Last weekend, my wife and I were at a local car dealership to negotiate on a car (our old car had reached the end of its life). After haggling with a salesperson for an hour, the finance manager came to speak with us.
The woman asked if we wanted an extended warranty. Here was how she pitched it:
Cars these days are full of electronics, and they are expensive. Material and labor costs continue to rise every year. If a piece of electronic breaks down in the future, it could cost you thousands of dollars, so this extra warranty is a great protection.
The 8-year coverage she offered was about 10% of the car’s value.
Before walking into the dealership, I made a plan: If I were to walk out with a car that day, the price would be no more than the manufacturer’s suggested retail price (MSRP) [1]. I would reject any markups, accessories, or additional packages.
I said no to the woman.
She clicked around on her computer. Then she turned to me, looked me in the eyes, and asked, “Would you consider it if I lowered the price?”
I said no again.
She looked disappointed and said, “Really? Most people would get it.”
Her comment struck me. I remained silent while she worked on the paperwork, but I second-guessed myself.
Can she be right? If “most people” get the extra warranty, am I a fool to decline?
This experience reminded me of a fascinating book called Wanting: The Power of Mimetic Desire in Everyday Life. Luke Burgis argues we make many daily choices based on what others do. We even desire something simply because others appear to prefer it—he calls this phenomenon mimesis [2]. According to Burgis, mimesis is not inherently good or bad, but it is a powerful, invisible force that subconsciously shapes our decisions.
This book opened my eyes, and I began to see mimesis everywhere. Why did I want to get a particular piece of furniture? I saw it in someone’s home. Why did I go to this restaurant instead of that restaurant? Restaurant reviews convinced me. Why did an online e-commerce site say, “300+ other people bought this last month”? It was a subtle persuasion: If everyone else believed in this product, why shouldn’t you?
When most people used to live in small communities like tribes and villages, conforming to others’ opinions was a matter of survival. If a person didn’t fit into a culture, the tribe could consider him an outcast and abandon him. Our society may have evolved, yet our psychology hasn’t: The desire to be accepted is universal.
For years, I worked at a company where my co-workers often discussed sports. While I didn’t care much about spectator sports, for two years, I set the browser homepage on my work laptop to the sports news website ESPN (even though I never read it). It felt like I should mirror what my colleagues did—I didn’t want to stand out and be left behind.
Ultimately, I walked out of the car dealership without the extended warranty [3], but the experience taught me a lesson. I had a budget in mind. I was intellectually aware of the psychological games associated with buying a car. Despite all the knowledge and preparation, a five-word comment—”most people would get it”—almost swayed me emotionally.
The urge to conform is incredibly powerful.
Notes:
[1] Car supply has increased since the peak of COVID but remains low where I live. I requested quotes from 10+ car dealerships across Northern California. Going below MSRP for the car we were considering was virtually impossible.
[2] Burgis’ work was inspired by René Girard, a French-American polymath and philosopher who used to teach at Stanford (he died in 2015). As part of his mimetic theory, Girard argues:
Man is the creature who does not know what to desire, and he turns to others in order to make up his mind. We desire what others desire because we imitate their desires.
[3] An extended warranty is an insurance policy. Whether it’s worthwhile is a personal choice. Based on my online research, car dealerships often pitch extended warranties when you buy a car. In reality, there is no urgency. An extended warranty can be bought anytime before the original warranty expires. It’s also possible to shop around and get a better deal elsewhere.