Open Post #5

 A university degree is of great advantage in the job market only to the extent that everyone does not have one. - Quoted from an anonymous source.

With that statement seeming to be the gloomy reality these days, it's no wonder that students feel pressured to continue their education after receiving their undergraduate degrees.  One might consider an undergraduate degree equivalent to nothing more than just a high school degree.  What choice does a struggling student, eager to succeed in the real world have, after this depressing news?  Driven by pressure (from  parents, media, peers, own self-ambition), one enrolls them-self in graduate school to embark on another four year journey filled with all-nighters, papers and full blown stress.  They find themselves desperately needing the years of education to pay off (in the form of $$$).  But what if  attaining this education results in decades of  monthly payments to a principal that never seems to get smaller?

Now an article from Fortune magazine reported that nearly 20% of  business graduate students are failing to repay their student loans!  This scares the sh*t out of me, given in a few years I could easily become that statistic.

The stereotype of a greedy, money-laundering, white collar criminal of a business student might be reinforced by this startling data.  How are all the recent business graduate students funding their BMW's and over-priced lattes as they leave their high-rise office building?  Who knew that behind the glamorous exterior resided a debt-ridden over-educated student?

Now the pressure heats up even more to find a job out of school.  There are options for repaying student loans.  Students pay opt for forbearance, income-based repayment or deferment.  Just to get an idea of of the dismal factoids: public colleges have a repayment rate of 54%, with private schools doing only 2% better.  Let's keep in mind that this information only pertains to government student loans.  I would bet that an overwhelming majority have private loans, which would undoubtedly inflate the repayment rates mentioned above.

So who cares?  What does this article have to do with the indifferent student that plans on repaying all payments in a timely manner?  Well, much to my dismay, according to the article, a school's repayment rate affects the amount of financial aid the school will receive in future years.  This means that a school's past graduates have the ability to affect how much financial aid we will receive today.  


Why the lack of repayment?  Seems simple enough, but the article cited several reasons.  Some might open up their own business and not become profitable until years later or  others find low-paying government or non-profit jobs.  Still others might take a non-paying internship, or do volunteer work abroad. The most scary factor is that some fail to find jobs altogether.

Random fact:  Carnegie Mellon's Tepper School of Business has the highest repayment rate for student loans clocking in at 81%.

 There is a bright side to the story.

According to financial aid directors "as salaries rise and the economy recovers" the repayment statistics will improve.  Those are pretty broad and general statements.  I tend to take the approach of working hard and expecting high returns in the future.  Work hard and everything will pay off in the end - something I try to tell myself everyday.  Wishful thinking and hoping does not pay the bills or get the work done.  Studies are conducted all the time, and depressing reports of lack of jobs and low savings rates will continue to invade our Twitter feeds. It is up to determination and self-motivation that will get us to to the finish lines.

Open Post #4 Current Event

You’d be hard-pressed to find a person out there who is not passionate about their cell phones and service providers. There is intense competition within the telecommunications industry and many cell phone companies market their products heavily in order to gain market share. For some, this means slashing phone prices to a penny or even selling them for free. Smartphone’s (iPhones, Blackberry’s, Droids) are the leading source of revenue for many companies because along with it comes unavoidable pricy data packages. (If you’ve ever wondered how phones can be so inexpensive, well you’ve got your answer) With the advent of social media and the trend of mobile devices being used as a means of instant communication, the intense competition in the marketplace is not surprising.

Nearly every major competitor is synonymous with a certain device; for example AT&T and the iPhone. Sprint received positive reviews with their HTC Evo. Apple has now confirmed Verizon will carry the iPhone within the next few months. It was recently announced that Amazon is selling all Verizon Droid phones for 1 penny. This may seem absurd, but might be a brilliant move on the part of retailers. By Verizon subsidizing the phone so heavily, this guarantees that new Verizon customers are locked into a two year contact. Companies like Amazon and Verizon might take a onetime hit for subsidizing a $600 phone, but will see high returns on investment when that same customer pays monthly data and service packages. Consumers might view this as a “deal” and will want the same phone for their spouses and children, heck even for their grandchildren. Why not switch the whole family over to Verizon and enroll in a family plan?? Smart move. And that’s exactly what companies like Verizon want you to think.

You think you’re only spending 5 cents per phone for a family of four, but in reality a typical family plan with unlimited text and data can run upwards of $275 per month. The upfront savings hardly seems like a bargain after a year of service (if you do the math that’s about $3300 per year).

There are also other psychological things to consider. If the Droid phone only cost 1 penny to the consumer, they might think that the product is an inferior one. One might wonder, why anyone would pay more than $50 for a phone that costs a penny. This leaves other companies like T-Mobile and AT&;T with no other choice but to meet those same prices, or just risk losing a customer to Verizon. An inexpensive price might denote that no one was willing to buy the phone before the markdown. If no one is willing to pay $199 for a Droid (like everyone would happily do for the iPhone), why not just buy the “better” phone?

In the long run the positioning of this product as an inferior one could hurt the corporate image of the Droid phones and compromise profits in the long run. I mean, you’ve never seen an Apple product below the sticker price, much less sold for a penny. So, before logging onto Amazon and expending your precious pennies, take out your calculator and crunch the numbers. If it makes financial sense to spend less now in order to pay more later………..I say hit the Buy Now button and start entering your credit card information!

