Back to Table of Contents pp Chapter 22 Making Consumer Decisions

Introduction to Business, Making Consumer Decisions Slide 2 of 58 Learning Objectives After completing this chapter, you’ll be able to: 1.Describe 1.Describe choices consumers make when buying goods and services. 2.Identify 2.Identify types of stores where consumers can make purchases. continued

Introduction to Business, Making Consumer Decisions Slide 3 of 58 Learning Objectives After completing this chapter, you’ll be able to: 3.List 3.List ways to be a smart consumer.

Introduction to Business, Making Consumer Decisions Slide 4 of 58 Why It’s Important As a consumer you have the problem of making your money go as far as possible. If you want to get the most for your money, you have to learn how to make good consumer decisions.

Introduction to Business, Making Consumer Decisions Slide 5 of 58 Key Words brand name generic products comparison shopping unit price promotional sale clearance sale continued

Introduction to Business, Making Consumer Decisions Slide 6 of 58 Key Words loss leaders impulse buying warranty

Introduction to Business, Making Consumer Decisions Slide 7 of 58 Consumer Choices Being a consumer—a person who selects, purchases, uses, and disposes of goods and services—is difficult when you have many choices.

Introduction to Business, Making Consumer Decisions Slide 8 of 58 What to Buy You can choose to buy either a brand- name product or a generic product. A brand name is a word or name on a product that helps consumers distinguish it from other products.

Introduction to Business, Making Consumer Decisions Slide 9 of 58 What to Buy Generic products are plainly labeled, unadvertised, and sold at lower prices. On the average, generic products cost 40 percent less than name-brand products.

Introduction to Business, Making Consumer Decisions Slide 10 of 58 Figure 22.1 MAKING A BRAND DECISION Generic brands usually cost less than brand-name products. Fresh, frozen, and canned are choices for many food products. When would you buy each of these different vegetable products?

Introduction to Business, Making Consumer Decisions Slide 11 of 58 What to Buy The main reason generic products cost less is because the producers spend so little on marketing and advertising.

Introduction to Business, Making Consumer Decisions Slide 12 of 58 When to Buy Prices for many items change during different times of the year. If you plan on buying a car or a computer, the prices usually go way down shortly before the new models are released.

Introduction to Business, Making Consumer Decisions Slide 13 of 58 Where to Buy The three reasons for the different types of places in which to shop are: The kinds of goods and services sold The prices The convenience

Introduction to Business, Making Consumer Decisions Slide 14 of 58 Department Stores Department stores sell a wide variety of goods, such as clothing, furniture, appliances, and sporting goods.

Introduction to Business, Making Consumer Decisions Slide 15 of 58 Department Stores Because department stores offer name brands and customer services, their prices are often higher than other types of stores.

Introduction to Business, Making Consumer Decisions Slide 16 of 58 Discount Stores Discount stores sell a wide variety of goods like department stores but at lower prices. They offer few services and stock merchandise in large quantities.

Introduction to Business, Making Consumer Decisions Slide 17 of 58 Off-Price and Outlet Stores Off-price and outlet stores are able to offer large discounts because the items they sell have minor flaws, are out of season, or have been discontinued.

Introduction to Business, Making Consumer Decisions Slide 18 of 58 Limited-Line Retailers Limited-line retailers, or specialty stores, sell a large assortment of goods in one product line or a few related lines.

Introduction to Business, Making Consumer Decisions Slide 19 of 58 Superstores and Hypermarkets Superstores and hypermarkets are like supermarkets but sell items such as books, hardware, and clothing as well as groceries.

Introduction to Business, Making Consumer Decisions Slide 20 of 58 Warehouse Stores Warehouse stores carry a huge selection of food and nonfood items at low prices and in bulk quantities. They sometimes require customers to become members of the store by paying a membership fee.

Introduction to Business, Making Consumer Decisions Slide 21 of 58 Showroom Retailers Showroom retailers display samples of their products for customers to choose from. Customers fill out an order form and the orders are filled from a backroom warehouse.

Introduction to Business, Making Consumer Decisions Slide 22 of 58 Shopping at Home You can also shop without ever leaving home by ordering products through: TV home shopping channels Mail-order catalogs The Internet

Introduction to Business, Making Consumer Decisions Slide 23 of 58 What to Pay Checking the price and quality of a product in more than one store is called comparison shopping. Comparison shopping is most important when making a major purchase.

Introduction to Business, Making Consumer Decisions Slide 24 of 58 What to Pay The unit price is the cost of an item for a standard unit of measurement, such as an ounce. Many stores list the unit price under the posted cost of an item.

Introduction to Business, Making Consumer Decisions Slide 25 of 58 What to Pay You can calculate the unit price of an item yourself by dividing the total price by its weight, volume, or quantity.

Introduction to Business, Making Consumer Decisions Slide 26 of 58 Figure 22.2 CHECKLIST FOR COMPARISON SHOPPING When you’re comparison shopping, check for various products’ features. When you examine an item of clothing for quality, what should you look for?

Introduction to Business, Making Consumer Decisions Slide 27 of 58 Fast Review 1.Why do generic products cost less than brand-name products? 2.When is a good time to shop for a product like a car, a computer, or an item of clothing? continued

Introduction to Business, Making Consumer Decisions Slide 28 of 58 Fast Review 3.What are the ways you can shop from home? 4.How can you calculate the unit price of an item?

Introduction to Business, Making Consumer Decisions Slide 29 of 58 How to Be a Smart Consumer You can become a smart consumer by planning in advance. One way to be a smart consumer is by learning how to read advertisements.

