Bought but never used: How and when unused utility reduces subsequent spending

Abstract

AbstractConsumers often buy products that they later do not use. How does failing to use purchased products affect subsequent spending? Six experiments demonstrate that when consumers do not use their purchased products, it decreases their subsequent discretionary spending across product categories due to an aversion to wasted money. We find that this effect is driven primarily by perceived money waste and not product waste. Consequently, the effect persists even when consumers avoid product waste, such as by donating their unused products, but is mitigated when they avoid money waste, such as when their unused products are freely acquired. We also find that failing to use products decreases discretionary spending only when consumers perceive the failure as a temporary setback on their goal to avoid waste but not as an unredeemable goal failure. Moreover, the effect is unique to perceived waste and does not generalize to other forms of financial mismanagement, such as excess spending beyond one's budget. Overall, our research builds a psychological understanding of how consumers think about unused utility and when and why it leads to a future reduction in consumption and spending.