Open Post # 3 – Black Friday is Just around the Corner

To some people, Thanksgiving is a time where families get together and share what they are thankful for. To others, it means waking up the morning after to snag some Black Friday deals. From an economic standpoint, some might consider the opportunity costs associated with standing in long lines just to get a few dollars off some electronic device that’s probably been unable to sell without a substantial discount.

Whatever standpoint you take, it’s almost an American tradition to spend excessively on things they don’t need. What I’m trying to say here is, I’d assume that people end up spending more than planned because of a perceived discount. In other words, people purchase things because they are on sale. Because of the money “saved,” some psychological processes tells the consumer that they must now buy another “discounted” item with the money they saved. At the end of the day, you might go home with a bunch of things you didn't really need, but bought anyway because they were on sale.

In my accounting class, the following problem was proposed:

Assume that you have spent $100 on a ticket for a weekend ski trip to Big Bear. Several weeks later you buy a $50 trip to Mammoth. You think the second trip will be more fun than the Big Bear trip. A few weeks later you notice that both trips are on the same weekend. Since it’s too late to sell either ticket and you can’t return either one, you have to choose one trip. Which trip do you choose?

Most people who do not consider the “sunk costs” (those costs that cannot be recovered) usually choose the first trip that they spent $100 on. However, that $100 cannot be recovered, so it would be preferable to you to go on the second trip because you think you’d have more fun. However, the “sunk cost effect” psychologically manipulates the individual into believing if they don’t choose the $100 trip, they’d be wasting it. In reailty, the $100 would have been “wasted” either way.

This just goes to show that Black Friday is in some ways psychological. Marketers are always trying to find positive ways to position their products and prices in the most positive light.  In the end it seems that companies are always out to make a buck, and consumers are always out to save one.

Black Friday isn’t all bad. The day after Thanksgiving is deemed Black Friday because historically consumers go out and shop after Thanksgiving, putting retailers that were operating with negative profits (in the red), into the “Black.” In other words, it’s the perfect storm of economic stimulation and a consumer buying frenzy. Retailers like Wal-Mart have already begun to advertise their Black Friday deals. There is a sense of urgency this holiday season because Wal-Mart lost market share this quarter to other discount retailers. November and December is very crucial for Wal-Mart, as they expect to generate 50% of their sales and profits from these two months alone. Many other companies also rely heavily on this faux-holiday.

So as Thanksgiving approaches make sure to think twice before you buy an item you think you might need. Have a set spending budget so you are not left with an empty wallet or maxed out credit card by the end of the day.

Open Post #2 - Consumer Confidence

Hello World.
I recently did an informational presentation on a book entitled “Stop Effing Yourself” by Dr. Sean Kennif for my communications class. The book highlighted several ways in which people “eff” themselves in their lives with regards to money, jobs, relationships and health. My group decided to present on how people “eff” themselves when it comes to their money. How do people eff themselves exactly? Well according to the author we are victims of sucker syndrome, participate in brainless buys and are in the pursuit of trying to keep up with the Jones’. This all boils down to the #1 effing problem – NO SAVINGS.

After the 2008 financial crisis, the savings rate increased because people were afraid to lose their jobs and homes. (It’s a vicious conundrum because high savings rate can also correlate to lack of stimulation in the economy). I assume that a healthy balance of both will make for a more efficient market.
Dr. Sean Kennif said that the U.S. savings rate in 2005 was -0.5% and improved slightly to 5% in 2009 after the huge U.S. financial crisis. This sounds promising right? Well our counterparts in Europe and China boast a 25-30% savings rate. The U.S. pales in comparison. According to Dr. Kenniff Americans find themselves in dire straits because they suffer from the sucker syndrome. They give in easily to salespeople, telemarketers, etc. To combat that, victims need to research and educate themselves before going out and buying things. They need to arm themselves with self-confidence and have the willpower to say “no” both to themselves and to the salesperson.

The brainless buys and keeping up with the Jones’s was my most favorite part of the book. It brought to light our obsession with the Jones’ and the continual quest to attain everything they have. Focusing on what others have is very distracting and detrimental to one’s wallet. Brainless buys consist of random impulse purchases that can quickly add up to large amounts of hard-earned money. An example of this is when people buy their breakfast lunch and dinner and by the end of the day have spent away nearly $30 (possibly more).

This talk of the recession and no savings may be depressing. There is a light at the end of the tunnel.
According to recent reports, based on consumer behavior, the economy has begun to rebound and reports of the recession coming to an end have begun to show merit with consumer spending. Retail stores reported a 6% growth rate in March. With the beginning of the fourth quarter and key holidays such as Thanksgiving and Christmas – we might be at the beginning of a healthier economy. Consumer confidence plays such a large role in the recovery of the economy. If consumers are not fearful of losing their jobs or homes, this opens up the door to retail therapy.

