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The effects of Scarcity and Stress on Consumption

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i The effects of Scarcity and Stress on Consumption

Master thesis - MscBA, specialization Marketing Management University of Groningen, Faculty of Economics and Business

Words: 7139 July 1st, 2017

Author

Thomas K. Neeleman

S2188473

tkneeleman@gmail.com

University of Groningen

Faculty of Economics and Business

MSc Marketing Management

Supervisors

University of Groningen

Prof. dr. Bob M. Fennis

Dr. Jan Willem Bolderdijk

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ii

Abstract

Scarcity and stress are two factors that everyone is confronted with during everyday life.

This phenomenon is interesting for marketers as they are the ones trying to deliver the right

products to the right persons with help from several external factors. This research covers the

effect of scarcity and the effect of stress aroused by limitation of time on consumption levels.

More specifically, participants were asked to solve 15 mathematical equations under time

pressure, and were offered to consume limited edition M&M’s. The results pointed, in line

with predictions subtracted from literature, towards a significant positive effect between

scarcity and consumption. Additionally, the results showed a significant positive effect

between stress and consumption. There was no significant moderation effect measured on

the effect of stress on the relationship between scarcity and consumption.

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1 Introduction

It is widely known that when there is little availability of an item, service, or anything in between people want to possess it desperately since the beginning of time. This has been proven by shoppers who try to purchase a relatively cheap high-end designer piece of clothing at H&M, the huge rare diamond ring a man tries to give to a woman when marrying, Frodo travelling the world for the one ring, and Napoleon

conquering a one of a kind nation; the Netherlands. Many books, among which the famous ‘The Psychology of Persuasion’ by Cialdini (2006), have been written regarding this phenomenon, and countless marketing strategies have been applied to make use of scarcity. Herpen et al. (2005) indicate the dual form of scarcity, being excess of demand or shortage of supply. Because shortage of supply is most convenient in

manipulation, this form is most interesting for marketers. Therefore, this form of scarcity will be applied in this research.

Another factor that influences consumer behavior in everyday life is stress. People who are stressed out about something have the tendency to resolve this factor by purchasing or complying to an offering that would reduce this feeling of stress (Durante & Laran, 2016). One often used method in reducing stress is complying to an offering of food, or consuming food in order to release feelings of stress (Alm & Olsen 2017). Especially the type of food high in fat and sugar is consumed as a result of time stress (Torres & Nowson, 2007).

Moschis (2007) indicates that stress resulting from an event such as studying for an exam that is nearly due, or writing articles right before the deadline is acute stress. However, in modern society most people suffer from chronic stress as well. Chronic stress is defined as continuous and persistent conditions in the social environment resulting in a problematic level of demand on the individual’s capacity to perform adequately in social roles. Marketers use the phenomenon of stress already in the form of relationship marketing (Berry, 1995). In this form of communication to the customer, focus is placed on the trustworthiness of a company, partly to reduce stress among customers. Hence, the phenomenon of stress could be used as a factor in marketing or as a marketing tool. In this research acute stress will be focused on as this form of stress is most interesting to induce among participants and measure the effects.

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2 stressed feeling. Moreover, Starcke & Brand (2016) outline that acute stress increases the reliance on

immediate and potentially high rewards. Scarcity leads to the urgency to directly comply to an offering because this offering might be gone in a later moment due to the scarce nature of the offering. This leads to a strengthening effect of stress on the relationship between scarcity and consumption due to the fact that increased stress leads to the desire of immediate high rewards. Additionally, when a product is scarce it could be expected that stressed out people want to possess or consume the product even more because they quickly want to reduce their feelings of stress.

1.1 Research Objectives

Until now research has mainly focused on the psychological rationale behind the effect of scarce offerings on compliance to this offering and the consumption thereof (Jang et al., 2015). This resulted in extensive marketing theories and strategies. The effect of stress on consumption has received significantly less attention, and is especially studied in the field of psychology. The effect of stress on the relationship between scarcity and consumption of products could be used in the field of marketing as well, even though there has been little attention regarding this topic. Therefore, the main research question for this study is:

What is the effect of Scarcity on Consumption, what is the effect of Time Stress on Consumption , and to what extent does Time Stress play a moderating role on the relationship between Scarcity and

Consumption?

When investigating this question the focus will be on the most heterogeneous sample because of the

assumption that resistance to stress is not the same in any group of people (Kudielka, Hellhammer & Wust, 2009). This research question is highly interesting and relevant due to a lack of attention in literature and on applicability in the field of marketing.

I will investigate the following sub-questions in order to be able to answer my main research question: - Does increased Scarcity lead to increased Consumption?

- Do higher levels of Stress lead to increased Consumption?

- Do higher levels of Stress strengthen the relationship between Scarcity and Consumption?

