When faced with uncertainty, people may act unreasonably out of fear. People swarmed to stores to gather necessities during the pandemic, resulting in panic shopping. Others tried to make a killing off of the shortages by charging exorbitant prices for necessities like paper towels and hand sanitizer.
Not only did this pandemic affect many nations and localities, but it was a worldwide phenomenon that wiped out entire grocery stores and wreaked havoc on supply networks.
But why do people act this way when there’s a crisis? What exactly is it? Is it some kind of innate survival mechanism, a socially conditioned herd mentality, or something entirely? Before the pandemic hit, we ran a study to figure out what makes us behave or overreact when we’re not sure what’s going to happen.
Consumers’ Mental Characteristics
Narcissism, psychological entitlement, status consumption, FOMO, and other related aspects were investigated in our study. A lack of empathy and an inflated feeling of self-importance define narcissism.
The idea that one is intrinsically worthy of preferential treatment or advantages is known as psychological entitlement. One example of status consumption is the propensity to buy things that bolster one’s social standing. Embarrassment anxiety is the worry that other people will look down on you. If you suffer from FOMO, you live in constant fear that you will not be able to partake in enjoyable activities that other people are enjoying.
Using their individual psychological characteristics as a determinant, our research separated consumers into four categories. One group is known as egalitarians. Narcissism and psychological entitlement were less prevalent among egalitarians than in the other categories. A more balanced and community-oriented outlook characterizes their way of life. They probably hold a firm conviction in the importance of justice and community duty. People who volunteer at food pantries or in community clean-ups are examples of egalitarians.
Egalitarians, in contrast to other groups, did not accumulate large quantities of goods. For instance, an egalitarian would purchase a couple of bottles of hand sanitizer and distribute the remaining stock to those in need, rather than stockpiling them all.
Those Who Refuse to Deviate From the Norm
A combination of mild FOMO and a high dread of humiliation drives conformists. People who are conformists adhere to social norms, such as clothing regulations, and seldom challenge those in positions of power.
Items that were in conformity with public health requirements, such as disposable masks, were given priority when conformists were making purchases. Whenever a new public health alert is issued, they are the first to typically purchase masks in large quantities.
Community Egoists Are the Third Type
Communal egoists exhibit moderate levels of narcissism and psychological entitlement. This type of person may plan a community gathering, but they will want to be the center of attention the whole time.
Products connected to food, such as bottled water and snacks, tend to pique the interest of this demographic. In an attempt to stand out, a communal egoist may buy a lot of these items, both for themselves and to share with their neighbors.
Egotistical Agents
Extreme narcissism and a sense of entitlement define agentic egoists. Someone who believes their time is more important than other people’s might, for instance, cut in line if they are an agentic egoist.
Spending more on things that directly benefit oneself is acceptable behavior for agentic egoists when it comes to purchasing. For instance, they may buy the last three bottles of a pricey, name-brand cough medication without thinking about how others could also benefit from it.
Consumers Should Take Note of This
The COVID-19 epidemic and the ensuing world chaos taught us many things, one of the most important being to always be prepared for the unexpected.
You are not alone if, in a moment of panic, you have ever filled your shopping cart to the brim. But the first step in becoming a better consumer is to know ourselves, our decision-making processes, and how to be more thoughtful.
Do you consider yourself an egalitarian who shops just for necessities, keeping an eye on the community at large? On the other hand, maybe you’re someone who takes pride in following the rules set down by health officials. When we become aware of these characteristics in ourselves, it might serve as a wake-up call to shop more ethically, particularly in anxious and frightening circumstances.
The Implications for Stores
Improving bottom lines isn’t the only benefit of segmenting your clientele. It’s a framework for organizations to follow so they may help communities in need in an ethical and efficient manner, particularly during emergencies.
For instance, you might want to think about stocking your stores with credible public health information if the majority of your consumers have a tendency to conform. Integrate equitable distribution of necessities into your community support plan if your clientele tends to be egalitarian.
Consider the consequences of encouraging excessive spending and how to promote ethical purchasing if you serve people who are self-interested (agentic egoists). Consider establishing continuous community-sharing activities or contribution drives if a significant number of your clients are community-focused (communal egoists).
Retailers can take stock of the difficulties we’ve encountered and make plans for the future that will help their company and the world at large. By developing our capacity for introspection, we may better navigate uncertain situations and choose actions that benefit those around us.
Social Media in Consumer Panic During Crises
The influence of social media on consumer behavior, especially during crises, presents a debatable topic. Social media platforms can act as amplifiers of fear and misinformation, potentially triggering panic buying and hoarding behaviors. The rapid spread of information, accurate or not, can create a sense of urgency and scarcity, prompting consumers to act irrationally. This phenomenon raises questions about the responsibility of social media companies in moderating content during crises and the need for digital literacy among consumers to discern reliable information.
Economic Inequality and Crisis Consumerism
Economic inequality plays a significant role in consumer behavior during emergencies. Those with limited financial resources may face greater challenges in accessing necessities, not due to panic buying but because of economic constraints. This issue opens a debate on how economic status influences consumer decisions during crises and the need for policies that ensure equitable access to essentials for all societal segments, especially the economically disadvantaged.
Psychological Impact of Prolonged Crisis
The prolonged nature of a crisis like a pandemic can lead to long-term changes in consumer habits. This topic explores how extended periods of stress and uncertainty can alter consumer behavior, potentially leading to more cautious spending, increased online shopping, or a shift in priorities towards health and safety products. Understanding these long-term psychological impacts is crucial for businesses to adapt their strategies and for mental health professionals to provide appropriate support.
Corporate Pricing Strategies in Crisis Situations
Corporate pricing strategies during crises, such as price gouging on essentials, spark ethical debates. While businesses need to balance profitability and operational costs, excessively high prices for crucial items during emergencies can be seen as exploitative. This topic examines the ethical responsibilities of businesses in crisis management and the role of government regulations in preventing price gouging and ensuring that consumer needs are met ethically and fairly.
Crisis on Small Businesses and Local Economies
The effect of crisis-driven consumer behavior on small businesses and local economies is an area of concern. While large retailers may cope with the surge in demand, small businesses often struggle with supply chain disruptions and reduced consumer spending. This situation raises questions about the resilience of local economies in crises and the need for targeted support to small businesses, which are essential for community well-being and economic diversity.
