Social media creates a whirlwind of ever-changing trends, encouraging consumers to constantly redefine their identities. From the current “it shoe” to the hottest home decor to the most popular water bottle, people are constantly buying more and more. This social media-dominated world has created instant pressure on people to conform to the latest fashions, with young people being particularly vulnerable. We are all affected by this new wave of extreme impulse buying, so much so that many of us don’t even realize the role we play in this never-ending cycle.

Although social media has provided convenience and disruptive innovation, digital impulse purchases have created new, irresponsible spending habits across all age groups and consumer segments. Credit unions are in a unique position to step in, take action and help consumers regain control of their finances.

Scrape off the fluff

It is estimated that consumers will spend around $11 trillion on online goods/services in 2024.¹ This concept of digital impulse buying is especially prevalent on everyone’s new favorite replacement for Vine, TikTok. A study by Earnest Analytics shows that adults between the ages of 18 and 24 are 3.2 times more likely to buy something from the TikTok Shop in 2023 than the average consumer.²

Back in 2020, the #TikTokMadeMeBuyIt trend started, encouraging viewers to buy and try trendy products. While some products may seem cheaper or more worthwhile, many of them are more of a waste of money. Ultimately, the trend is about impulsive and irresponsible spending. With the launch of TikTok Shop in 2022, the urge to mindlessly shop has only increased.

Is there a way to strategically incorporate marketing into the stimulant itself? Cut the rug out from under social media. Find a way to show consumers the impact social media has on their purchasing decisions.
before they click “buy.” Credit unions have the tools to support these responses and make saving as exciting as spending.

Let’s get to the point

So what is really going on in people’s heads that triggers this behavior? The key to effective marketing is to truly understand human behavior; not just the what, but the why behind the what.

Psychological analysis can provide deeper insights into human behavior. Perhaps the most compelling reason for impulsive spending is that it provides immediate need satisfaction. On the other hand, as a marketer, you can point out that this immediate need satisfaction is likely to lead to later resentment, and financial responsibility is sure to lead to greater fulfillment later instead.

FOMO is another factor that contributes to such poor financial decisions.³ Buying the new “it product” makes people feel like they belong. However, trends are constantly changing, trapping consumers in a never-ending buying chain. Use this to your advantage and expose the unrealistic conditions of these ever-changing trends.

Particularly important to understanding younger generations about impulse buying is the control that impulse buying offers. When our emotions are out of whack or we experience uncontrollable changes in our lives, impulsive decisions provide an immediate sense of regaining control that can easily be abused in the clutter of excess goods.³ By redirecting this immediate desire for power, marketers can show consumers that patience and planning can give them a greater sense of control in the long run.

While good marketing requires an understanding of human behavior, good marketing shares that knowledge with consumers and educates them rather than leaving them in the dark. Is there a way to raise awareness and teach consumers to reduce the triggers of impulsive buying habits? As cheesy as it may sound, knowledge is power. The most effective thing you can do as a marketer is to empower consumers to come to a decision for themselves.

Remember: When in doubt, turn things on their head. When you’re stuck, challenge yourself to look at your marketing campaign in a whole new light. What crazy connections can you make that might lead to new insights?

Opening Pandora’s box

The world of social media and the digital world have changed shopping forever. Instead of providing added value for entertainment and flexible access, bad shopping habits and impulsive behavior are now a common occurrence. People are often unaware that their online spending can affect more than just their own bank accounts.

Digital impulse purchases also harm the environment, increase overconsumption and support fast fashion. Considering that Generation Z strives to shop at brands that align with their values, are you bringing these insights to light in your advertising strategies?

In the flood of irresponsible purchases, credit unions can be a bright spot. Marketing should reflect the various tools credit unions can offer to establish better spending habits. This can include:
Encourage consumers to regularly check their statements, create budgets, compare rates, and limit extra spending. What other specific resources does your credit union offer? Maybe an app tracker? Use the leverage, use the leverage.

By giving their customers the power to make their own decisions, credit unions can act as a checks and balances, helping to free consumers from the negative influence of social media and give them back control of their own finances.

The key is brand recall. Try to dominate this top-of-mind space so that as soon as consumers discover the unmet need, the answer is already in front of their eyes. If you stop the search before it begins, you monopolize the solution to that particular problem.

¹https://www.forbes.com/sites/michelleevans1/2024/01/25/top-e-commerce-trends-changing-how-we-shop-in-2024/
²https://www.forbes.com/sites/jennmcmillen/2024/06/17/tiktok-shop-is-attracting-millions-of-consumers-7-facts-about-who-they-are/
³https://www.forbes.com/sites/traversmark/2023/12/11/a-psychologist-offers-3-tips-to-tame-your-impulse-buying-habit/