1.2 Outline

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2 Theoretical Framework

This chapter will provide an overview of available literature on the research topic. It starts with a literature review on the effect of scarcity on consumption. Thereafter, I will investigate the effect of stress on

consumption. Also, I will review previous research of the interaction effect of stress on the relation between scarcity and consumption. Lastly, I will provide a conceptual model of my research.

2.1 Scarcity

Mukherjee & Lee (2016) provide a very basic overview of the meaning of scarcity. They state in their research that scarcity appeals indicate a restriction on the quantity available of a product. The reason for having restricted quantities available is researched by van Herpen et al. (2005). These authors state that two forms of scarcity exist. The first form is scarcity due to excess demand, where consumers see excessive purchase behavior of others which may lead them to follow this behavior because they believe they need the offering as well. The second option is insufficient supply where the lack of availability of the offering leads consumers to believe this offering is of high value. Excess demand can only be induced by shoppers,

whereas insufficient supply could be used by marketers to induce scarcity appeal. The arousal of insufficient supply is therefore relevant for the present research because insufficient supply of an offering would be the only factor that is easy to manipulate by the researcher to simulate scarcity appeal. This would be the only pragmatic way of creating the feeling of scarcity in the present research, and therefore the distinction between scarcity induced by excess of demand or scarcity induced by insufficient supply is highly relevant. Now that the nature of scarcity is defined, the question how higher scarcity appeal leads to higher levels of consumption arises.

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4 The positive effect of scarcity on consumption of an offering is explained in another way by Brock &

Brannon (1992) through commodity theory. This theory states that scarcity enhances the value (or

desirability) of anything that can be possessed, is useful to its possessor, and is transferable from one person to another through the tendency to form more extreme attitudes about scarce products. Value in the

commodity theory refers to an offering’s potency for affecting attitudes and behavior (Brock, 1968). Because commodities have a positive utility, all increases of a commodity’s potency or value will increase its perceived utility. This will make the commodity more desirable and sought after through extremer inferences about the product. Hence, value can be seen as the same thing as utility or desirability.

This is highly relevant to marketers because they want to make their product more desirable, resulting in increased consumption of offerings. Commodity theory proves that arousing scarcity is a highly effective way of doing this. Hence, these theories prove that increased scarcity leads to higher levels of consumption. This is relevant for the present research as it provides proof for the statement made earlier that increased scarcity of an offering would lead to higher levels of consumption.

Another study performed by Brock (1968) states that people will desire scarce commodities over regular commodities because scarce items convey feelings of personal distinctiveness or uniqueness. According to the need-for-uniqueness theory (Snyder & Fromkin, 1980) people have the urge to feel distinctively

different than others. Therefore, complying to scarce offers increases their feeling of uniqueness as there is only limited availability which shows uniqueness of personality in the possession of scarce items. Thus, when an offering is scarce consumers will be more likely to have a preference for this offering. This would lead to increased consumption of that offering. Also, this theory shows that consumers would consume more of a scarce product due to the same line of reasoning. A very well-known example of this would be the consumption of caviar and champagne on high-end exclusive parties. Hence, increased scarcity leads to increased compliance, leading to increased consumption.

In the paper by Burger & Caldwell (2010) the effect of heuristics was added to why increased scarcity leads to higher compliance levels. Heuristic processing is something all human organisms do in order to not overthink all actions in life (Cialdini & Goldstein, 2004). Even though this is a useful tool, it has the downside that salesmen take advantage of by triggering these heuristics. Because people perceive a unique opportunity in such a way that they feel the urge to take advantage of it, the study by Burger & Caldwell (2010) proves that higher scarcity leads to higher consumption. Based on the previous literature it can be assumed that increased scarcity leads to higher levels of consumption. To investigate if this holds true in the present research, I state the following hypothesis:

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5 2.2 Stress

The concept of stress is broadly defined as a stimulus, a response, or a combination of the former (Moschis, 2007). The stimulus part focuses on external conditions such as life situations or events that are inducing stress. A response definition refers to the state of stress where a person is stressed and therefore reacts stressful which results in a vicious stress cycle. Another distinction is made by Moschis (2007) between acute stress, which refers to stress from observable events, and chronic stress, which refers to continuous conditions in society resulting in a problematic level of demand on the individual’s capacity to perform adequately in social roles (Wheaton, 1990). The present research will focus on acute stress from stimuli, for dual reasons. First, marketers in the field could easiest take advantage of inducing this type of stress in customers. Also, they could respond to stressful situations resulting from acute stress, for example by offering discounted temporary living space to people who just get out of a divorce. Second, as stated earlier, resistance to stress is different for each individual based on the combination of nature and nurture factors. This implies that many variables in different social layers of society create resistance to stress, and no

generalization can be done on which people resist stress better than others. Therefore, acute stress is the only type of stress that would be relevant to measure in the present research. More specifically, acute stress as a result of lack of time will be focused on in this article. In the following text it is assumed that stress refers to stress resulting from observable events (Moschis, 2007).

