Consumerism:Roots of Consumerism, The Nature of Consumerism

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Consumer Psychology (PSY - 514)

Lecture 43

Consumerism

Understanding:

Consumerism

· Roots of Consumerism

Nature of Consumerism

Consumerism

Consumerism encompasses the evolving set of activities of government, business and independent organizations

that are designed to protect the rights of the consumers.

Consumerism is concerned with protecting consumers from all organizations with which there is exchange

relationship. There are consumer problems associated with hospitals, libraries, schools, police forces, and various

government agencies, as well as with business firms

Roots of Consumerism

Roots of consumerism may be traced through the following:

Disillusionment with the system

The performance gap

The consumer information gap

Antagonism toward advertising

Impersonal and unresponsive marketing institutions

Intrusions of privacy

Declining living standards

Special problems of the disadvantaged

Different views of the marketplace

Institutions have been subjected to increasing public scrutiny, skepticism and loss of esteem

Many consumers think that they get worst deals in the marketplace than they used to.

Many consumers express broad dissatisfaction with the goods they buy. Their expectations of product

performance and reliability have risen (largely because of advertising touting the new improvements). Increased

product complexity brings about new possibilities for malfunction and a perception by the consumers that the

promise performance gap is increasing.

Amateur buyers lacking time, interest or capacity to process information adequately in order to make optimal

marketplace decisions face literally thousands of complex products requiring evaluations along many dimensions

relating to performance, convenience or even societal concerns.

Large segments of population are very skeptical of the usefulness and truthfulness of the advertising information.

It is criticized for its intrusiveness and clutter, irritation factor, stereotyped role portrayals, and promotion of

unrealistic and unsupportable expectations. Telemarketing calls are a related annoyance. Where there is human or

computerized voice on the other end, about 70% people ranked it as a major irritation

There have been impersonal and unresponding marketing institutions that have been causing such marketing

factors as:

The rise of self service retailing

Reduced knowledge of sales employees

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Consumer Psychology (PSY - 514)

Bureaucratic structures contribute to feeling that no marketer is listening

Development of many consumer-information databases made possible under our increasingly computerized

society has caused concern over the access to and use of such data and has led to the attempts to protect the

consumer's privacy

Reductions in consumers real discretionary income has led to pessimism and disenchantment with the economic

system and attempts to deal with the situation

The young, the old and the poor are even more vulnerable than most other groups in the society and face great

difficulties coping in the marketplace. Poor people face great difficulties that restrict their ability to function as

consumer in the marketplace. Poverty restricts people's ability to function as ordinary consumers, but the face

hygienic, dress and interpersonal problems.

Business people and their critics have radically different perceptions of the nature of marketplace

2. The Nature of Consumerism

The Nature of Consumerism may be summarized in the following points:

Consumer Safety

Consumer Information

Consumer Choice

Environmental Concerns

Consumer Privacy

Business Response to Social and Ethical Concerns

Consumer's Responsibilities

Market Responses to Consumers

1. Consumer Safety

The oldest and most controversial of the consumer's rights, the one which both business people and consumerists

agree upon and support. Consumers regularly complain about shoddy or defective merchandise and poor services.

It is one thing to be cheated or deceived. It is quite another to be physically injured by unsafe product. Safety

always is an issue for consumers, business and government.

2. Consumer Information

Consumers' rights with regard to information relate to the marketer's provision of adequate information which

neither deceives nor misleads. Two areas are important here:

a. Deception of Consumers:

The deception of consumers is accomplished by deceptive advertisement. While dealing with deception then it

needs not to prove that deception actually occurred in advertisement but merely that the ad had the capacity to

deceive. It is also important for the advertisers to learn that they can't escape the liability simply because they

didn't know that the ad's claim was false.

Puffery in Advertisements

Advertisements have long been designed on the basis of accepted approach of puffery the use of exaggerated

praise for an advertised item. The most difficult point here, however, is that at which point the puffery becomes

deception.

On the basis of definition three types of deceptive advertising may exist:

The outright lie: The outright lie occurs where a claim is made that is completely false, even from an

objective point of view. That is it is impossible for consumers to achieve claimed benefit.

Claim fact discrepancy: The claimed benefit of the advertised product must be qualified in some way

for it to be correctly understood and evaluated but this I not done in the ad). An advertisement may claim

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that 60% doctors recommend "X" if consumers knew what types of doctors, how many were surveyed,

what questions were asked.

Claim fact interaction: The advertisement claim (while being neither explicitly or implicitly deceptive)

interacts with the accumulated belief and attitudes held by consumers in such a way that they are misled or

deceived by it. An actor who played the role of a doctor in a popular play/movie recommends in an

advertisement a certain product, people may think of him as an expert, if consumers are not told that he is

in fact an actor

b. Misleading the consumers:

Misleading statements about the rivals' products are also grounds for a suit

3. Consumer Choice

Some consumer activists argue that consumers have less choice than might be desirable and possible. Other

consumer activists support reduced choice by arguing that consumers should be given not simply what they want,

but what is the best for them. They support that buyers are not able to adequately determine for themselves that

what is best in their interest and must be provided with right products.

4. Environmental Concerns

The right to clean environment assures that the environment in which the consumers live is free from pollution.

Large scale pollution seems to be a by-product of an economically developed society, but it is also an area of great

concern for many consumers

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