Effects of Global Financial Recession on Consumer Buying Behavior

This research proposal analyzes the impact of global financial recession on consumer buying behavior, with a focus on Wal-Mart. It discusses the challenges faced by Wal-Mart and suggests strategies to regain profitability.

Running head: RESEARCH PROPOSAL
The Effects of global financial Recession on Consumer Buying Behavior
Name of the Student
Name of the University
Author note

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Table of Contents
Introduction......................................................................................................................................2
Background of the study..............................................................................................................2
Background..................................................................................................................................2
Problem statement.......................................................................................................................2
Rationale of the study..................................................................................................................3
Aims and objectives of the research............................................................................................4
Research questions.......................................................................................................................4
Literature review..............................................................................................................................5
Introduction..................................................................................................................................5
Major aspects of customers buying behavior..............................................................................5
Impact of financial crisis on consumer behavior.........................................................................6
Main factors that is affecting the retail business of Wal-Mart....................................................7
Wal-Mart......................................................................................................................................8
Summing up.................................................................................................................................9
Methodology..................................................................................................................................10
Research philosophy..................................................................................................................10
Research approach.....................................................................................................................10
Design of the research...............................................................................................................11
Sampling....................................................................................................................................11

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Data collection...........................................................................................................................11
Data analysis..............................................................................................................................11
Ethical consideration.................................................................................................................11
References......................................................................................................................................13

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Introduction
Background of the study
Background
It is a matter of fact that due to the Global economic recession the profitability of the
business organizations like Wal-Mart has seen a gradual decline due to the change in buying
preferences and the buying frequencies of the target customers of the business organization. It is
a matter of fact that everyday low prices is at which is synonymous with the operations of a
business organization like Wal-Mart and that made the business organization one of the largest
retailers in the market of United States of America (Heasman, and Lang 2015). It has been seen
that the management of the business organization is facing some challenges as their profitability
is declining in a gradual manner as the shopping approach or the shopping preferences of the
target customers of the organizations have been changing due to the financial recession there for
the management of the organization should implement some strategic tools in order to overcome
this concerning situation (Mander 2014).
Problem statement
In the recent times Wal-Mart being the largest retailer of the United States America is
experiencing some challenges to secure the profitability duty the Global recession and their
growth rate also declined over the last couple of years and that made the situation really
concerning for the management of the organization (Ford 2014). It is a matter of fact that due to
the Global recession few of the luxury products that the management of Wal-Mart offers to their
target customers have lost their salability as the buying preferences of the buying attitudes of the
target customers of the company is changing rapidly after experiencing the ills brought in by the

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global financial crisis. Due to the Global recession the market share of the companies also falling
and that raised a few eyebrows in the board of directors and the company therefore aspires to
regain its best glory and profitability in the market of United States of America. It has been seen
that if the management of Wal-Mart against the ability to see car position to promote their
products by rising the Expectations of the customers that can be beneficial for the management
to regain its past stature. Apart from these challenges the management of Wal-Mart can easily
gain success if they are able to implement some strategic tools to attract more customers in their
organization (Benn, Edwards and Williams 2014).
Rationale of the study
It is a matter of fact that the current scenario in the business sectors it is affecting the
profitability of the business organizations like Wal-Mart as the worldwide economic recession is
affecting the buying behavior of the customers and that is harming the profitability of the
retailers in the Global market. In the recent times it has been seen that the profitability of Wal-
Mart has been reduced to almost 10 to 15% due to this financial crisis and therefore the
management of the organization is aiming to regain its past profitability by introducing some
strategic changes in the structure of the organization and the operations of the organization.
Therefore the management of the organization will have to focus on effective marketing and
strategies that can attract more customers to their organization and convince them to buy
products just like that they did previously. Thus the management of Wal-Mart will be focusing
on providing significant discounts and offers to the customers of the organizations so that they
could get attractive to buy products from Wal-Mart and that could effectively help the
organization to regain its profitability in these odd circumstances. This world wide economic
recession has gotten huge competition in their market of operation and therefore the management

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of Wal-Mart will have to device different methods in order to gain the competitive advantage to
secure the profitability and reputation. The Wal-Mart can be counted among the top 33 major
retailers that’d operating in the international market that have lowered their outlooks for the
fourth quarter and beyond only due to the disappointing holiday shopping season and lack of
salability of the luxurious products that they offer to their target customers (Ford 2014).
Therefore it should be the duty of the leaders of Wal-Mart to proactively improve the marketing
policies so that they can attract more customers and they will have to implement training and
developmental programs in order to improve the organizational performance in all the stages of
their operations. Thus it can be said that all the management of the business organization needs is
that a strong leadership and a leadership that has the ability to do accurate decision making. This
is because, in the recent times, to achieve the past profitability, the management of the business
organization will have to focus on going through a structural change for securing the best
interests of the company.
Aims and objectives of the research
 How the management of Wal-Mart can sustainable growth rate in this current scenario?
 How the directors at Wal-Mart can sustain the profitability of the organization?
 To determine how the Global economic recession has affected the buying preferences and
the buying behaviour of the customers.
Research questions
RQ 1. How the management of Wal-Mart can secure the salability while operating in amarket
full of rivalries?

