Influence of Age and Income on Consumer Behavior in Holiday Market - Essay Example

INFLUENCE OF AGE AND INCOME ON CONSUMER BEHAVIOR IN HOLIDAY MARKET Introduction The processes and activities that people undertake while choosing, purchasing, using and or disposing off products aimed at generating satisfaction explains consumer behavior according to Belch (1997, p. 252-253). The consumer behavior as would be understood to imply the choices and decisions made while buying and consuming services and goods is a multifaceted discipline. Particular markets have various factors that are dominantly influencing the behavior of consumers especially as would be understood through evaluation of the different subcultures that are at play. These subcultures would include, age, income, gender, social class, ethnicity, norms as well as cultural beliefs among others. Different markets equally exist and they all have particular characteristics, which are directly or indirectly influential towards consumer behavior especially as relating to the subcultures outlined above (Mullins and Walker, 2014, para 1-6). Is this study, this paper focuses on evaluating the comparatively the impacts of age and income as subcultures towards consumer behavior in the holiday market. The study therefore focuses on how particular subcultures (age and income in this case) influence the way consumer(s) reason, think, choose and make decisions on different brands, products or even services in focus to the holiday markets. Besides, the study will evaluate how the subcultures have influence on the manner of decisions and choices made by the consumers. Discussion The understanding of the holiday market would be better understood through the model of ‘travel-buying behavior’, which is what the market entails. The linear five-stage model developed by Mathieson and Wall in 1982 illustrates various components that influence the consumer behavior in the holiday market. The first segment explains how the desire or need for travel (may be for a holiday) develops and this is followed by the consumer gathering information in the market. Having enough and relevant information aids at decision making by the consumer while deciding between alternatives after which the necessary preparation commences. Travel and such other experiences as are characteristic in holiday market explain the outcomes of behaviors adopted by the consumer. The fifth stage illustrates the stage of evaluation, as the consumer would have to do after such a market experience(Mathieson and Wall, 1982, p. 95). (Model of Travel-Buying Behavior ) Literature and past studies reveal that consumers are directly influenced by age especially when it regards free will consumer decisions such as are involved in holiday markets. For instance, Saleh, Alothman and Alhoshan (2013, p. 86) conducted a study on the ‘influence of subcultures’ in behavior of consumers on free-product samples. Among the sub-cultures studied were the age and household income and the findings presented a great trend. First, the literature reviewed showed that young persons (below 25 years) in age had higher preference to the samples while compared to the elderly groups in the segments evaluated. From the study, the young consumers within the holiday market would perceive free samples as opportunities to gain more at lower costs. The elderly would have a different perspective hence the distinction on age matters. Concerning the household incomes, the neoclassical economics show that rational consumers maximize on personal utilities when engaging in buying practices (Thaler, 1980, p. 39). This would be supposedly as even within the holiday market as is studied. The consumers are therefore expected to respond to respond to the market positively only when the gains realized is higher as against the costs to be incurred. However, an interesting relationship is shown between high-income households as well as the low-income households concerning appreciation of free samples within the holiday market. For instance, the low-income persons would perceive highly the free samples on offer within the market while the high-income households will not. Nevertheless, it is noted that disparities occurred in the studies reviewed within the study by Saleh, Alothman and Alhoshan especially in income where no much disparity was established quantitatively on preference to samples in the market. However, the study confirmed the preference of the young person’s to free samples as against the elderly. Income is a direct factor that influences the decision of consumers on matters pertaining to the holiday market and it should be noted that not all income is spent on luxury (Durden, 2013, para 1-4). While much of the revenue incomes generated by individuals is used on the basic needs like the food, clothing and shelter, some income (discretionary income) is spent on luxury. While defining the discretionary income may be problematic to many, it is shown through studies that the income has direct implications towards consumers’ decisions and choices on holiday expenditures. The margin of income left for luxury may determine and influence the choices made by consumers concerning behaviors in the holiday market. For instance, higher income may imply higher margins of discretionary income, which equally implies that higher spending on luxury would be realized while the converse is true. The report by Durden in 2012 had projections on contracting holiday market performance because of income