Says one analyst shoppers now are taking pride in their newfound financial

Says one analyst shoppers now are taking pride in

This preview shows page 7 - 9 out of 21 pages.

Says one analyst, shoppers “now are taking pride in their newfound financial discipline.” As a result, far from encouraging today’s more frugal consumers to overspend, marketers are working to help them find greater value with less.19Too Few Social GoodsBusiness has been accused of overselling private goods at the expense of public goods. As private goods increase, they require more public services that are usually not forthcoming. For example, an increase in automobile ownership (private good) requires more highways, traffic control, parking spaces, and police services (public goods). The overselling of private goods results in “social costs.” For cars, some of the social costs include traffic congestion, gasoline shortages, and air pollution. For example, people living in the Toronto area, the fourth most congested region in North America, spend seven hours per week stuck in traffic. (Kotler 117-118)A way must be found to restore a balance between private and public goods. One option is to make producers bear the full social costs of their operations. For example, the government is requiring automobile manufacturers to build cars withmore efficient engines and better pollution-control systems. Automakers will then raise their prices to cover the extra costs. If buyers find the price of some cars too high, however, the producers of these cars will disappear. Demand will then moveto those producers that can support the sum of the private and social costs.A second option is to make consumers pay the social costs. For example, many cities around the world are now charging “congestion tolls” in an effort to reduce traffic congestion. To unclog its streets, the city of London levies a congestion charge of £8 per day per car to drive in an eight-square-mile area downtown. The charge not only has reduced traffic congestion within the zone by 21 percent (70 000 fewer vehicles per day) and increased bicycling by 43 percent, but also raises money to shore up London’s public transportation system.21(Kotler 118)Cultural Pollution
Background image
Critics charge the marketing system with creating cultural pollution. Our senses are being constantly assaulted by marketing and advertising. Commercials interrupt serious programs, pages of ads obscure magazines, billboards mar beautiful scenery, and spam fills our inboxes. These interruptions continually pollute people’s minds with messages of materialism, sex, power, or status.Marketers answer the charges of “commercial noise” with these arguments: First, they hope that their ads primarily reach the target audience. But because of mass communication channels, some ads are bound to reach people who have no interest in the product and are therefore bored or annoyed by them. People who buy magazines addressed to their interests—such as Vogueor Canadian Business—rarely complain about the ads because the magazines advertise products of interest.
Background image
Image of page 9

You've reached the end of your free preview.

Want to read all 21 pages?

  • Winter '16
  • Simon P. Sigué
  • Marketing

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes