It’s been definitively proven that American adults enjoy experiential purchases more than material ones, yet we still instinctively purchase material goods much more frequently. Let’s take a look at this interesting conundrum.
A recent study by JWT Intelligence showed that an overwhelming 79% of American & British adults value experiences more than material items. Further, 64% of adults would rather spend their earnings on experiences than material items. Clearly, there is a psychological preference for purchasing experiences.
However, when actually making purchases, we tend to flip our preferences. According to a study by the Journal of Positive Psychology, immediately before a purchase, consumers believe that by making a material purchase, their money is 65% more “well spent,” compared to making an experiential purchase.
Why do we continue to make material purchases, even though we seem to prefer experiential ones?
SFSU professor Ryan Howell found that most people just make a simple, seemingly-rational calculation: experiences are fleeting in nature, while material goods last longer. “Therefore,” Howell says, “we keep buying material things because they’re tangible, and we think we can keep on using them.”
That being said, multiple studies have proven that experiences provide more happiness and more lasting value than material purchases. This happens because we adapt to our material purchases over time, and they stop providing the same initial excitement. Contrast that with experiences, which tend to provide rosy memories and value that grows over time, rather than diminishing.
So what lessons can we glean from these studies? Much like deciding to exercise regularly to improve our health and wellbeing, we can make a conscious choice and commitment to be more intentional with our discretionary income, and purchase experiences.
Whether you want to take guitar lessons or escape to Machu Picchu, the proof is in the pudding: both near- and long-term, you’ll be happier choosing to spend on experiences, rather than buying an iPad or any material good.
Learn more about how to bring experiential rewards to your employees as a recognition perk on our employee rewards page.