33 CONSUMER IN CHANGING TRENDS, CONSUMER MOVEMENT, CONSUMER MARKET – TYPES

Sarasvathi. V

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Introduction:

 

A consumer is someone who can make the decision whether or not to purchase an item at the store, and someone who can be influenced by marketing and advertisements. The consumer is the one who pays to consume the goods and services produced. Consumer is an individual, who buys products or services for his own personal use and not for the purpose of manufacturing or resale. A consumer is someone who can make the decision whether or not to purchase an item at the store, and someone who can be influenced by marketing and advertisements. Any time someone goes to a store and purchases a toy, shirt, beverage, or anything else, they are making that decision as a consumer.

 

Consumer is the most neglected being in the present scarcity- ridden society. A business unit cannot dare to ignore its consumers, if it wants to flourish. Despite initiating several Acts and Rules, consumers encounter a number of problems. It is the education concerned with teaching people the skills, attitudes and knowledge required for living in a consumer society in order to achieve maximum satisfaction and utilization of resources. It is also a fundamental component of general education, which helps to support consumers in their attempts to organize their everyday lives in a sustainable way.

 

Concept of Consumerism

 

Consumerism has been defined as a social movement seeking to increase the powers and rights of buyers in relation to sellers. It is a movement which strives to augment the rights and powers of consumers in relation to products, services and traders. The complaints made by a Persian emperor Cyrus the Great , about the malpractices in Greek market had created the ripples for such a movement and has helped to change the maxim – “Caveat Emptor” to “Caveat Venditor”, meaning “Let the buyer beware” to “Let the seller beware”.

 

The movement became stronger with time, since the consumers started realizing the fact that despite their powers to express Veto for any product their powers to exercise their rights was rather remote. To exercise their rights the need to unite and form a movement was found imperative. Hence this movement is described as: The organized efforts of consumers seeking redress, restitution and remedy for dissatisfaction they have accumulated the question of their standard of living”. The impact of consumerism, thus on the nation’s economy and general well – being is thus evident. This is essentially a movement against unsafe products and false claims made by producers. The movement got shape in the West. In the USA, the movement was initiated by Ralph Nadar and Rachel Carson. In 1962, John F. Kennedy approved the rights of the consumer through declaring “Consumer Bill of Rights”. The movement got shape in the West. In the USA, the movement was initiated by Ralph Nadar and Rachel Carson. In 1962, John F. Kennedy approved the rights of the consumer through declaring “Consumer Bill of Rights”.

 

According to the Bill, the consumer has the following rights:

 

  • Right to safety: to be protected against the marketing of goods which are hazardous to health or life
  • Right to be informed: to be protected against fraudulent, deceitful or to grossly misleading information, advertising, labeling and other practices and to be given the facts one needs to make an informed choice
  • Right to choose: to be assured wherever possible of access to a variety of products and services at competitive prices
  • Right to be heard: to be assured  that consumer  interests  will  receive full and sympathetic considerations in the formulation of Governmental policy Thus the thrust of the consumer movement in India has been on shortages. The year 1966 AWARE (later reorganized as Consumer Guidance Society of India) was formed which marked the path for active action. They dealt with three areas:

consumer education, protection and representation.

 

Some other voluntary organizations working in the field are:

 

•      Indian Federation of Consumer Organizations

•      Consumer Education and Research Centre

•      National Consumers Protection Council etc.

 

The government also passed many laws for the protection of the consumers and to save them from exploitation. The last in the series is the Consumer Protection Act of 1986 (CPA, 1986). Unfortunately, consumers in India are robbed of their economic liberties in matters of consumption, choice and satisfaction.

 

Consumer movement in India

 

Like the sellers and traders, consumers also have to perform certain duties and be responsible consumers to evolve a fairly appreciable consumer market in any country. That will tantamount to successful consumerism. What are the duties consumers need to take up and how are their responsibilities defined?

