Critically evaluate and discuss the advantages and disadvantages of Customer Boycotts. Compare and contrast either Coca Cola or Bacardi with another consumer boycott of your choice and discuss appropriate microeconomic theoretical models.
Firstly to understand this question we need to understand what a customer or consumer boycott actually is. Well it is normally called by an organisation or a group of individuals, asking consumers not to buy a specific product, or the products of a specific company, in order to exert commercial pressure. This is usually done to get the company to change behaviour, to cease an activity or to adopt a more ethical practice.
For this essay I am going to discuss many advantages and disadvantages of consumer boycotts and also I have decided to compare and contrast coca cola with the Nestle boycott.
There are various ways to make a boycott efficient. To be efficient a reduction of 1-2% of turnaround of a company (or product) is seen as the critical mass needed. (27 Mar 2003, Demanding consumer [online]. Available at:).
Boycotts can be successful, for example, in 1986 Rainforest Action Network launched a boycott of Burger King. This was because of Burger King importing beef from tropical rainforest countries because it was cheap. But the rainforests were getting destroyed in order to provide pasture for cattle. As a result of the boycott, Burger Kings sales dropped by 12%. In response, Burger King cancelled thirty-five million dollars worth of beef contracts in Central America and announced that the company would stop importing rainforest beef.
Boycott calls are at times controversial because they may be called by groups from the political side or for activities that people don't specifically disagree. Boycott efforts can include protests against everything from investing in a politically undesirable country to discouragement of the eating or drinking of products from certain companies...