Monday, September 26, 2011

It is easier and more satisfying to buy experiences than to buy stuff

One of my kids has a tough time making choices.  If he has gift money to spend at the toy store, he’ll find three things he really likes and then agonize over the decision.  Just when we think he’s ready to pick one of the items, he starts to think about not having one of the others and he gets thrown back into the agony of the choice. 

I hadn’t noticed it before, but last year I gave him the choice between going to a local amusement park and a nearby water park.  That choice was free of the real pain that usually goes along with decisions.

Some new research gives some insight into what is going on.

A paper in the January, 2010 issue of the Journal of Personality and Social Psychology by Travis Carter and Tom Gilovich looks at differences in the way people treat choices involving material goods (that is, stuff like toys, electronics, or jewelry) and choices involving experiential goods (like trips or visits to an amusement park). 

Consistent with the story about my conflicted son, they find that people report that choices for material products are harder for them to make than choices for experiential products. 

There is another interesting finding as well.  When people were asked about choices they made for material products, they found themselves less satisfied with the choice they had made over time.  When people were asked about choices of experiences, though, they were more satisfied with their choice over time. 

Why is this?

Part of what is happening is that when we buy a material product, it is often easy for us to compare that product to other similar ones.  So, if you go out and buy a flat-screen TV, the store probably has a wall of TVs just like it.  They differ in lots of ways, and so you can always think about the ones you did not buy and how they may have been better than what you got.

Experiences are different.  It is hard to compare across them.  If you take a trip to the beaches of Florida in the winter, you might spend your time swimming, eating good food, and dancing at night.  You could have chosen a trip to ski in Colorado instead.  Your activities on that trip would have been much different, and so it isn’t so easy to compare the different options.

Consistent with this idea, Carter and Gilovich find that when people are making choices for material products, they spend more time comparing alternatives than when they are making choices for experiences.  People think about choices for experiences, but they aren’t really comparing the different options.

Another difference is that material products are just possessions.  Even really expensive and important purchases are just things that eventually get older or break or are replaced by newer and (usually) better things.  The stuff you have is not psychologically a part of you.

Experiences, though, are a part of you.  The trips you take, the movies you see, and the things you do create your memories which become a central part of who you are.  Even bad experiences can often become stories that you tell, and in that way, they gain value.  You do not shed your experiences as easily as you shed your stuff.

Finally, as Carter and Gilovich point out, it is important to remember that many things that you may buy have both a material and an experiential part.  For example, a new car can be thought of as a material product.  It has features like the styling, handling, and engine power that can be compared to other cars.  It may also be thought of as an experience.  You could choose to focus on the enjoyment of driving the car and the trips you take in it. 

In the end, you are much more likely to be satisfied with your choices if you treat the objects in your life as experiences rather than just as stuff that you have accumulated.  Stuff will come and go, but your experiences will make you who you are.