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RQ2. How can the management of Wal-Mart attract more customers to their organization and
convince them to change their buying behavior that could be beneficial for the company?
Literature review
Introduction
It has been seen that the macroeconomic fluctuation caused by the financial recession not
only have a major impact on the Retail Industry but it also makes the environment of the retail
market more competitive and this nasal infection the development of global economy that
includes the retail sector and the manufacturing sector also. It is a matter of fact that financial
crisis significantly impacts on any changes in the customer's behavior while buying products
(Katz-Rosene and Paterson 2018).
Major aspects of customers buying behavior
As opined by Keep (2014), there are two major aspects that can explain consumer
behavior and doors at behavior level and policy level. It can be that the definition of consumer
behavior can be described from the aspect of behavior level as purchase consumer collect use
evaluation and dealing with the products that satisfies the demands of the customers. In this
context it can also be said that consumers performance numerous of activities and ads during
purchasing the goods and the operations of such activities and acts are significantly depend on
the requirement of those individual customers (Goetsch and Davis 2014). Therefore it can surely
be said that consumer behavior is a problem solving process in order to be able to satisfy that
reminds of the customers. On the other hand, to define customer behavior from the aspect of
policy level it can be said that all the actions of the customers at the ground was involved in the

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process of acquiring consuming and the process product process and not only that it includes all
the decision making before and after the purchasing of the products or services. When the
customers makes decisions regarding purchasing they played more than one roles as an initiative
decision maker influences buyer and also the user (Wilson 2016). It can be said that each time
the customers play different roles under different conditions and when the customer is play the
role of the wires they will generally collect relevant information regarding the products there
buying and choose a reasonable price among the different ranges for that product (Cummings
and Worley 2014).
Impact of financial crisis on consumer behavior
The Global recession in the financial sector significantly affect the consumer behavior
while purchasing products and it can be said that after facing The Global recession the sprinting
budget of the household significantly reduced in the major parts of the world (Kolb 2014). It has
been observed that majority of the consumer is reduced their spending behavior and according to
a survey that has been seen that as the uncertainty of job security and economic development
increase the confidence of the customers of the consumers across the world decreased
significantly and that is quite natural too. As stated by Noe et al. (2014), the rising
unemployment shrinking wages can significantly put the consumers in image psychological
pressure and therefore that affects their spending behavior. The management of Wal-Mart stated
that the worldwide financial decision has resulted in a sudden fall in their profitability is draught
and that is only due to the lack of confidence of the consumers to spend after experiencing
shrinking wages and increased unemployment rate in parts of the world (Cummings and Worley
2014). After experiencing the horrible effects of global recession in the financial sector the
consumers has become more rational and sensitive right comes to taking buying decisions and

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this can effectively change the buying behavior or buying habits of the consumers (Kolb 2014).
It has been observed that after experiencing the financial crisis nowadays the consumers pay
more attention on the price range and the quality of the products of the services they buy and
apart from that it can be said that the consumers are trying to get access to shops before making
online transactions so that they can choose the products which have a wide range of quality and a
wide range of pricing so that they can get the best deal out of it. The management of Wal-Mart
has experienced that the consumers focus have shifted on the products and the information of the
retailers after experiencing the financial crisis and that has made it a bit difficult for the
management of Wal-Mart to be able to satisfy all the demands of their target customers.
Main factors that is affecting the retail business of Wal-Mart
It has been observed by Aarons et al. (2015), shopping environment, product quality,
price range, image of the shopping malls and convenience; these are the main factors that are
affecting the Retail Industry and the profitability of organizations like Wal-Mart. It is a matter of
fact that nowadays after experiencing this global financial crisis the consumers are compared to
pay more attention on the quality and the prices of the products rather focusing on the brand
service and the style of the products their purchasing apart from that the consumers are trying to
do brief research on the products they are purchasing (Kolb 2014).
The directors of Wal-Mart stated in a press meet that nowadays the profitability of the
buying preferences of the consumers are significantly dependent on the promotional walks that
the management is doing in order to increase their salability of the products. As opined by
Bolman and Deal (2017), it is a matter of fact that after the global financial crisis the buyers
purchasing decisions are significantly dependent on the discounts are the offers that the retailers

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can offer to them and for this case the globalization and the shrinking wages of the individuals
are the main reason.
Wal-Mart
Nowadays Wal-Mart is the largest retailer in the market of United States as they serve
more than 140 millions of customers on a weekly basis. It has been seen that the management of
Wal-Mart has been facing some challenges in securing their profitability after experiencing the
global financial crisis all over the world. As stated by Noe et al. (2014), as the global financial
crisis should the confidence of the customers, therefore it has been seen that buying preferences
or the buying frequencies of the customers have changed significantly over the years. It has been
observed that the traditional consumer companies like Wal-Mart have continued to struggle as
the Americans has started spending in a more cautious approach after experiencing the effects of
financial crisis in all over the world (Kolb 2014).
As stated by Mackey and Gass (2015), This trend was observed during the pie hotel
Holiday shopping season as in between the days of November to December the management of
Wal-Mart can make up to almost 40% of their annual revenue for the management of the
organization experienced only 25% of revenue generation in that time period which is
concerning. After experiencing the disappointing results the management of Wal-Mart stated that
its fiscal fourth quarter and full year adjust it earnings from continuing the operations may come
in slightly below the lower end of its tired forecasts as they have experienced a huge decrease in
the sales after the financial crisis took place.

