WHY DID I BUY THAT?

1. “I thought I wanted it, but I never use it.” Or “It looked really cool.” Does this sound familiar? WHY DID I BUY THAT? Understanding consumer decisions

2. LifeSmarts is a program of the National Consumers League

3. “Money can’t buy me love” Purchasing goods and services is complex human behavior.

4. Behavioral Economics The field of behavioral economics tells us– Humans seem to be only partially rational. We sometimes make decisions that are not inour best interest.

5. ir.ra.tion.al -adjective, without the faculty of reason; deprived of reason Dictionary.com Recognizing the human capacity to be irrational at times is a helpful piece of information when examining choices.

6. Needs and Wants We make consumer decisions based onneeds and wants that we can sort into threecategories: • Physiological • Psychological • Social

7. Physiological Needs Some of our basic biological needs are food, water and shelter from the elements.

8. Psychological Needs Our self concept,values, beliefs andattitudes all effectour decisions.

9. Social Needs Culture, family, social class and reference groups all influence consumer behavior, too.

10. What is a reference group? A reference group is one source of ourpersonal standards. Individuals look toreference groups to help them define whothey are or who they want to be.

11. Common decision making strategies Analyzing decision making strategies canhelp you make good decisions or evaluatewhy a particular decision was unsatisfactory.

12. Spontaneity “I just feel like it.” Not dangerous if it isan occasional icecream, but if yourincome flows out andyou continuouslywonder where your paycheck went, youare in trouble.

13. Compliance An appropriatestrategy when youare sent to the grocerystore with a list, butthink twice if you arebuying the latestelectronic gadget justbecause your friendshave one. “I’ll just go along.”

14. Procrastination “I’ll decide later.” or “I just can’t decide.” This could be positiveif you delay a decisionto complete moreresearch or to ask foradvice, but can benegative when you failto take responsibilityfor choices you needto make.

15. Agonizing You may never knowas much as theexperts, but you arethe expert on yourneeds and wants. “I just can’t decide what I want.”

16. Desire “Just go for it!” You can want a resultso much that youignore risk to achievea desirable outcome.

17. Avoidance You should use cautionin making decisionsthat have seriousconsequences, but, as aregular decision makingstrategy, avoidanceseldom producessatisfying results. “Well, I could do worse.”

18. Intention “This is what I want, it is the right decision for me.” Intent is important whenit helps you reach agoal, but it can looklike stubbornness if youare not thinking aboutconsequences.

19. Security When you avoid riskyou use the securitystrategy, but there aretimes when risk isdesirable. “This is the safest option I have.”

20. Synthesis “I believe this is the best decision and I have confidence I can make it work.” When you combine theelements of severaldecision makingstrategies you havesynthesis.

21. Ethics and Consumer Decisions Consumer decisions are also influenced bysocial responsibility – the welfare of society.

22. Avoiding excessive consumption Buying clothes at the local thriftshop, adhering to the slow food movement, and using the library are all decisions that reduce consumption. “Money is just the symbol we use to facilitate the gathering of memories and experiences.” — Stuart Wilde

23. Conserving Natural Resources Reduce, reuse & recycle. Becoming aware ofyour carbon footprint,driving a hybrid car,and recycling areexamples ofconservation strategiesthat influencepurchasing decisions.

24. Protecting the Environment Teenagers are moreaware of the need tochoose to recycle batteriesand electronics because oftheir harmful effects inlandfills. They have grownup with environmentalawareness.

25. Consumer Decision Making What are the influences on the consumer decisions you make? “Thinking well is wise; planning well, wise; but doing well is the wisest and best of all.” — Unknown

26. LifeSmarts Learn it. Live it. • An educational program teaching teens and tweens important real-life knowledge • A competition – students compete online and in-person  • A teaching toolbox. Check out our resources • An opportunity for students to gain leadership skills, and fulfill community service requirements • A chance to develop strong partnerships with national groups such as FBLA and FCCLA LifeSmarts is: Visit LifeSmarts at www.lifesmarts.org