Can Social Media Persuade You to Spend More Money?
Research says, Yes! Moreover, which platform users prefer indicates how much they will spend.
Towards the end of last year, two of Facebook’s social scientists acknowledged in a blog post that passive consumption of content on the platform can affect a user’s mood and mental health. The authors, director of research David Ginsberg and Moira Burke, a research scientist, say that recent research blaming social media for an increase in alienation, depression and anxiety is “compelling.” They go on to cite a number of findings including one that found a direct relationship between clicking “likes” and links and a reduced sense of mental health.
Research has long proven that spending time on social media can make you feel better or worse. However, new research suggests that the effects of unregulated social media use can also be seen in how we spend our money. A recent study done by two business school researchers says that social media really can influence the amount of money you spend to the point that you can’t control yourself.
It’s all about emotions.
The researchers, Keith Wilcox of Columbia University and Andrew T. Stephen of the University of Pittsburgh, sought to find out if there were any negative effects of social media amid reports that social media made users feel more connected and also helped improve their self-esteem, boosting their overall happiness. They already knew that when people are happy, and they feel good about themselves, they’re likely to “license themselves…to let their guard down,” says Stephen. In other words, the emotions contribute to lower self-control. “We wondered if that would play out in this instance.” It did.
The study involving about 1000 Facebook users in the US found that those who spent relatively more time on Facebook and had a strong network on social media were more likely to have lower credit scores and more credit card debt compared to those who used it less and had a comparatively weaker network. The heavy users were also found to have less persistence for tasks following their social media time.
Stephen points out an experiment where after using Facebook briefly, users were taken directly to an eBay-type auction and told to bid on an iPad. Surprisingly, those with stronger networks on social media ended up bidding up to 30 perfect more than they’d have spent on the same device if they had just walked into a store.
The study also highlighted the relationship between social media usage and overeating. Users with stronger social networks were found to have a higher Body-Mass Index (BMI) score than the rest. “Think about self-control as a muscle that gets tired,” Stephen explains. “When you’re happy, feeling good about your friends, you let your guard down. You’re not focused on your long-term well-being, you’re focused on now.”
Each platform has its effects.
While Facebook does make you spend a lot of money, reports show that, of all social networks, Pinterest is likely to make you spend the most money. An analysis of close to 700 million online shopping transactions concluded that one average, a Pinterest user will spend around 70 percent more per order compared to a Facebook or Twitter user. Where Facebook users spent $95 per session, Pinterest users spent $170. Twitter users spent an average of $70 per session.
In case you think you have it under control, Julie Bornstein, Sephora’s head of digital, warns that you’ll end up spending, one way or another. Speaking to VentureBeat, she says, “The reality is that when you’re in the Pinterest mindset, you’re actually interested in acquiring items…which is not what people go to Facebook for. Facebook continues to be just a great customer interaction tool that gives us the real-time ability to dialog with our customer…it’s a big customer-service venue for us.” At the time of writing, Sephora has over 17 million fans on Facebook.
Posting under the influence?
In other news, booze is taking over from food pics as the most posted on Instagram. But this isn’t just any booze. Users want their friends to know about their eccentric tastes. According to a recent report by Havas Media Group commissioned by Evolve Media, “knowledge of spirits is becoming social currency among millennials, and they will order name brands to impress their peers.”
According to the study, the brand of alcohol a millennial bought was highly influenced by what they were doing, where they were doing it, and who they were doing it with.
The main contributor to these spending habits seems to be peer pressure or the need to keep up. While 62 percent of millennials identify as savers and 80 percent have a budget, a survey by TD Ameritrade shows that social media makes millennials 64 percent more likely to compare themselves with others. In comparison, Boomers are only 29 percent likely to compare themselves to their peers. Almost 25 percent of millennials are pressured to keep up with their friends’ spending habits and 15 percent have admitted to spending money in order to make a good impression.
What Can You Do?
So, how can you make sure Facebook doesn’t reach deeper into your wallet and Pinterest doesn’t make you start a project you don’t even need? Researchers suggest that instead of giving up social media — they advise against this — you should:
- Talk about it: Turns out there’s a psychological effect in talking it out. Being aware of the problem is a great first step.
- Set concrete saving goals: This keeps you on your toes and helps you resist the urge more strongly.
- Use social media for longer periods, less frequently: Instead of logging in for two minutes every 15 minutes, you can allocate three 15-minute blocks throughout your day when you can log in. With time, your overall time spent on social media will come down.
Research conducted on the effects of social media shows that it can indeed make you spend more money. And it’s about the emotions. One would have thought people spend so much to make themselves feel better. But according to research, it’s the other way round: People are spending because they feel good about themselves.
It seems like if social media isn’t making you get depressed, it’s getting you so happy you forget you have budgets to stick to. The key is to have controlled use.
written article by Jeremy Diamond0