Chapter 2 Business and the Consumer

Needs and Wants Needs: the goods and services you need to survive Wants: the goods and services not necessary for survival Your income affects how many of each you get/purchase Do I really need it? Where would I get it? Is there variety available? How much $ can I afford to spend? Should I wait for a sale? Is it possible that someone else may buy it for me?

Values and Goals Affect what you decide are needs and wants Value: what you believe is important in life Influenced by personal experiences, friends and family and your community Can change throughout your life Goal: something that you work to achieve Short term or long term Important for financial stability

SMART Goal Setting Specific Measurable Attainable Realistic Timely Shelley would like to lose 10 pounds. Set a goal for Shelley! To lose 10 pounds. You can measure 10 pounds using a scale. Shelley feels that she can lose 10 pounds (60 may be unattainable) This is realistic, something she can do. Shelley would like to lose 10 pounds within a month.

Choices Choices depend on your financial position and skills that you have Good decisions mean being able to sustain your lifestyle What are some choices (small and large) that you will have to make in your life?

Factors that Influence Consumer Buying Decisions Income and Price Personal/ Life Status (keeping up with the Jones’, brands, sometimes unaffordable) Current Trends (peer pressure) Customs and Habits (family, religion, community) Safety (Canadian Standards Association for product safety) Promotion (advertising and using different mediums to do so) Lifestyle Advertising – when product is advertised using ideal, healthy, fit people but the product does not necessarily cause you to become this way

Responding to Consumer Behaviour Once a business opens, they must pay attention to their consumers to keep the business running successfully. If they don’t, the customers will choose to go elsewhere. They use this information to promote sales and improve revenues. 1. The amount of time a customer spends in a store changes sales: the longer that a customer spends in a store, the more likely they are to buy something. 2. Contact time or “interception rate” is the amount of time that is spent with a customer. The more time spent with a customer, the more likely that they will buy something. You should also think about how long a customer is in the store before an employee acknowledges them. 3. The longer that customers have to wait in line, the more unhappy they get. Sometimes, customers see long lineups and avoid them altogether. Long lineups mean fewer customers will come back.

How Business is Changing Today E-Commerce = Electronic Commerce With the internet, businesses can run without customers having to go anywhere No hours of operation, 24-7 Has become prevalent with the internet A professional web site and domain name are needed and web pages are needed to advertise goods and services The number of hits on a website shows how successfully the business can be Sometimes the owner does all the work independently or people can be hired to do this Sometimes businesses will have websites as well as an office with hours of operation The internet has opened up a whole new market and have made the business world much more competitive