I realize that my blogs may be pessimistic towards consumer s giving in to instant gratification. But I can ease up a little and allow consumers to purchase at their own discretion. It’s nice to splurge on an iced caramel latte from the Coffee Bean on occasion. So go ahead…..ENJOY….but not too much :)

Open Post #1 – Why do big banks target college students?

Hello World!

Today we will explore the realm of personal finance. As I was scrolling through my CNN app on my BlackBerry, I came across an article entitled “Banks Spend Big to Sell Credit Cards to Students.” I was struck by this because credit cards have always made me uneasy. To me, credit cards represented fear, uncertainty and massive amounts of debt.

When I got my first credit card, I wasn’t sure if I was supposed to pay my bill in full. I was told that if I were to do this, it would indicate to the credit card company that you had no use for their card, so they had no incentive to offer you lower interest rates. In the beginning, I wasn’t even sure whether interest charges were standard or paid only if you kept a balance. I questioned whether my interest rate would fluctuate. I wondered if getting a credit card would help me improve my credit score. All these questions and more ran through my head.

Now to take a step back, I was worried about how one little piece of plastic could affect my life. Over thinking it? Maybe. But a few missteps here and there can lead to intense migraines for the future. I thought banks were supposed to have our best interests at heart, but with further consideration, they only have their best interests at heart. It may be a pessimistic outlook in life, but professional services are only concerned with you if you can pad their pockets. Back to the article, I was compelled to read further.

I was shocked to find out that in 2009 Bank of America paid colleges $62 million for the right to market their credit cards on university campuses. Banks and credit card companies alike are willing to take the financial hit with direct-marketing costs because they can project a tenfold return on investment. The marketing costs employed today will probably pale in comparison to the massive amounts of interest revenue accrued from the debt that students take on in college. If you think about, this hurts our economy in the long run. As these college students graduate and become members of the workforce, a large portion of their income will go towards paying down their student loan debt. This is money that would be better spent funneling back into our economy to stimulate growth in real estate and the stock market, etc.. This might seem like a dramatic exaggeration, but when we take a step back to calculate where in the heck all our money goes, we might find that a large portion of it wasn't that necessary. Take a minute to think about unnecessary luxuries, and focus on the bare necessities. Failure in paying down the principal of a loan or balance on a credit card can lead to disastrous financial ruin. Can we say Real Housewives of New Jersey?

Which brings us to a question for self-reflection…..Why did I just buy that?

Social Bookmarking Soulmate

On the quest to finding my social bookmarking soul mate, I searched on the Delicious website. There was no one out there that could relate to my interests. After finding someone that had tagged an article I found interesting, I went to their page of tags. Although they had tagged my article, the rest of their topics were completely unrelated to mine. After a few hours of searching, I took a different approach and decided to search specific tags that brought interesting sites to my attention. Upon doing so, I was much more satisfied with the results.


I typed in consumer behavior and psychology and received a wide variety of sites that related perfectly to my topic. I had succeeded in finding my “tag key word soul mate.” I scrolled down and nearly every article was relevant to potential research in the field of consumer behavior. By doing this, I was exposed to other tags that would make it even easier to find sites of interest. Tags that were grouped with the ones I typed in included: marketing, decision making, emotion, persuasion and branding.


One article that was tagged with the following key words: consumerism, choice, consumer behavior and psychology, I found very useful. Forty-nine other delicious users tagged this article-Six Psychological Reasons Consumer Culture is Unsatisfying It interestingly explored the trend of consumers leaning towards experiential purchases over material items. People now find greater satisfaction with experience based purchases because they are often difficult to compare. The article further explored that material objects are more likely to be re-evaluated as being necessary. After a few days with the product, the consumer might choose to return it. The study concluded that there is less opportunity for re-evaluation and buyer’s remorse with an experiential purchase. (When you pay thousands of dollars for a vacation, you are kind of forced to enjoy it, or else your money is wasted). Another reason was brought to light that I’m sure many people can relate to. As soon as you purchase the latest gadget – a new or cheaper model is brought to the market. This is sure to create customer dissatisfaction and annoyance. (I know this has happened to me on several occasions)


Another article, Consumer Behavior: the Psychology of Marketing had 459 tags (content was actually written by a USC Marshall professor, Fight On!). That article was one that I stumbled on to when I was looking for my social bookmarking soul mate. I explored the users that had tagged that article and I discovered that most of their interests were not similar to mine. To get back to the point, this article was very useful in that it covered all aspects of the psychology behind consumer purchases.


Although I failed in finding a bookmarking soul mate, I did find another useful site to help me participate in research: Delicious.com My readers will definitely be able to find useful AND interesting information relating to consumer behavior. Typing in a couple of relevant key words provides a gateway into an amazing database of resources. The best part is, users have already ranked the usefulness of the site/page, and the researcher (you and me) can gage this by the numbers of times it’s been book-marked. Research has never been easier. Now, the only hard part is actually taking the time to READ through the resources!

2 comments

The following comment was written on "Social Commerce Today" blog. The article was entitled: How Social Commerce Works: The Social Psychology of Social Shopping.