Surprisingly little research has been executed on the effect of stress on allocating resources, even though this would be highly interesting with regard to consumer consumption of an offering. The marketing field could hugely benefit from knowing whether stress induces consumer spending or consumer saving, or increased consumption of an offering.

Durante & Laran (2016) state that stress can either result in avoidance or action in order to prevent further harm caused or even eliminate the stress completely. Avoidance of the stress situation has the consequence of not feeling the stress in the short term by focusing on other activities, for example food consumption (Stone & Brownell, 1994). The other option is that people try to solve the source of stress by taking action and solving the source of stress. Previous research endorses the statement that both human and nonhuman organisms can withdraw and become passive in response to stress (De Boer et al. 1990). Some research suggests that this inaction even may result in action in areas unrelated to the source of stress, such as higher consumption of food in order to forget about the factors inducing stress (Stone & Brownell, 1994; Torres & Nowson, 2007). This proves as an indication of stress leading to increased consumption levels of an offering if the offering leads to the possibility of escaping the stressed feeling, for example by increased food

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6 Other research suggests that stress may lead to action in order to tackle the source of stress (Duhachek, 2005). The implication that Durante & Laran (2016) make is that divergent findings lead to different views on the consequences of stress on consumption. Even though this seems conflicting, there seems to be a reason for this behavior which shows in lack of control over environment (Botti & McGill, 2011).

Therefore, Durante & Laran (2016) propose that consumers strategically allocate their resources in order to regain belief that they have control over their environment, thus either by saving money, spending money on items that recover control, or spending money on items, such as increased food consumption, that make the target forget about their lack of control. This finding supports this research because it proves that marketers could induce stress and let customers believe they can regain control either by solving the source of stress or escaping the source of stress by giving in to the offer made by marketers. This would prove that increased stress could lead to increased consumption of an offering when consumers believe complying to necessities leads to restoring control over their lives (Durante & Laran, 2016). Also, marketers could provide ‘escaping’ possibilities in places where levels of stress are high.

The present research will focus on a type of stress that is increasingly relevant in everyday life, namely stress induced by shortage of time. This type of acute stress reduces the cognitive ability of consumers (Dhar & Nowlis, 1999) leading to a preference for the most stress relieving options. Moreover, Starcke & Brand (2016) indicate that stress increases the reliance on immediate and potentially high rewards. Especially the focus on immediate rewards is significant in this present study as consumers get the opportunity to directly relieve the levels of stress by consumption (Stone & Brownell, 1994; Torres & Nowson, 2007).

Based on the previous, the following hypothesis is stated:

H2: Higher levels of time related Stress lead to increased levels of Consumption of an offering.

2.3 The Moderating Role Of Stress

Kudielka, Hellhammer & Wust (2009) indicate that stress elicits different psychological, physiological, and behavioral reactions that differ in strength across persons. Starcke & Brand (2009) indicate that a general tendency can be found in situations resulting from acute stress.

People have the tendency to search for immediate and potentially high rewards in situations resulting from acute stress. This is due to the fact that stress leads to an increase in the stress hormone cortisol (Ungless et al., 2010) resulting in dopaminergic activities. The dopamine rate is crucially important in reward prediction and feedback learning. More specifically, high dopamine levels let individuals respond stronger to stimuli that predict immediate potentially large rewards. At the same time, the willingness to avoid potential losses is diminished by the increased dopamine release. Thus, heightened reward and lowered punishment

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7 An example of the previous could be found in increased impulse buying in stressful situations. Customers are looking for direct rewards in terms of purchasing a product, and the costs of purchasing this product are not taken into account as much. This is proven by the fact that in another situation with less stress a

consumer would not purchase the item as he has more cognitive ability to make a more favorable decision. Janis & Mann (1977) also indicate that stress leads to hurried and unsystematic decision making without considering all the options, and the ability to pick the most beneficial option. This is also due to the lack of cognitive ability because of the excessive release of dopamine.

Cialdini (2006) indicated that opportunities seem more valuable when they appear to be more limited, and that this hampers the cue to evaluate the best option. Here, it can already be assumed that there is a

strengthening effect of excessive dopamine release because of acute stress situations on the possession of scarce items due to the fact that these items appear to be more limited. The acute stress diminishes the cognitive ability, as does the induced value of a limited available item.

