Conspicuous Consumption: Consumer Behavior Analysis Report

This report delves into the concept of conspicuous consumption, which involves spending on luxury goods and services to display economic power and attain social status. It examines the impact of conspicuous consumption on consumer behavior, customer satisfaction, and motivation. The repo...Read More

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Conspicous Consumption
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Introduction
Conspicuous consumption is the spending of money on luxury services and goods and
then acquiring them in a show of display of economic power. This is out of the income or from
the accumulated wealth of a particular buyer. This is a means of getting a particular social status
for the buyer in question or a display of discretionary economic power. In the development of
Thorsteins Veblens sociology, there are various terms that were derived from conspicuous
consumption such as invidious consumption which is the ostentatious consumption meant to
provoke envy of the people looking. There is also the term conspicuous compassion which is the
deliberate use of donation money given to charitable organizations in order to display a superior
socio-economic status (Bellezza, et al., 2016). There are various ways in which conspicuous
consumption affect the consumer’s behavior, customer satisfaction, motivation and customer
experience.
Conspicous consumption analysis
In order to determine the attitude of consumers of goods, services to the store a study was
conducted of customers who repeatedly, that is, 3 or more times used the services, products of
this economy. The survey involved 300 people at the same time; consumers of products of the
store of the female are 7% more than the male. The largest part of the sample (63%) is the
interviewed customers of the store at the age of 28 to 45 years. The results of the marketing
research on the criterion of belonging to the client of the store for this or that social status
allowed to formulate the conclusion that products and services among customers of the store are
made (Dev, et al, 2018):

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The results of the marketing research on this issue made it possible to conclude that the
most important factors in the selection of the store are the quality policy, which is spoken by
83% of the customers of the store, as well as the polite customer service (81% of respondents).
The study of consumers is primarily aimed at understanding their needs to ensure their
fullest satisfaction. To do this, it is necessary to identify and analyze deeply the already existing
needs, to study the patterns of their development and the formation of new needs.
The purpose of writing the course work is to study and analyze the behavior of consumers in the
market of goods and services. It should be noted that consumer behavior is a field of knowledge
that goes beyond the strictly marketing sphere of activity. It is relevant for anyone who strives to
firmly and successfully integrate into the market and succeed in it, using a wide range of
professional methods for managing consumer behavior.
Consumer behavior is an activity directly involved in acquiring, consuming and disposing
of products, services, ideas, including decision processes that precede and follow these activities
(Hinz and Hann, 2015).When analyzing the behavior of consumers in the market of goods and
services, it is also necessary to take into account the decision-making process of buying, post-
purchase analysis and the formation of the buyers' loyalty to the brand of the product firm
(Kapeller, and Schütz, 2015). The purpose of the practical part of the course work is to study a
personal household, comparing the monthly budget with the total costs.
Factors of external influence on consumer behavior

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Factors of external influence on consumer behavior include: culture, values, demography,
social status, reference groups, households. These factors are, in fact, a diverse influence of
groups of different scale on the consumer. The scheme of the relationship between the size and
type of influence of groups on an individual (Kastanakis, and Balabanis, 2014).
Demographic factor
The demographic factor considers the study of the population, its number, density, distribution
and life features. Typical statistical demographic characteristics include age, sex, income,
education, marital status, family size and occupation. The consumption strategy is determined by
the type of influence of the reference group on the target segment of consumers. The main types
of such influence are: information influence, normative influence, identification, or value-
expressed influence.
Information impact
The information type of influence (informational influence) per consumer is the use of
information provided by the reference group. The strength, effectiveness of information
influence is proportional to the importance of the information provided by the reference group.
Information impact is widespread in cases where it is difficult to assess the characteristics of a
product or brand by observation (Kim and Jang, 2017). Therefore, the experience of using or
recommending other people is likely to be perceived as relevant and valuable. Thus, the
"principle of social proof" (the principle of social proof) serves as a factor of consumer choice.
Mechanisms of information influence, we will discuss later in more detail.

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Limitations to the research in conspicuous consumption
The normative influence of the reference group is to encourage the individual to follow
group norms in order to receive direct remuneration or avoid sanction. So, for example, the
parents of a certain social group buy educational, entertainment and education services for their
children (foreign language, music, vocational training), following the norms of this group.
Likewise, an individual may refuse to wear a trendy style to avoid becoming the object of
friends' jokes (Mandler, 2018). Norms are expected and acceptable behaviors. Norms arise with
the emergence of groups and cover all aspects of behavior associated with the group. Violation
of the rules may entail sanctions. The significance and effectiveness of regulatory influence is
proportional to the significance of the group's reward / sanction for the individual.
Conclusion
The strategic orientation of business in the era of globalization presupposes knowledge of
the global consumer structure and world trends in its development. Significant for the marketing
trends of the global population are:The increased period of replacement of generations in
developed countries - due to the increase in the terms of education, urbanization, with the growth
of living standards, the legalization of abortion, more effective methods of contraception,
widespread sterilization, increased participation of women in social work, high divorce rate,
delayed marriage and childbearing (Oosterlinck, 2017). Rapid urbanization in less developed
countries with high population migration to richer industrial countries. The demographic
structure of world markets is clear and obviously necessary for analyzing the consumer potential.

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References
Bellezza, S., Paharia, N. and Keinan, A., 2016. Conspicuous consumption of time: When
busyness and lack of leisure time become a status symbol. Journal of Consumer Research, 44(1),
pp.118-138.
Dev, M., Podoshen, J.S. and Shahzad, M., 2018. An Exploratory Comparison of Materialism and
Conspicuous Consumption in Pakistan. Journal of International Consumer Marketing, pp.1-9.
Hinz, O., Spann, M. and Hann, I.H., 2015. Research Note—Can’t Buy Me Love… Or Can I?
Social Capital Attainment Through Conspicuous Consumption in Virtual
Environments. Information Systems Research, 26(4), pp.859-870.
Kapeller, J. and Schütz, B., 2015. Conspicuous consumption, inequality and debt: the nature of
consumption‐driven profit‐led regimes. Metroeconomica, 66(1), pp.51-70.
Kastanakis, M.N. and Balabanis, G., 2014. Explaining variation in conspicuous luxury
consumption: An individual differences' perspective. Journal of Business Research, 67(10),
pp.2147-2154.
Kim, D. and Jang, S., 2017. Symbolic consumption in upscale cafés: examining Korean Gen Y
consumers’ materialism, conformity, conspicuous tendencies, and functional qualities. Journal
of Hospitality & Tourism Research, 41(2), pp.154-179.
Mandler, M., 2018. Piracy versus monopoly in the market for conspicuous consumption. The
Economic Journal, 128(610), pp.1257-1275.

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Oosterlinck, K., 2017. Art as a wartime investment: Conspicuous consumption and
discretion. The Economic Journal, 127(607), pp.2665-2701.