Use Terror Management Theory for Status Items

Researchers at London Business School and Cornell University gave 150 study participants information designed to temporarily threaten the participants’ self-esteem. One consequence was that the amount participants were willing to pay for fancy cars, luxury watches, and other high-status goods climbed. The agreeable amount did not climb for non-status items. By comparison, the amount people were willing to pay for high-status goods did not climb when the participants’ self-esteem was not threatened.
     Terror Management Theory (TMT) says that our realization we will someday die leads us to crave the promise of life in an afterworld and to us building legacies of children, fame, and fortune. Research projects at Stanford University find that a related protection against death anxiety is high self-esteem. The colloquial phrase “I was so embarrassed I could’ve died” reflects a relationship between threats to self-esteem and one’s demise.
     What this means to you as a retailer is that whenever you heighten a shopper’s low self-esteem, you’re appealing to an especially deep and compelling need in that shopper. Since consumers associate self-esteem with items having social status, the effectiveness of self-esteem appeals is greatest with status items.
     TMT says that one consumer motivation for buying luxury products is to build enough self-esteem to protect against death anxiety. To maximize the effectiveness of that motivation, make it a point to remind shoppers to enjoy themselves before it’s too late and then give genuine and generous praise whenever the shopper purchases a luxury item.

• Build self-esteem after the purchase is made. The London/Cornell researchers found that when praise is given before the purchase, the urge to splurge fades.
• Be ethically comfortable with using an underlying fear of death as a sales motivator. In my opinion, it’s fine to deliver value by relieving your customers’ anxiety. The three caveats for me are: Don’t violate the law to make customers feel good. Don’t gouge people by charging excessive prices. And don’t pressure people to buy when they’re seeming to struggle with temptation. But those are my rules. You need to decide for yourself.
• Recognize that TMT motivation is reserved for adults. Reminding children they’ll inevitably die is nothing if not ghoulish. And teenagers—those reckless rascals—behave and misbehave on the assumption they’ll never die.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more:
Sell Self-Esteem After Times of Fear
Offer Aspirational Shoppers Subtle Signals
Give Low-Income Customers Dignity
Build Self-Esteem of Your Teen Customers