ArticlePDF Available

The hidden cost of value-seeking: People do not accurately forecast the economic benefits of experiential purchases

Authors:

Abstract and Figures

In spite of the experiential advantage, people consume material items in the pursuit of happiness. We conducted three studies to determine if people commit forecasting errors when deciding between purchasing life experiences and material items. Study 1a showed that people expect life experiences to result in more well-being, whereas material items are forecasted to be a better use of money. However, Study 1b demonstrated that people enjoy greater well-being from life experiences and consider them to be a better use of money. Study 2, a four-week longitudinal study, corroborated this economic misforecast. Study 3 demonstrated that seeking to make good use of one's money, compared to prioritizing happiness, is more important during material consumption, and when people attempt to maximize economic value, instead of their happiness, they are more likely to consume material items. We suggest that prioritizing value may encourage people to prefer material items instead of life experiences.
No caption available
… 
Content may be subject to copyright.
A preview of the PDF is not available
... d = .50. These results are consistent with the previous literature on the stronger hedonic expectations associated with experiential compared to material purchases (e.g., Kumar, Killingsworth, & Gilovich, 2014;Pchelin & Howell, 2014). Results of all four variables for each purchase are presented in Table 1. ...
... The present research further helps understand the eudaimonic benefits of experiential purchases by demonstrating that people are aware of the fact that experiential purchases have eudaimonic benefits such as true self-knowledge. This suggests that people have different expectations regarding psychological outcomes when they spend money on experiential and material purchases (e.g., Pchelin & Howell, 2014). ...
... Thus, to sufficiently examine the effect of experiential purchases on true self-knowledge, an experience-sampling method, daily diary, or longitudinal approach would be appropriate. Similarly, people may hold a negative view of material purchases compared to experiential purchases (e.g., Pchelin & Howell, 2014), and as such, self-presentation may explain the preference for life experiences over material possessions. Employing different methodologies (e.g., experience-sampling) may reduce the possibility of self-presentation as participants are reporting on their real experiences. ...
Article
One mechanism underlying the hedonic benefits of experiential purchases is that one's core self is more centrally reflected in experiential purchases. However, little is known about whether people consume experiential purchases as a means of discovering their true self. The present research explored the possibility that people value experiential purchases as a potential tool for understanding their true self. Consistent with the hypothesis, Study 1 demonstrated that experiential purchases were perceived to be a more valuable source of gaining knowledge about one's true self compared to material purchases. Using correlational methods, Study 2 found that the motivation to search for true self-knowledge positively predicted preference for experiential purchases over material purchases. Finally, Study 3 showed a causal effect of motivation to search for true self-knowledge on a tendency to prefer experiential purchases to material purchases. Implications and future directions for well-being research and marketing are discussed. The only journey is the journey within.-Rainer Maria Rilke Many philosophers extol the virtues of understanding one's core self and using it as a guide when deciding how to live. A recent stream of psychological research has demonstrated that the perception of knowing one's true self, defined as who a person really is "deep down inside, " is linked to enhanced subjective well
... In examining how people should spend their discretionary money to increase well-being (Ahuvia 2008;Dutt 2006), considerable research has linked experiences with well-being and possessions to economic value maximization (e.g., Aknin, Wiwad, and Hanniball 2018;Pchelin and Howell 2014). In general, experiences have been empirically supported as producing greater happiness than possessions (Carter and Gilovich 2014;Gilovich, Kumar, and Jampol 2015;Kumar, Killingsworth, and Gilovich 2020). ...
... Some scholars have shown that experiential consumption generates a stronger sense of meaningfulness and is more likely to satisfy the three basic psychological needs (i.e., autonomy, competence, and relatedness) as crucial determinants of eudaimonia (Sun et al. 2019;Van Boven and Gilovich 2003). People were also found more likely to anticipate eudaimonia-related outcomes from experiences than possessions (Pchelin and Howell 2014). In contrast, others identified no such advantage of experiences over material consumption (Gaston-Breton, Sørensen, and Thomsen 2020;Sääksjärvi, Hellén, and Desmet 2016;Yu et al. 2016). ...
