Clientbook Blog
March 21, 2024

The four types of consumer spending habits

The four types of consumer spending habits

Whether we're picking up groceries, paying bills, signing up for a new subscription, paying for parking, or filling up the car with gas, money is constantly leaving our bank accounts. 

But spending money is more than just a transaction—it's an action that brings up feelings each time, whether bad, neutral, or good. These transactions, whether necessary ones or guilty pleasures, can bring up different reactions and emotions each time we hand over the credit card.

Our emotions play a significant role in shaping our spending habits and financial goals. Rather than a simple means of exchange, money carries a deep emotional significance that often goes beyond its practical use. These emotional ties can have a profound impact on how we manage our finances and our common spending habits. 

So, it's time to start paying attention to how you feel when you spend money and as a retailer, to think about the experiences your customers might be having when they spend money in your stores.

This brings us to the four types of consumer spending habits:

  1. Abundant spending
  2. Neutral spending
  3. Scarcity spending
  4. Avoidance spending.

This article will help you understand your customers' money habits and spending behaviors as we cover the four types of spending, why retailers should care about these four types, and tools for tracking your clients' spending.

Want to understand what motivates Gen Z to buy? Find out in our guide

Four types of spending

While there are many types of financial habits and ways people choose to spend their money, there are four primary types of common spending patterns that result in different experiences for the spender.

Let's dive into the details of each type and see which of these paints an accurate picture surrounding your spending patterns and financial habits.

1. Abundant spending

Woman trying on rings at a jewelry store

Embracing an abundance mindset when it comes to spending money is a powerful financial philosophy. Instead of approaching expenditures with fear or scarcity, an abundant spending style encourages you to view money as a tool for enriching your life.

When engaging in abundant spending, you feel good about the price you're paying for an item, your emotions are positive, and you're happy with your purchase in the end. As a luxury retailer, these types of spenders are your dream customers, because they’re looking for reasons to spend to feel good.

Example: Your customer is feeling happy and secure in their partnership and they want to celebrate their significant other’s recent promotion. They stop by your jewelry store and pick out a simple, elegant ring to gift their partner. As they make this purchase, they’re feeling content, secure, and happy with their decision and their relationship. Those dollars spent toward this celebratory gift are an abundant spend.

2. Neutral spending

Neutral spending is a balanced and deliberate approach to managing your finances.

In this mindset, people are trying to find balance in their spending habits and are making sure that their actual spending aligns with their values and goals. It's not overly restrictive or excessively indulgent but instead finds a balanced middle ground.

Neutral spending involves making mindful financial decisions, avoiding impulsive purchases or frivolous spending, and focusing on what truly matters, whether it's savings goals for the future or enjoying life's simple pleasures. It's a way of navigating the financial landscape with a sense of control, ensuring that money serves as a tool for both security and fulfillment.

In this category, you feel neutral about the price, neutral emotionally, and neutral about the item you're purchasing.

As a retailer, your role is to understand what your customers value when they are engaging in neutral spending. If an item doesn’t have value to the customer, they’re likely not going to buy it. But, if you can help them to see the personal value it will add to their life or their experience, they’ll feel that it’s worth the money to spend on your product. The key is to personalize your approach by really knowing your customers.

3. Scarcity spending

Man typing on a blue calculator

Scarcity spending is a mindset characterized by fear and limitation when it comes to managing money. It's a perspective that sees resources as perpetually scarce, leading to anxious and often shortsighted financial goals.

Those in a scarcity spending mindset may restrict their spending, deny themselves essential items, or avoid investing in personal growth and enjoyment, all driven by a deep-seated fear of running out of money.

In this category, you feel bad about the price, feel bad emotionally, and feel bad about the item you're purchasing.

This approach can create a cycle of financial stress and missed opportunities, making it difficult to ever have financial security. Shifting away from scarcity spending toward a more balanced perspective can open the door to a healthier and more fulfilling financial life.

4. Avoidance spending

Woman looking into store window with purses

Avoidance spending is a coping mechanism where you use spending as a way to escape, numb, or distract yourself from emotional issues, stress, or discomfort.

It often involves making impulsive purchases or indulging in excessive retail therapy to temporarily get relief from negative emotions.

