Consumer Behaviour and Financial Decision-Making

This document analyzes the impact of consumer behaviour on financial decision-making and its effects on real-life organizations. It includes empirical studies and findings from a chosen article that highlight the complexity and reluctance of individuals in making financial decisions. The document also discusses the case of Woolworths, an Australian company, and its financial issues.

Running head: CONSUMER BEHAVIOUR
Consumer Behaviour and Financial Decision-Making
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Empirical Studies and Findings from Chosen Article along with Real Life Organization
Example
Article- Park, J. J., & Sela, A. (2018). Not my type: Why affective decision makers are
reluctant to make financial decisions. Journal of Consumer Research, 45(2), 298-319.
From the respective article, it can be identified and analyzed that most of the
individuals are uncomfortable in dealing with the financial decisions as it is complex in
nature. The findings help in underscoring one novel characteristic which makes financial
decisions worthy of distinct examination. As compared to the other decision-making styles, it
can be analyzed that financial decisions stand out of competition in comparison to the other
decision-making domains. In the present scenario of the business environment, it can be
identified that the business activities are becoming complex and sophisticated that can
compromise on the financial returns as well.
Moreover, despite the different kinds of importance of managing their personal
finances, the different individuals feel hesitant to engage in an active manner in the different
financial decisions which is inclusive of investments, savings or debt management. As per the
respective article, it can be identified that the avoidance of financial decisions by the different
individuals are caused often due to the lack of the sufficient knowledge regarding the
different financial products as well as services. the other finding is that due to the financial
illiteracy among the different individuals, it makes it difficult for the different customers in
understanding and choosing among the financial alternatives and options that affects the
financial decisions negatively.
In order to analyse the issues which are faced while analysing the financial decision-
making approaches, it can be identified that Woolworths is one of the suitable examples

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wherein the business was affected due to the financial crisis which was faced by the
company.
Woolworths Inc is one of the Australian companies with extensive retail interest
throughout Australia and New Zealand. The company was founded in the year 1924 and it is
headquartered in New South Wales, Australia. The number of employees who are employed
in the organization presently is 205000 till 2018, however there has been decrease in the
revenue of the company during the last few years due to the ill-financial health.
The different products which are sold by Woolworths include different grocery items
starting from health and beauty products, household products as well as stationary items.
The main financial issue which affected Woolworths is the impairment of David
Jones which led to the full year loss for the respective company. There has been per share
loss of between R3.40 to R3.97 for the 52 weeks as the other individuals who were in-charge
of tackling the financial aspects of the company were not financially competent and it led to
the loss of the company. Moreover, there was potential debt problems which could not be
avoided and it led to increase in the balance along with adding interest to the annual fees
along with penalties to the overhead budget of the company.
The recommendations which can be provided to Woolworths includes the following:
 Introduction of proper marketing techniques can be applied by Woolworths to through
hiring more talented individuals in the company which will allow them in scaling
business and focus on the activities which will make more money
 Increase in the prices of the different products which are sold by the company which
will be complying with the pricing legislations and it will be improving the financial
status of the company

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