Article
To inform consumption choices bring people greater happiness, it is necessary to identify the types of consumption with greater happiness-generating potential. Using an experimental design, this research demonstrates that tourism experiences tend to cultivate happiness better than possessions, by empirically testing a potential underlying mechanism of such superiority—tourism’s potential to cultivate eudaimonia (i.e., the more enduring form of happiness that accounts for the bigger picture beyond the self) without explicit eudaimonic motives. The mechanism can aid the identification of forms of consumption that maximize happiness. This research makes multi-faceted contributions to the tourism and consumption literature on eudaimonia and happiness promotion, including how its revealed potential in implicitly cultivating eudaimonia renders tourism a better consumption choice than material possessions for happiness maximization. Practically, the study suggests how tourism experiences can be designed and marketed to capitalize on the eudaimonic potential.
... For example, one study showed that individuals were more likely to post experiential purchases on social media because they represented a more important part of the self than material purchases (Duan and Dholakia, 2018), another one showed that experiential purchases led to more identity expression opportunities (Guevarra and Howell, 2015), a third one showed that experiential purchases generated higher levels of word of mouth , and the last one showed that experiences had a higher conversational value because they communicated positive attributes of the self (Bastos and Brucks, 2017). One last study examined the influence of type of purchase on eudaimonia, finding support for the advantage of experiential purchases over their material counterparts (Pchelin and Howell, 2014). Even though the concept of eudaimonia could include a construal of meaningfulness, these authors conceptualized eudaimonia as developing new skills and friendships and feeling alive, which is different from the construal of a meaningful memory or moment. ...
Article
Full-text available
The examination of the affective consequences of the consumption of experiential and material gifts has increased in recent years, yet the attention paid to gratitude has been limited. Consequently, in five experiments, we tested the influence of type of gift, experiential versus material, on gratitude and social connection by increasing the construal of meaningful memories coming from the consumption of experiential gifts. In experiment 1, participants were randomly assigned to either an experiential gift consumption or material gift consumption condition and completed questionnaires assessing gratitude and social connection. Results showed that experiential gifts elicited greater gratitude, which then had a positive relationship with social connection. In experiment 2, participants were randomly assigned to the same conditions as study 1 and completed questions about the meaningfulness of the consumption memory and gratitude. Results showed that the consumption of experiential gifts elicited greater construal of meaningful memories, which then had a positive relationship with gratitude. In experiments 3 and 4, we manipulated the meaningfulness of gifts, special versus ordinary, and assessed the meaningfulness of the consumption memory and gratitude, with the addition of social connection in study 4. Results showed that special gifts were construed as more meaningful memories, which then had a positive relationship with gratitude. In addition, we also found a positive relationship between gratitude and social connection in study 4. Study 5 showed that the mediation effect of the construal of meaningful memories on the relationship between type of gift and gratitude was not moderated by whether the gift was special or ordinary.
... on a 9-point scale (ranging from 1 = not at all to 9 = very much; α = .74). This measure was taken from prior literature (Moldes et al., 2019;Pchelin & Howell, 2014) and aimed to combine affective and cognitive well-being judgements to achieve an overall understanding of the subjective hedonic gratification that consumers associate with a spending choice. ...
Article
Full-text available
Consumption is thought to be a goal‐directed behaviour often marketed as a source of happiness. However, it has yet to be tested whether we associate greater happiness with purchases that help us move towards our goals—goal satisfaction mechanism—or whether spending behaviours that help us primarily to attain intrinsic goals—such as affiliation or self‐growth—are linked to higher well‐being as self‐determination theory would predict. Across two studies, intrinsic goal satisfaction was associated with greater well‐being, rather than the purchase helping the consumer to satisfy their goals. Moreover, intrinsic goal satisfaction predicted significantly more variance in well‐being (13%–16%) than the material‐experiential purchase typology (2%–5%) used in past research. Finally, higher dispositional extrinsic goals predicted both extrinsic and intrinsic goal satisfaction through consumption suggesting that materialistic individuals might use consumption as a strategy to seek the attainment of intrinsic goals. These findings suggest that future research should shift the focus from the purchase (what is bought) to the consumer (who is spending money and why) when looking at the links between spending money and happiness. Finally, this report hints that future interventions aiming to reduce excessive consumption should explore lessening people's extrinsic goals.
... Despite the allure and perceived value of material items, compulsive consumers should be wary of seeking stress relief or happiness through material consumption. Research reveals that the memories generated from experiential purchases instill a longer lasting contentment that is significantly more sustainable than material items (Pchelin and Howell, 2014). As such, consumers are strongly encouraged to embrace life experiences and not underestimate the experiential value of memories. ...
