The Hindu Business Line : Economic appetisers

This incident happened quite sometime back. I share this experience now because I have some explanation to give based on my reading a similar article in a science magazine recently. Here is the experience: I visited a small bookstore in downtown Toronto last year. The owner-managed bookstore seemed busier than larger book chains just round the corner.

Scented candles throw light

After some talk with the store owner and finding out that both of us shared interest in yogic meditation, I asked him as to how he was able to compete with larger book chains. His answer was astounding. He said that he was meditating one day when suddenly lot of scented candles danced in front of him. It was as if they were asking him to place them in his bookstore. He did just that. He claims that his revenue has since increased! You might find it very difficult to believe. After all, what has scented candles got to do with people buying books?

A recent article in Science throws some light on this subject. The magazine reported a study conducted by researchers that a picture or smell of some of appetitive stimulus can induce people to make impulsive purchases in unrelated areas.

Unplanned purchase

An experiment conducted in a room with hidden cookie-scented candles showed that persons were more likely to make unplanned purchase of a sweater, even though they were on a tight budget. This was, perhaps, the stimulus that made the book shop in downtown Toronto sell more books. Why?

The researchers found that the scent of the appetitive stimulus led to reduced happiness about future gains. That meant that the consumers were more inclined to think about the present and satisfy their current desires. And that led to impulsive consumer behaviour.

Another experiment found that people exposed to pictures of food were more likely to choose options that delivered smaller, sooner utility in unrelated areas.

Would scented candles or photos of mouth-watering desserts in your stock broker office prompt you to do more day-trading, sooner with smaller payoffs?

(The author is a Chennai-based investment strategist.)

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