The Business Side of FOMO | Barbara Kahn

What Is FOMO?

Dan Loney: The term “FOMO,” or fear of missing out, is one that's used quite a bit these days. It obviously has real world implications, but social media has allowed it to become part of our everyday vernacular. As for that real world, there are some important things to understand about FOMO when you talk about it from a business perspective.

The Wharton School's Barbara Kahn is part of a group of researchers looking at a better understanding of FOMO, and for what reasons. Barbara is a marketing professor as well as co-host of Marketing Matters on the Wharton Podcast Network. Barbara, great to see you again. Take us through this research. Everybody knows the term, but you look at it from a unique perspective.

Barbara Kahn: It's funny that you should say everybody knows the term. Because we started this research a long, long time ago. It took us a while to get it published. When we started, people didn't actually know the word. We didn't make the word up. It existed. But a lot of people didn't exactly know what FOMO was. We were finding ourselves telling people, “fear of missing out,” like what the letters stood for. So, we started doing descriptive research on it. We wanted to be the first one to publish anything on FOMO, so we'd get all the citations coming to us. But as luck would have it, we just couldn't get through the publication process.

I seriously think it's been 10 years we've been working on it. By the time we finally publish it, it is true that a lot of people know what FOMO means now. So, what we found ourselves doing is defining a specific type of FOMO so that we could get a publication.

People use FOMO to mean a whole lot of different things now, and we wanted to specifically differentiate between FOMO and the idea of regret. Some people, I think, use the word FOMO, but they just regret not being there. We wanted to define our FOMO as specifically not regret, and as specifically having to do with social media. Social media exacerbates it. We also found, from all our work over the 10 years, that FOMO tended to be used more when it had to do with social groups than when it had to do with just missing an event, per se. What you were feeling FOMO about was something that you missed, that your friends were doing, that you weren't part of. What we found is that's what people really meant when they were saying FOMO, and that's how it differentiated from regret.

Loney: So, something like, if you missed out on a concert that your friends were going to and they were going to have that great experience, but you were not going to have it.

Kahn: Right. Over the years, we started saying that's where FOMO is different than regret. You might regret missing the concert, but you feel FOMO if your friends went to the concert and you didn't. That's what we were really trying to tease apart. What does that FOMO mean? What is it that you're missing? What we thought it was, you were missing being there with your friends. You were missing part of the social history that was being developed around your friend group.

Loney: I'm guessing the component of social media then comes in when those friends are maybe posting pictures or videos from the event that you missed out on. You see it and it just kind of doubles the angst that you feel.

Kahn: Right. It's not just missing an event. It's missing specifically an event that your friends have, that you're not at. And it becomes exacerbated because you're seeing all these pictures and you're imagining what went on that you weren't a part of.

Loney: You're looking specifically at the psychology behind a lot of this.

Kahn: Right. Before I get to the business implications of it — we're not publishing about the business yet. But we have run a bunch of studies on it. There were a couple things that were interesting about this. The first thing is, it's not about the event. You can feel FOMO even for a negative event. Your friends might go to a funeral, and you regret not being there because your friends were bonding over things that happened at the funeral. It's not the event per se, it's the bonding.

The other thing that we discovered the more we did research on it was that it's not really a fear. It's more like an anxiety. And the difference is that anxiety is cognitive. It's the way you think about it. You're imagining what you're missing out. You're maybe not missing out on that much. It's just that you think you're missing out on it. That was also interesting.

When we were doing the research, I remember the thing that motivated me to do it is one of my daughter's friends was talking about how she wanted to go to the shore with my daughter and her friends. Unfortunately, she had to go to this beautiful wedding in this gorgeous place, and she was going to miss out on it. My thought was, that's crazy. You're going to a beautiful place. You can go to the shore anytime you want. Why are you so worried about it? And the more you probe, it was because she was worried about her friends having fun or making social stories that she wasn't going to be part of.

Loney: Part of the research I mentioned did play into the impact of being at an event like a concert. You also have part of this research that looks at being, or not being, at a retreat.

Kahn: Yeah. The point is, if you're not looking at the regret of missing the event — it could be a negative event. It could be a positive event. It could be anything. It could be a business event. What we manipulated in that case is what was happening at the retreat. Like, if you were going to retreat and you were self-improving and working on yourself, and everything was independent, you're not going to feel as much FOMO as if you were going to a retreat or you missed out on a retreat that your friends went to. The point of it was to develop connections and social interactions. So, the two things that would make you experience the FOMO at something like a retreat — the retreat doesn't matter, right, because it's not the event — is that your friends went, not a group of strangers. They were talking to each other and perhaps finding new things out, telling stories, making new things up that you weren't part of.

Loney: Is there an element of FOMO that, as you said, can be a negative event where you didn't really want to go to it anyway, and maybe your friends didn't want to go to, but they still went and you did not.