Article
Purpose The purpose of this research is to shed light on the chain of psychological and behavioral effects that precipitates from a materialistic state of mind. Specifically, this study examines the psychological impact of materialism on younger consumers and in turn, their compulsive buying (CB) habits. This study also proposes possible interventions that may enhance consumer resistance to materialism and buying impulses and, ultimately, protect consumers’ mental and financial well-being. Design/methodology/approach An online survey was assembled in Qualtrics using reputable scales from extant marketing and psychology literature. The survey was completed by 193 young adults. Structural equation modeling was used to evaluate the proposed model of psychological drivers of CB. Findings The results suggest that young, materialistic consumers are at high risk of developing depression. Moreover, obsessive-compulsive (OC) tendencies and impaired self-esteem (SE) resulting from this depression may facilitate and fuel CB addiction. Despite no evidence for a direct link between depression and CB, the results indicate that this particular relationship is fully mediated by OC behavior and low SE. Social implications The discussion provides a detailed list of various behavioral modifications to help reduce consumer susceptibility to materialistic values and CB addiction. Originality/value This study contributes to consumer research by proposing an alternative conceptualization of the traditionally direct relationship assumed between materialism and CB in the literature. The facilitating roles of depression and its psychological byproducts (i.e. impaired SE and OC disorder) are examined as precursors of CB. Implications and suggestions for consumers battling CB addiction are provided.
Article
Full-text available
Purpose This study aims to test the experiential advantage argument from both the hedonic and eudaimonic well-being perspectives and seeks to explore the mediating roles of a sense of meaning, as well as the moderating effects of consumers’ motivational autonomy, in a novel context – China. Design/methodology/approach Study 1 ( n = 203) used a between-subject experiment where participants role-played an imaginary purchase with experiential versus material focus; Study 2 ( n = 290) used a recall method where participants were asked to recall their past experiential purchase or material purchase that cost more than RMB500 (about US$70); Study 3 ( n = 185) used a between-subject experiment where participants were assigned to one of the four scenarios (two types of purchases (experiential vs material) × 2 levels of motivational autonomy (high vs low). Findings The authors find that the experiential advantage argument holds true for eudaimonic well-being as well as hedonic well-being in three studies with Chinese consumers. In addition, the authors find that a sense of meaning serves as an additional mediator for the experiential advantage argument. Further, the authors find that the level of motivational autonomy positively moderates the effect size of experiential advantages and the mediating roles of a sense of meaning. Research limitations/implications The authors only address the two ends of the experiential–material purchase continuum. Whether the discovered mediation roles of a sense of meaning and the moderation roles of motivational autonomy hold for hybrid experiential products remain unknown. Originality/value The authors enriched the experiential advantage literature through exploring the mediation roles of a sense of meaning and the moderating effects of motivational autonomy in the experiential advantage model.
Article
Purpose In recent years, the application of artificial intelligence and digital technology has increasingly become a priority for online retailers. It is crucial to choose a way to make use of human–computer interaction (HCI) design to exert the positive influence of intelligent technology on consumer welfare. Despite the increasing use of HCI design in online retail context, there remain limitations in their effect of consumer well-being improvement. Although there is extensive literature in the field of consumer well-being improvement, few studies have empirically examined how HCI design drives the improvement of consumer well-being in the online retail context. Therefor, this study aims to deeply and systematically analyze the psychological mechanism between HCI and consumer well-being in the online retail environment. Design/methodology/approach The empirical analysis is based on data collection of 476 samples of online shoppers through the online survey method. From the perspective of autonomy, this study deeply analyzes the influence mechanism of different dimensions of HCI perception on consumer well-being. Findings The results indicated that autonomy plays a positive intermediary role in the impact of perceived connectivity, perceived personalization, perceived control and perceived responsiveness on the eudaimonia and hedonic enjoyment. Also, it revealed that psychological resistance negatively regulates the impact of perceived connectivity, perceived personalization and perceived control on autonomy, while experience purchase positively regulates the impact of autonomy on hedonic enjoyment. Originality/value This paper expands the research situation of consumer well-being by making integration of the dual structure of subjective well-being and psychological well-being to define the psychological mechanism and boundary conditions of the impact of HCI perception on consumer well-being. The main contribution of this study is to provide enlightenment for online retail enterprises to improve HCI design and help consumers enhance long-term well-being.
