In the last decade, social media has changed how we interact with businesses.
While we might still visit physical stores to purchase goods, the average person can spend several hours each week browsing company offerings on social media and being influenced by celebrities and people they admire or envy.
You may not realize that social media is affecting your spending, but it might be having more of an impact than you think.
Here are just a few of the many ways it might be influencing your purchasing impulsivity and some helpful tips for what you can do about it:
1. Targeted Advertising
Many companies are offering credit repair Australia-wide, attempting to fix the credit scores of people who have spent beyond their means while shopping online and have been unable to pay their resultant credit card bills.
Once they default on their payments, they have a black mark against their name that might impact their ability to take out loans in the future. While companies aren’t forcing you to make purchases, how they advertise on social media might make it hard to turn down ‘once in a lifetime’ offers.
Many businesses are now taking advantage of the many powerful advertising tools on social media that allow them to target particular brands, products, and services to people who fit within their specific demographic. They can even target posts and advertisements toward people based on their behaviors.
For example, if you have previously shown an interest in purchasing bikinis online, you might start seeing more ads for bikinis appearing in your social media feeds that encourage you to make a purchase.
While there’s no denying that social media advertising can be beneficial for businesses, it’s crucial for consumers to think carefully about their wants versus needs to avoid making impulsive choices.
2. The Fear of Missing Out (FOMO)
When you see people you admire and like online wearing and using the latest clothing and gadgets, it’s hard not to be envious or a little bit jealous. You might even think you’re less of a person because you don’t have the same fabulous possessions as them.
The fear of missing out can cause people to make rash purchasing decisions. You might not need the items being advertised or shown off online, but seeing how many other people have them might make you decide to buy them anyway.
3. Social Proofing
Social proofing sounds like a relatively modern concept coined by a social media expert. It describes someone who will look for reviews and recommendations about a particular product or service before making a purchasing decision. Essentially, you’re letting someone else guide you in buying something.
It’s a reasonably new concept in this digital world, but social proofing dates back to the 1980s when American psychologist and academic Robert Cialdini described it as informational social influence. In his book titled ‘Influence,’ Cialdini stated that people will copy the actions of others in specific situations to mimic the most acceptable behaviors.
For example, if you’re visiting a café for the first time, you might observe the behavior and mannerisms of the person ordering in front of you to make sure you’re acting in a way that’s natural and expected for the environment.
4. Straightforward Shopping Experience
Shopping in a physical location can be time-consuming. You have to write a list, drive or take public transport to the location, then browse the aisles until you find what you want. Once you have it, you have to wait in line before making your way home again.
Social media and eCommerce platforms have transformed our shopping experience. While it’s beneficial for several reasons, it can also cause us to make impulsive buys. Within minutes, we can fill out digital carts with goods we don’t necessarily need and hand over our payment information.
The speed and ease might mean that there’s a high risk of making unnecessary purchases that negatively impact your financial stability.
How to Curb Your Online Spending
If you’ve come to the realization that you’re spending too much money on online purchases, you might be wondering what you can do to avoid temptation and keep your credit card firmly in your wallet.
Fortunately, there are many different ways to take back control, such as these below:
- Limit Your Social Media Time
- Ask Yourself Important Questions
- Distract Yourself
1. Limit Your Social Media Time
We have a range of social media platforms at our disposal, such as Facebook, Instagram, and TikTok. When you know that browsing these platforms leads you to make purchases, limiting your time on them might be how you stop yourself from doing so.
Set a timer to know when to stop browsing or consider downloading apps that disable social media after a certain amount of time. You might even go as far as to remove particular apps from your devices.
2. Ask Yourself Important Questions
When an influencer describes a product they think you need, or you see something for sale at a bargain price, ask yourself whether you need the item, or whether you’ll use it often.
If you identify the item as a want rather than a need and don’t think you will use or wear it often, you might have more strength to walk away from the purchase.
However, if you do need an item and believe you’ll use or wear it often, you might be able to make your purchase without feeling guilty.
3. Distract Yourself
Many people browse online goods for sale as a way to pass the time. Doing so might increase the chances of finding something you like and buying it when you don’t really need it.
If you currently use social media as something to do, consider distracting yourself with something else.
Take up another hobby like puzzles, reading, gardening, or photography. When you spend more time away from your phone or another internet-connected device, you generally have fewer opportunities to make purchases.
There’s no denying that online shopping can be convenient, cost-effective, and fun. However, it can also cause you to overspend and potentially increase your chances of not having enough money for everyday essentials. If you relate to any of this information above, now might be the right time to address your social media usage to benefit your bank account.