How Fear of Missing out and cognitive biases shape online shopping

Understanding consumer behavior is crucial for businesses in the e-commerce sector. A recent study, published in the International Journal for Multidisciplinary Research (IJFMR), highlights the subtle yet powerful influence of cognitive biases, specifically scarcity messaging and its role in triggering the Fear of Missing Out (FOMO), on consumer decision-making in online shopping. 

This research provides valuable insights for online marketers and consumers, illustrating how these psychological shortcuts can lead to purchases that might otherwise be overlooked.

The psychology behind the purchase

Effective marketing isn't about chance; it's a meticulously designed journey that guides consumers through their decision-making process with clear and purposeful messaging. The goal isn't to manipulate, but to understand human psychology and present a brand in the most effective way possible. This is where cognitive biases come into play, acting as crucial tools for persuading potential customers to become actual buyers.

A cognitive bias, as defined by Chegg Study, is a "mistake in reasoning, evaluating, remembering, or other cognitive process, often occurring as a result of holding onto one's preferences and beliefs regardless of contrary information". These mental shortcuts, although often unconscious, significantly influence how we interact with others, interpret our surroundings, and, most importantly, shape our purchasing decisions. 

The IJFMR study specifically focused on two prominent biases: scarcity messaging and social proof.

Scarcity messaging: The power of Fear of Missing Out

Scarcity bias refers to the human tendency to place a higher value on something that appears to be in limited supply. When something is perceived as scarce or exclusive, it often feels more desirable and valuable. Marketers ingeniously employ scarcity messaging to create a sense of urgency. 

By suggesting that a product or offer is available for a limited time or in limited quantity, businesses tap into consumers' Fear of Missing Out. This encourages them to make quick decisions, sometimes impulsively, to avoid losing out on the opportunity.

Common tactics to leverage Fear of Missing Out include:

• Limited stock: Phrases like "Only 2 items left!" or "Hurry, sale ends in 24 hours!" directly trigger a sense of urgency, encouraging customers to act quickly.
• Limited-time offers: Countdown timers or phrases like "Flash Sale" or "Last Chance" create a sense of urgency to buy before the opportunity expires.
• Exclusive offers: Tactics like "Exclusive to members" or "Limited edition" make customers feel they have access to something rare, increasing its perceived value and intensifying the fear of missing out on something special.
• Out-of-stock alerts: Even showing an item as low on stock or unavailable can prompt customers to make a purchase quickly before it's gone entirely, driven by the desire not to miss out.

Humans are naturally wired to fear loss. The scarcity principle triggers a psychological reaction, where consumers desire what they believe they can't have. This triggers both urgency and desire, pushing people to take action to avoid missing out.

Social proof

While the study also examined social proof, which refers to the tendency for people to look to others when deciding how to act, the primary focus here is on the potent effect of scarcity. Social proof, by showing that others have made a similar choice, helps build trust and reduce uncertainty.

When scarcity messaging is combined with social proof (e.g., "Almost Sold Out" alongside customer ratings and reviews ), it creates a powerful one-two punch that encourages consumer action, driven by social validation and the intense fear of missing out.

Methodology

The study employed a Google Form survey to collect data on online shopping behavior and the impact of social proof and scarcity messages on purchasing decisions. With 108 responses, the research revealed a fascinating paradox: despite being aware of the cognitive biases used by sellers, consumers tend to buy, do not regret their decisions, and even find these tactics somewhat ethical.

Key findings about Fear of Missing Out

Key findings from the survey directly related to Fear of Missing Out and scarcity include:

• Pressure to purchase: A significant portion of respondents (51.8%) sometimes feel pressured by "limited-time offers" or "low stock warnings," with another 45.4% always feeling this pressure. This clearly indicates the strong impact of scarcity messaging in creating urgency.
• Regret factor: Interestingly, a large majority (77.8%) stated they have not regretted a purchase made under the influence of such messaging (e.g., scarcity cues). This suggests that while FOMO tactics create urgency, they don't necessarily lead to buyer's remorse, implying a degree of satisfaction even with impulse purchases.
• Awareness of tactics: A high percentage (80.4%) of respondents were aware that marketers use psychological techniques like scarcity and social proof to influence decisions. This highlights a degree of consumer savviness, even when susceptible to FOMO.
• Perceived ethics: When asked about the ethics of these tactics, 75% considered them "Yes, to some extent," while 23.2% found them "Yes, completely" ethical. This finding challenges the notion that consumers perceive these strategies as manipulative, even when the Fear of Missing Out drives them.
• Impact on trust: For products with both high ratings and low stock messaging, a combined 67.8% of respondents reported that it either significantly (10.7%) or slightly (57.1%) increases their trust in the product's quality. This indicates that the combination of perceived popularity and impending unavailability due to scarcity can enhance perceived quality.
• Transparency and trust: A substantial majority (92.8% combined) indicated that greater transparency (e.g., disclosing how "scarcity" or "popularity" claims are calculated) would either significantly (32.1%) or slightly (60.7%) affect their trust in these tactics. This suggests a potential avenue for businesses to further build consumer confidence, even when leveraging the Fear of Missing Out, by being more transparent about their strategies and approaches.

Conclusion

This study highlights that marketing psychology is fundamentally about understanding how consumers think, feel, and ultimately make purchasing decisions. In the competitive online landscape, scarcity messaging, by effectively triggering the Fear of Missing Out, is a powerful tool that businesses use to guide consumers toward making a purchase. These cognitive biases are so deeply ingrained in human psychology that they often influence purchasing behavior without consumers even being aware of them.

For marketers, the ethical use of these biases is crucial for maintaining credibility and building long-term customer loyalty. For consumers, recognizing and understanding these biases through critical thinking, delaying purchase decisions, and seeking diverse information sources can empower them to make more informed and rational choices.

Ultimately, the insights from this study emphasize the ongoing interplay between human psychology and digital commerce, highlighting the continued relevance of behavioral economics in understanding and shaping online consumer behavior.

You can read and download the full study here.