Kahn: Right. We ran a bunch of experiments to talk about, what if your friend missed the event? What if it wasn't you that missed the event? If your friend missed it, do you think they'd be missing out on a lot of stuff? Then you have the wherewithal to say, “Nah, probably not. It’s just one event. Probably not that much happened. You're still part of the friend group.” But when it comes to you missing out, now you imagine, “Oh yes, a lot more happened.”

Loney: There are so many potential scenarios that could play out where these elements of FOMO could be in. It could be like-minded individuals, people who are fans of a country music artist or a rock star or whoever it might be, and you're not friends with them, but you're all fans of that person.

Kahn: And that's where we're going to go to it when we get to the business applications. A lot of what's happening with brands now, where they're creating brand identities, brand community. And a lot of is experiential. It's not just buying the branded product, it's being part of the branded experience. Our hypothesis is what you're suggesting: If you feel like you're part of a branded community and miss out on some events, maybe you don't feel like your membership in that community is as strong as it would be if you had gone. And that's the FOMO you might end up feeling.

How Does FOMO Affect Business?

Loney: How do businesses think about FOMO?

Kahn: We haven't finished all that research. First, we just wanted to establish that there was some FOMO in the branded community, and it's kind of hard to get. You have to control all these things. There used to be a Lululemon store here near campus. Lululemon had gym classes and things in the store, so we were using that as part of the Lulu community to kind of manipulate it. And it was hard. You had to run the gym class. You had people in and out. You had to control all this. So, we were still just trying to find whether or not people felt [FOMO].

Then we were trying to determine should the brand encourage it or not encourage it? Like maybe feeling that FOMO is good because it makes you not want to miss the next event. But maybe it's bad because it makes you, over time, feel disengaged from the community. We weren't quite sure. We haven't done that study yet to figure out, how is the FOMO going to work? Can we play on it in a good way, or is it a bad thing?

Loney: Is it surprising to see the idea of FOMO in so many different avenues?

Kahn: Like I said, we've been doing this for a long time. Over the years, people have taken the term and used it to mean a lot of different things. We came back and tightly identified it as this kind of thing now. When you say FOMO today, you may not mean exactly what I'm saying now. You could mean regret, or you can mean these other things. In fact, you're even seeing people now talk about JOMO. You know, the joy of missing out. Like, “I don't want to be involved in everything.”

Loney: Oh, wow. I hadn’t heard that.

Kahn: Yeah, so you can see it flip. Like, it's just crazy to worry about it all the time. And it’s attached to this whole idea of social media. That you're looking at everything, and all these things you're missing, all these feelings you're missing, maybe it's better if you just don't look at it as much.

We start playing with this in the brand implications. Is it a good idea to show on the website other people doing things that might encourage your feelings of FOMO? Or should you show the activity, show the product? There's a lot of different things that people might take away when they see an event they missed. We're parsing out some of these different things. A firm can think about that as either positive or negative, to encourage those feelings and thoughts.

Loney: But isn’t the challenge partly because feelings about a specific scenario would be different for different people? The company, the firm that works with it, has to be nimble to be able to deal with all kinds of different reactions.

Kahn: We purposely stayed away from those kind of things. There has been a lot of work in FOMO over these 10 years that other people published. What you're talking about is individual differences. We have a little bit of that. People who are more anxious about their social activity feel more FOMO than people who aren't. That's an individual difference.

But we were trying not to focus on individual differences, trying to focus on main events that people would feel FOMO about or not. Some of the things that we were identifying is, it has to be part of a social group you care about. Our extension to business is, will those feelings be as intense if it's a brand community, if it's a brand you feel about? You might argue yes and no. We don't know.

The other thing we were thinking about it is, it's an anxiety. It's a little bit imagined. It's not actually true. People just see this stuff and start to spiral out, and they make assumptions about it. That's another thing brands can either try to tamper down, or they can try to encourage it if they think the FOMO is good. Like, you might imagine if the brand thinks, “Feeling a little FOMO, that's good. You won't miss our next event.”

Loney: How do you want to take this research into that next realm, focusing on business?

Kahn: The first thing we have to establish is those ground rules. We have to establish, do people, when they're part of a brand community, feel the same sense of FOMO when they miss out on a branded event? That, we haven't proved yet. We have some preliminary evidence that shows that they do. But it also depends on whether it's a small brand or a big brand. It's not true for all brands.

That's kind of an interesting idea if we're moving towards, in retail, this idea of more customer experiences and things like that. When you miss a customer experience, does that make you want to go to it more the next time, or does it make you feel disengaged and less and less part of the community, because they're telling brand narratives that you're not part of? That's where we're thinking it might go. It might depend on the type of brand, your relationship with the brand, the type of people who are at the brand.

I want it to be different than just regret. For example, if there's a branded community event and some big celebrity is there — Taylor Swift is there — you would definitely feel regret. But you might not feel what we're calling FOMO. We want to make that distinction, too, because the FOMO is more about the social connection you feel to the group that surrounds the brand.