A new survey from CreditCards.com shows that 5 in 6 Americans admit to impulse buying – and millennials lead the way in succumbing to instant gratification.
In the scientific telephone survey of U.S. adults, 9 out of 10 millennials confess to impulsive spending. The numbers are even higher among the youngest millennials, ages 25 and younger: 95 percent saying they’ve made an impulse buy.
It’s a mindset that contrasts sharply with that of older generations, according to the poll. One in five (21 percent) senior citizens say they’ve never made an impulse buy.
“These results fit in with what we already know about millennials,” says Nora Ganim Barnes, director of the Center for Marketing Research at the University of Massachusetts in Dartmouth. “We know that most of them don’t shop off a list. And the characteristics that define their generation include impatience, instant gratification and the need for recognition, which play right into impulse buying. They are wired for it.”
Another characteristic of today’s young adults? They’re social, Ganim Barnes says, and they care deeply about their peers.
The survey reflects that, too: It shows those under age 25 are five times more likely to make an impulse purchase for a friend, compared to people in other age groups.
Online impulse buying skyrockets
The survey found that the majority (68 percent) of impulse buys are still made in brick-and-mortar stores. That’s because even if you’re just picking up one thing, you may have to walk by hundreds of other strategically placed items designed to evoke an emotional reaction that will make you want to buy.
However, the poll also reveals a significant surge in online impulse purchases, a sign that retailers are figuring out how to evoke those same emotions when you’re shopping on-screen. About 1 in 3 (31 percent) Americans say they’ve made most of their impulse buys in the past three months using a computer, tablet or phone, compared to just 1 in 5 (19 percent) a year ago.
Of course, the online numbers should be up since folks are doing more online shopping. But the spike in online impulse purchases – a 60 percent jump – far exceeds the 12.6 percent increase in online sales reported by the National Retail Federation over the same period.
That’s an “impressive increase” that could be attributed to a number of factors, says George Loewenstein, a professor of economics and psychology at Carnegie Melon University in Pittsburgh. He notes that online retailers are using sophisticated analytics to track consumers and create targeted ads. In addition, he says, retailers are using more one-day deals and limited quantities (“Only 2 left!”) to produce “a feeling of anxiety that if you don’t buy this right now, you’re going to be stuck paying a higher price.” Finally, “one-click” ordering eliminates the extra steps – and the extra time you’d have to reconsider – before a big splurge.
“Online retailers have been trying to get rid of barriers, and it’s working,” says Mary Gresham, a psychologist who specializes in money issues in Atlanta. “Bargains have always been hard to resist. But a bargain you can get with just one click is even harder to resist. It’s convenient, it’s easy, there’s no shipping fee, there’s no time commitment, and you don’t have to go anywhere. You don’t even have to get dressed.”
Computers are still used about twice as often as mobile devices for online impulse purchases, the poll shows, but phones and tablets are catching up.
Unsurprisingly, millennials are the most likely to go mobile, with 14 percent reporting using a tablet or phone for most of their unplanned buying. That’s double the 2016 number. About 7 percent of Generation Xers, 10 percent of baby boomers and 5 percent of the Silent Generation (age 71+) say they use a mobile device for most of their impulse buys.
Men splurge on wives, women treat their kids
Who is benefiting from all this careless spending? Almost half (45 percent) of respondents say most of their impulse buys over the past three months were for themselves.
The survey did find some interesting gender differences, however. For example, three times as many men (25 percent) as women (8 percent) say their spouse is most often the recipient of their impulse buys.
Men in general are less likely to plan ahead when they shop, and the spontaneous purchases may be a way for them to express love or affection for their wives, Gresham says. “Men want their wives to know they care about them, but it can be hard for them to express that verbally,” she says.
Women, on the other hand, are much more likely to treat their children when they shop impulsively. About 33 percent of women say their impulse buys are mostly for their children, while just 16 percent of men say the same. Women may be making those buys out of guilt, out of love or simply because they didn’t plan ahead for a birthday or holiday, Gresham says.
Children who live in the South and Midwest are most likely to be the lucky recipients of their parents’ impulse purchases. About 30 percent of consumers in those regions say they’ve made an unplanned purchase for their children, compared to just 13 percent who live in Western states and 21 percent in the Northeast.
The regional differences could be related to the higher cost of living in the Northeast and West, says Randy Allen, a senior lecturer at Cornell University who studies marketing and consumer goods. “It’s also harder to go shopping in big metro areas, and stores are smaller,” she says. “So it may simply be a matter of not being exposed to as many items when they shop.”
Other poll results
Other key findings from the poll include:
- Among all Americans, 72 percent say they’ve made an unplanned buy just in the past three months, a slight drop from 77 percent who said the same a year ago. Those who make under $30,000 a year are least likely to buy on a whim, with only 65 percent reporting a recent impulse buy.
- While most impulse buys are small, some can be real budget-busters. About half of respondents say they’ve spent $100 or more on an impulse buy. One in four have spent $500 or more, and 17 percent have spent at least $1,000.
- Men are far more likely than women to report an impulse buy of $1,000 or more. About 23 percent report a big splurge, compared to 11 percent of women.
- Republicans also seem more likely to peel off the big bills. One in four (25 percent) say they’ve spent more than $1,000 on an impulse buy, while only 15 percent of Democrats and Independents say the same. And in the past three months, four times as many Republicans as Democrats say they spent $1,000 or more on an impulse buy. Higher numbers of affluent Republicans could explain some of the discrepancy, but the 2016 election may have also played a role, Allen says. “Republicans are buoyed by winning the election,” Allen says. “They’re expecting the economy to boom under President Donald Trump. So they may be thinking, ‘I can afford to spend $1,000.’”
- Ethnic differences are pronounced. Whites are almost twice as likely to make impulse purchases compared to other ethnic groups, according to the survey.
- Age appears to bring restraint, with the poll showing a direct correlation between age and the percentage of respondents reporting a recent impulse buy. About half (47 percent) of those over age 71 say they haven’t made an unplanned purchase in the past three months. Only 30 percent of baby boomers, 24 percent of Generation Xers and 16 percent of millennials could say the same. Gresham notes that senior citizens are more likely to be on a fixed income and generally see less value in material objects compared to younger generations.
The poll was conducted by Princeton Survey Research Associates International for CreditCards.com Jan. 5-8, 2017. PSRAI contacted a random sample of 1,003 adults living in the continental United States. Interviews were conducted in English and Spanish by landline (503) and cellphone (500, including 317 without a landline phone). Statistical results are weighted to correct known demographic discrepancies. The margin of sampling error is ± 3.7 percentage points for the complete set of weighted data.