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