What is Consumerism?
You might find yourself guilty of today’s topic, battling your way through a society that is programmed to capture your attention in the exchange of profit. How do you fight your way through the rampage of advertisements sending whispers to buy that dress, new game console, or new pair of shoes for next year’s summer that in all honesty might be outdated by the time you plan to wear them – fast fashion waits for nobody – keep up with the pace. Consumerism is the belief that happiness and wellbeing are centred around the purchase of material goods. Consumerist society believes the notion that happiness can be bought, the more consumption the better. Thousands of people are willing to spend hours upon hours, resources, and money on consuming as much as they can.
American Consumerism
The United States is a great example of a hyper-consumerist society. Many companies are willing to spend a lot of time and splurge a big budget on marketing their products urging the public to buy them. On average a child aged 2-11 views over 25,000 ads on television a year, while the average adult sees 52,500 – meaning children in the united states spend over a week of their lives every year (10,700 minutes) watching television advertisements, adults spend over two weeks a year in the same activity. All these actions contribute to society’s perception of “the good life” and what it takes to be happy. Excessive shopping is a therapeutic activity to some even if it leads to thousands of dollars in debt for buying beyond basic necessities and living above your means.
Let us look further into consumerism society in America. Starting in the early 1980s, as seen through the growth of the average size of new houses. During the time period from the 1960s until the early 1980s, the median size of a new home in the United States varied up and down around 1,500 square feet to over 2,200 square feet. In the 1980s about 25% of all new homes were under 1,200 square feet in size while 15% were over 2,500 square feet. By 2007 less than 3% of new homes were under 1,200 square feet and over 40% over larger than 2,500 square feet. Surprisingly, this drastic change in the size of new homes occurred in a period when average family size was declining, meaning a larger living space per person. So, what goes in the free space? Yup, they are filled with decorative stuff that reflects hyper-consumerism. Stretching far beyond home theaters, home gym, spacious designer kitchens and three car garages.
How has this become a problem? It is rather rude and controlling if one is to tell you how to spend your time and manage your consumerism habits. People have their own perceptions of shopping and the ideology centred around materialism bringing happiness. They have a choice as the free market evidently translates through their adverts, so if you purchase a big house, a new pair of shoes, a designer bag the question is, didn’t you simply want to make that purchase?
As highlighted in the previous blog, explaining how fast fashion has overtaken the planet leading to environmental sustainability challenges. The planet is overwhelmed and incapable of supporting American-style consumption everywhere.
Everybody seeks happiness, either through chasing their dream career, marrying their ideal spouse or anything that makes your soul leap with joy. So, if the hyper-consumerist lifestyle does not lead to happiness, then why do people do it? Something does not add up here. This leads to the idea of systematic consumption-bias in the decisions that people make. If this bias was removed, people might make different choices in their consumerist habits, consuming less and being happier. The main problem that exists in society today is that the market system infers that shopping and consuming leads to happiness favoring the latter rather than any other values like spending time with your kids, spouse or acquiring a new hobby.
Some critical processes that take part in the American society and foster consumerist culture include: The consumption bias in capitalist profit- maximization strategies. What drives companies to invest so much into marketing and communication strategies is a result of the nature of profit maximizing competition in a capitalist economy. Increase of competition among firms is a catalyst of innovation, you must stand out from the crowd in one way or the other. This, however, puts a lot of pressure on firms resulting in a lot more innovation that increase productivity over time.
What is Productivity?
Productivity refers to the ability of an individual, team, or organization to work efficiently within that time to maximize output. – Psychology Today. Usually increasing productivity saves time with less laboring time to produce a given quantity of output. The debate to date is the ability to have free time from your job, hence some may find themselves perplexed between working a 9-5 job or becoming an entrepreneur and having more control of your time. There are two assumptions regarding increases in productivity. First is that we could produce the same amount of things with less total labor input, which ultimately results in more free time. Secondly, we could produce more things with the same amount of labor input.
So where does consumption bias come in? While you’d expect increased productivity to lead to more free time, the reality is it leads to increased production of goods and services. In a first world country like America, where adequate nutrition, housing and other basic necessities is available for majority of the population compared to developing countries – what is the reason to produce way above the threshold of what is needed?
Capitalism catapults excessive pressure even on the wealthy capitalist economies to produce more total output via profit-driven market competition.