Moreover, commodity theory (Brock & Brannon, 1992) states that scarcity increases the value and

desirability of anything that can be possessed, is useful to its possessor, and is transferable from one person to another. When increased dopamine release from acute stress situations occur, people tend to look for immediate rewards (Starcke & Brand, 2016). Therefore, it can be assumed that there will be a stronger preference for scarce commodities when persons experience increased dopamine release due to stressful situations.

Another example of direct reward seeking can be found in the research by Wiedmann, Hennigs & Siebels (2009). They state that conspicuous consumption of scarce items has proven to be associated with a feeling of having higher social status, wealth, and power. These aforementioned feelings are all feelings that make an individual feel better about themselves. This indicates that it gives a rewarding feeling to consume these scarce items when others see the consumption of these items.

The paper by Starcke & Brand (2016) indicates the increased reward seeking due to stressful situations among people. Thus, a strengthening effect of stress on the willingness to consume scarce products can be expected because people tend to want a stress relieving offer directly. When this offer is limited, people are increasingly triggered to purchase this offering.

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8 Based on the previous, theory shows that there is a strengthening effect of acute stress on the relationship between scarcity and consumption levels. Based on these theories, hypothesis 3 can be stated as following:

H3: Higher levels of Stress increase the positive relationship between Scarcity and levels of Consumption of the offering.

2.4 Conceptual Model

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3 Methodology

In this part of the research there will be focus on the composition of participant sample and the way that the participants were approached and questioned. Moreover, it will be explained how the raw data was prepared to draw valid conclusions. Next to the independent variables the control variables will be elaborated on.

3.1 Participants & Design

For this study 101 Dutch speaking participants (49 female, 52 male; Mage = 27,18 years, SD = 8,13) were approached to voluntarily participate in an experimental field study. Participants were approached in public places such as the city center of Groningen and the Zernike complex in Groningen (Appendix 1: description of specific places), and were selected based on 1) the minimum estimated age of 18 years (in line with the ethical principles of doing research), 2) fluent in the Dutch language, 3) showed behavior that indicated they had time to participate in the experiment.

This experimental field study used a 2 (high scarcity vs. low scarcity) x 2 (high stress vs. low stress) between-subjects factorial design, as visualized in Figure 2.

Neutral stress condition

(no stress) Stress condition No-scarcity appeal (neutral) Condition 1 (no-scarcity/no-stress) Condition 2 (no-scarcity/stress)

Scarcity appeal Condition 3 (scarcity/no-stress)

Condition 3 (scarcity/stress) Figure 2 – Condition Overview

Participants did not have any prior knowledge regarding the research. They only knew that they were

participating in a study for the MSc. Marketing Management of the University of Groningen with the goal to measure personality traits and to evaluate how they would cope with processing information.

3.2 Procedure

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10 The researcher simply approached people and explained that he was graduating for the master marketing at the University of Groningen. Thereafter, he asked whether possible participants could spare approximately 10 minutes of their time in order to help him. Most often the possible participants were interested, and started asking some questions regarding the exact nature of the researcher. As a response, the researcher indicated that he could give no further information than what was written on the front of the questionnaire. Then participants started reading and filling out the questionnaire.

Participants were told that the study was part of a scientific experiment for a marketing study, and that they first had to engage in some assignments, fill in a questionnaire and then could earn a small reward for participating in the study. The actual reward for participating in this study was any amount between 0 and 100 grams of limited edition M&M’s as visualized in Appendix 3. The limited edition of these M&M’s was due to the limited supply of this particular taste. The participants did not know that the reward would be M&M’s. Furthermore, the same type of limited edition M&M’s were used during every condition.

Kicking off the study, participants would be introduced to the study with a written introduction stating that the research was for the University of Groningen and that no wrong answers were possible. For a complete overview, see Appendix 7.2. Additionally, the participants were also told that the study would consist of a series of unrelated parts, and that the main focus would be on how people process information and how this influences performance (Durante & Laran, 2016). Participants were randomly allocated to one of the four conditions with the stress prime (solving 15 math equations in 10 seconds vs. solving math equations without time constraint) and the scarcity prime (information given regarding limited edition M&M’s vs. no information given regarding limited edition M&M’s). The random allocation was done by giving a random questionnaire to each participant and by taking turns in inducing the scarcity condition.

The first part of the research would administer the stress task, based on the research by Koolhaas et a. (2011) and Dickerson & Kemeny (2004). These researchers state that acute stress could be assumed when an

observable event lets demand exceed the regulatory capacity of an organism. This part of the research would be to either induce higher levels of stress, or not induce feelings of stress by solving 15 mathematical

equations, either with time pressure (stress) or without time pressure (neutral condition). In the time pressure condition, the researcher indicated that each participant had 10 seconds to solve 15 mathematical equations. All outcomes of these equations were somewhere in between 0 and 9. Furthermore, the researcher kept track of time with a stopwatch and instructed the participant when the 10 seconds were due, and when the

participant had to start working on the subsequent equation. During this part of the questionnaire most participants became a little insecure regarding their math solving skills, purely by looking at the

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11 general better in solving the questions than participants who did not do this. Some examples of the equations are ‘12*12/8-9’ or ‘8*6/3-11’. For the full set of mathematical equations see Appendix 2.

