Doom Spending, Is Hardolin Included in This Category?
Tauhid Nur Azhar
The rapid access to information that characterizes our daily lives has made our brains dizzy in managing the information that comes in, including the increasing number of acronyms and unique terms that are becoming more and more complex.
This morning, I heard the term “doom spending” for the first time. What is this? After FOMO, OVT, OCD, LDR, CMIIW, and many other terms that have been circulating on social media and in digital conversations, there is now another new term that sounds quite fantastic?
Because I started to feel FOMO, I began to search for the meaning of doom spending. What does it really mean?
According to an article on Detik.com, the phenomenon of doom spending is when someone shops without thinking, to calm themselves down because they feel pessimistic about the economy and their future.
Still quoting from the same article, it is said that doom spending occurs when someone feels stressed by situations such as political chaos in the United States, climate chaos everywhere, and other things. As a result, people buy more goods to overcome that stress.
Wow, this definition is interesting? Blonjo enthek-enthekan nganti rungkad, maybe this term is suitable if we use a slightly deviant terminology.
There is data and facts that show that excessive consumer behavior as a response to stress or anxiety about the future is increasingly found in millennials. This phenomenon becomes more relevant with economic uncertainty, social change, and feelings of powerlessness caused by various global crises, such as pandemics, inflation, and climate crises.
Then, does something similar happen in our country? Or maybe even around us? It’s possible. Why? Because Indonesia is a country whose economy is also supported by consumption. When consumption tends to decrease, aggregate income will decrease.
Based on data from the Central Bureau of Statistics (BPS) regarding inflation profiles, the Consumer Price Index (CPI) in June 2024 tends to experience deflation, which is 0.08% (mtm) or can be said to decrease to 2.51% (yoy) compared to May, which was 2.84% (yoy). It is noted that BPS data states that CPI inflation in May 2024 decreased by 0.03% (mtm), where the previous month was 3.00% (yoy).
Fundamentally, CPI is a proxy that captures changes in purchasing costs at the consumer level. This condition is likely caused by multifactorial factors that are quite complex. CPI can change along with changes in community income, changes in community consumption patterns, the abundance of certain commodities, the availability of substitute goods and services in each sub-sector, and so on.
The existence of objective data regarding the decline in purchasing power, marked by deflation and a decrease in CPI, indicates a contraction at the consumer level. Moreover, if we integrate it with data on unemployment and layoffs. According to BPS data, the number of unemployed people is still recorded at 7.2 million people. Meanwhile, the number of layoffs according to the Ministry of Manpower data also increased in the period from January to June 2024, reaching 32,064 people. This number increased by 21.4% from the same period last year.
Allow me to use a little bit of gothak-gathuk logic to analyze the surface data (disclaimer). Information about CPI, purchasing power, and unemployment rates may represent economic pressure that can affect the psychosocial profile of the community.
This initial data can be used as a starting point to analyze the phenomenon of doom spending.
Why is that? Because there is unique data that shows that in the same period and location, there is a significant increase in the leisure sector, which I obtained from data on the most happening transportation mode in Java, namely the train.
From January 1 to August 31, 2024, KAI Group has served 299,752,109 passengers, consisting of 29,922,766 long-distance train passengers, 4,648,369 local train passengers (managed by KAI), 244,454,242 KRL and local train passengers managed by KAI Commuter, 3,693,345 KAI Airport passengers, 12,700,737 LRT Jabodebek passengers, 95,355 KAI Wisata passengers, and 4,237,295 Whoosh passengers.
The formal data above, if elaborated in a casual style, can be said to be a “significant increase” from time to time in the number of train passengers. More and more people are using trains. Whether it’s because plane tickets are expensive, or driving is tiring, but there is an increase in enthusiasm for traveling by train.
Isn’t this phenomenon a bit strange? How can it happen in a sluggish economic condition, but the number of people traveling or at least taking the train is increasing? Not only that, using the same gothak-gathuk logic, I also want to show data on hotel occupancy in Yogyakarta, one of Indonesia’s main tourist destinations, which is also located on the main train route.
Is There a Possibility that Economic Pressure is Causing Doom Spending?
The data on hotel occupancy in Yogyakarta in 2024 shows that:
- In June 2024, the occupancy rate of starred hotels in Yogyakarta reached 60.57%, while non-starred hotels reached 26.46%.
- In May 2024, the occupancy rate of starred hotels in Yogyakarta reached 61.89%, while non-starred hotels reached 27%.
- During the long holiday from May 23–26, 2024, the occupancy rate of hotels in Yogyakarta reached 90%.
- In July 2024, Hotel Harper Malioboro recorded an occupancy rate of 98%.
- During the Idul Fitri/Lebaran holiday in 2024, the occupancy rate of hotels in Yogyakarta reached 90%.
Is it possible that economic pressure, which brings uncertainty and dim prospects for future well-being, has driven people to engage in doom spending by traveling or going on vacation? Maybe, but this is just a hypothesis that needs to be proven through a series of research processes that can be academically and scientifically accountable.
Theoretical Basis of Doom Spending
There are several theories that can explain the phenomenon of doom spending, including:
- Terror Management Theory, which states that individuals who are faced with thoughts of death or uncertainty tend to adopt behaviors that affirm their identity and sense of security. Excessive consumption can be a way to affirm one’s existence through the possession of material goods that are perceived to increase social status.
- Coping and Stress Theory, which explains that individuals will seek coping strategies to deal with stress. Doom spending can be seen as a maladaptive coping mechanism, where individuals try to reduce their emotional tension by engaging in excessive consumption, even though it does not solve the underlying problem.
- Behavioral Economics, Present Bias, which states that humans tend to value immediate gratification over long-term benefits. Individuals who experience greater uncertainty tend to choose immediate consumption to achieve instant happiness rather than saving or investing for the future.
- Self-Determination Theory, which states that individuals have basic psychological needs: autonomy, competence, and relatedness. When these needs are not met, individuals will seek substitutes through other means, including excessive consumption. Doom spending can be seen as an attempt to fulfill unmet emotional needs, such as a sense of control and autonomy that is lost in times of crisis.
Impulsive Buying Disorder
Impulsive buying disorder is characterized by excessive and repetitive buying, which can lead to financial, social, occupational, legal, and mental problems. The four phases of compulsive buying are:
- Anticipation: A preoccupation with shopping or a specific item
- Preparation: Planning the shopping trip
- Shopping: The actual shopping event
- Spending: The feelings of excitement that come with spending money on desired items
Conclusion
The high occupancy rate of hotel rooms and train seats in Yogyakarta may not be an indicator of the country’s economic quality. Instead, it could be a “yellow light” from a psycho-economic and psycho-social perspective, warning us to be more cautious in interpreting it, as it may be a form of catharsis for feelings of frustration that enter the domain of doom spending. Excessive consumption, which is no longer supported by economic rationality and financial resources, can lead to stress, guilt, and a sense of aversion, as well as the widespread use of loan and credit facilities.
