Retail Therapy Hijacked the Speed Economy

2 forces collided and imploded to become a self-sustaining consumer habit.

⚔️ The speed of everything is increasing, well at least in the consumer cosmos. Every swipe, every order, every social feed refresh, every delivery, every signup (except for account closures, which is a whole other annoyance)
🛡️ A powerful coping mechanism for everyday stress – retail therapy – has been helping us deal with stress and improve our mood instantly.

Speed enables retail therapy. Retail therapy incentivizes speed. Where does this take us? Let’s rewind a bit 🕐.

An intense life leads to higher stress and less time, which makes retail therapy a convenient method for emotional recovery. And because retail therapy exists, we feel good and create the perfect incentive for companies to give us more “speed” in getting that therapy.

The speed economy enables retail therapy, and retail therapy provides relief from the stress of a fast life. Share on X

Retail therapy

Emotional spending, buying happiness – aka dopamine delivery. We’ve all done it. We’ve purchased things to feel good. We’ve impulsively ordered items to lift ourselves up.

This relatively new phenomenon has become a simultaneously beneficial yet harmful aspect of our lives. Researchers have validated^[1] what many of us know through experience – shopping improves mood immediately and also helps with long-term emotional regulation. It is a coping mechanism that helps people repair their mood and deal with stress.

For starters, it’s a mood repair mechanism and not a problem-solver. It will make you feel better but it won’t help you fix the stress you have from bad work-life balance. The instant gratification of retail therapy in the form of quick delivery, buying online, receiving same-day deliveries, etc., is a positive reinforcement – Since it feels good, we do it. And since we usually feel good doing it, we repeat it.

But the bigger problems emerge when you look at retail therapy from an economics and personal finance point of view.

In a lendingtree survey^[2], 69% percent Americans do this “emotional spending,” and over 75% of them have overspent. 4 out of 10 people also feel emotional spending has hurt their financial wellbeing.

There are layers to this. First, overspending can become a problem. And it can escalate into mismanaging the budget because humans tend to overestimate the value of short-term rewards and underestimate long-term consequences.

Psychologists call this “Present bias^[3]“. We value getting something right now more than getting the same thing much later. This tendency has fueled the “convenience culture” of quick-commerce. We’ve begun valuing objects based on how quickly we get them.

15-minute food delivery and same day e-commerce delivery have emerged in the market because of our desire for getting the reward as soon as possible.

Retail therapy has a special case, too. Revenge consumption – shopping and consuming luxury products more because of stress created by a lack of control. It’s when consumers take revenge on their negative uncontrollable circumstances by spending more money to feel better. According to a study^[4] on Korean participants, revenge consumption improved wellbeing and self-esteem after COVID. This behavior emerges from a more general tendency of humans to compensate for uncertain and stressful events by seeking things that improves their mood and regain stability in life. Emotional spending or Retail therapy is one such way to compensate for stress and instability. Other common ways is seeking spirituality or exerting control in other domains of life. For example, losing autonomy at work might make a person want to over-control their relationship.

This tendency dubbed the “compensatory control theory^[5]” guides shopping habits and is a common motivation to seek retail therapy. The theory predicts that people will be motivated to buy things that improve their social, personal, and professional status if stress increases and control over circumstances reduces. Essentially, negative circumstances motivate the need to seek retail therapy.

You may have wondered why stress causes people to suddenly become believers of a higher power or indulge in astrology. It adds “structure” to a chaotic world, something that is highly appealing when a person feels lost. Like retail therapy, it becomes a coping mechanism to deal with the uncertainty.

The speed economy

What changed in our economy since the bronze age was the speed at which things change – the rate of change – the speed of social media, the speed of getting medicines, the speed of getting deliveries, the speed of conversations, the speed of television media. All these increases in speed made us expect and want speed. So the technology that was developed alongside also supported speed through faster data, faster downloads, faster processing, shorter videos, dedicating just a few seconds to acquire information, etc. It became a positive feedback loop where everything gets faster and we expect it to keep getting faster, so someone builds technology that makes things even faster. Everything from content to home-delivery focused on speed. Everyone fed the consumers’ expectation of speed. Naturally, the consumer habits settled down on expecting and getting comfortable with speed.

I call this the speed economy. Value is proportional to speed.

This speed economy as I define it has 3 components.

• We are habituated to get things faster and we expect things to be fast. Be it cooking, home delivery, downloads, dating, reaching travel destinations, etc.
• We are ok to pay more for speed.
• We think getting a reward faster makes the reward bigger.

The Indian market is a case-study for this. Quick commerce (q-commerce) has grown at an unbelievable rate. From a Gross Merchandize Volume (GMV – total value of good sold via q-commerce services) increased from $100 Million in 2020 to $3.3 Billion in 2024.^[6]That’s a 33x growth!

Consumer buying trends also show that “faster is better“. In another report^[7], 48% consumers preferred faster deliveries and 44% preferred cheaper deliveries. Value is being assigned to speed because of this mix of speed being synonymous with faster rewards and seed being a solution to a busy life with high stress.

Amazon disrupted the world in 2005 when it launched its 2-day delivery. That may have triggered a primal greed (or goal) to break the speed barrier every year. That 2-day expectation has evolved into companies successfully managing 10-minute deliveries for the same products. Whether or not this is feasible is from a long-term economics point of view is a different story. But this evolution in quick-commerce fueled technologies that enable speed and now speed is a habit of our society.

This barrage of speed created a problem – what happens when you are used to speed and you have to get comfortable with something slow? People get uncomfortable with the lack of speed. The lack of speed triggers an avoidance system in us through which we reject, ignore, or avoid things that feel slow. We begin devaluing things that are slow because now we have a very high standard of convenience.

Look at a casual example – the movie is boring, nothings happening in it, what do you do? Begin looking at your phone for a faster delivery of emotions via reels (that’s what I do).

Where does this outcome of capitalism take us?

It makes retail therapy viable, and possibly costly and financially unwise. And it does that with the added problem of taking our focus away from problems. It redirects our focus to our emotions. Because…. why fix something if buying online makes us feel better anyway? Emotions are easy to fix, retail therapy proves it.

Humans have a tendency to prefer easy over difficult. That’s why we use decision-making shortcuts (heuristics) like asking someone else to recommend a laptop instead of finding one yourself, or asking ChatGPT to write even the most basic LinkedIn comment replies.

Speed has won. We wanted speed, and we made it happen. But ironically speed gave us time and convenience – yet it managed to steal our ability to slow down and solve problems.

At some point we have to think – do I buy myself better emotions or do I ignore those emotions in a package and fix my problems?

Retail therapy redirects our focus to our emotions because the speed economy makes it very easy. Our feelings get fixed, but problems don't. Share on X

P.s. If you think about this more, you’ll see this similar to how a lot of us have planned and prepared to study for hours without actually studying and felt we’ve accomplished a lot. It’s a hidden procrastination.

P.P.S. This article is purely informational and in no way a commentary on my personal love for shopping and obsession with speed. If you know me personally, you know what I mean! 🙂

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