Consumption conservation psychiatry

Savings rates in many countries has been declining, raising concerns about the future sustainability of spending as well as the stability of economies in general. And lack of control over eating can only bring with it long term costs both in terms of health evidenced by increasing incidence of heart ailments as well as cost in terms of healthcare.

Over the past few years, both in India as well as the rest of the world, people’s inability to control eating and spending have both raised criticism and spawned a lot of discussion.

While the jury is out on the exact causes behind the consumption epidemic, it is clear that a large part of the problem arises due to the easy access to resources which promote tempting consumption habits.

In our research we do not wish to contribute to the discussion on why this consumption epidemic happens. Our goal is simple we wanted to prescribe a simple solution to help curb consumption. We call it partitioning. Quite simply when a given quantity of resource (food, money or even other consumables like cigarettes) is divided into smaller quantities by physical partitions, it reduces both the total quantity consumed, as well as the speed of consumption.

In a series of studies predictions were tested and they were found exactly what was predicted. For instance, in one study, a number of participants volunteered to participate in a cookie tasting study. Every participant received an identical box of 24 cookies and was asked to consume them over time, noting how much they liked the cookies and when they ate them. Unknown to them, there were differences across participants. Some participants (let’s call them Box A) received 24 cookies in a box. Others, who received Box B, got the same box and the same cookies but each cookie was individually wrapped in foil. It was found a typical consumer who got box A took 6 days to finish the cookies and those who got box B took 24 days to finish. A simple sheet of thin foil paper had the power to slow down consumption by a factor of fourfold.

Interestingly, it was found similar results when we partition money, not just food. Students were given 100 cash coupons to participate in a gambling study an activity that is considered fun but sinful. Some were given all 100 coupons sealed in one envelope; others were given 10 coupons in each of 10 sealed envelopes.

It was found that once the big envelope was opened, it became easy to spend the 100 coupons. However, with the smaller envelope, people tended to spend a lot less – in one study, about half as much. In this case it was the power of glue in reducing spending by 50%.

In an ongoing a series of studies with laborers who get cash wages again it was observed that giving them cash divided into sealed envelopes increased their savings rates dramatically as compared to giving them a wad of notes. And in analysis of data from prepaid calling cards, we find that people who purchased five $10 cards rather than one $50 card spaced out their ISD/STD phone calls over a longer period of time.

When people make a decision to consume, they do so in the form of a meta-decision. For instance, when one visits the theatre they decide to eat popcorn. Once that meta-decision has been made, consumption continues in what we call “automatic” mode.

However, the moments a partition is hit or are rudely jolted from the automatic behavior and are forced to make a decision whether to open the next bag of popcorn or the next envelope of money. That’s when one is confronted with the reality that he has already consumed a fair bit, and perhaps it’s time to stop.

Put differently, partitions force the consumer to think about the consumption decision and if it’s a discretionary type of consumption activity that we’re trying to curtail, the process of thinking might just be enough to get us to stop.

To marketers, the study suggests that simple forms of packaging have the ability to create dramatic variations in consumption.

To consumers, the message is simple for consumption that when they want to controls it is tempting but the simple act of partitioning the resource will help curb consumption. This might mean cutting up food into smaller portion, partitioning our money across smaller stashes or adding small costs that force us to think about consumption. In short, divide and conquer the consumption epidemic.