Following the stress condition, the scarcity task was administered. This manipulation was based on commodity theory by Brock (1968), which states that scarce products enhance value (or desirability) of anything that can be possessed, is useful to its possessor, and is transferable from one person to another through the tendency to form more extreme attitudes about scarce products. Here, participants was told they would receive a bowl with (limited edition) M&M’s as a gesture of kindness after filling in the mathematical equations. Only the researcher knew that exactly 100 grams of M&M’s were in the bowl. This information regarding the weight was unknown to participants. In the no-scarcity conditions the participants were told they could simply grab the chocolates whereas in the scarcity condition the participants were told and shown that these chocolates were a limited edition. The package that participants saw in presented in Appendix 3. The M&M’s were chosen because it is a good that is relatively unhealthy, and it is still considered to be comfort food. This is essential in reducing feelings of stress as mentioned earlier. Thereafter, the dependent variable in the form of consumption of participants was measured in the amount of grams of M&M’s they consumed. The researcher knew that 100 grams were in the bowl in the beginning. Thereafter, the researcher weighted the bowl after consumption of participants. The difference in weight would be the amount of grams of consumed M&M’s.

During the measurement of consumption by the researcher the participants were asked to fill in the rest of the questionnaire (Appendix 7.2) that measured the stress manipulation check, Mini-K, Dispositional Attitudes, SES-scale, Gender, Age. Consequently, the participants did not see the researcher measuring the amount of consumed M&M’s.

Lastly, participants were warmly thanked for engaging in the research. They read the closing text of the questionnaire (Appendix 2) where it was indicated that the research was now over and that they could fill in their email addresses if they wanted to know more about the outcomes of the research.

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12 3.3 Stress Manipulation Checks

The stress manipulation check as proposed by Dedovic et al (2005) was used to measure the exact effect of the acute time related stress arousal. This factor was included as a check to measure the actual effect of stress resulting from solving the mathematical equations either with limited time, or with an abundance of time. Some sample statements posed in the stress manipulation check were ‘I found the task difficult’ or ‘I found the task demanding’. The outcome of the manipulation check showed that the induced feeling of stress was significantly higher among participants in the stress condition than for participants in the no-stress condition. The results of the stress manipulation check are to be found in figure 3.

Mean Standard Deviation Number of participants in condition

No stress 3.720 1.193 50

Stress 4.846 1.065 51

Total 4.289 1.260 101

Figure 3 – Stress Manipulation Outcomes

Figure 3 shows that the experienced average stress for participants where stress was induced was 4,846. Additionally, the experienced average stress for participants where stress was not induced was 3,720. An independent samples t-test to compare the average means between two groups showed that the stress effect was significant among participants. More specifically, the outcome of the stress manipulation check showed that t(97.294)=-5,001, p<0,001. Thus, the stress manipulation in this research was strong enough to measure effects in subsequent analyses.

3.4 Control variables

Life History Strategies

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13 earlier sexual maturation and producing children at an earlier age. The behavioral tendencies associated with each strategy are especially likely to emerge in stressful contexts (Griskevicius, Delton, et al., 2011). Some examples of questions posed in the LHS questionnaire were ‘I avoid taking risks’, ‘I often have social contact with my friends’, and ‘I do not give up until I solved my problems’. For the full set of questions see Appendix 2. This research thus controls for the reactions based on personal histories via the Mini-K.

Socioeconomic status

An indicator for exposure to harness and unpredictability in an early life stage is childhood socioeconomic status (SES; Chen & Miller, 2012). Whereas high-SES childhood environments tend to be less hard and more predictable, low-SES environments tend to be more harsh and unpredictable. This research thus also controls for the reactions based on personal histories via the SES scale. Some examples of questions posed in the SES-questionnaire were ‘I was raised in a relatively wealth neighborhood’ and ‘I have enough money to buy what I want’. For the full overview of questions see Appendix 2.

Dispositional attitude

The current state of being of a participant was measured using the dispositional attitude measure (Hepler & Albarracin, 2013). In this part of the questionnaire participants’ attitude towards some random items, such as architecture, playing chess, and politics, was measured. It was assumed that participants who were in a certain state of being before entering the research would be better or worse resistant to the aroused stress. Therefore, this emotional state of being was controlled for with this scale by measuring the preferences for 16 random items.

