By Andy J. Yap and Charlene Y. Chen
SINGAPORE — Waves of panic buying triggered by the rapid global spread of the novel coronavirus are a mass psychological phenomenon worth pondering.
As the outbreak escalates in a particular area, it will result in people raiding the shops, irrespective of cultures and national borders. To be sure, some of the stockpiled items are directly associated with disease prevention, such as face masks and hand sanitiser. But there has also been a mad rush for general household staples, such as rice and eggs, despite there being no indication of impending shortage.
The latest instances of panic-buying played out in Australia earlier this week, after more than 30 cases of COVID were confirmed. People stripped stores of toilet paper and other cleaning supplies, forcing Australia’s largest supermarket to announce it would implement a four-pack limit on loo rolls for customers. In Japan, where good manners and social etiquette are normally sacrosanct, consumer panic has translated to long lines and surging prices for toilet rolls even though the authorities and manufacturers have promised there is enough stock to go around.
While some experts recommend buying moderate quantities of extra supplies in case strict coronavirus quarantines are eventually imposed (as they have been in several Chinese cities), unbridled hoarding by consumers makes society less safe rather than more.
Social scientists have pinned it on a herd instinct that is triggered by fear and spread through social media. However, there is also evidence that this focus on buying practical goods is a behavioural reaction to feelings of stress and uncertainty.
Think of it as a form of retail therapy, only instead of splurging on the latest fashion garment or gadget, consumers purchase utilitarian products associated with problem solving, which may enhance their sense of control.
In recent research we conducted with Leonard Lee, Professor of Marketing at NUS Business School, we looked at the types of products that appealed to consumers when they felt control deprived. We hypothesised, and found, that consumers would compensate for a loss of perceived control by buying useful products designed to fill a basic need or accomplish a task. Closer analysis suggested this preference was due to the products’ association with problem solving or their ability to help manage a problem.
The research includes a series of studies written up in the paper, “Control Deprivation Motivates Acquisition of Utilitarian Products”, published in the Journal of Consumer Research. In it, we found that a group of participants who had been asked to recall a situation where they had felt a low sense of control over their environment bought more practical items such as cooking ingredients and household cleaners),during a supermarket trip, compared to another group who were asked to recall a time when they were well and in control.
Follow-up studies showed that consumers whose sense of control was threatened were far more likely to favour functional sneakers over more fashionable footwear or book a therapeutic massage over a relaxing one.
Loss of control doesn’t mean being out of control or lacking self-discipline. Autonomy-seeking consumers tend to prefer products that bolster their individuality, such as status symbols that communicate uniqueness, or items that can be used or displayed in a variety of ways.
People in countries – and particularly high-density cities – where fears of a pandemic could start, may be stressed by the potential spread of the virus or the panic that is rising around them and seek to restore their sense of equilibrium by buying practical, utilitarian products.
With the coronavirus outbreak spreading to more than 80 countries and regions outside China with over 90,000 confirmed cases, it is unlikely that purchasing handwipes or even face masks will keep people completely safe. However, just purchasing the goods may help to keep them calm and give them a sense that they still have some control over their lives.
The story was updated since it first appeared on Insead Knowledge.
Andy J. Yap, is Assistant Professor of Organisational Behaviour, INSEAD and Academic Director, Centre for Organisational Research; and Charlene Y. Chen, is Assistant Professor of Marketing, Nanyang Business School.