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Lecture 17

ADM 3321 Lecture Notes - Lecture 17: Everybody Loves Raymond, Conspicuous Consumption, Blue-Collar Worker


Department
Administration
Course Code
ADM 3321
Professor
Michael Mulvey
Lecture
17

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Lecture 17
Income, Social Class, and Family Structure
Harry Rosen videos
!Not going to see the alligator on the goods, instead provide high
end good quality stuff
How do luxury goods differ from other goods? Provide some examples.
!They cost more
!Better quality
Describe the consumer who buys luxury goods.
!Old money is anyways there
Why are luxury goods recession—proof?
What is the relationship between social class and income?
!People who own businesses
What kinds of goods and status symbols among college students?
!Fashion accessories and bags, they never go old/out of fashion
The “Takeaway”
!Products and brands may serve as status symbols
!Many luxury goods are not as conspicuous as they once were. Some
people want to avoid such blatant displays and seeks subtlety in
luxury.
o!Luxury is also contained within social groups
!Consumption of luxury goods may also be driven by inner-focused
motives (i.e. “reward” and “indulgence” motives of self-gifts)
o!Thought, design that went into creation of that good
!Luxury goods may carry different connotations across reference
groups.
!Do “low-budget” luxury goods exist?
o!E.g. low-budget Mercedes
o!Discount stores e.g. Winners
o!Buying in Bulk
o!Going to the right store
o!E.g. Starbucks
o!Independent seller
o!Counterfeit goods
!!Fake it
Right-hand Rings
!DeBears Diamond
!Diamonds across the world
!They create a mythology: Right-hand rights

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o!Independence
o!Self-determination
o!Self-worth
!Each diamond to become unique
o!Sacred and profane
!Take an ordinary old thing
Demand Management Strategies
!Sell value, not price
!Offer budgeting advice
!Up sell (bigger diamonds)
!Turnover surplus goods (small diamonds)
!Increase purchase frequency by adding occasions
!Target new buyers using self gifts
!Encourage multiple unit sales
!Sell the sizzle (romance, love, devotion) not the steak (stones)
Behavioural Economics
!Behavioural economics
o!They study of the behavioural determinants of economic
decisions
o!In people’s mind gains and losses are placed in very different
ways
o!E.g. how do you get people to meet deadlines?
!Discretionary income
o!Money available to a household above that required for a
comfortable standard of living.
o!What you get left over after paying your bills
!Consumer confidence
o!Measures consumers state of mind; optimism or pessimism
about economic conditions.
o!Sense of people’s sentiment about where the economy is
heading but also where their own economic situation is
heading
o!Economic conditions called for
Social Class
!Social class
o!Overall rank of people in a society
o!Based on social standing, occupations and lifestyles
o!Every place has social pecking order
o!People in cultures look for things to separate people
!Social stratification

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o!The process is a social system by which scarce and valuable
resources are distributed unequally to status positions that
become more or less permanently ranked in terms of the
share of valuable resources each receives.
o!We rank people based on resources
!Social hierarchy
o!A ranking of social desirability in terms of consumers’ access
to such resources as :
!!Money, education, luxury goods
o!Luxury goods are conspicuous consumption signaling that you
are up there and not down
Ascribed vs. Achieved Status
!Ascribed
o!Born with a status
!Achieved
o!Status that is earned through hard work or diligent study
o!You work your way up
Class Structure
!There is class structure everywhere
!Blue
o!Top tier are the richest
o!Bottom are extreme poor
!Red
!Yellow
Social Mobility
!When people come into wealth they change
!The Jeffersons
o!Represents the American dream
o!Celebration of that with material trappings
o!Living in upper east side
o!Lyrically celebrating American dream
o!Something that has mobility
o!The pinnacle of success is the top floor of a building
!Status: how its perceived and actualized
Depictions of Social Class on TV
!Upward mobility
o!Work hard to get to the top
o!E.g. in friends
!Horizontal mobility
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