What consumers do not realize is that capitalist firms will take every opportunity they have to produce more goods and services – staking profits upon profits. Hefty sums contributed towards advertising and marketing strategies are a drop in the ocean compared to the net gain that follows. However, they cannot reach their goals without the consumer, the key to their success. In other words, consumers have the “dollar vote”. This is an analogy used to refer to the theoretical impact of consumer choices on producers’ actions through flow of consumer payments to producers for their goods and services. – Wikipedia. If consumers were to change their buying habits that puts pressure on producers to adjust accordingly. Easier said than done but is possible.
Government policies also advocate for the expansion of output over increases in free time. Meaning that growth in productivity is channelled into the continual development and remodelling of markets which on the contrary generates tremendous bias, promoting growth in consumption rather than free time. What price do you have to pay to have a life where you can manage your own time? Spending time with your family, taking that trip to your desired destination or simply taking a hike are now luxuries unless you are intentional about it, it might never happen.
Living in an economy that leverages off consumption behaviour and tries to allure you into a deep hole by reducing interest rates so borrowing seems a lot easier and cheaper. A lot of effort given into getting people to spend their money. Take for instance the economic crisis that took place in 2008 showed a massive decline in consumer expenditure due to unemployment- so people were saving and spending less. For the economy to run smoothly, maximum effort was put into reverting consumer behaviour and getting people to spend more and saving less. There is a direct correlation between mass consumerism and capitalism. A parasitic relationship until large masses say, “enough is enough” and prefer a simpler minimalistic life, rejecting consumerism.
The power of advertising
We are all human and like to look fashionable, well presented, and treat ourselves here and there. Naturally, we are acquisitive – chasing to keep up with trends and reaching our desired level of success and happiness.
Once you attain all your necessities naturally there is really no tendency to attain more stuff. So, the best bet for capitalist firms is to motivate people to spend more using influence. Marketing via social media is everywhere, from the moment you pick up your phone a video might be randomly playing showcasing their beautiful product and there you find yourself on their checkout page via a single click. Quick and easy – anything to get what they are after. Corporations want you to remember their brand, so they are willing to pay enormous sums for naming rights of public facilities.
In some cases, advertisements target the youngest of age groups. Even though they are not the ones doing the direct purchase, advertising researchers have discovered an advertising strategy that works effectively to exploit. Lucy Hughes came across an advertising strategy called the “Nag Factor”. The nag factor shows that 20 percent to 40 percent of purchases would have not occurred unless the children nagged their parents. Children are indirectly taught how to nag effectively to get what they want. It is a win – win situation. While some may argue that advertisements are a form of translating information, they do far more than that. Generating an American culture where heavily oriented consumption is the norm.
The use of Credit Cards to enhance consumerism.
Money is made available as easy as possible because credit card companies know they will benefit from each transaction with most of it coming from late fees, and penalty fees. Credit card companies’ main initiative is to get people to spend above their means.
In Conclusion
Well most of us have all been guilty of going above our spending threshold, fell in love with a product that you did not need or think of a minute before seeing an advert on it. Capitalist companies will not tire with their extensive market strategies to get a hold of their goal. Consumerism is also generated by what can be called a failure in the “market” for leisure. This generates an imbalance between the amount of work done and desired leisure time. If we existed in a utopia then a perfect market would exist and people would be able to decide their preferred amount of work and leisure time. In the US workers work longer hours than in any other developed country. If you get up after 8:00 am then you are already late to the party, early bird always catches the worm so run. This obviously has been beneficial over the years generating a lot of output in a given period of time. In 2006 alone, Americans worked an average of 1804 hours. Whereas, in countries like Italy, they worked an average of 342 hours.
Wow, we have highlighted some key fundamental processes that have a massive impact on consumerism today. There is power in numbers, if consumers were to come together and make changes in their spending habits that would put a lot of pressure on capitalist companies to change their strategies in a way that better serves the masses. The choice is in your hands.
References:
Chapter 7 Consumerism – Norton August
HTTP://www.money-zine.com/Financial-Planning/Debt-Consolidation/Credit-Card-Debt-Statistics/
Board of Governors of federal reserve system, “Report to the Congress on Practices of the Consumer Credit Industry in Soliciting and Extending Credit and their Effects on Consumer Debt and Insolvency” ( Washington, D.C Federal Reserve, 2006) Table 2 p. 6
HTTP://www.creditcards.com/credit-card-news/federl-reserve-credit-card-report-april-2008.php
Federal Reserve Board survey of consumer finances, 1989-2007
Figures are reported by Synovate, a global market research company that tracks credit card services, see entry for 2007 at HTTP://mailmonitor.synovate.com/news.asp
Only_Pammy 