Living on the Edge: A Comprehensive Look into the Characteristics, Psychology, and Behaviors of People Living Paycheck-to-Paycheck
Led by globally acclaimed behavioral economist Dan Ariely of Duke University and renowned researcher Mariel Beasely of Duke University’s Behavior Shop, Living on the Edge will reveal what it means to survive P2P in today’s complex and challenging financial world. This project will detail the unique behaviors, needs, beliefs, and emotions of both the overall P2P group and its key segments.
About
Dan Ariely is famous for his TedTalks on consumers living paycheck to paycheck. Now, together with his renown colleague Mariel Beasely, who runs Duke University’s Behavior Shop, they're leading a multi-client project bringing all-new light to this critical topic.
Up to 78% of US households live paycheck to paycheck or worse. And 39% struggle to cover a $400 unexpected expense. Revealingly, this predicament is not just driven by income level: one in five households earning more than $100,000 live P2P. This multi-phased project will both size the P2P population while diving-deep into their financial behaviors and emotional effect of living on tight margins.
Objectives
- Identify and size the different segments who live paycheck-to-paycheck (or worse) in today’s increasingly complex financial world
- Understand each segment’s financial situations and how their earning and spending differs from those who don’t live P2P
- Demographically and psychometrically profile these segments including differences in self-control, social desirability, purpose in life, and pain of paying
- Reveal the unique consumer behaviors, needs, and expectations of these segments, including the savings approaches and mechanisms that could help improve their current state
- Differentiate between those who were living P2P pre-COVID and those who are now in this overall segment (or worse) because of the pandemic
Why?
The world is teetering on the edge of a massive economic downturn that will continue to impact millions of Americans. Six weeks after initial stay-at-home orders, one in five American workers are without a job. (During the Great Depression, one in four workers were without a job.) The pandemic has revealed significant and long-term economic challenges that have been percolating under the surface for years. And with so much economic turmoil, it's more essential than ever before to fully understand how many Americans are living paycheck-to-paycheck (or worse, without one at all), and to establish an empathetic understanding of their experience in order to develop products, services and connect with them on a meaningful, emotional level.
Methodology: Quantitative/qualitative
Qualitative Design
Design Rationale:
There will be three phases to the research:
Phase One: Background & Secondary Research
Phase Two: Identifying P2P Households within US Population (quant survey)
Phase Three: Deep Dive into P2P Population (qualitative interviews, quant survey)
Approaches:
Phase 1: Background and Secondary Research:
Prior to conducting the primary research that will form the bulk of this project, we will:
- Review existing reports and literature on P2Pin order to understand how the market has been
defined including gaps in understanding this overall group
- Conduct secondary data analyses on relevant existing datasets, including:
- The Survey of Household Economic Decision-Making
- The Survey of Income and Program Participation
- The Household Financial Survey
- The Consumer Expenditure Survey
We'll share out findings and gather input into hypotheses and Phase 2 research
Phase 2: Identifying P2P Households within US Population
Quantitative Survey of 2,500 respondents
Representative of US population by age, gender, ethnicity, Hispanic origin, region, income
Areas of questioning
- Financial life (income, expenses, spending)
- Structure, timing, location
- Validated scales (potential examples below):
- Lynch & Netemyer Perceived Financial Wellbeing Spendthrift & Tightwad
- Social Desirability
- Meaning in Life
- Adult Hope
- Self-Control
- Risk
Share out findings and gather input for Phase 3
Qualitative Research Target
Gender: 50% Male, 50% Female
Ethnicity: Approximates national population distribution
Ages: 23 to 73
Quantitative Design
Number of Interviews: 2500
Design Rationale:
There will be three phases to the research:
Phase One: Background & Secondary Research
Phase Two: Identifying P2P Households within US Population (quant survey)
Phase Three: Deep Dive into P2P Population (qualitative interviews, quant survey)
Quantitative Research Target
Gender: 50% Male, 50% Female
Ethnicity: Approximates national population distribution
Ages: 23 to 73
Additional Demographic Screening:
Phase 3: Deep Dive into P2P Population
Pre Qualitative interviews:
Generate/confirm consumer profiles to be tested: income, purchasing behavior, values, attitudes, expectations
Quantitative survey among 1,500 P2P respondents
- Demographics
- Validated scales
- Product and platform usage
- Values & goals
- Networks
Analysis: Profile and Sizing of P2P segments
- Characteristics of each segment -
- Needs and expectations unique to each segment
Deliverables
Reporting: Formal Report; Summary Report
Presentation: Both web-based and in-person
Additional Deliverables:
Phase 1 Memo Report
- Working definition of Paycheck to Paycheck (pre Covid and current)
- Identified gaps, conflicts in previous research; hypotheses to be testred
Phase 2 Interim Report
- Estimated size of P2P
- Characteristics of P2P group vs. general population
- Data tables and graphs
- Further hypotheses and direction for segmenting the P2P population
Phase 3 Detailed Report of P2P Segments
- Key integrated analyses from Phase 1 and 2
- Profile & Characteristics of each segment
- Needs & expectations unique to each segment
Presentation by Mariel Beasley and/or Dan Ariel
Reasonable travel and housing lodging costs are billed separately
Supplier
Company: The Behavior Shop
Previous Projects: 1
Rating: Supplier has not been rated
Supplier's Qualifications:
Mariel Beasle has overseen qualitative and quantitative research projects more than 100 corporate companies as well as local and state governments, universities, and not-for-profits. She’s a sought-after speaker, having presented at South By Southwest, American Banker, Emerge, and Digital Insight. And, she’s been featured in Forbes, Market Watch, Tech Crunch and the New York Times. Mariel also teaches a masters-level course at Duke University’s Sanford School of Public Policy.
Dan Ariely’s TedTalks are famous for explaining research on behavioral economics, as he puts it, “in plain language.”
Supplier's Team:
This project is being led by acclaimed research and thought leader Mariel Beasley, co-founder of The Behavior Shop and Principal at Duke University’s Center for Advanced Hindsight and renowned behavioral economist Dan Ariely of Duke University. Their deep expertise will help brands understand this group in powerful new ways, including how to solve for these consumers’ pain points and stressors.
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