Solomon’s Consumer Behavior Nancy Southerland, MBA
Lecture Four/Chapter Four
Welcome Students, I am Nancy Southerland.
I am eager to begin the discussion of Chapter 4 . Chapter 4 is entitled “The Consumer
and Social Well-Being”.
We will discuss four Learning Objectives in Chapter Four.
1.
Ethical business is good business.
2.
Marketers have an obligation to provide safe and functional products as part of their business
activities.
3.
Consumer behavior impacts directly on major public policy issues that confront our society.
4.
Consumer behavior can be harmful to individuals and to society.
Students, the first learning objective states that ethical business is good business.
Business ethics are rules of conduct that guide actions in the marketplace There are
cultural differences in what is considered ethical.
Thus, it can be difficult to avoid ethical conflicts because our thoughts of what is
right and wrong vary among people, organizations, and cultures.
These cultural differences certainly influence whether business practices such as bribery
are acceptable.
Bribing foreigners to gain business has been against the law in the
United States since 1977, under the Foreign Corrupt Practices Act.
The Organization for Economic Cooperation and Development (OECD), to which most industrialized
countries belong, also outlaws bribery.
Still, these practices are common in many countries.
Do Marketers manipulate consumers?
I strongly feel that the answer is NO, for advertisers simply do not know enough about
people to manipulate them.
Students, I am a strong proponent of Marketing.
Marketing, in my opinion, provides desparately needed product EDUCATION to the consumer.
Marketing is commonly criticized as trying to convince consumers that they need something
when they really don’t.
This is an ethical issue.
Marketers respond to this question by pointing out that the need already exists in the consumer,
but marketers recommend ways to satisfy the need.
Students, I feel strongly that products are designed to meet existing needs and that advertising
only helps to communicate their availability.
Yes, we can say that advertising and marketing are necessary because consumers may not know
that solutions to problems exist without the information provided by advertising and marketing.
This is the view of the economics of information perspective.
It points out that there is an economic cost to searching for information.
Advertising helps consumers by reducing search time.
As I have stated, Marketing provides the much needed product education to the consumer.
The failure rate for new products ranges from 40-80% thereby sifting out products that would
not serve the consumer in a positive fashion.
Although people may think that advertisers use magic to sell products, marketers are
only successful when they promote good products.
Learning Objective Two states that Marketers have an obligation to provide safe and functional
products as part of their business activities.
I love Marketing because Marketing fulfills needs by providing products.
This table illustrates some differences in what materialism used to look like compared
to what it looks like today.
Today’s materialistic consumers are more likely to focus on values over status.
When brands fail to satisfy, consumers have three options: 1) a voice response, 2) a private
response, and 3) a third-party response.
A voice response means complaining.
A private response means sharing your dissatisfaction with friends.
The third-party response may mean taking legal action or going through an organization like
the Better Business Bureau.
Table 4.2 lists several of the legislative acts that protect consumer welfare as well
as the purpose of each act.
The most recent ones are listed in the slide.
Some of the US regulatory agencies are listed in the slide.
These act in concern for the welfare of consumers.
Others and their specific responsibilities are provided in Table 4.3.
Adbusters sponsors many initiatives that try to discourage rampant commercialism.
Its work is a type of culture jamming, a strategy to disrupt efforts by the corporate world
to dominate our cultural landscape.
Marketing helps change society for the good.
Thus, Transformative Consumer Research (TCR) promotes research projects that include the
goal of helping people or bringing about social change.
In fact, social marketing strategies use marketing techniques to encourage positive behaviors
such as increased literacy and to discourage negative activities such as drunk driving.
This is a good thing.
Would you not agree?
Literacy and promoting responsible drinking are examples of causes.
These Corporate entities are examples of top Cause Marketers.
Students, we now need to master Learning Objective Three: Consumer behavior impacts directly
on major public policy issues that confront our society.
Some of the issues facing consumers include data privacy and identity theft, market access,
and sustainability.
Identity theft occurs when someone steals your personal information and uses it without
your permission.
Market access means the extent that the consumer has the ability to find and purchase goods
and services.
Most of us take for granted market access, but due diligence must be made for individuals
that are limited due to physical, mental, economic, or social barriers.
Many American consumers suffer disabilities, food deserts, and media literacy.
Sustainability means building strong communities that play and work together.
Sustainability emphasizes a triple bottom-line which refers to business strategies that strive
to maximize return in three ways: The Financial bottom-line: Provide profits
to stakeholders The social bottom-line: Return benefits to
the communities where the organization operates.
The environmental bottom-line: Minimize damage to the environment or even improve natural
conditions.
Amazon is using its Vine web site to illustrate how consumers can shop green.
Students, I would now ask you to engage into Reflection with me.
Advertisers are often blamed for promoting a materialist society by making their products
as desirable as possibile.
Do you agree with this?
• If yes, is materialism a bad thing?
• If no, what are your reasons?
LOHAS is the acronym for “lifestyles of health and sustainability”.
LOHAS is the term used to describe the groups of green consumers.
This label is given to people who worry about the environment, want products to be produced
in a sustainable way, and spend their money to support these ideas.
Green consumers may also want to dispose of products in green ways!
I would like for us to discuss Learning Objective Four.
Consumer behavior can be harmful to individuals and to society.
There are many things that can be negative about consumer behavior.
Consumers may suffer from attacks from others, may become addicted to products, may suffer
from compulsion, and may even become products themselves . Thus, Consumer behavior can be
harmful to individuals and to society.
To our chagrin, our society has been assaulted with consumer terrorism, addictive consumption,
compulsive consumption, consumed consumers and Illegal acquisition and product use.
Thus, this dark side of consumer behavior includes terrorism, the use of people as products
as in prostitution and the excessive sell of blood and blood products, and in theft
and vandalism (anticonsumption).
Students, this is the close of the lecture.
I want to emphasize Chapter Four Objectives.
1.
Ethical business is good business.
2.
Marketers have an obligation to provide safe and functional products as part of their business
activities.
3.
Consumer behavior impacts directly on major public policy issues that confront our society.
4.
Consumer behavior can be harmful to individuals and to society.
Thank you for listening to the lecture of Consumer Behavior Chapter 4 entitled Consumer
and Social Well-Being.
I am Nancy Southerland.
I am eager to engage you.