Consumers are individuals or households that consume goods and services generated within the economy. Since the word includes just about everyone, it is a political term as much as an economic one when it is used in everyday speech. Business revolves around having a seller and a consumer.
Typically when business people and economists talk about a consumer, they are talking about a person as a consumer, an aggregated commodity with little individuality other than that expressed in his decision to buy or not buy.
There, however, is a trend in marketing to individualize the concept. Instead of generating broad demographic profiles and psychographic profiles of market segments, marketers are engaging in personalized marketing, permission marketing and mass customization. Look at the power of social media. Have you noticed that every time you log on a web page, there are pop outs or opt ins that make a viewer sign up.
A consumer is assumed to have a budget, which can be spent on a range of goods and services available in the market. Under the assumption of rationality, the budget allocation is chosen according to the preference of the consumer, i.e., to maximize his or her utility function.
Credit-card companies tempt consumers into availing themselves of higher credit limits. In franchising, there are now loans specifically offered to consumers wanting to have their own businesses.
Rewards come in different ways to get consumers to spend more. Last Sunday I saw this signage in a restaurant. It says, “Download this app in your mobile phone and get a free drink.”
Whatever manner one gets to attract the consumer, I still believe in the power of loyalty.
Consumers are smart and wise. If they see a greater value in what they purchase and the business establishment cares, expect a much better result.
Many businesses try to attract a greater number of consumers. There are above-the- line and below-the- line methods. In the end, if a consumer cannot remember and recall the beautiful and lasting experience he or she had, everything goes to waste.
Take care of your consumers and they, in return, will make your business last.
(Armando Bartolome is a business mentor to numerous micro entrepreneurs who are now themselves big names in the industry. This article was previously published on the author’s website. For questions and more information, you may contact Armando "Butz" Bartolome by email:email@example.com or on Twitter @philfranguru. His website is www.gmb.com.ph)