 I thought this was a great article and it brought to light several issues that consumers deal with. Your article did a great job on applying theories to actual phenomenon occurring today. For example your “follow the crowd theorem,” made me analyze several factors that influence our buying action. I believe the iPhone is one item that many people purchased just because the “crowd” was doing the same. I tend to be annoyed by those who do things just because everyone else is doing them. But your article is helping me be a bit more understanding. The social media aspect of marketing has become so crucial because when items are “recommended” by others or we see things as top-rated, the consumer is more inclined to buy those items.

The power of social media and the media in general is playing such a prominent role and your article helps address this. You’ve provided many classic experiments that made me realize the extent to which an individual can be psychologically manipulated. Your article made me recall an episode of the Tonight Show with Conan o Brien where he told his viewers to purchase frivolous, random items (Steven Segal CD, chicken calendar). To his surprise, he attained a huge following and people actually bought what he told them to buy. He then began to recommend items every week. The success of his campaign was apparent when you looked at the “Customers Who Bought This Item Also Bought…”section; all of them were listed. This just goes to show the power of influence.

Here is the second comment in response to Scientists Find that Low Self-Esteem & Materialism Goes Hand in Hand.  

I think it is extremely unfortunate that materialism affects young children the way it does. Kids are peer pressured into giving into the latest crazes, simply because their friends deem it to be cool.   Unfortunately, if self-esteem is never learned then these habits carry on to adulthood.  I am currently doing research on materialism and its relation to self-esteem.  Your article brought to light that the cost of materialism far extends the cost of the material item itself.  Self-esteem and feelings of self-worth may be far more damaging.  The cost to the environment is another giant to tackle.

The issue of consumerism is really a double-edge sword.  As you mentioned above, purchasing is beneficial and healthy for the economy as a whole, but detrimental to the individual.  The hard part is finding a balance and means of self-control when faced with a purchasing dilemma.  There is definitely a link between esteem and impulse buying.  People compensate for their lack of self-worth through showing off their material goods.  But the momentary gratification soon fades and then they are left with little else.  We just need to remember that our personal value is intrinsic rather than extrinsic.

My Research Question

Readers that have kept up with my blog, have heard me talk about consumer behavior, psychology and impulse behavior which can lead to unpleasant things like living paycheck to paycheck.  I’ve profiled other people and reviewed the literature that others have been so fortunate to conduct before me.  Now, it’s come to the point where I’ve self-reflected in deep thought and  began to analyze the deeper reason behind the value one places in their material goods.

Before, I begin, I am not going to preach about the trials and tribulations of the consumption of material goods.  The latest crazes and technology do put a hole in our pocket, but some things are just necessary and a little moderation never hurt anyone.  However, it becomes a problem when after the purchase you experience guilt, or when the credit card bill comes and you can only manage to make the minimum payment.  My research has led me to conclude that there are two types of consumers: one being the high-materialism and other, you guessed it, low-materialism.  To clarify conventional wisdom defines materialism as the “importance ascribed to the ownership and acquisition of material goods in achieving major life goals or desired states.”  Scientists  have also gone as far as creating the Material Values Scale, which conveniently rates just how materialistic you are.  Basically the more materialistic you are, the higher you rate on this scale. 

The research I found claims that those rating on high on the Material Values Scale placed great importance on material items yet lacked the desire to better themselves.  Most of those people were less happy with their incomes, jobs and lives in general.  It might be a leap to assume that they solve their problems by just going shopping (however this is the case for many). However, I aim to explore the deeper reasons behind impulse purchases and find a correlation between dissatisfaction with one’s life and the desire to obtain material goods.  The other side of the research coin claims that those who value material items very little are ones that seek self-improvement and have a better sense of self-awareness.  I’m going to create an online questionnaire that will ask a series of questions and I hope to make the connection that those who are self-aware and comfortable with themselves will will tend to place a lower value on material goods.  Just a fun little quiz - How Materialistic Are You? (keep in mind this is just a fun quiz, not the actual Material Values Scale)

sample annotation

The Urge to Splurge. (2004, February). Chain Store Age, 80(2), 64-65. Retrieved September 20, 2010, from ABI/INFORM Global.

Julie Fitzmaurice. (2008). Splurge purchases and materialism. The Journal of Consumer Marketing, 25(6), 332-338. Retrieved September 22, 2010, from ABI/INFORM Global. (Document ID: 1564041421).

This article by Leo Shapiro explores the results of an experiment used to study consumer behavior. It found that nearly 1/3 of all consumers buy impulsively, with the median price splurge of $30. This is a useful article because it helps quantify the number of consumers that impulsively buy, which he finds to be a significantly large number. His work is then applied to how the market should advertise their products to maximize profits. A few other findings in the study conclude that men with children in the household are more likely to impulse buy. This article helps me understand the demographic of the consumer, but fails to address the psychology behind these purchases. This article would be useful in providing a foundation for understanding consumer attitudes when they are faced in a purchasing dilemma. I can use this article as a basis for conducting a research paper on consumer behavior with a specific focus on impulsive buying.

Given that my first article was short, “Splurge Purchase and Materialism” provided empirical evidence regarding the psychology behind impulse buying. The basic premise of this journal was to explore two types of consumers which the author defined as high and low-materialism. This article does a great job of delving deeper into the psychology of the consumer.

