2. Add elements to the mind map below to summarise the factors affecting consumer decisions.
Key factors affecting consumer decisions:
Finance- used when you do not have enough cash. Involves taking out a loan. Interest must
be paid on the amount borrowed.
Price-This is usually one of the first things you want to know. If the price of a good is more
than you can afford you probably won’t buy it. Consumers want the best value for their
money: that is they want to pay for the lowest price for the best quality.
Marketing: Plays an extremely important part in influencing the consumer’s decisions. As
consumers are constantly, exposed to all aspects, of marketing. The average consumer is
exposed to an estimated 500 marketing strategies (mainly some sort of advertising) every
Age- People at different ages wants to buy different things, like by the time your 18 a car
becomes an important want. In older age people often want and need less. Our wants
change over time.
Gender- Males and females have different wants and needs, such as entertainment, music
and cars. However, a person’s gender influences some types of purchase. For example
female consumers spend more on cosmetics than males.
Convenience- Many consumers don’t have time to shop. Consumers want shops which are
hassle free, or convenient. Convenience has many meanings for consumers, such as
travelling time to retail outlet, the number of stores located within one shopping complex or
suitable shopping hours.
Environment- With increasing community awareness of environmental pollution, many
consumers are becoming more aware of the problems caused by throwaway packaging. You
therefore may be influenced to purchase a product that has minimal packaging or packaging
that can be recycled.
Service- Good pre-sale and after-sale service makes you feel like a valued customer and,
consequently, will keep you buying that product or going back to that particular store. Poor
service has the opposite effect.
3. In small groups, discuss why some consumers are prepared to pay a high price for a product
while other consumers would not buy the product even if the price was low. What does this tell you
about the relationship between price and customer tastes and preferences?
(a) In pairs, debate the following topic: ‘Advertising is the most important factor affecting consumer
decisions’. One person presents the affirmative case and the other person the negative case. Each
person writes the key points for their case.
Without advertising people would not buy products or know that certain products have
certain objects in it which endanger animals or environments.
Advertising will bankrupt companies which support foundations such as the cancer council.
Advertising can lead to false advertising.
Waste of electricity.
Annoying for people who don’t care about the product.
(b) Divide the class into two groups, those for the affirmative case and those for the negative case.
Each group is to refine their arguments before a spokesperson presents the group’s comments.