Article
Living in a consumerist society can afford material abundance, but these gains can bring psychological costs. A developed literature suggests experiential purchases (such as trips or outdoor recreation) represent a more promising route to enduring consumer happiness than the consumption of material goods. The satisfaction from experiences extends across a rather broad time course, including the anticipation of experiential consumption, in-the-moment consumption, and retrospection. This review discusses the underlying reasons for why these effects occur, additional downstream consequences of consuming experiences, and potential directions for future work. This extensive program of research provides a simple lesson people can apply to improve wellbeing in daily life: shifting spending in the direction of doing rather than having would likely be psychologically wise.
Article
What can you do to improve your health and at the same time improve the health of our home planet? Do you want to be a healthier and more sustainable consumer? In this straightforward, easy-to-understand and entertaining book, dietitian and environmentalist Dr. Dana Ellis Hunnes outlines the actions we can all take. Many people feel overwhelmed by the scope of climate change and believe that only large, sweeping changes will make any difference. Yet the choices we make every day can have effects on climate change, the oceans, the land, and other species. This book outlines the problems we are facing, and then presents ideas or 'recipes' to empower us, to help us all make a difference. Recipe For Survival provides the guidance that you can use right now to improve your health, your family's health, and the health of the environment simultaneously.
Article
Full-text available
Although numerous studies have demonstrated the hedonic benefits of spending money on life experiences instead of material possessions, there has been no attempt to determine how different motivations for experiential consumption relate to psychological need satisfaction and well-being. Across five studies (N = 931), guided by self-determination theory, we developed a reliable and valid measure of motivation for experiential consumption—the Motivation for Experiential Buying Scale—to test these relations. Those who spend money on life experience for autonomous reasons (e.g., “because they are an integral part of my life”) report more autonomy, competence, relatedness, flourishing, and vitality; however, those who spend money on life experiences for controlled (e.g., “for the recognition I’ll get from others”) or amotivated reasons (e.g., “I don’t really know”) reported less autonomy, competence, and relatedness. These results demonstrated that the benefits of experiential consumption depend on why one buys life experiences.
Article
Full-text available
Do people learn from experience that emotional reactions to events are often short-lived? Two studies indicate that it depends on whether the events are positive or negative. People who received positive or negative feedback on a test were not as happy or unhappy as they would have predicted. People in the positive feedback condition did not learn from this experience when making predictions about their reactions to future positive events. People in the negative feedback condition moderated their predictions about their reactions to future negative events, but this may not have been a result of learning. Rather, participants denigrated the test as a way of making themselves feel better and, when predicting future reactions, brought to mind this reconstrual of the test and inferred that doing poorly on it again would not make them very unhappy. Experience with a negative event (but not with a positive event) may improve the accuracy of one’s affective forecasts, but the extent to which people learn from their affective forecasting errors may be limited.
Article
People prefer to make changeable decisions rather than unchangeable decisions because they do not realize that they may be more satisfied with the latter. Photography students believed that having the opportunity to change their minds about which prints to keep would not influence their liking of the prints. However, those who had the opportunity to change their minds liked their prints less than those who did not (Study 1). Although the opportunity to change their minds impaired the postdecisional processes that normally promote satisfaction (Study 2a), most participants wanted to have that opportunity (Study 2b). The results demonstrate that errors in affective forecasting can lead people to behave in ways that do not optimize their happiness and well-being.
Article
This article reports the development and validation of a scale to measure global life satisfaction, the Satisfaction With Life Scale (SWLS). Among the various components of subjective well-being, the SWLS is narrowly focused to assess global life satisfaction and does not tap related constructs such as positive affect or loneliness. The SWLS is shown to have favorable psychometric properties, including high internal consistency and high temporal reliability. Scores on the SWLS correlate moderately to highly with other measures of subjective well-being, and correlate predictably with specific personality characteristics. It is noted that the SWLS is suited for use with different age groups, and other potential uses of the scale are discussed.
Article
Some theories suggest that pleasure and interest are separable emotions, with distinct functions and phenomenology. This study proposes a functional model of well-being that draws on these insights. It argues that both pleasure and satisfaction are elements of hedonic well-being and that their main function is to reward goal achievement and to mentally signalize that the body is in homeostatic stability. In contrast, the main function of interest is to promote mental and physical growth, and to suppress hedonic tendencies of premature returns to a homeostatic balance during difficult strivings. The feeling of interest facilitates personal growth, and is thus an indicator of eudaimonic well-being. A follow-up study (N = 145 Norwegian students) gave empirical support to these assumptions. Life satisfaction predicted feelings of pleasantness while personal growth predicted feelings of interest. With a projective technique, it was further demonstrated that satisfaction produces pleasant stories, but not interesting stories.