Those participants involved in the study defined splurge purchases as an item “you probably want, and don't need, and you still get it” (Fitzmaurice). This article reaffirmed what I had originally thought about impulsive buying. It revealed that the high-materialism consumer believed that material goods helped define success and were self-affirmed by their splurge purchases. When compared to low materialism consumers, the high were not any more satisfied with their income, standard of living and their life as a whole. This does not surprise me because it would seem that these high-materialism consumers are trying to compensate for the lack of substance in their lives by purchasing material items.

This article concisely and comprehensively details a research study that allows the consumer to self-evaluate their feelings after a splurge. Again, not surprisingly those that splurged were more likely to buy items that they could wear or display on themselves, and were more likely to make known to others that the product was “expensive.” However after the purchase it was the same high-material customers that reported feelings of guilt and irresponsibility, yet still continued the same behavior even while knowing the negative consequences.  I would utilize this article in a research paper and it would help provide experimental data into furthering my findings on consumer behavior. 

Living Paycheck to Paycheck

When we think about our futures as USC graduates we think of BMW’s, big mansions and BIG fat paychecks. Since we are hotshots out of college, everyone and everything is at our disposal, because we just spent the last four years of our lives at a prestigious four year university. What we do not think of, however is how at risk we are of living paycheck to paycheck...

I feel I have authority to talk about this because I have experienced it first-hand. Coming across even a small amount of money makes people feel powerful, and there’s a burning itch to spend it. I can attest to the adjustments in pay, with the adjustments in purchasing power. My most recent job working at AT&T paid me more than any job I had ever had before. I will admit to some purchases that as I look back on, I regret. To be honest, it’s hard to say where my money went, because small purchases add up, and before you know it, your paycheck is gone. I stand back, kinda pissed and look around my room searching for what I have to show for a summer long of spending. I think I’ll be searching for a long time. So I’ll give up, but to answer truthfully, I have nothing to show for it.

This topic intrigued me when a friend told me about her internship at Merrill Lynch. The financial advisor she works for said that many college students who make tons of money of out of college, usually have spending habits that eventually lead to the paycheck to paycheck lifestyle. It’s very easy to adapt to making money, and of course people want to show off the fact they can purchase the latest trends.  Making more means spending more.  Hey...if we're making $100,000/year, we have to have the house, car and clothes to show for it.  Pretty soon, the bank account dwindles and we find ourselves waiting for next week's pay.

Even if one does graduate from USC, making $60,000/year, studies indicate that it takes them only a few weeks to adjust to that pay bracket. After adjusting to the money(which I presume isn't too hard), their lifestyles also change and they begin to adapt to the new wages. This is undoubtedly tied to the virtually 0% savings rate in the U.S. Many Americans are just making so much money, they don’t know what to do with it. So they spend it.  The saying that the extra cash is burning a hole in your pocket, seems to have a literal meaning nowadays.

An article in CNN stated that nearly ½ of all Americans live paycheck to paycheck. A huge reason is that people go over their budgets and indulge in small purchases that really add up. They go out to eat and slowly but surely their bank accounts dwindle. I can relate to this because at the moment of purchase, you’re not really deducting that amount in your head because it’s just easier not to and to enjoy the instant gratification of the delicious cheeseburger you are about to enjoy.

Also a part of this obsession with eating, oftentimes it’s just convenient to grab a quick bite at a fast food chain. Since we are always on the go and balancing hectic schedules, we don’t realize just how much we spend on food. There’s also the socializing aspect where we spend small sums of money (that adds up quickly) when we go out to eat with friends. To sum this all up, no matter how secure in our careers we may be, we should always be mindful and try not to let spending habits go in over our head.

Voice Critique

Voice Critique
I was immediately drawn to Gerd’s Consumer Behavior blog because the first page contained images of trendy products, celebrities and pop culture. In one of her posts entitled “Why I Love Ikea,” Gerd lists her #5 reason as the “You cannot go to an IKEA store without stopping by the cafeteria for the Swedish meatballs.” I liked this post in particular because I also enjoy them and no trip to Ikea is complete unless I eat a tray of meatballs covered in gravy, not to mention the mashed potatoes on the side. This blogger clearly shared my obsession with food and cheap furniture. This display of personality really helps the reader get an immediate sense of the blogger's voice. The graphics posted on her blog also speaks volumes to her personality and voice.

Gerd also complements many of her blogs with relevant images or video clips, which help the readers get a better feel for the topic being blogged about. She spiced up her blog by integrating a YouTube clip of a man that lived at Ikea while his apartment was being fumigated. I thought this was a clever way for her to market her own blog, while at the same time exposing another person’s media stunt.

This blog was very conversational in nature because it usually begins each blog entry with a question. In doing this, Gerd initiates a conversation with her reading audience I chose her blog because it was very easy to navigate and browse. She effectively created a nice flow by using bulleted and numbered lists. In doing this, it brought by attention to the main points and allowed me to skim over the blog quicker. Her Ikea blog is a prime example of this. Given that she is a female student interested in pop culture/media, her persona leads me to believe that she is a typical student on a budget that shops at Ikea. This topic reflects Gerd’s personality as a blogger because she chooses topics that would be of interest to the average college student. Given that she is a college student herself, she can connect to that specific audience.

