Lecture Consumer behaviour: Chapter 18 - Cathy Neal, Pascale Quester, Del Hawkins

This lecture covers the concept of consumerism, and the role of organisations that protect consumer’s rights. Ethics in business is important as unethical practices can be easily exposed and firms can suffer the resultant negative publicity. We will also discuss the impact of technological changes, such as the Internet, on consumers and their behaviours.

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–1

• Role of consumerism and consumer movement

• Role of government legislation and regulation

• Growing importance of ethics in marketing

• Meaning of negative consumer behaviour

• Effects of the Internet on marketing and consumer behaviour

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–2

Consumer Movement in Australia,

New Zealand and Internationally

• Australian Consumers Association (ACA)

http://www.choice.com.au

• Ministerial Council on Consumer Affairs

http://www.consumer.gov.au

• Consumers’ Institute of New Zealand

http://www.consumer.co.nz

• Consumers International

• http://www.consumersinternational.org

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–3

Consumerism: Definition

The evolving activities of governments, businesses, independent organisations and concerned consumers aimed at protecting and enhancing the rights of

consumers

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

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Consumerism

Can be viewed from 3 levels:

• Relationship between consumer and manufacturer

• Consumer’s relationship within the broader societal context

• Consumerism at a political level

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–5

Global Consumer Movement

• Consumers International

– 250 consumer organisations in 115 countries

• Covers:

– Product safety

– Consumers’ economic interests (banking, financial

services, insurance)

– Consumer information and education

– Redress and complaint facility

– Draft legislation on electronic commerce

The Rights and Responsibilities

of Consumers

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–7

The Consumer Movement in

Australia

• Australian Consumers Association

– Non-profit, non-party-political organisation

– Conducts comparative tests

– Publishes reports and speaks out on issues such as:

 Information and advice on goods, services, health and personal finances, and

 Issues that help to maintain the quality of life of consumers

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–8

The Consumer Movement in

New Zealand

Consumers’ Institute

• Non-profit, independent organisation

• Conducts comparative tests and surveys on

consumer goods

• Advises on financial, food, health, safety, welfare and environmental matters

• Has representation on parliamentary committees

• Plays a role in educating consumers

• Advises them on how to make complaints

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18–9

The Government Regulatory

Environment

• Australia

– Trade Practices Act 1974

– Australian Competition and Consumer Commission

(ACCC)

• New Zealand

– Fair Trading Act 1986

– Consumer Guarantees Act 1993

– Hire Purchase Act 1971

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18– 10

Industry Self-Regulation

• Australia

– Some areas have favoured self-regulation

e.g Advertising Standards Bureau

• New Zealand

– Advertising Standards Authority

(administers Advertising Standards Complaints Board)

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18– 11

Ethics in Business

• Marketing ethics

• A societal marketing concept

• A framework for marketing ethics

(see next slide)

Marketing Ethics Framework

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18– 13

Marketing Mix Decisions

• Product

– design and safety

– packaging and labelling

– product recalls and

bans

• Pricing

– resale price

maintenance

– price discrimination

– two-price advertising

• Promotion

– portrayal of women – advertising to children – use of sex in ads

• Market research

– privacy – Internet

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18– 14

Marketing Mix Decisions (cont.)

• Product issues

– Product design and safety

– Packaging and labelling

– Nutritional labelling

– Product recalls and bans

• Pricing issues

• Promotion issues

PPTs t/a Consumer Behaviour 4e by Neal, Quester, 

Hawkins

18– 15

Negative Consumer Behaviour

• Potential detrimental effects on consumers

– compulsive buying

– compulsive consumption

(e.g compulsive eating, drinking or gambling)

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Hawkins

18– 16

The Electronic Marketplace

• Current consumer protection provisions were

developed in the traditional marketplace

• Government and consumer groups have new

concerns with issues of privacy, security, access and consumer protection