieces written to accompany related content from Zhichao Wei: New Knowledge in Psychology. They were published on the now-closed platform FANTUAN, and the original links no longer exist.
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