In another post, Gerd’s personality is very apparent when she blogs about the over-consumption of different products and it’s effect on the environment. Again she employs her device of bulleted lists and offers several suggestions on how to reduce pollution. Her first lists includes ridiculous items like

• “Meat consumption takes 10 times the amount of resources to produce as a corresponding amount of vegetables. Therefore; quit eating meat.
• Did you hear about the British MP who announced that he was going to quit flushing after doing “number one” on the toilet? You can do better: Stop flushing the toilet even after number two; it will save much energy and water.
• While you’re at it, quit showering.”
She engages in a casual conversation with her audience if
“you love meat too much to give it up, you like smelling nice, you think the sound of a toilet flushing is like music to your ears.”

Gerd uses humor when talking to her audience and says if they agree to the above statement, then they must heed her second bulleted list of tips. By offering the first set of lists, she sets the tone that she can be comedic about the issue, however she transitions to a more serious tone. Her second list offers more realistic and practical solutions to over consumption. At the end of the blog she speaks more to her persona by saying “Next week I become a green consumer super-hero!” and places a picture of an imaginary super hero. Again she does this to add humor and possibly relay to the audience that although she blogs about a sensitive topic, she can still be funny.

Profile Post

Profile
Phillip Graves contributes to a blog entitled the Consumer Behavior Blog in which he explores the psychology of why consumers make certain purchases. This blog was of great interest to me because it not only focused on consumer behavior but also critiques the marketing strategies of certain companies. He said that market research is ineffective because consumers are usually not knowledgeable and there are so many differing ideas that coming to a consensus is impossible. In relation to my topic, Phillip focuses on the company rather than the consumer. This can give some good insight on why customer's take the actions that they do.

Phillip’s blog is academic in nature, since he claims to be a consumer behavior expert. He authored a book called Consumer.ology where he discusses the psychology behind why consumer’s make the decisions they do. He again stresses that market research is ineffective and that the key to understanding consumer’s lies in their psychology. His writing and studies are based in the United Kingdom, where he has consulted for various corporations. Although I could not find Phillip on Technorati, there were a good amount of responses to his blog entries. Phillip frequently posts to his blog on a range of topics that he seems to be very knowledgeable about. I find that he uses his blog as a tool to market his books.

This subject fascinates me and I hope to draw from his knowledge to come to a better understanding of the topic for myself. Phillip defies generally accepted marketing principles and claims that the standard way of thinking is incorrect. His blog counters the status quo and forces the reader to challenge their preconceived notion of consumer behavior and marketing.

I hope to mirror my blog as Phillip’s writes his, because he delves into topics that I also hope to analyze in my own blog. He authored one entitled “The Consumer Need Myth and Why Customers Really Buy.” This is the topic of my first blog and Phillip came to the conclusion that companies must target either a physical or emotional need of the customer. Phillip discusses that companies are usually out in the market to fill a need, but Philip argues that usually consumers don’t really know what they need, rather they know very little about the product they purchase. Moreover, the act of buying something is a goal that is set out in a person’s mind, and after the act is done, our brain releases the feel good hormone, dopamine, reacting to the idea that we have successfully completed a goal. He explores the psychology of “shopping” and discusses how it has always been beneficial to obtain material possessions. For example tools and “mechanisms for protecting ourselves” has always been valuable to us. Presently, material items that we purchase are a way of “protecting” our image and preventing us from being too much of an outsider.

The layout and organizational structure of Philips blog makes it easy for the reader to navigate. It is very simplistic, but not overly so that it makes the reader want to leave the site. His homepage contains only 3 tabs for external links, but it effectively organizes his blog. My own blog will draw information from Phillip’s blog; however, I will not have an in depth working knowledge of the topic. I hope to draw from his topics and expand his research by finding other scholars that agree or disagree with his opinions.

Hello World

Hello World

After googling “impulsive buying,” I skip over the Wikipedia link and click on a more a reliable, businessdictioanry.com. This website defined it as “Spur of the moment, unplanned decision to buy, made just before a purchase.” The real take-away from that search was the last part of the definition stating that “usually about 80% of the time) )[it can] lead to problems such as financial difficulties, family disapproval, or feeling of guilt or disappointment.” Sure, impulsive buying might not be as harmful for things like chocolate or Hometown Buffet, but larger purchases can reveal a deeper knowledge about one’s financial stability and spending habits.


After working in retail, I have come to the conclusion that consumers are usually uneducated and frivolous in their decision making. Customers go after the new “hot” or “must have” item without really acknowledging the real reason for that purchase. Everyone and their mother, grandmother and great grandmother wants the IPhone. Do they know how to use it or even turn it on for that matter? You’d be surprised at the questions I get. “Is WebBrowsing the same as email?” I’ve come to the realization that people just buy things for no other reason than maintaining the status quo and to have something to show off to their friends. It is a marker of prestige and one’s ability to make that extravagant purchase at that point in time. It doesn’t matter if you can’t afford it! That’s beside the point…


Time and time again I have witnessed this obsession with material wealth. My most recent job as a sales associate at AT&T qualifies me to analyze the actions made by most consumers. People, unable to pay the past due balances on their account have it set in their mind they must purchase top of the line PDA phones, at any cost. Most people living paycheck to paycheck insist on having these items as well. This is evident to me when I hear I have to wait a week because “they don’t get paid until next Friday…” (Most people find no shame in telling me this). I feel like a marriage counselor when couples argue (in front of me) that they can't afford this, OH WAIT, yes they can, they just have to wait for their checks to clear. Now you might be skeptical and wonder if a phone is really an impulse buy , and I would say DEFINITELY YES!


