Irrationally-Rational! How Marketers Are Influencing Consumer Psyche?
In a VUCA world where the consumers are experimenters, they are more prone to irrational buying behaviour
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Consumers are engaged in decision making that combines complex mental and emotional processes. Truly speaking, they undergo between a choice influenced by irrationality, binging over rationality. This article attempts to examine the diversities associated with the buying process, heavily influenced by smart marketers, succumbing the consumer towards extended buying, even if it is irrational!
Consumers are always confident that their purchases are rationalized, though at times it is irrational. Is this an irrational exuberance extended over rational decision making? When emotions start governing the decision-making process and create logic around it, is presumably the vortex, wherein the customer is caught, and it is here that the rationalizing irrationality occurs. The reasons could be deep penetration and marketing appeals by marketers, who are offensive in pushing their products and services to newer heights. In today’s context, most industries are reeling under Volatility, Uncertainty, Complexity and Ambiguity (VUCA). Despite the high level of turbulence in the market and economy, there are several factors and driving forces, influencing the consumer towards this extending buying. Are you in this category?
What really drives consumers towards irrational purchases?
Consumers support to several reasons to these irrational purchases in VUCA times. It may be reliving in times of depression, maybe fun or even experimenting in expressing their identity. It seems their (consumers) dreams and product association gives a “kick”, a celestial delight of ownership, belongingness and an elevated self. It connects them with the dynamic market, the community they belong to, the cohorts etc. The urge leads to such unwanted purchases. The question is what are these unwanted purchases? It is proven that emotions drive a pleasure emanating from an impulsive purchase. Let’s accept, most of us get this adrenaline in our system, giving us a reason to exist within the cohort or even uplifted one! What is the purpose for such ownership is unknown, the economics of possessing etc. but it saddles down to the irrational desire that “I want more…” syndrome.
Lifestyles are evolving globally and Indian consumers are not far apart. They too intend to stay contemporary, whether they want to change a car, buy a new more spacious home, get the newly launched hi-tech phone, possess the fashion brand labelled apparels, white good, take on an expensive journey etc. The question is of staying contemporary. Top class brands invest extensively on campaigns involving leading celebrities, predatory pricing and web the consumer. The mindful buying shifts to buying with emotions or by heart. This is a fast-catching phenomenon.
Let us consider the luxury market that earned more than USD 23 billion and is steadily moving forward. There has been an increase in high net worth individuals. This has followed digitalization, offering a neat space for marketers to reach the consumer easily and web him to his wants. Does this bring an interesting debate as to whether this stratum will also exhibit rational buying behaviour over irrational? We consider this a seriously ‘yes’ proposition as the ‘nouveau rich’ category likes to immaculately immerse in romance over self-identity and personality. The rise in income level, higher disposable incomes and ease of using plastic money compounds to this irrational buying. But they say and it accepts as rational! Retailers are fast cashing on the consumers, who are already experimenting with their lifestyles.
With the above discussion, we zero on two sets of individuals. One emanating from a higher income group having larger disposable income. These groups can definitely experiment as long as the loss bearing capacity is high and that one does not feel the burden on his or her daily life. For them the gamble maybe not to create an economic disorder and that they will carry on until they really make a mess over excess! Perhaps they see their own powerful persona as an outcome of this extended buying behaviour.
On the contrary, the second group not having a higher disposable income, if trying to emulate a similar buying pattern as exhibited by the first group, can be catastrophic. It can end into buying or consuming services that may really not be needed within the framework of their existence. This nudged buying can be extremely dangerous, qualifying the context of rationalizing-irrationality, leading to serious consequences for the consumer and also his/her family. If this buying pattern continues, it may seriously impact their pockets and a serious debt trap in the long run. Consumers in this category, as our research says, please be careful. Contextualise your need, the purchasing power, disposable income and its long term need before being the consumer for the newly wants to become a powerful need. Is it the newly addicted consumer surplus?
Further, in the larger context, the thought leads, whether such buying streak lead to consumerism and that will it burden the economy?
Perhaps this is a global phenomenon and India as an emerging economy is not far left behind. The global brands are delving into the Indian consumer market place, with an intention to capitalize aggressively. With the Indian history lamenting that we are prone to luxury, having witnessed kingly empires, this is where the marketers are attempting to cash upon. The retail industry is the fastest space witnessing this phenomenon. The fact remains that Indian consumers, particularly in the luxury market are maturing and have started experimenting with luxury brands. This is applicable across genders in the luxury cohort. The monetary value of the product stands secondary against the flavor of richness and this is where the consumer lands into irrational buying. This phenomenon can be widely used by the brands in outreaching their business goals.
But here lies an important thought. Is this irrational exuberance dangerous? With rising trends in such irrational buying behaviour amongst the upper class in tier 2 and tier 3 cities in India, they are exposed to a higher level of economic volatility. This rationally-irrational behaviour can have long term repercussions over them.
In a VUCA world where the consumers are experimenters, they are more prone to irrational buying behaviour. Their impulse or binge buying, upgrading their self-identity and personality with a series of irrational purchase, can have a serious impact in their personal economy. They can be debt-laden individuals. If it continues and grows to a cluster it may even harm a larger group. And if this spur continues to a region and to a nation may create a debt-laden economy. Watch out on this!
There must be a careful balance on consumer choice one makes. “Seeing and buying”, succumbing on the first sight may be dangerous, even if it is rationalized. This impulse buying leads to excess over loans, improper utilization of credit facilities, landing the consumer into a long debt trap. This may result in a non-repayment of debts on time and burdening the economy into a debt-laden one. Do we hope you are not one of these rationally-irrational buyers and a debt-laden one?
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.