 

Consumer duties

 

Ø  Insist on receipts or bill without fail on all purchases made

Ø  Read the information or instructions given on the packets carefully before any purchase

Ø  Don’t give way for temptations on seeing misleading advertisements

Ø  Pledge to buy only standardized products. That is those with ISI mark, AGMARK brands etc

Ø  File consumer complaints against default in goods, deficiency in services or unfair trade practice

Ø  Responsibility of self help

Ø   Maintaining proof of transactions

Ø   Demanding proper claims

Ø   Proper use of products and services

 

Status of the Indian consumer – his major problems

 

Consumer is the most neglected being in the present scarcity ridden society. A business unit cannot dare to ignore its consumers, if it wants o flourish. But even after a lot of Acts and Rules, a number of problems are faced by the consumers. The major problems faced by consumers in general are:

 

a.Lack of information: This is the primary problem. The customers are so ignorant that they do not even know the sources of getting information.

 

b.Illiteracy: This is still the fate of many consumers across the Country. Ultimately their illiteracy is a major reason for them for not understanding the policies of an organization or the Government. They remain unaware to comprehend the uses or misuse of a product

 

c.No fair return: Pricing policies are such that many a times the consumer does not get the fair return for the price he pays for a product. They pay high price for the goods they purchase, but receive less satisfaction.

 

d.Exploitation: The consumers in the Indian market are exploited by the sellers/ traders by way of various malpractices like creation of artificial scarcity, hoarding, black marketing, high prices, adulteration etc

 

e. Adulteration: Traders and sellers practice adulteration of goods. Eventually, despite paying high prices the consumer does not receive pure or quality products. When profit maximization becomes the ultimate goal of the businessman, consumer is the sufferer.

 

f. Irregular supply: Irregularity in supply of goods, causing artificial shortage of goods at times when the consumer requires the product is another problem. The traders successfully create a scarcity by hoarding such goods and selling them when they can charge higher and yield good profit. Here again, the organization only benefits.

 

g. Attractive packing: Being lured by attractive packing which may even contain inferior goods is taken as a weakness in consumers. Consumers need to be prudent enough to demand quality products and not attractive packaging strategies

 

h. Disorganized customers: This is a self inflicted problem rampant in recent years. Customers being widely scattered, do not show sentiments of unity. Contrarily the producers and traders are organized and united. When the consumers are not united the traders take the opportunity to exploit them.

 

All these have led consumers to understand the need for consumerism Why consumerism?

 

  • Empower consumers to have access to  the basic needs of life
  • Protect consumers from hazards to their life and safety
  • Enhance the access of consumers to adequate information to enable them to make informed and environmentally benign choices according to individual as well as societal needs
  • Promote consumer education through formal as well as non – formal education systems so as to help consumers in their decision making.
  • Promote accountability and transparency through adoption of Citizens’ Charters
  • Provide expeditious and inexpensive system of delivery of justice
  • Promote an independent consumer movement in the country by providing assistance to consumer and other relevant groups to form their organizations and giving them the opportunity to present their views in the decision making process
  • Initiate and implement appropriate mechanisms for exchange of information on measures of consumer protection, nationally, regionally and internationally.

 

Meaning and concept of consumer movement

 

It evolved basically as a protest movement. It is a type of mass movement, where ‘mass’ means a general body of consumers with a common purpose / idea. Contextually it is a non official movement. People who initiate can be public and voluntary consumers or organizations. Sponsors are not the Government, but the movement is recognized and supported by Government. It is an offshoot of consumer protection.

 

How did it evolve in India? History

 

Our Country has an ancient history of consumer protection. It was part of ancient culture and had formed the core of Indian administration. Introduction of abundant commercialization of activities had eclipsed the rich old heritage. As in Europe the movement was in the form of consumer cooperatives. Kautilya’s “Arthasasthra’ was the basic law of ancient India. Later it was strengthened with provisions to protect consumers. Organizing sale of commodities in such ways that they did not inflict any trouble to the general public was the major measure taken up. For instance those trade activities gaining high profits, thereby causing trouble to general public were stopped immediately.

