What Makes the WORLD Buy?

ShannonCherry over at Startup Spark noted that scientists have found a connection between novelty packaging/snappy logos and the area of the brain responsible for the “buy” impulse. That type of research is covering the biological/neurological aspects of spending money.

But are there cultural differences as to what and why people want to buy? Daniel Altman recently addressed this question and looked at buying behaviours in Seoul, Mumbai, Moscow and London. Not only the state of the local economy but also a diverse range of cultural influences affect how people save and spend money.

Korean nationalism plays a large role in Seoul, where citizens don’t want to keep up with the Joneses but rather with the Japanese.  In India, further education is a large priority. Over the last few years, Moscow has gained a reputation for ostentatious consumption; imported products are often preferred just because the import duties make them more expensive. While in the UK, inflation and a bursting housing bubble are slowing consumption down, as people worry about a downturn in the economy.

Economists like Marcel Fafchamps at Oxford University, however, dismiss the role that cultural differences play on fundamental economic models. “The core belief of economics is that all people make rational decisions in the interests of themselves and their loved ones.”

It makes sense to me that economic models need to be universal in order to be useful in the long-term. But in terms of short- or mid-term business strategies, I would focus on the cultural aspects of local markets and throw in a bit of biological background for effective marketing and packaging.

Which factors do you think are more important as to what and why people buy: biological/neurological, economic or cultural?

Reference: Daniel Altman at the IHT. 

Image from nlm.nih.gov