Why Do Consumers Like to Engage in Conspicuous Consumption? What Are the Marketing Implications?

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Why do consumers like to engage in conspicuous consumption? What are the marketing implications?

In society, consumers do not only buy products to satisfy needs. Instead, they buy luxury products, which symbolise a lifestyle or image they would like to acquire. They aim to acquire this image by displaying that they can afford such luxury goods. This is called conspicuous consumption. This essay will determine why consumers engage in conspicuous consumption and what marketing implications this has in terms of the marketing mix.

In order to determine why consumers engage in conspicuous consumption, this term must first be defined. “Conspicuous consumption is the acquisition and visible display of luxury goods and services to demonstrate one’s ability to afford them” (Arnould et al., 2004 p.93). Research demonstrates that consumers buy branded products as solutions to practical problems. However, when engaging in conspicuous consumption, consumers buy branded products as symbols of their wealth (Piacentini & Mailer, 2004). They believe these products will give them a higher social standing and appearance; this is called status consumption (O’Cass & Frost, 2002). “The acquisition of material goods is one of the strongest measures of social success and achievement” (O’Cass & McEwen, 2004 p.27). Conspicuous consumers tend to be highly influenced by the perception the rest of society has on the product they are buying. Extended problem solving involves purchasing high-risk, expensive items, which are not bought very often such as houses or cars (Brassington & Pettitt, 2006). When purchasing such high-involvement products, conspicuous consumers are even more likely to consider the opinions of others and will purchase according to those opinions (Piacentini & Mailer, 2004). Another reason consumers engage in conspicuous consumption is to convey their personalities and identities through the products they buy (Piacentini & Mailer, 2004). Many consumers use products such as cars, houses, clothes, and electronics to portray a lifestyle they would like to have or be seen as having (Woodruffe-Burton, 1998). The use of clothing to symbolise a personality or lifestyle is commonly used by teenagers. They tend to use clothing as a method of identification, allowing them to judge whether or not they would be friends with someone according to what they are wearing (Piacentini and Mailer, 2004).

The final reason consumers engage in conspicuous consumption is to fulfil a need or desire that they cannot fulfil by other means; this is called compensatory consumption (Woodruffe-Burton, 1998). This is directly linked to conspicuous consumption (Woodruffe-Burton, 1998) since it is also undertaken in order to enlarge an individual’s ego (O’Cass & McEwen, 2004). The need or lack that consumers are aiming to fulfil through consumption can be caused by an absence of confidence, happiness, or self-esteem (Woodruffe-Burton, 1998). Compensatory consumers aim to satisfy these needs or lacks through the purchase of items that will increase their confidence or make them happier.

Maslow’s hierarchy of needs enables marketers to understand what needs consumers are trying to fulfil when purchasing a product or service (Arnould et al., 2004). Once a consumer has satisfied all of the lower needs of the hierarchy, they seek to achieve esteem and self-actualization (Arnould et al., 2004). Individuals who have already reached those levels of the hierarchy tend to be seen as more intelligent, beautiful, and successful compared to the individuals who have not reached those levels of needs fulfilment. This is called the “halo effect” (Piacentini & Mailer, 2004, p.256). This is when conspicuous consumption begins. Some consumers will be likely to buy products that are symbols of wealth and status in order to achieve the “halo effect”. Increasingly, in the western world, basic needs such as physiological needs, safety and security needs...
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