Holiday Shopping Ads Are Geared Toward Brain's Reward Center

Nov 26, 2014
Originally published on November 27, 2014 4:21 pm

Black Friday sales seem to start earlier and earlier every year. But what makes us want to rush to the stores or online to snap up the best bargains?

Those wall-to-wall TV ads — and the holiday season itself — are tapping into a very primitive part of our brains.

"There is more of a sport to Black Friday shopping, and people expect some deal, but they aren't likely to get the best deal on a particular item because the best deal may have already happened six months ago," says Sucharita Mulpuru, a retail analyst with Forrester Research.

Overall, the best holiday deals don't happen on Black Friday. They usually happen right before Christmas and after. Analysts have been saying that to shoppers for years, and it's something we should all know, but we still go out.

Why do we do that?

"I think it's because of the role that emotions — especially positive emotions like excitement — play on people's decision-making process," says Camelia Kuhnen, a behavioral economist at the University of North Carolina.

Kuhnen says our financial decisions are governed essentially by two centers in our brain. One is the fear anxiety center — the part of our brains that reacts to panic or makes us run away from danger. The other is the reward center — the part that's a trigger when we're happy, Kuhnen says.

There's run-of-the-mill happy, she says, "and then there's happy-excited. Happy-aroused. Happy-frenzied. And it's really that happy-frenzied state that is driven by a lot of activation in this brain reward center. It's when you feel the impetus to sort of go for it."

That go-for-it impulse is what makes the holiday season run. Every single part of the holidays — the music, the food, for some of us the family — goes to get us excited and to activate that primitive part of our brain.

"When that happens, people end up making certain choices that are quite interesting," Kuhnen says. "So they tend to take on more financial risk, they tend to prefer, much more strongly, immediate rewards rather than delayed rewards. And they tend to be much more interested in purchasing a good that's showed to them."

Sound like those Black Friday ads to you?

Meanwhile, the analysts say retailers know about this ancient part of our brain and they've worked on it for centuries. The problem in the age of the Internet is whether they can keep pace.

"What's going on, I think: Convenience is a huge thing to the consumer," says retail analyst Howard Davidowitz. He says right now the Internet gives consumers the upper hand.

The fight among retailers is to provide the most convenient option for customers.

"Everybody — everybody — is trying to capitalize on that. The consumer wants free shipping, and they want it right away," Davidowitz says.

And if you're a retailer and don't give that to consumers, "you've got a problem because your competitor will," he says.

It's not about which store or brand has the keys to our brain — it's which retailers can get in line first.

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

DAVID GREENE, HOST:

With the economy picking up steam, this Thanksgiving week is expected to be better for shop owners and retailers compared to last year's holiday. The turkey is barely defrosted, but retailers are ready to go.

(SOUNDBITE OF VARIOUS ADS)

UNIDENTIFIED WOMAN #1: This just in. Macy's is giving away a million dollars...

UNIDENTIFIED MAN #1: Black Friday is here early...

UNIDENTIFIED WOMAN #2: Five p.m. with amazing four-hour deals on the hottest toys...

UNIDENTIFIED WOMAN #3: We're cooking up big doorbusters...

UNIDENTIFIED MAN #2: This Thursday at 8 p.m. get all...

UNIDENTIFIED WOMAN #4: I got up at 3 a.m. for Black Friday, but I saved hundreds...

GREENE: Wow, are you dizzy yet? Well, it turns out those ads and also the holiday season itself are tapping into a very primitive part of our brains. NPR's Sonari Glinton explains.

SONARI GLINTON, BYLINE: Here's a cold, hard fact about the holiday shopping season around Thanksgiving. It's delivered to us by Sucharita Mulpuru. She's a retail analyst with Forrester Research.

SUCHARITA MULPURU: Black Friday is a big shopping day, but in the rank order it's probably sixth, seventh on the list, but it's definitely not number one.

GLINTON: If Black Friday is not the best day sales-wise for store owners - OK, what about consumers?

MULPURU: There is more of a sport to Black Friday shopping, and people expect some deal. But they aren't likely to get the best deal on a particular item because the best deal may have already happened six months ago.

GLINTON: Overall, the best holiday deals don't happen on Black Friday. They usually happen right before Christmas and after. Analysts have been saying that to shoppers for years, and it's something we should all know. But we still go out. That raises an important question.

CAMELIA KUHNEN: So why do people do this?

GLINTON: The woman with the answer is Camelia Kuhnen. She's a behavioral economist at the University of North Carolina.

KUHNEN: I think it's because of the role that emotions, especially positive emotions like excitement, play on people's decision-making process.

GLINTON: OK, folks, we're about to get deep, so lock in. Kuhnen says our financial decisions are governed essentially by two centers in our brain. One is the fear-anxiety center. That's the part of our brain that reacts to panics or makes us run away from danger. The other is the reward center. Kuhnen says this part is triggered when we're happy. She says there's run-of-the-mill happy...

KUHNEN: And then there's happy-excited, happy-aroused, happy-frenzied. OK? And it's really that happy-frenzied state that is driven by a lot of activation in this brain reward center. It's when you feel the impetus to sort of go for it.

GLINTON: That go-for-it impulse is what makes the holiday season run. Every single part of the holidays - the music, the food, for some of us the family - all go to get us excited and to activate that primitive part of our brain.

KUHNEN: And when that happens, people end up making certain choices that are quite interesting. So they tend to take on more financial risk. They tend to prefer much more strongly immediate rewards rather than delayed rewards. And they tend to be much more interested in purchasing a good that's showed to them.

GLINTON: More interested in purchasing a good that's shown to them? Sound like those Black Friday ads to you? Meanwhile, the analysts say retailers know about this ancient part of our brain, and they've worked on it for centuries. The problem is, in the age of the internet, whether they can keep the pace.

HOWARD DAVIDOWITZ: What's going on, I think, convenience is a huge thing to the consumer.

GLINTON: Howard Davidowitz is a retail analyst. He says right now the Internet gives consumers the upper hand. The fight amongst retailers is who can have the most convenient option for customers.

DAVIDOWITZ: So that everybody - everybody is trying to capitalize on that. The consumer wants free shipping, and they want it right away, period.

GLINTON: And if you don't give that to them...

DAVIDOWITZ: You got a problem 'cause your competitor will.

GLINTON: It's not about which store or brand has the keys to our brain. It's about which retailers can get in line first. Sonari Glinton, NPR News. Transcript provided by NPR, Copyright NPR.