influence at the heart of a declining economic activity across nations. On the other hand, age has direct influence on amounts of income that would be spared and understood as discretionary by consumers. In often times, young persons may have higher needs as basics while compared to elderly persons and this may influence the amounts set apart for holiday markets. Nevertheless, the young would be more active in generating income hence the higher amounts in income to be spent on the luxury while compared to the elderly. The levels of income to be spent by consumers in any market have a direct influence on the choices that consumers make. This is even more pronounced in the holiday market where choices made are directly related on prestige and class of services and products purchased. For instance, in making the choice for a hotel to lodge in would be dependent on the prices, services as well as the facilities that are there (Nick, 2013, para 1-4). Nevertheless, the choice of these features in making a choice has direct relation to the income that a consumer has for the expenditure. In often times, higher incomes imply that better facilities and services are to be purchased as against with low incomes. Nevertheless, age as a determinant subculture may have a rather deferent effect in the decisions or behaviors exhibited by such consumers. Age factor influences the regard and attitude that persons have towards certain services and facilities. For instance, young persons may prefer to go for such services as swimming facilities and gaming facilities while general comfort may be enough for the elderly persons within the same market. Another dominant feature in the holiday market is the preference of or choice of distance while in operating within the holiday market. According to the theory of ‘permanent income’, it is expected that customers within the market portray constant behaviors and decisions while playing in the market. However, a variation may be observed with consumer’s behavior in this market as income margins may not be constant especially throughout the month as well as because holidays may not be an everyday experience. On the other hand, age may influence such preferences as spending on holiday far away or even at the proximity of home. In a study by Hastings and Washington (2009, p. 1-7), consumer behaviors would be monitored throughout a month with variation being observable in the start of month assuming it’s the pay time as well as in the latter days of the month. Spending on holiday markets would be higher while one has much income (especially at the beginning of month) as against when the month is about to end. On the other hand, comparing age and the spending in holiday market, we would note that age would influence the choice of a consumer to spend far away or near ones residence area. For instance, the use of own vehicle for travelling for holiday may not be as preferable with the elderly as would be with the young. This therefore would have influence on the decisions to have consumers participate in the market within close distances or else far away (Palani and Sohrabi, 2013, p. 1-5). Conclusions and recommendations Marketing mix has particular attention on the price, place, promotion as well as the actual product concerning the market. Price regards the value that a product carries in the market, which has dependence on such factors as the cost involved in production of the product, the prevailing market values as well as ability of the target market to afford the commodity. The production represents the actual good on offer while promotion revolves around practices adopted to create awareness of the existence of such a product within the market (‘The Economic Times’, 2013, para 1-3). From the findings, it is clear that incomes and age has direct and definite influence on consumer behavior especially within the market under analysis (holiday market). The subcultures have been shown to have different influence on consumer choice on free samples in the holiday market, the quality and standard of services and facilities, amounts of discretionary income as well as market coverage. This paper therefore recommends that marketers within the holiday market should be aware of the influences while choosing on the product, price, place as well as promotion strategy to adopt while carrying out marketing. For instance, it would be ineffective to adopt policies favorable for young people like free samples for application in marketing targeting the elderly. Proper definition and understanding of the influence of such factors in the market would therefore aid in choosing right marketing mix for the market (Choibamroong, nd, p. 1-2). Bibliography Belch,G.E.,and Landon, E.L., 1977 “Discriminate Validity of a Product. Anchored Self-Concept Measure.”Journal of Marketing Research, 14:252-56. Choibamroong T., nd. Knowledge of Tourists’ Behavior: A Key Success Factor for Managers in Tourism Business. Available at:< http://www.bu.ac.th/knowledgecenter/epaper/jan_june2006/Teardchai.pdf> (Accessed on 8 March 2014) Durden T., 2013. Holiday Spending "Hopes" Crumble As Income Gains Stagnate. Available at:< http://www.zerohedge.com/news/2013-11-04/holiday-spending-hopes-crumble-income-gains-stagnate >(Accessed on 8 March 2014) Hastings J. and Washington E. 2009.The First of the Month Effect: Consumer Behavior and Store Responses. Available at (Accessed March 8, 2014) Mathieson, A. and Wall, G, 1982. 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