Chapter_3 - Consumption Chapter3 Introduction /retailerto...

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Click to edit Master subtitle style  10/27/10 Utilitarian and Hedonic  Consumption Chapter 3
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 10/27/10 Introduction Power has shifted from the marketer/ retailer to  the consumer Consumer express their desires and expectations  through their purchases of products and services The consumption experience has become a major  emphasis for consumer spending Consumption experiences are a more holistic way  that take in these elements: objects,  environment, emotional, needs and functional 
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 10/27/10 Current Consumer and Retail Trends Consumers take on different degrees of  importance to utilitarian vs. hedonic experience Although consumers exhibits different  preferences for utilitarian vs. hedonic shopping  experiences, both aspects are important to meet  the needs of today’s consumers Retailers need to understand why and in what  way consumers buy and consume certain  products or services. Trends can be explored through the consumer & 
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 10/27/10 Baby Boom Effects Baby boomers have the highest median income of  any age group (Census Bureau data)  Accounted for 58% of purchases in most  consumer product and service categories Affluent baby boomers fueled the growth of  upscale department stores  Have the attitude of “been there, done that”  toward buying more things Shifting there consumer focus to desire  
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 10/27/10 Baby Boomers Cont. Catering to baby boomers means providing goods  and services that make them feel better as they  age Retailers are offering goods and services to  diminish the effects of the aging process because  more boomers are focused on life’s joys Millennial Generation (Gen. Y) are the baby  boomers’ children
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 10/27/10 Polarized Demographics The two largest segments of the population are  boomers and millennials- created two huge  generational waves Results in the overall economy being polarized Growth in the luxury market targeting the affluent,  empty-nest baby boomers Strong demand for low-priced goods by millennials These polarized demographics direct the  consumer toward opposite ends of the spending  spectrum
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 10/27/10 Polarized Demographics Cont. Two major income groups: Higher income: demand high-quality goods and  additional services Lower income These polarized economic and demographic  trends influence retailing- retailers face a  paradox Affluent consumers take advantage of the  bargain-price offerings targeted at those with  less household income
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 10/27/10 Summary of Polarized Demographics Influence the consumer concepts of wants vs.  needs People who are driven by wants exhibit 
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