Brief description of the theory

Conspicuous consumption is defined as acquisition and possession of goods with an aim to gain social status in the society. Conspicuous consumption is related to public display of wealth to impress society. The rational decision making of consumers is based on taste and preferences. These preferences are undertaken by exploring the psychology of Veblen conspicuous theory and Scitovsky`s neuropsychological analysis. This discussion continues on how the consumer buying behaviour and customer satisfaction affects the decision-making to purchase goods to achieve a high level of satisfaction. Difference in economic status in a society motivates the customers to enrich their living standards. Further, four academic articles are chosen. First article gives brief description of the theory. In second article, the researcher conducted quantitative research with the help of questionnaire. In third article, the researcher conducted Qualitative research and studies effect of advertisements on people. In fourth article, both qualitative and quantitative research is conducted.

According to Almeida, (2015), the concept of conspicuous consumption has been evolved after the introduction of term “conspicuous” in theory of leisure class in 1899. Conspicuous consumption has become popular in developing countries because of income inequalities. Conspicuous consumption is referred as a type of consumer behaviour that displays how people spend maximum proportion of their income on luxurious goods and services. The consumer achieves different level of satisfaction after acquiring the goods. Conspicuous consumption is related to consumer habits of acquiring the concept of goods rather than goods. The highest level of satisfaction that a conspicuous consumer attains when consumer gets the pleasure of consuming the concept of goods, which is associated with higher leisure class.

Each article among the four articles has some common findings such as the market is dominated by rational decision-making of consumers, which is further based on tastes and preferences and the buying behaviour. Consumer behaviour traits and characteristics are the most crucial part for studying consumer behaviour. With the increasing considerable growth of fashion brands in luxury market.

Every author defines that buying behaviour of the consumers differ from culture to culture especially regarding purchase of luxury goods. Conspicuous consumption of different branded accessories varies across the cultures. The conspicuous consumption always look to consume like the higher social class to maintain the social esteem. Social esteem in conspicuous consumption is a wasteful expenditure by consumers. It is the acquisition of goods leading to wastage of money rather than fulfilling the basic needs.

According to Fuchs et al., (2013), Status consumption is defined as a motivational process through which an individual try to improve its social standing by consuming conspicuously. Status product helps to give an identification as a member of desirable group. Scitovsky is based on behavioural economics because he drew attention on psychology and people`s preferences which may be ‘joyless’ if level of satisfaction is not attained.

According to Zhu, (2016), the two basic aims associated with behavioural economics is firstly, to increase explanation power to realise psychological foundation. Second, to show that consumer choices can be biased systematically from time to time. Both aims at challenging the rational decision-making of the consumer. Therefore, there may be circumstances where choosing the option among different product can not be best for them. As Veblen leisure theory, Scitovsky does not focus on inner impulses, which plays an important role in motivating the consumer behaviour. Scitovsky is associated with pleasure and novelty.

Common findings across the four articles

According to Almeida, (2015), the article states that the status product gives social satisfaction rather than the physical satisfaction. Personality traits and social participation has greater impact on new product adoption. According to Scitovsky, the well-being of a consumer depends on crucial source of satisfaction rather than merely consumption of good. The pleasure and comfort is a potential source of satisfaction, which gives a sense of mastery to the understanding of customers by consumption of goods.

According to Pugno, (2014), a term ‘novelty’ may not imply to consumption of goods in scitovsky`s sense. Difference between comfort and novelty focuses uncertainty. The scitovsky sense has observed addictive consumption, which is an unusual and destructive type of novelty. The love for uncertainty may raise the behavioural types of gambling. It generally concentrates on affluent people who satisfy their needs just for their comfort. These affluent people faces the problem of boredom during the free time. The term of consumption skills can be misleading in regards to experience quality of consumers. Sometimes, it recalls the skill of selecting those goods, which are either near or alternative to conspicuous consumption. The element of innovation is associated with factors where use of interpersonal communication skills and decision-making ability of consumers can be affected.  

Under the research method, this article uses appropriate methods to analyse data. The main three kinds of research methods that can be used while conducting research are qualitative approach, quantitative approach, and mixed research of qualitative and quantitative.

According to Kuksov, and Xie, (2012), the second article explores several element such as consumer behaviour, buying behaviour, customer motivation, and experience, which surrounds the concept of conspicuous consumption. The effect of advertisement campaigns on different income level people and the overall happiness. In quantitative research, a questionnaire of 10 questions was randomly distributed to 200 people who were randomly chosen. The questionnaire is structured with logics of conspicuous consumption.

Nguyen et al., (2015), the article explores qualitative research level, the researchers could analyse the consumer buying behaviour, consumer satisfaction, experience quality, and consumer satisfaction, which is concerned with brands advertisement on social media. Advertisement campaign establish the luxury brand images and convince the customers to create a favourable opinion. Future researchers should investigate the study of conspicuous consumption patterns by collecting data from leisure-class and middle class people, which is determined by the income levels.

According to Almeida, (2016), although both qualitative and quantitative research were conducted but still, there are limitations to the research. The range of respondents were limited to a particular age group and region. Majority of respondents belonged to high-income group. It is not at all necessary that product advertised on social media is always of good quality.  

According to Ryu, (2015), Researchers relate conspicuous consumption with the image factors. This research would help to identify what type of consumers purchase conspicuously. Company tries to integrate experiences with products in today`s marketplace because ownership of luxury goods is not a major concern because the purchase decision of consumers is based on the situation of how relationship between the consumer and the environment is established. According to The Veblen theory relies on social leanings, which is based on role of habits in conspicuous consumer rational decision-making. The conspicuous consumption has become an evidence of social status. Despite this, customers also want quality in product to enrich their life. Once the brand gets recognition through any advertisement campaigns, individuals start consuming the brand product to associate themselves to the brand. Moreover, some individuals believe that their self-image depends on the usage of conspicuous consumption. Consumer who project his future purchase more luxury goods. The future research can increase the sample size by covering the people of each income group from low to high.

Reference

Almeida, F. (2015) The Psychology of Early Institutional Economics: The Instinctive Approach of Thorstein Veblen’s Conspicuous Consumer Theory. Economia, 16(2), pp. 226–234.

Almeida, F. (2016) Society and brain: A complementary approach to Thorstein Veblen’s conspicuous consumer based on Tibor Scitovsky’s neuropsychology, Nova Economia, 26(2) pp. 347-367.

Fuchs, C., Prandelli, E., Schreier, M. and Dahl, D.W. (2013) All that is users might not be gold: How labeling products as user designed backers in the context of luxury fashion brands. Journal of Marketing, 77(5), pp. 75-91.

Kuksov, D. and Xie, Y. (2012) Competition in s status goods market. Journal of Marketing Research, 49(5), pp. 609-623.

Nguyen, T., Ngamsiriudom, W., Pelton, L. and Dubinsky, A. (2015) Interrelationships among Facets of Self, Motivation, and Conspicuous and Sustainable Consumption Behaviour. International Journal of Business Science & Applied Management, 10(2). Pp. 21-24.

Pugno, M. (2014) Scitovsky’s The Joyless Economy and the economics of happiness. The European Journal of the History of Economic Thought, 21(2), pp. 278-303.

Ryu, J. S. (2015) the Emergence of New Conspicuous Consumption. Journal of Distribution Science, 13(6), pp. 5-10.

Zhu, D. (2016) Understanding middle class consumers from the justification of taste: a case study of Beijing. The Journal of Chinese Sociology, 3(1), p. 14