Many of my customers are pulled in by a “sales greet” and then convinced to buy a phone. You would think that something as serious as a cell phone, binding you into a two year contract would warrant someone to think twice. I would then urge you to spend a few hours in my store and you will change your mind set.


Impulsive buying and consumer behavior is a topic that I’ve always thought about passionately in my head, but I’ve never actually sat down and organized my thoughts. Through this blog I hope to answer the question of WHY? WHY do people purchase things they know they cannot afford? It blows my mind and I don’t think I will ever find an answer. It’s actually common knowledge that the poor tend to spend their money and the rich tend to invest, which speaks volumes for capitalist society. Please don’t get me wrong and draw the conclusion that I think ‘all spending is bad.” We need “spenders” in our system to make the world go round. But if we brought to light the “not so smart choices” of these spenders, maybe our world would be a better place.


Please join me as I delve into a topic that I know you’ve been guilty of at one point or another. As this blog is a continuous work in process, I hope to touch a nerve with a few readers and together learn how to make better financial decisions. The topic of personal finance is taboo and will undoubtedly make us uncomfortable to talk about it out loud. We will not understand the topic or change our circumstances unless we force ourselves to sit down and assess our own financial decisions. So please, if something I say sparks a nerve with you, comment and make your voice heard!

Trifecta

 Hello World
After googling “impulsive buying,” I skip over the Wikipedia link and click on a more a reliable, businessdictioanry.com. This website defined it as “Spur of the moment, unplanned decision to buy, made just before a purchase.” The real take-away from that search was the last part of the definition stating that “usually about 80% of the time) )[it can] lead to problems such as financial difficulties, family disapproval, or feeling of guilt or disappointment.” Sure, impulsive buying might not be as harmful for things like chocolate or Hometown Buffet, but larger purchases can reveal a deeper knowledge about one’s financial stability and spending habits.

After working in retail, I have come to the conclusion that consumers are usually uneducated and frivolous in their decision making. Customers go after the new “hot” or “must have” item without really acknowledging the real reason for that purchase. Everyone and their mother, grandmother and great grandmother wants the IPhone. Do they know how to use it or even turn it on for that matter? You’d be surprised at the questions I get. “Is WebBrowsing the same as email?” I’ve come to the realization that people just buy things for no other reason than maintaining the status quo and to have something to show off to their friends. It is a marker of prestige and one’s ability to make that extravagant purchase at that point in time. It doesn’t matter if you can’t afford it! That’s beside the point…

Time and time again I have witnessed this obsession with material wealth. My most recent job as a sales associate at AT&T qualifies me to analyze the actions made by most consumers. People, unable to pay the past due balances on their account have it set in their mind they must purchase top of the line PDA phones, at any cost. Most people living paycheck to paycheck insist on having these items as well. This is evident to me when I hear I have to wait a week because “they don’t get paid until next Friday…” (Most people find no shame in telling me this). I feel like a marriage counselor when couples argue (in front of me) that they can't afford this, OH WAIT, yes they can, they just have to wait for their checks to clear. Now you might be skeptical and wonder if a phone is really an impulse buy , and I would say DEFINITELY YES!

Many of my customers are pulled in by a “sales greet” and then convinced to buy a phone. You would think that something as serious as a cell phone, binding you into a two year contract would warrant someone to think twice. I would then urge you to spend a few hours in my store and you will change your mind set.

Impulsive buying and consumer behavior is a topic that I’ve always thought about passionately in my head, but I’ve never actually sat down and organized my thoughts. Through this blog I hope to answer the question of WHY? WHY do people purchase things they know they cannot afford? It blows my mind and I don’t think I will ever find an answer. It’s actually common knowledge that the poor tend to spend their money and the rich tend to invest, which speaks volumes for capitalist society. Please don’t get me wrong and draw the conclusion that I think ‘all spending is bad.” We need “spenders” in our system to make the world go round. But if we brought to light the “not so smart choices” of these spenders, maybe our world would be a better place.

Please join me as I delve into a topic that I know you’ve been guilty of at one point or another. As this blog is a continuous work in process, I hope to touch a nerve with a few readers and together learn how to make better financial decisions. The topic of personal finance is taboo and will undoubtedly make us uncomfortable to talk about it out loud. We will not understand the topic or change our circumstances unless we force ourselves to sit down and assess our own financial decisions. So please, if something I say sparks a nerve with you, comment and make your voice heard!