Introduction to Business, Making Consumer Decisions Slide 30 of 58 Study Advertisements Rational advertising attempts to convince you with facts and information. Emotional advertising appeals to your feelings.

Introduction to Business, Making Consumer Decisions Slide 31 of 58 Study Advertisements An ad that says “The best buy in town!” won’t necessarily help you become a smarter consumer. An ad that says “9 oz. Sparkle-Plenty Toothpaste, $1.99” might be very helpful.

Introduction to Business, Making Consumer Decisions Slide 32 of 58 Read Consumer Publications Magazines such as Consumer Reports and Consumers Research Magazine give detailed information about goods that have been tested and rated by them.

Introduction to Business, Making Consumer Decisions Slide 33 of 58 Read Consumer Publications Libraries and online services are good places to find these sources of consumer information.

Introduction to Business, Making Consumer Decisions Slide 34 of 58 Shop at Sales Some shopping experts say that the average consumer can save up to 15 percent by taking advantage of sales.

Introduction to Business, Making Consumer Decisions Slide 35 of 58 Shop at Sales A promotional sale is one that gives you a special buy on a new product or a product that’s in season.

Introduction to Business, Making Consumer Decisions Slide 36 of 58 Shop at Sales A store might have a clearance sale to clear out goods that are going out of season or are no longer profitable in order to make room for new merchandise.

Introduction to Business, Making Consumer Decisions Slide 37 of 58 Shop at Sales During sales, look for products that are advertised as selling at a loss or below cost. These advertised specials are called loss leaders.

Introduction to Business, Making Consumer Decisions Slide 38 of 58 Use Shopping Lists Impulse buying is purchasing things on the spur of the moment.

Introduction to Business, Making Consumer Decisions Slide 39 of 58 Use Shopping Lists A shopping list will keep you from making unnecessary shopping trips and keep you from buying on the spur of the moment.

Introduction to Business, Making Consumer Decisions Slide 40 of 58 Resist Pressure and Gimmicks Some salespersons use high-pressure tactics to try to get you to buy what they’re selling.

Introduction to Business, Making Consumer Decisions Slide 41 of 58 Resist Pressure and Gimmicks Sales gimmicks are meant to grab your attention and get you into the store or draw you into buying something.

Introduction to Business, Making Consumer Decisions Slide 42 of 58 Resist Pressure and Gimmicks Always closely examine any deal or bargain that seems too good to be true.

Introduction to Business, Making Consumer Decisions Slide 43 of 58 Read Labels and Warranties You might find information on the label that will make you decide not to buy the product.

Introduction to Business, Making Consumer Decisions Slide 44 of 58 Read Labels and Warranties A warranty is a legal document that states the rights and responsibilities agreed to by the consumer and the store or the manufacturer.

Introduction to Business, Making Consumer Decisions Slide 45 of 58 Read Labels and Warranties Full warranties are usually good for a stated time period, such as 90 days or one year. Limited warranties cover only certain parts of a product.

Introduction to Business, Making Consumer Decisions Slide 46 of 58 Graphic Organizer Being a Smart Consumer Graphic Organizer Resist sales gimmicks Resist sales gimmicks Use shopping lists Use shopping lists Read consumer publications Read consumer publications Shop at sales Shop at sales Study advertisements Study advertisements Read labels and warranties Read labels and warranties SMARTCOSUMERS

Introduction to Business, Making Consumer Decisions Slide 47 of 58 Fast Review 1.What is the difference between rational advertising and emotional advertising? continued

Introduction to Business, Making Consumer Decisions Slide 48 of 58 Fast Review 2.What two consumer magazines are good sources of information about products? 3.Why do stores have clearance sales? continued

Introduction to Business, Making Consumer Decisions Slide 49 of 58 Fast Review 4.What is the difference between a full warranty and a limited warranty?

Introduction to Business, Making Consumer Decisions Slide 50 of 58 In business, good communication spells success. Active listening is an important part of good communication. You can learn and improve active listening. continued Developing Listening Skills Business Building Blocks

Introduction to Business, Making Consumer Decisions Slide 51 of 58 When you’re listening, do you: continued Checklist for Active Listening Business Building Blocks  Fidget?  Ignore things that could distract you?  Keep your eyes on the speaker?  Concentrate on what the speaker is saying?

Introduction to Business, Making Consumer Decisions Slide 52 of 58 continued Checklist for Active Listening Business Building Blocks  Pick out the important ideas and think about how they’re related?  Summarize the ideas in your head?  Take notes to help you focus and remember?

Introduction to Business, Making Consumer Decisions Slide 53 of 58 continued Checklist for Active Listening Business Building Blocks  Ask the person to repeat or explain something that isn’t clear to you?  Avoid interrupting before the speaker is finished talking?  Avoid thinking of what you’ll say next?

Introduction to Business, Making Consumer Decisions Slide 54 of 58 Checklist for Active Listening Business Building Blocks  Pay attention even if you think the person’s words don’t interest you?

Introduction to Business, Making Consumer Decisions Slide 55 of 58 “100 percent fruit juice; 8 ounces gives you 75 percent of your daily requirement of Vitamin C.” Is this statement rational or emotional?

Introduction to Business, Making Consumer Decisions Slide 56 of 58 One ad reads: “The best buy in town. Sale ends today!” Is this statement rational or emotional?

Introduction to Business, Making Consumer Decisions Slide 57 of 58 You see a sign that reads “CD Bargain Bin. Regular $7.95, on sale for $5.95.” Is this statement rational or emotional?

Back to Table of Contents pp End of Chapter 22 Making Consumer Decisions