Spring 2011

Can credit cards make you fat?

Research says we buy more junk food when paying with plastic

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Marci Roth

In the past two decades, the number of U.S. adults who are obese has jumped from 23 percent to 34 percent. During the same time, the number of credit cards carried by Americans has more than doubled, from 82 million to 177 million.

Researchers have long known that consumers paying with credit cards tend to buy more than they intend. But does paying with plastic increase the amount of unhealthy food we purchase, resulting in more consumption of such food and, in turn, leading to obesity?

The link between credit card usage and junk food had never been addressed until Kalpesh K. Desai, an associate professor of marketing at Binghamton, proposed a joint research project with a colleague at Cornell University in 2008 to study the relationship.

After analyzing the shopping habits of 1,000 randomly selected single-family households in the Buffalo area during a six-month period, the researchers concluded that consumers who used credit bought 40 percent more unhealthy food than those who paid with cash. This conclusion was then confirmed with three online shopping surveys conducted with Binghamton and Cornell students and consumers selected by a market research firm.

“When we started running experiments, the finding was just robust,” says Desai, a behavioral psychologist who teaches in the School of Management. “It took us by surprise. We didn’t expect the finding to be that strong and that consistent.”

Desai and his collaborators — Manoj Thomas, an assistant professor of marketing at Cornell, and Satheeshkumar Seenivasan, a doctoral student in marketing at the State University of New York at Buffalo — came to the connection between credit cards and unhealthy food with a hunch that paying with plastic might make consumers more likely to buy what are considered “vice” products: cookies, candy and cake. Once their theory had been confirmed, they turned to the issue of what motivated credit card holders to buy more junk food.

Their explanation focused on a principle known as the “pain of payment” — a phenomenon that helps consumers curb impulsive spending. “Cash is a more vivid form of payment,” Desai says. “When I’m paying in cash, there is a pain involved; I’m giving up something which I feel is valuable. When I’m paying with credit or debit cards, those two forms of payment are more emotionally inert compared to cash. Thus, when I pay with them, there is less pain involved.”

Faced with aisles stocked with potato chips and soda, consumers will think twice before placing such products in their carts when they are paying with cash, Desai says. When using plastic, however, their choices are motivated more by impulse than deliberation.
As credit and debit cards have replaced cash as the preferred method of payment, Desai’s research has broad implications in the debate about curbing obesity rates. Only 14 percent of consumers use cash on their shopping trips, and Americans on average carry 4.4 credit cards in their wallets, according to the study.

“People just do not discipline themselves in the form of spending or what they’re eating,” says Gary Truce, a professor of health and wellness studies at Binghamton. “You can talk all you want about ways to stop obesity in America, and it’s not going to happen because it all comes down to a person’s self-discipline.”

While using cash in a grocery store would impose more control over spending, Truce and others question how consumers can be convinced to eschew their credit cards. “It may be smarter to pay with cash for things, but because we become ingrained into our habits and everything is freedom of expression in our society, we’re not going to be told to make that change if we don’t want to,” Truce says.

Unlike food stamps, which the government finances and therefore can control, the choice of paying with credit versus cash cannot be influenced by public policy, adds Kristina Lambright, an assistant professor of public administration at Binghamton. “I think this is an important issue for public policy, but I’m not sure what public policy makers can do with this information.”

Desai admits that it would be a monumental challenge to motivate consumers to buy their groceries with cash. As one indication of how difficult it would be, Desai notes that the original draft of the study, published in the Journal of Consumer Research, included a recommendation that health food stores accept only cash payments, since such stores are increasingly selling foods such as pizza and potato chips, which may tempt customers using credit cards. The reviewers of the study, however, proposed that they delete that suggestion because they felt it was not practical.

As the results of the study become more widely known, however, Desai hopes that consumers will consider the consequences of buying groceries on credit. Since it was published online in October, the study has attracted media attention from more than 50 newspapers, magazines and television stations around the world.

“It will be very difficult in our society where credit rules,” Desai says, “but hopefully after seeing the findings people will say, ‘This is a tradeoff I need to make. If I value my health, then I probably need to carry cash or there’s this risk that I will buy unhealthy food.’”

Besides the method of payment, Desai’s research has uncovered another factor that influences the purchase of junk food: the timing of shopping. The study found that people who shopped on the weekends are less likely to be impulsive because that is when consumers tend to use shopping lists, which suggest planned purchases.

In a new study he has launched, Desai is testing an initial finding that people who shop before 11 a.m. and after 5 p.m. tend to buy more unhealthy food because he believes their energy levels are lower at that time.

For his part, Desai admits that he does not carry cash but relies on credit cards instead. “I need to self-regulate it, although that takes years to develop,” he says. “But if I take my health seriously, I will probably have to relent.”