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Summing up
Therefore, it can be said that the management of Wal-Mart should realize the fact that the
changing scenario in the finance sector is making it obvious that the target customers of the
business organization will check on their spending habits after experiencing the ills of rapid
financial crisis that is affecting the business sector immensely (Benn, Edwards and Williams
2014). As stated by Gereffi and Luo (2015), the frequency of losing jobs and increasing rate of
unemployment have shook the confidence of the frequent buyers and the shrinking of wages also
made it impossible for the buyers to sustain a culture where they would have invested money in a
shopping spree. Therefore, it has become evident that the management of Wal-Mart will have to
implement some strategies in order to sustain their profitability (Mackey and Gass 2015).
Therefore it would be beneficial of the management of Wal-Mart implement some marketing
tactics in order to sustain their profitability in the most adverse situation in the market of
operation. The management therefore is heavily depending on providing huge discounts and
offers to their customers in order to attract them to buy goods. As the largest retailer in the
market of United States, it is expected that the management of Wal-Mart will not have to face
huge problems at the time of economic recession as they are such a company that the customers
will have to buy products for them at appoint of time. But as the customers are not been able to
spend more, the frequency of shopping and the budget of their shopping has significantly
reduced and that is the matter of concern for the management of the business organization.

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Methodology
Research philosophy
There are three types of philosophy is for conducting research works and those are
positivism post positivism and realism. It has been seen that positivism research philosophy
allows the researchers to evaluate various other philosophical approaches by using reality and
other linked philosophies. On the other hand post positivism philosophy of the research is helpful
to cross check specific findings of the research by analyzing the existing data which have been
collected before. Realism philosophy of the research considers the objective reality of the
research topic.
Therefore for this particular topic of the research post positivism philosophy will be
chosen as it would help the researcher to study the relevant information by cross checking the
collected data and this is because this particular topic of the research is mostly dependent on
theoretical analysis of reality and thus this philosophy has been chosen by looking at the
advanced thinking and utilizing cross checking the collected information.
Research approach
There are 2 types of research approaches and those are Inductive and deductive approach
of research. Inductive approach enables the researcher to utilize recently established theories and
models while conducting the research work, on the other hand, the deductive approach allows the
researcher to study the research procedure in a broader sense while using already established
theories, models and ideas by other scholars.
Therefore for this particular research work deductive approach will be chosen by the
researcher so that the research can be conducted using established theories and models.

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Design of the research
The designs of the research works allows the researchers to undertake the design for performing
the research work. There are three types of research designs and those are primary, secondary
and mixed (Taylor, Bogdan and DeVault 2015). For this research work mixed design will be
followed as it is the mixture of both primary and secondary type of design.
Sampling
For conducting this research work, the researcher will be surveying 30 general employees of the
Wal-Mart and 10 managers and top leaders of the business organization.
Data collection
The researcher will collect necessary and relevant information from both primary and secondary
sources. To collect data from secondary sources, the researcher will have to collect data from
books, magazines, journals and various articles and websites (Mackey and Gass 2015). On the
other hand, the researcher will be collecting primary data by surveying 40 people associated with
Wal-Mart.
Data analysis
For completing this research work, the researcher will have to perform a quantitative data
analysis.
Ethical consideration
While conducting the research ork, the research scholar will be complying with all the rules and
regulations according to data protection Act 2009. The researcher will ensure that the collected
data for this research work and will be kept secret and will not be used for any other purposes
other than academic reasons (Flick 2015). The researcher will ensure that the respondents’

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answers will not be under any influences and the researcher will not change the information that
he collected while conducting the research work.

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References
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Routledge.
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Economy. Routledge.
Wilson, T., 2016. Access to, and Exclusion of, European Consumers from Financial Markets
after the Global Financial Crisis. In International Responses to Issues of Credit and Over-
indebtedness in the Wake of Crisis (pp. 59-88). Routledge.
Gereffi, G. and Luo, X., 2015. Risks and opportunities of participation in global value chains.
Aarons, G.A., Ehrhart, M.G., Farahnak, L.R. and Hurlburt, M.S., 2015. Leadership and
organizational change for implementation (LOCI): a randomized mixed method pilot study of a
leadership and organization development intervention for evidence-based practice
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sustainability. Routledge.
Bolman, L.G. and Deal, T.E., 2017. Reframing organizations: Artistry, choice, and leadership.
John Wiley & Sons.

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Cummings, T.G. and Worley, C.G., 2014. Organization development and change. Cengage
learning.
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project. Sage.
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125.
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Taylor, S.J., Bogdan, R. and DeVault, M., 2015. Introduction to qualitative research methods: A
guidebook and resource. John Wiley & Sons.

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