1ST NOV 2017
by James Swift
I’m a millennial and I find some of the preferences ascribed to my generation suspect and baffling. The obsession with true crime podcasts, for instance, or the rejection of cereal as ‘inconvenient’.
But the trope that millennials prefer experiences to stuff, I accept has legs.
It bears out in polls (e.g. 72% of millennials prefer spending money on experiences) and in spending patterns.
Barclaycard’s transactions data for April shows restaurant spending was up 16% on the previous month, as theatres and cinemas enjoyed a 13% boost.
Meanwhile, people spent 2.5% less on household appliances and 11% less on vehicles. According to the Guardian, Barclaycard says this trend has been visible for about a year.
What’s more, the preference for experiences over stuff is endorsed by behavioural economics.
Dan Ariely, a professor of psychology and behavioural economics at Duke University, in his book The Upside of Irrationality, talks about hedonic adaptation: people’s tendency to return to a baseline level of happiness even after positive or negative events.
To prove his point, Ariely cites the work of marketing professors Leif Nelson and Tom Meyvis, who tested hedonic adaptation with an experiment. They put one group of participants in a massage chair for three minutes, and another group in the chair for two 80-second bursts of bliss, interrupted by a 20-second pause. Not only did the latter group report greater levels of enjoyment, they said they’d pay more than the first group to do it again.
The explanation is that the latter group enjoyed their experience more because they had less time to adapt to the massage and take it for granted.
Commenting on the phenomenon, Ariely says: ‘We can harness adaptation to maximise our overall satisfaction in life by shifting our investments away from products and services that give us a constant stream of experiences and toward ones that are more temporary and fleeting.’
A bigger TV might seem like a good investment for future happiness, but your appreciation of it is likely to wear thin sooner than you think. On the other hand, a short break to a festival or country cottage offers no time for adaptation, and the memories of that experience are likely to provide longer-term enjoyment.
Whether millennials intuited the positive effects of choosing experiences over products, or stumbled upon them after being priced out of the market for significant physical purchases (like houses), they’ve struck on a recipe for greater happiness.
That doesn’t mean they know the first thing about cereal, though.