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Amazon May Have Just Created a Weapon of Mass Consumption

By Suzanne Woolley
June 20, 2014 2:40 PM EDT 80 Comments
Jeff Bezos, chief executive officer of Amazon.com Inc., unveils the Fire Phone during an event at Fremont Studios in Seattle on June 18, 2018.
Photographer: Mike Kane/Bloomberg
Jeff Bezos, chief executive officer of Amazon.com Inc., unveils the Fire Phone during an event at Fremont Studios in Seattle on June 18, 2018.

With its announcement of a new smartphone this week, Amazon unveiled advanced camera technology that could arguably be called "point and shoot yourself in the foot."

Amazon’s foray into smartphones includes image-recognition technology that lets consumers point the phone at a product to buy it from its online store. The phone’s Firefly button recognizes more than 70 million products, the company says. Mixing compulsive smartphone usage with the instant gratification of point-and-purchase could take impulse spending to a new level. Within minutes of the announcement, the twitterverse saw the potential: "Amazon launches a shopping machine," one person tweeted, "calls it a smartphone."

But shopping convenience may come at a high cost for some people. The more removed people are from purchasing with cash the more they tend to overspend, behavioral finance experts say. Research shows that when people pay with plastic they can spend 20 percent to 30 percent more than when they use cash, says Denise Hughes, a financial coach based in San Carlos, California. Casinos use chips, behavioral experts note, to also remove the regulating "pain of paying."

The phone could remove "frictions and barriers" -- like taking out a wallet -- that get people to think about purchases in a less emotional way, says Dan Ariely, behavioral economics professor at Duke University's Fuqua School of Business. "The ability to act very quickly on our emotions is going to simply get people to buy more impulsive things," he says. And those things, he adds, aren't going to be vitamins or long-term savings bonds. "They'd buy stuff that is more shiny and tempting at the moment, like the new Amazon phone."

What worries financial coach Hughes is that the technology has the potential to let a watchdog part of the brain "go to the beach." When shopping at Costco, for example, a part of the brain relaxes because it knows everything is a good price, she says. Since Amazon has a reputation for low prices, she expects the Firefly button to have the same effect and "relax people into spending more."

There may be other effects on the brain. Already, the unpredictable, intermittent nature of text and tweets on smartphones provide users with the “reward” of elevated levels of dopamine in the brain, says Dr. David Greenfield, director of The Center for Internet and Technology Addiction. Amazon’s new technology “just amplifies the potential for self-medicated behavior without being conscious,” he says. It gives you, at any moment, “an instant conduit to gratify yourself.”

Developments like Amazon’s image-recognition tool are “great for capitalism,” he adds. But "capitalism and health have never been related in a positive way.”

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