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Low-desire consumption is on the rise, and young Americans on TikTok are no longer keen on "buying, buying, buying"

2024-08-17

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U.S. retail sales unexpectedly rose sharply in July, and young people on TikTok are resisting excessive consumption.

Half-used cosmetics, old plastic bags, cracked mirrors, a new type of video emphasizing rational consumption and making full use of what you already have is becoming popular among TikTok users.

The trend is called "underconsumption core," which refers to a low-desire consumption trend where TikTok creators share how they avoid overconsumption by spending less, buying less, and using less. In pop culture, especially on TikTok, "core" means "aesthetic" or "style," and is often used at the end of a trend name, such as "normcore," which began to rise about 20 years ago.

Content creators and personal finance experts say it’s a direct response to the flood of videos on TikTok that promote products, show off new purchases or feature influencers’ lavish lifestyles.

"Finally some normal people on TikTok," one user commented on a video of a creator showing off his second-hand furniture and bringing his lunch to work in a plastic shopping bag.

"Underconsumption core is my favorite TikTok trend," another user commented on a video showing the creator's old curling irons and an unnamed makeup line. "It feels real and human," the user said.

The trend isn’t just about relatability, experts say the core message of these videos is good for your wallet, too — especially at a time when many young people feel their finances are precarious.

“I know this trend has been called underconsumption, but to me, that’s healthy consumption, and people see these videos and feel like, I’m not weird, I’m not the only one living this way,” said Paige Pritchard, a TikTok content creator and founder of Overcoming Overspending, a personal finance company.

What is an "underconsumption core"?

Pritchard said she first saw the trend about a month ago and was surprised by the number of likes and comments on her videos, which showed that people were careful about spending on items such as makeup, clothes and tableware.

“People are showing real aspects of their lives in these videos: ‘I don’t have 50 coffee mugs, I only have two,’ and that obviously resonates,” Pritchard said.

There are currently more than 10,000 videos on TikTok with the hashtag #underconsumption.

“Underconsumption is a little bit like minimalism,” said Michela Allocca, another TikTok creator and CEO of the personal finance company Break Your Budget. But she noted that it’s not all about buying less stuff, but rather a reminder that having the right amount of stuff — and the shopping habits to match — is completely normal.

“I think young people are really focusing on how to make the most of what they already have and only buy what they need,” Aloka said.

Kimberly Palmer, a personal finance expert at NerdWallet, also noted that people want to see an alternative to endless spending, even competitive spending.

"I think it's a reaction to what we see so often on social media, things that encourage us to spend more money and buy luxury goods, people are tired of seeing that," Palmer said.

This isn’t the first TikTok trend to be seen as a pushback against conspicuous consumption. Earlier this year, “loud budgeting” went viral on TikTok after Lukas Battle, a celebrity who coined the term, said in a video that 2024 should be the year to proudly proclaim your limited financial means. Battle’s original video has received more than 1.5 million views.

Then there’s “de-influencing,” videos showing products that you shouldn’t spend money on.

The antidote to overconsumption

Many social media platforms have the phenomenon of creating competitive consumption and anxiety about over-consumption, but Pritchard pointed out that this phenomenon is more prominent on TikTok.

“I have a feeling a popular underlying theme that’s been brewing on TikTok is overconsumption, and I’m glad to see new trends offering an antidote,” Pritchard said.

NerdWallet's Palmer noted that social media use can lead to overspending, especially because people often use it when they're tired, bored or prone to impulse buying. A 2023 NerdWallet survey found that about 65% of Americans believe social media contributes to overspending, and nearly one in five have made a purchase influenced by social media and later regretted it.

Aloka of Break Your Budget believes that the features of the app itself can also increase the pressure to continue spending. Last year, TikTok launched the "in-app shopping feature" TikTok Shop, which allows users to open stores on TikTok and purchase products through links in videos.

“How to control impulse spending and what to do if you feel the urge to keep up with others is one of the questions I get asked a lot, and I think it stems from the social media environment,” Aloka said.

The content users see on TikTok is determined by the content they have previously engaged with, so if users like, comment or favorite a certain type of video - such as a product review or shopping share, they are more likely to see this type of content again.

A TikTok spokesperson said ads make up a small portion of what users see on the For You recommended page, and if users don't want to see something, they can mark the video as "not interested" or filter out keywords or tags.

Young people face huge financial pressure

The "underconsumption" trend also comes at a time when many young people are feeling the pinch.

A new report from the Federal Reserve Bank of New York shows that borrowers aged 18 to 29 are more than 90 days behind on credit card bills and auto loans, with a higher delinquency rate than borrowers of other age groups. The slowing job market also means that many young people are finding it harder to find a job. If the unemployment rate continues to rise, young job seekers may be one of the first groups to be severely affected.

Although the U.S. economy is slowing, many Americans are still spending. Data released recently by the U.S. Department of Commerce showed that U.S. retail sales increased in July, driven by increased car purchases. The data showed that sales at large electronics retailers, grocery stores, home centers and drug stores all increased.

But Aloka believes that broader financial pressures are making TikTok users increasingly skeptical of super support.

"A lot of people are struggling to make ends meet and can't afford to buy as much, and I think the 'underconsumption' trend is a direct response to that," she said.

By Hannah Irene Long
Editor | Guo Liqun
Copyright Notice:
This article is originally published by Barron's China and may not be reproduced without permission. For the English version, see the report on August 16, 2024, "Consumers are still spending. But on TikTok 'underconsumption' is trending."
(The content of this article is for reference only and does not constitute any form of investment and financial advice; the market is risky and investment should be cautious.)