While avoidance spending might provide short-term relief, it can lead to long-term financial consequences, bad spending habits, and emotional dependency on material possessions.

This can look like racking up credit card debt without a plan to pay it off, disregarding shopping lists or spending plans you've created for yourself, unconsciously spending money on a daily basis by not dealing with finances like unused automatic payments, overdraft fees, late fees, etc, or spending excessive amounts of money when you've received bad news.

Recognizing and addressing the underlying emotional triggers is important for seeking healthier ways to cope with challenges and developing a better spending plan.

These broad categories are variable and we may feel all of them at different points in our lives. None of these consistent spending categories are fixed and absolute—there's always room to change your spending habits and secure your financial freedom. 

Why should retailers care about the four types of spending?

Retailers should pay close attention to these types of spending because understanding consumer behavior and their underlying motivations can significantly impact their business strategies and bottom line. Here's why retailers should make their business client-centric and care about these spending patterns:

Targeted marketing

Knowing the different spending mindsets allows retailers to tailor their marketing efforts more effectively. They can create campaigns and promotions that resonate with consumers based on their spending habits, whether it's appealing to those with an abundance mindset looking for quality experiences or helping individuals in a scarcity mindset find value in their purchases.

Customer engagement

Retailers can enhance customer engagement by offering personalized shopping experiences. For example, they can provide product recommendations or loyalty programs that align with a customer's spending preferences, fostering brand loyalty and repeat business.

Pricing strategies

Retail transaction with price displayed and a woman cashier in a blue shirt

Retailers can adjust their pricing strategies to accommodate different spending mindsets. Offering a range of products at various price points can cater to both the frugal shopper and those seeking premium experiences.

Customer education

Retailers can play a role in educating consumers about responsible spending habits. They can offer resources and guidance on budgeting habits, savings goals, and making informed decisions, which can build trust and loyalty among their customer base.

Ethical considerations 

Inside a retail boutique with plants and women's clothes and accessories

Understanding spending behaviors allows retailers to make ethical decisions. For instance, they can avoid the negative feelings that come with avoidance and scarcity spending by promoting responsible consumption and ensuring their marketing practices are ethical and transparent.

Adaptation to market changes

Being aware of shifts in consumer spending patterns can help retailers adapt to changing market conditions. For example, during economic downturns, consumers may adopt more frugal spending habits, prompting retailers to adjust their offerings and marketing accordingly.

Competitive advantage

Retailers who effectively address and cater to different spending mindsets can gain a competitive advantage in the market. They can differentiate themselves by providing a shopping experience that resonates with consumers on a deeper level.

Track your clients' spending with Clientbook

Clientbook is a customer relationship management (CRM) software designed to help retailers improve their customer engagement and personalization efforts through clienteling. It can be valuable in addressing several of the points mentioned above, specifically in understanding customer spending patterns and tailoring marketing strategies. Here's how Clientbook can help:

Personalized recommendations

By analyzing past impulse purchases and customer preferences, Clientbook can provide retailers with insights to make personalized product recommendations. This helps retailers offer customers products that align with their spending habits and preferences, enhancing the shopping experience.


Clientbook facilitates seamless communication between retailers and their customers through various channels, including email, SMS, and in-app messaging. Retailers can use this platform to send targeted messages and promotions that appeal to specific spending mindsets.

Customer engagement tracking

Clientbook allows retailers to track customer engagement and interactions. Retailers can use this data to understand how different customers respond to marketing efforts and adjust their strategies accordingly.

Clientbook is a powerful tool for retailers to better understand their customers' spending habits and preferences, tailor their marketing efforts, and enhance customer engagement. By leveraging the insights and capabilities of Clientbook's CRM platform, retailers can create a more personalized and effective shopping experience that caters to various spending mindsets, ultimately driving customer loyalty and business success.


In the end, understanding and responding to these four spending patterns not only allows retailers to better serve their customers, but also to optimize their business operations and thrive in a dynamic retail landscape. It fosters a win-win situation where consumers find shopping experiences that align with their values and needs, while retailers benefit from increased customer loyalty and sustainable profitability.

To begin working with Clientbook today, book a demo with one of our experts. Get to know your customers, build trust, and understand their needs so that they become your loyal clients.

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