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Can money buy happiness?

Written by Emily Johnson, Psychologist, MAPS on Nov 25, 2015 3:02:43 PM 2 Comment

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Can money buy happiness? This is an age old question and one that has generated a lot of research in field of psychology. For example, Danny Kahneman, from Princeton University has been researching the relationship between money and happiness. What he found is that people’s happiness increases as their income increases…however only to a certain point. When a person’s income exceeds $75K (US Dollars), the happiness line actually plateaus and happiness doesn’t continue to increase. Therefore, constantly seeking more income, doesn’t necessarily equate to more happiness. So what does?

What does create happiness?

“New research into positive psychology is showing us that social connections, kindness and pro-social behaviour are the keys to the pursuit of happiness,” says Emiliana Simon-Thomas, Science Director from the Greater Good Science Center.

Social connections first and foremost are achieved through rapport building. For business people, this includes getting people to firstly like you and trust you, which is then enhanced by finding areas of commonality. On a longer term basis, focusing on building relationships with your customers will enhance social connections.

Social connections not only apply to businesses that interact face to face with customers, but also to businesses that interact online in the form or live chats, forums or webinars. Roger Courville from www.virtualpresenter.com supports this by suggesting that webinars “are live, in real time, in a manner that allows people a different level of connection that is like an in-person event”.

Tom Gilovich, a professor at Cornell Psychology in Ithaca, America has and continues to conduct research into the subsequent levels of personal happiness that are generated from purchasing material possessions verses positive experiences.

To enable him to do this he measures customer happiness at the time of purchase, then six months later he measures whether the possession or the experience provided greater happiness and satisfaction for these same customers.

His results concluded that after six months happiness and satisfaction levels actually went down when rating the purchase of material possessions whereas they went up when rating experiences (Carter & Cilovich, 2010).

So, how do you facilitate a joyful buying experience for your customers?

One way in which to increase the feeling of social connection is to increase/enhance shared experiences between you and your customers. These experiences provide opportunities for you and your customers to demonstrate mutual support, trust and empathy.

According to the Temkin Group insight report, the actual customer experience isn’t necessarily the most important factor; rather it’s the memories of these experiences, which supports Gilovich’s findings. Through their research and development of the ‘people centric experience design’ they advocate that “people make decisions based on how they remember experiences, not on how they actually experience them”.

That is to say, the anticipation and the recall of events, known as the ‘cherished-memories effect’ are the things that encourage customer delight. So, take some time to consider your customer interactions. Look at them from your customer’s point of view. What part of the interaction will they remember and why?

What is hedonic adaptation?

Another consideration when creating a happy buying experience is our ingrained ability to adapt to either positive or negative events. Research tells us that we have an incredible ability to quickly return to a base line of happiness following a positive change in circumstance or even a misfortune.

This occurs for significant life events also for example, when we get married or if we win lotto or even the death of a loved one. Eventually, our happiness level returns to previously set levels of happiness. This process is known as hedonic adaptation or riding the ‘hedonic treadmill’. There are two suggested positive psychology practices to alleviate this process, which include:

1. Being grateful
2. Savouring the good things in life

Gratitude assists you to appreciate the good that has already occurred whilst savouring can be reminiscing about the past, projecting about the future, or more of a mindfulness technique that guides you to focus your attention on the actual experience and the feeling it brings you. In other words, practicing ‘stopping and smelling the roses’. Ask your customer how they feel about their recent purchase/buying experience.

How this applies to Bartercard members

Whenever trading through the Bartercard system, I encourage you to realise the great benefits this form of commerce offers your business. Personally, I have found that purchasing on Bartercard is an incredibly satisfying experience as it not only enables me to form new relationships with business owners but also allows me to facilitate happy events such as holidays and weekends away whilst at the same time saving cash!

For further ideas on how to instil happiness in your day http://time.com/4042834/neuroscience-happy-rituals/

Author: Emily Johnson, Psychologist |mobile: 0413 737 191 |email: emily.johnson1@uqconnect.edu.au |www.linkedin.com/in/emilyracheljohnson

Emily Johnson is a registered psychologist and member of the Australian psychological society. She consults in the areas of organisational development and change, leadership, training and development (including elearning), and executive coaching. Emily is available to develop and facilitate professional development workshops and speak at conferences.

Source: Lebon, T. (2014). Achieve your potential with positive psychology. The McGraw-Hill Companies: London. 

 

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Topics: Bartercard, Google adwords, customer delight, happiness, happy rituals, positive psychology

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