Profile
Phillip Graves contributes to a blog entitled the Consumer Behavior Blog in which he explores the psychology of why consumers make certain purchases. This blog was of great interest to me because it not only focused on consumer behavior but also critiques the marketing strategies of certain companies. He said that market research is ineffective because consumers are usually not knowledgeable and there are so many differing ideas that coming to a consensus is impossible. In relation to my topic, Phillip focuses on the company rather than the consumer. This can give some good insight on why customer's take the actions that they do.

Phillip’s blog is academic in nature, since he claims to be a consumer behavior expert. He authored a book called Consumer.ology where he discusses the psychology behind why consumer’s make the decisions they do. He again stresses that market research is ineffective and that the key to understanding consumer’s lies in their psychology. His writing and studies are based in the United Kingdom, where he has consulted for various corporations. Although I could not find Phillip on Technorati, there were a good amount of responses to his blog entries. Phillip frequently posts to his blog on a range of topics that he seems to be very knowledgeable about. I find that he uses his blog as a tool to market his books.

This subject fascinates me and I hope to draw from his knowledge to come to a better understanding of the topic for myself. Phillip defies generally accepted marketing principles and claims that the standard way of thinking is incorrect. His blog counters the status quo and forces the reader to challenge their preconceived notion of consumer behavior and marketing.

I hope to mirror my blog as Phillip’s writes his, because he delves into topics that I also hope to analyze in my own blog. He authored one entitled “The Consumer Need Myth and Why Customers Really Buy.” This is the topic of my first blog and Phillip came to the conclusion that companies must target either a physical or emotional need of the customer. Phillip discusses that companies are usually out in the market to fill a need, but Philip argues that usually consumers don’t really know what they need, rather they know very little about the product they purchase. Moreover, the act of buying something is a goal that is set out in a person’s mind, and after the act is done, our brain releases the feel good hormone, dopamine, reacting to the idea that we have successfully completed a goal. He explores the psychology of “shopping” and discusses how it has always been beneficial to obtain material possessions. For example tools and “mechanisms for protecting ourselves” has always been valuable to us. Presently, material items that we purchase are a way of “protecting” our image and preventing us from being too much of an outsider.

The layout and organizational structure of Philips blog makes it easy for the reader to navigate. It is very simplistic, but not overly so that it makes the reader want to leave the site. His homepage contains only 3 tabs for external links, but it effectively organizes his blog. My own blog will draw information from Phillip’s blog; however, I will not have an in depth working knowledge of the topic. I hope to draw from his topics and expand his research by finding other scholars that agree or disagree with his opinions.

Voice Critique
I was immediately drawn to Gerd’s Consumer Behavior blog because the first page contained images of trendy products, celebrities and pop culture. In one of her posts entitled “Why I Love Ikea,” Gerd lists her #5 reason as the “You cannot go to an IKEA store without stopping by the cafeteria for the Swedish meatballs.” I liked this post in particular because I also enjoy them and no trip to Ikea is complete unless I eat a tray of meatballs covered in gravy, not to mention the mashed potatoes on the side. This blogger clearly shared my obsession with food and cheap furniture. This display of personality really helps the reader get an immediate sense of the blogger's voice. The graphics posted on her blog also speaks volumes to her personality and voice.

Gerd also complements many of her blogs with relevant images or video clips, which help the readers get a better feel for the topic being blogged about. She spiced up her blog by integrating a YouTube clip of a man that lived at Ikea while his apartment was being fumigated. I thought this was a clever way for her to market her own blog, while at the same time exposing another person’s media stunt.

This blog was very conversational in nature because it usually begins each blog entry with a question. In doing this, Gerd initiates a conversation with her reading audience I chose her blog because it was very easy to navigate and browse. She effectively created a nice flow by using bulleted and numbered lists. In doing this, it brought by attention to the main points and allowed me to skim over the blog quicker. Her Ikea blog is a prime example of this. Given that she is a female student interested in pop culture/media, her persona leads me to believe that she is a typical student on a budget that shops at Ikea. This topic reflects Gerd’s personality as a blogger because she chooses topics that would be of interest to the average college student. Given that she is a college student herself, she can connect to that specific audience.

In another post, Gerd’s personality is very apparent when she blogs about the over-consumption of different products and it’s effect on the environment. Again she employs her device of bulleted lists and offers several suggestions on how to reduce pollution. Her first lists includes ridiculous items like

• “Meat consumption takes 10 times the amount of resources to produce as a corresponding amount of vegetables. Therefore; quit eating meat.
• Did you hear about the British MP who announced that he was going to quit flushing after doing “number one” on the toilet? You can do better: Stop flushing the toilet even after number two; it will save much energy and water.
• While you’re at it, quit showering.”
She engages in a casual conversation with her audience if
“you love meat too much to give it up, you like smelling nice, you think the sound of a toilet flushing is like music to your ears.”

Gerd uses humor when talking to her audience and says if they agree to the above statement, then they must heed her second bulleted list of tips. By offering the first set of lists, she sets the tone that she can be comedic about the issue, however she transitions to a more serious tone. Her second list offers more realistic and practical solutions to over consumption. At the end of the blog she speaks more to her persona by saying “Next week I become a green consumer super-hero!” and places a picture of an imaginary super hero. Again she does this to add humor and possibly relay to the audience that although she blogs about a sensitive topic, she can still be funny.