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Consumer Buying Strategies and Smart Selling Techniques

Learn about consumer buying strategies like rational buying, emotional buying, and impulse buying. Discover smart selling techniques to meet and create demand.

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Consumer Buying Strategies and Smart Selling Techniques

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  1. Chapter 3 Your Purchasing Power

  2. How Are Prices Set in a Market Economy? • Cost-recovery pricing is used to recover R&D costs. • Cost-plus pricing iscalculated usingproduction costs plus a markup. • Value-based pricing isbased onwhatconsumers are willing to pay. • Market-based pricing isset to be competitive with similar products. 3-2 Prices and Consumer Choices Slide 2

  3. Activity • Assume that your family recently bought the following items: • Loaf of bread • Blu-ray player • Ipad mini 4 Slide 3

  4. How Do Buying Strategies Affect Prices? • Rational buying • Economizing is saving money and spending only when necessary. • Optimizing is getting the highest value for money spent. 3-2 Prices and Consumer Choices Slide 4

  5. Smart Buying Strategies • Customer Loyalty Program: designed to encourage a customer’s repeat business by providing special discounts and other incentives • Emotional Buying: the process of purchasing products based on desire rather than logic Slide 5

  6. Smart Buying Strategies cont. • Rational Buying: the process of selecting goods and services based on need, want, and logical choices • Impulse Buying: buying something in the spur of the moment without thinking it through or planning your purchase • Buyer’s remorse: sense of regret after making a large purchase Slide 6

  7. What Are Selling Strategies? Meeting demand • Convenience • Customer service • The right product and price • Examples: meet basic needs, offer brand names, use discount pricing 3-3 Getting More for Your Money Slide 7

  8. What Are Selling Strategies? Creating demand • Advertisingis informing consumers about products and encouraging them to buy. • Advertising sources: newspapers, magazines, TV, radio, Internet, billboards, signs, direct sales • Thetarget audience is a specific group of people who are likely to buy. 3-3 Getting More for Your Money Slide 8

  9. Cookies • WSJ Video • “Sponsored” ads on Instagram • “Suggested” posts on Facebook Slide 9

  10. What Are Consumer Buying Strategies? • Prepare a shopping list. • Do not let a salesperson influence you. • Stick to your list and avoid impulse buying. • Shop when you are most alert. • Comparison shop among several sellers. • Keep receipts, warranties, and packaging. 3-3 Getting More for Your Money Slide 10

  11. Your Purchasing Power • Page 99: #10-18 • With a partner • Page 100 #20 • Individual answers Slide 11

  12. What Are Consumer Rights? Many laws protect consumers. • Consumer Bill of Rights • Airline Passenger Rights • Consumer Technology Bill of Rights • Patients’ Bill of Rights • Consumer Protection Laws • Examples: Food, Drug, and Cosmetic Act; Hazardous Substances Act; Cigarette Labeling and Advertising Act; Nutrition Labeling and Education Act; FERPA; HIPAA 3-4 Consumer Rights and Responsibilities Slide 12

  13. Sources of Consumer Protection • Federal Agencies • USDA • FDA • CPSC • FCC • FTC • FAA • SEC Slide 13

  14. Consumer Bill of Rights • Right to safety • Right to be informed • Right to choose • Right to be heard • Right to reparation • Right to consumer education Slide 14

  15. Sources of Consumer Protection • State and local assistance • Private Organizations • Examples: BBB, National Consumers League, Consumers Union 3-4 Consumer Rights and Responsibilities Slide 15

  16. How Are Consumers Defrauded? Deception involves false or misleading claims made about a product. • Bait and switch • Fake sales • Low-balling • Pyramid schemes • Ponzi schemes • Pigeon drop • Infomercials 3-4 Consumer Rights and Responsibilities Slide 16

  17. Deceptive Advertising • Video • What claims are made about the product? • What gimmicks are being used to sell the product? • How effective is the commercial? Slide 17

  18. How Can Consumers Protect Themselves from Fraud? • Read contracts • Keep receipts and warranties • Compute total cost • Research businesses • Shop smart • Be aware of prices • Understand sale terminology • Compute unit prices • Read labels • Check packages carefully 3-4 Consumer Rights and Responsibilities Slide 18

  19. International Studies • With a partner, select another country and research its consumer protection laws. Report the following to the class: • What laws are in place? • How are they different from the U.S.’s laws? Slide 19

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