Gender, education, age

Kudielka, Hellhammer & Wust (2009) show that gender, education and age might have an influence on the way people react to stressful situations. Therefore, they are included in the present research as control variables. Gender was measured by asking the participant to tick the box correlating to their gender. Age was measured by asking participants to fill in their age. Education was measured by asking participants to circle the highest type of education they currently were in. See Appendix 2 for the complete overview.

3.5 Recoding into different variables

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14 3.6 Reliability analysis

Because all the dimensions (Stress manipulation check, Mini-K, Dispositional attitude, SES-scale) were from theory it was decided not to conduct a factor analysis before measuring reliability.

When conducting a reliability analysis on the six items that checked for stress manipulation it was found that all items together had an α=0,833. This is higher than the threshold of 0,600 (Leliveld & Wiebenga, 2014). Therefore, a new averaged variable was made with all the items included in the factor with α=0,833, N=6. In the Mini-K, reliability analysis on the 20 items showed that, when deleting item6 (I avoid taking risks) and item20 (I am closely connected to and involved in my religion), the items had an α=0,612. Thus, a new averaged variable was created based on the remainder items with α=0,612, N=18.

In the Dispositional attitude measurement all items together had an α=0,703, and therefore all items were used in computing a new average variable. Therefore, α=0,703, N=16. Lastly, in the SES-scale all items together had an α=0,812. Therefore, all items were used in computing a new average variable with α=0,812,

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4 Results

In this section of the report the outcomes of the scarcity and stress manipulation on consumption levels will be reported. Moreover, the interaction effect of stress on the relation between scarcity and consumption will be presented. Additionally the effect of the control variables mentioned before will be discussed.

4.1 Main effect

In order to analyze the influence of stress and scarcity on consumption, a 2 (scarcity vs. no-scarcity) x 2 (stress vs. no stress) between subjects ANOVA on consumption was performed. Both main effects proved to be significant, in line with predictions. The interaction effect appeared not to be significant in contrast with predictions. Participants consumed more when they were under the impression that their specific flavor of M&M’s were scarce (M=20,967 grams, SD=1,290 grams) than when they were under the impression that their flavor were regular M&M’s (M=16,320 grams, SD=1,302 grams), F(1,97)=6,426, p=,013.

Also, a stress manipulation leads to more consumption (M=22,487 grams, SD=1,290 grams) than with no stress manipulation (M=14,800 grams, SD=1,302 grams), F(1,97)=17,584, p<0,001. However, the

interaction effect appeared not to be significant F(1,97) = 0,847, p=,360. Thus, consumption does not seem to increase more when scarcity is aroused together with stress.

When looking at the means (MnostressXnoscarcity=13,320 grams, SD=8,250 grams), (MnostressXscarcity=16,280 grams, SD=9,140 grams), (MstressXnoscarcity=19,320 grams, SD=7,936 grams), (MstressXscarcity=25,654 grams,

SD=11,096 grams) there appears to be some sort of effect in consumption which is also visualized in figure

4. The mean for the effect of both scarcity and stress is higher than the means for solely a scarcity effect or solely a stress effect. However, this difference is not significantly large to assume an interaction effect of stress on the relation between stress and consumption levels.

The most important conclusion is that H1: Increased Scarcity of an offering leads to higher levels of

Consumption of that offering is found to be true. Moreover, H2: Higher levels of time related Stress lead to increased levels of Consumption of an offering is also found to be true.

Contrasting, H3: Higher levels of Stress increase the positive relationship between Scarcity and levels of Consumption of the offering, was unfortunately not proven true by this research. The results are visualized in Figure 4. In this figure it can be seen that the levels of consumption in the no-stress condition are

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16 and scarcity exists due to the fact that the amount of grams consumed increases even more when both stress and scarcity are induced. However, the results indicate that this interaction effect is not significant.

Figure 4– Results No Stress / Stress Consumption Levels

4.2 Main effect with control variables

In order to check for other factors that could possibly influence the main effects the two-way ANOVA between subjects design was run again with covariates LifeHistoyTheory, DispositionalAttitude

SocialEconomicScale, Gender, Age, and Education. In order to analyze the influence of stress and scarcity on consumption with these covariates, a new 2(scarcity vs. no-scarcity) x 2 (stress vs. no-stress) between subjects ANOVA on consumption levels was performed.

Both main effects still prove to be significant whereas the interaction effect still is not significant. A scarcity manipulation still leads to more consumption (M=21,095 grams, SD=1,294 grams) than with no scarcity manipulation (M=16,177 grams, SD=1,307 grams), F(1,90)=7,039, p=0,009. Also, a stress manipulation still leads to more consumption (M=23,125 grams, SD=1,380 grams) than with no stress manipulation

(M=14,146 grams, SD=1,396 grams), F(91,97)=18,410, p<0,001. The results indicate that there still appears to be no interaction effect of stress on the main effect between scarcity and consumption, due to the fact that

p=,850.