 

Consumer movement in modern period

 

This movement in its present form emerged only in 1960’s in India.

 

Objectives

 

•      Provide opportunity to the consumers to make intelligent purchases

•      Help in recognition of consumer requests

•      Strengthen protection against fraud, misrepresentation, unsanitary and unjust products

•      Voice for participation of consumer representatives in management of aspects affecting consumers

•      Assist in promoting consumer interests

•      Help in increasing consumer awareness

•      Enhance consumer expectations through consumer education

•      Motivate pioneers and leadership formation in the movement

•      Facilitate organized effort through consumer societies

 

Hindrances to growth of the movement

 

•      Lack of leadership and management

•      Illiteracy

•      Multi – lingual, multi – cultured nature on the citizens

•      Dearth of adequate resources (Financial) to organize the movement at the national level

•      Attitude of people – non cooperation (no solidarity)

 

Consumer groups (India)

 

•      CF – Consumer Forum

•      Indian CEC – Consumer Education Centre (India)

•      IAC – Indian Association of Consumer

•      BCT – Bombay Civil Trust

•      CGSI – Consumer Guidance Society of India

•      CVC – Citizen’s Voice Club (Coimbatore)

 

Consumer Market

 

Market – meaning and definition

 

Market has its origin from a Latin term “Mercatus“, which means “to trade”. It is well described as a place or a geographical area where buyers and sellers meet and function, goods or services are offered for sale, and transfers of title of ownership occur. It is through markets the separations between production and consumption functions are bridged. The term encompasses three distinct meanings: a place, a group of people and an activity.

 

The consumer market is the sum total of all the goods and services purchased in a given period of time by all the inhabitants of a given country or a section thereof for the satisfaction of their consumption needs. The four components of the consumer market are:

 

Components of the consumer market

  • People: Their needs (varied and specific) and ability to buy are determining factors
  • Purchasing power;: depends on potential customers, who represent the potential market
  • Need for a specific product: Here even purchasing power is not a factor. Need only counts, notaffordability.

Willingness of a consumer to fulfill personal need with a specific product: brand, trade name/ mark etc counts here along with willingness

 

A consumer cannot be forced to buy.

 

Thus, from the point of view of a manufacturer, the consumer market is only that segment of the people who can afford to buy his product, who have need for it and who are willing to buy the product in preference to all similar products sold by other manufacturers. This also entails another condition that a consumer should have the authority to buy.Not all are entitled to buy anything

 

Classification of Manufactured Goods

 

On the basis of consumption, Industrial goods and consumer goods are the two divisions of manufactured goods. Some products have both industrial and consumer market. Eg. Computer. They serve both the markets.

 

Industrial goods: Those goods which are destined to be sold primarily for use in producing other goods or rendering services as contrasted with those goods destined to be sold primarily to the ultimate consumer are called industrial goods. Those goods which are destined to be sold primarily for use in producing other goods or rendering services as contrasted with those goods destined to be sold primarily to the ultimate consumer are called industrial goods. So, they are not sold directly to the consumers.

 

Characteristics of industrial goods that differentiate them from consumer goods

  • They are not meant for consumption.
  • Their buyers are evidently different from the buyers of consumer goods.
  • Further processing is required in the case of industrial goods before they can be finally consumed.
  • A typical buyer is well informed – product, source, alternate source, merits/ demerits, supply and demand, completion etc

 

Classification of industrial goods (1)

Classification of industrial goods (II)

 

1.  Production facilities and equipments

2.  Production materials

3.  Production supplies

4.  Management materials

 

Consumer goods

 

Those goods destined for use by ultimate consumers or households and in such form that they can be used without commercial processing are called consumer goods. They are also called products.

 

Goods are basically classified into three categories: Industrial goods, consumer goods and agricultural goods.

