Hedonic adaptation: what does it mean and what does it mean for for business?

Revisions to the US savings rate show that since the crisis Americans have been saving more than we'd thought. In June, the savings rate hit 6.4% of disposable income, a whole new ball game compared to the 1% - 2% pre-crisis savings rate.

The New York Times article referenced in the link below discusses "Great Recession"- induced changes in buying habits. "Hedonic adaptation" is the term psychologists used to describe people's ability to adapt quickly to great changes, bad or good, in order to maintain their level of happiness: in other words, the pleasure derived from purchasing a new item, be it a TV, car, or clothes, is quickly absorbed.

As a result of the recession, households have been deleveraging and families, forced to turn towards sharing experiences rather than purchasing big ticket items. If the conclusions suggested by current research on happiness -- "unlike consumption of material goods, spending on leisure and services typically strengthens social bonds, which in turn helps amplify happiness." -- are correct, we'll see spending shifting towards the purchase of services and experiences and away from goods.

http://www.nytimes.com/2010/08/08/business/08consume.html?_r=1&th&emc=th