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17 (p<0,001) remain significant. That is, even when controlled for the following factors possibly influencing stress: life history of participants, current state of mind, socio-economic status of participants, gender, age, and education.

5 Discussion

This research was conducted in order to investigate the direct impact of Stress and Scarcity on Consumption levels, considering the Stress Manipulation Check (Dedovic et al, 2005), Life History Theory (Kaplan & Gangestad, 2005; Stearns, 1992), Dispositional Attitude (Hepler & Albarracin, 2013), and Socio-Economic Scale (Chen & Miller, 2012), with an additional moderating effect of Stress.

The distinctive element of the present research is that actual behavior of participants in a field-experiment was measured. This reflects the subconscious behavior that the hypotheses in this article are based on, resulting in highly credible results.

Firstly, the direct effect of Scarcity on Consumption levels was tested, as mentioned in Hypothesis 1:

Increased Scarcity of an offering leads to higher levels of Consumption of that offering.

A significant effect was found which proves the hypothesized relationship to be true.

Secondly, the direct effect of Stress on Consumption was tested, and was also found to be significant. This indicates that Hypothesis 2: Higher levels of time related Stress lead to increased levels of Consumption of

an offering was also found to be true.

The moderating effect of Stress on the relationship between Scarcity and Consumption as postulated in Hypothesis 3: Higher levels of Stress increase the positive relationship between Scarcity and levels of

Consumption of the offering was found not to be true in this specific study. Figure 5 below provides an

overview of the hypotheses that were tested in this study. Thereafter, the theoretical implications will be discussed, followed by the managerial implications.

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18 5.1 Theoretical implications

As Cialdini (2006) indicated, not reacting to a scarce offering might result in a potential loss of gain. A significant portion of the participants showcased this behavior explained by Cialdini. The result of the Scarcity arousal condition on Consumption in this present research underlined this. Moreover, Cialdini (2006) states that an opportunity seems more valuable when it appears to be more limited, and that this cue hampers the opportunity to evaluate the best option (Cialdini, 1993). Also this statement is confirmed by the present research, even though no other options were available. Additionally, the highly influential

commodity theory (Brock & Brannon, 1992) is proven right by this current study. A setback in this research might be that the usefulness of possessing M&M’s is questionable. This is one of the three requirements for a product to be scarce according to Brock & Brannon (1992).

Moschis (2007) indicated that stress is broadly defined as a stimulus, a response, or a combination of these factors. The stimulus of stress was used in this research by offering limited time (10 seconds) to solve 15 mathematical equations, and the results are in line with the predictions made by Moschis (2007). The distinction between acute stress, which results from observable events, and chronic stress, which is always present, was measured after solving the mathematical equations by the Stress Manipulation Check (Dedovic et al, 2005). According to this study there indeed appears to be a significant positive effect of acute stress on levels of consumption.

5.2 Managerial implications

The positive effect of both scarcity and stress on consumption could be used by managers in several ways. The most ethical way to use this present study is to arouse scarcity based on limited supply among products offered. Even though more research on this specific type of scarcity would be needed, the contribution of this study shows that this would likely increase demand to the product. For now, we assume that increased demand for a product also increases sales, but this would need further specific research.

Additionally, managers could see how their product relieves levels of stress and apply marketing tactics on this to increase awareness. Stone & Brownell (1994) and Torres & Nowson (2007) indicate that

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19

6 Limitations and future research

Limitations

During this research some limitations were found. One of the major limitations in this research was found in the lack of a scarcity manipulation check. Even though the limited edition taste of the M&M’s actually was scarce, there is no data to confirm this. Therefore, the analyses are done based on the assumption that participants believed in the actual scarcity of the product. However, no proof for this can be given through hard numbers.

Moreover, the situation in which participants take part in the research differed. For example, some participants were students sitting at the Zernike complex, waiting for the next class to start whereas other participants were employees at the Admissions Office of the University of Groningen. The second group would be more stressed due to professional pressure before starting the questionnaire than the first group.

Future research

Even though this research was properly conducted, some results would even be more valuable in the future when more resources would be available and some minor changes to the research setup would be applied. First, the experiment could be conducted in a lab setting in order to have neutral stress among each participants. In a field experiment it cannot be assumed that all participants have equal ‘starting’ levels of stress.

Second, the commodity theory as explained by Brock & Brannon (1992) states that scarcity enhances the value of anything that can be possessed, is useful to its possessor, and is transferable from one person to another. The usefulness of possessing M&M’s is rather questionable. Therefore, a future research idea might be to repeat this measure with a scarce product that would actually be more useful to possess.

Third, in this research the focus was on time related stress. It would be interesting to research other stress factors such as social stress or financial stress to compare the effects, both as a moderator on the effect between scarcity and consumption, and as an independent effect on consumption.

Fourth, some other form of consumption levels could be measured to see if the significant results from the present study hold for other situations.

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20 Sixth, the present study aroused scarcity by indicating that limited supply was available. Theory indicates that another form of scarcity is due to excess demand. Another research might try to arouse scarcity by excess demand and compare the effects with this present study.

Seventh, the present study used a free sample of M&M’s and measured the amount of grams taken.

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21

7 Appendices

7.1 Experiment details

1. Approaching:

- Who?

Participants for this research were approached based on three criteria: 1. A minimum estimated age of 18 years

2. Fluent in the Dutch language

3. They had to show behavior that indicated to the researcher they had time to participate in the experiment

- Where?

At public places such as Zernike campus, the city center of Groningen, and the central train station of Groningen.

- When?

During weekdays, from 10am – 4pm in order to assume similar levels of stress.

2. Cover story

- Participants was told that they would be part of a research for the University of Groningen. They were instructed that a series of unrelated questions or assignments would be posed to them and that the overall aim of the research was to examine how people process information and how this influences performance.

3. IV Stress level manipulation

Participants were randomly allocated to one of the 4 conditions by receiving a printed version that corresponds with a condition.

- Stress manipulation condition:

Participants were asked to solve 16 mathematical equations, for which they have 10 seconds per question. The researcher indicated when the 10 seconds were over, and when the participant had to move to the next question. When solving the mathematical equations they often experienced a shortage of time which lead to time induced stress.

- Neutral condition:

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22

4. IV Scarcity manipulation

Participants were randomly allocated to one of the 4 conditions by receiving a printed version that corresponds with a condition.

- Scarcity manipulation condition:

After solving the mathematical equations the participants received a bowl with exactly 100 grams (pre-weighted by the researcher) of limited edition M&M’s. The package of the M&M’s was shown to the participants as a proof of the limited edition. Subsequently, the participants could grab as many M&M’s as they wanted to consume while answering the stress manipulation check questions.

- No-Scarcity condition:

Participants would receive exactly 100 grams of M&M’s with no additional information about the limited edition of these M&M’s. They could simply grab as many M&M’s as they wanted to consume during the rest of the research.

5. DV Consumption measurement

The participants would, after solving the mathematical equations, receive the option to take some M&M’s out of a bowl and consume those while filling out the Stress Manipulation Check. The amount of grams consumed was weighted by the researcher. This would be the outcome value for consumption levels.

6. Additional measures to control for

Stress Manipulation Check (Dedovic et al., 2005)

Life History Strategies: Mini-K Short Form (Kaplan & Gangestad, 2005; Stearns, 1992)

Socioeconomic Status: childhood and current SES scale (Chen & Miller, 2012)

Dispositional negativity: Dispositional Attitude Measure (DAM; Hepler & Albarracin, 2013)

7. Demographics

• Age • Gender • Education

8. Debriefing

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23 7.2 Questionnaire no-stress / stress condition

Beste deelnemer,

Hartelijk dank voor je deelname aan dit onderzoek. Ik wil je vragen een aantal

vragen in te vullen en wat korte testjes te doen om inzicht te krijgen in

persoonlijkheidskenmerken en bepaalde vaardigheden. Dit onderzoek zal niet

meer dan 10 minuten duren.

Deze enquête bestaat uit verschillende ongerelateerde deelstudies. De focus zal

vooral liggen op hoe jij informatie verwerkt, en hoe dit jouw resultaten

beïnvloedt.

De resultaten zullen worden verwerkt in verschillende onderzoeken binnen de

Rijksuniversiteit Groningen, Faculteit Economie en Bedrijfskunde.

Er worden geen persoonlijke gegevens gebruikt in ons onderzoek, en jouw

antwoorden zullen dan ook anoniem behandeld worden.

Houd er rekening mee dat er geen juiste of onjuiste antwoorden zijn in dit

onderzoek!

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26 Ik vond de taak …

Helemaal mee oneens

Mee oneens

Gedeeltel ijk mee oneens

Niet oneens, noch eens

Gedeeltel ijk mee eens

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31

Beste deelnemer,

Je bent nu klaar met je deelname aan dit onderzoek.

Bedankt hiervoor! Nogmaals, je antwoorden zullen

anoniem worden verwerkt. Mocht je geïnteresseerd

zijn in de uitkomsten van dit onderzoek, vul dan

hieronder je mail adres in zodat ik de resultaten van

het onderzoek naar je op kan sturen. Ook je mail

adres zal voor geen ander doeleinden worden

gebruikt.

Mailadres:

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32 7.3 Limited edition M&M’s used

For this study the type of limited edition M&M’s as shown in figure 6 were used.

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33

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