 

Consumer goods as the name implies, are the goods purchased and consumed by the consumers for own and their families’ gratification. There are various classifications adopted for dividing consumer goods

 

Classification of markets

 

Therefore a market comprises a group of potential customers for a particular product who are willing and able to spend money or exchange other resources to satisfy their wants. Evidently a market consists of people with wants, purchasing power and the willingness to utilize the purchasing power.

 

Types of markets

 

1, Industrial

2.  Consumer

3.  Reseller

4.  Government

5.  International

 

These markets can either be vertical or horizontal in nature

 

a. Vertical markets: They are often found in industrial marketing where a direct sale is involved. A market is described as vertical if the product of a manufacturer is used virtually in only one or two industries. Here the products can be tailor – made to meet the specific needs of the buyers. Eg: manufacturer of aeroplanes.

 

Horizontal markets: If the product is used by many industries (consumers), then it is described as a horizontal market. Consumer products undergo large scale production. Therefore, in a horizontal market, the product must be developed to meet various purposes. Because of the numerous customers involved in a horizontal market, the producer has to give equal importance to personal as well as impersonal methods of sales promotion. The use of middlemen is also greater in a horizontal market. Eg: manufacturer of watches

 

Marketing

 

It is explained as a business function entrusted with the creation and satisfaction of the customers to achieve the aims of business. The process of marketing begins with the conception of a business idea or earlier than that. Marketing is one that is directly concerned with demand: its recognition, anticipation, creation, stimulation and finally satisfaction. The three terms encompassing “market’ are linked together by a slender thread called transfer; to be exact it is exchange. All are a party to the exchange; they give and receive value.

 

Definitions

 

It is the process of determining consumer demand for a product or service, motivating its sales and distributing it to ultimate consumer at a profit.(directing their flow from producer to customer or user)

 

It is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives.(Given by AMA)

 

Ø  Product -oriented definition

 

American Marketing Association (AMA) has redefined marketing as the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals

 

Ø  Customer – oriented definition

 

It is the process of discovering and translating consumer needs and wants into product and service specifications, creating demand for these products and services and then in return expanding this demand

 

What is macro marketing and micro marketing?

 

The former’s role is to effectively match the heterogeneous supply capabilities and the homogeneous demand requirements; thrust is on societal needs and efficient use of scarce resources

 

The latter concept rests its thrust on individual firms. it reveals two concepts: it has to ensure need satisfying goods on the one hand and marketing, rather than production should determine what products are to be made, that is, consumer is the centre of all marketing activities. It involves the process of formulating and implementing the policies of the firm

 

Nature of marketing

 

The following are the features or characteristics of marketing which are indicative of their nature.

 

Marketing:

 

v  is a goal oriented process

v   deals with products, distribution, promotion and pricing

v  focuses on goods, services and ideas

v   intends to satisfy and delight the customer

v   focuses on delivering value to the customers

v   is surrounded by needs

v   is business and business is marketing

v   is a process of exchange

v   is a universal function

 

Non-profit organizations also perform marketing functions (hospitals, colleges, charitable institutions etc). Therefore marketing is a universal function.

 

 

Difference between market and marketing

 

 

Merchandising

 

This term refers to product planning. it aims at internal planning relating to products or services for marketing at the right time, at the right price and in proper qualities colour and sizes. It covers everything from the packaging of the product to the way in which it is offered for sale.

 

Conclusion:

 

As stated by Mahatama Gadhi , The Father of the nation, “A Consumer is the most important visitor on our premises. He is not dependent on us we are on him. He is not an interruption to our work; he is the purpose of it. We are not doing a favour to a consumer by giving him an opportunity. He is doing us a favour by giving an opportunity to serve him”.

 

Consumerism is a social and legal force which aims at protecting the general interests of the consumers. Consumerism is a movement or policies aimed at regulating the products or services, methods or standards of manufacturers, sellers and advertisers in the interest of buyers, such regulation maybe institutional, statutory or embodied in a voluntary code occupied by a particular industry or it may result more indirectly from the influence of consumer organisations.

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