In this lesson you will learn decision-making skills that will help you to become a more knowledgeable consumer. As a consumer you have a variety of alternatives from which to choose. In this activity you learn about the importance of price information as a factor influencing consumers' decisions.
First, you will gather information on different brands of athletic shoes and determine which shoe is the best buy for you and why. Then, you will identify a toy or game you would like to buy. To help you decide where you should purchase your item, you will gather information from a traditional store, a catalog and several websites.
More and more consumers are using e-commerce to purchase goods and services. To determine the extent to which consumers in your neighborhood use e-commerce, you will conduct a survey of adults and report your findings to the class and to those who participated in the survey.
You will explore how the price of an item helps consumers decide which item to purchase and where they should purchase it. You will also discover what e-commerce is and how e-commerce influences consumers in their decisions about what to buy.
The athletic shoes you are wearing now are too small. You need to purchase a new pair. Fill out this worksheet about purchasing new shoes. After you have finished the worksheet, answer the questions in the activity below.
Did your rankings differ? Explain.
If there is little difference in price, on what do consumers base their decisions?
Why is knowing the price of the shoes you would like to buy important?
- Why do consumers substitute less expensive goods for more expensive goods?
You have been saving your allowance to buy yourself a new toy or game. Go to one of the following websites to find a specific toy that you would like to buy.
Fat Brain Toys
Toys 'R' Us
After selecting a toy that you would like to buy, fill in this Toy Survey with information you gathered from this website. To make an informed decision, you need to gather information from two other websites, a local store and a catalog and complete the remainder of the chart. Using the information from your chart, select the location where you want to buy your toy. Explain why you chose this location for your purchase.
Where would you buy your toy or game? How did price influence your decision?
How might the amount of the time needed to purchase an item influence your choice?
- What other factors influenced your choice?
E-commerce is a term used to describe the buying and selling of goods and services on the internet. E-commerce is growing. More and more people are buying and selling goods using the internet. In 1999, 39 million households shopped on line and nearly half of them spent $500 or more.
- How do you think e-commerce might influence the way people purchase items?
- How do you think the influence on consumers might influence local stores or small businesses?
- What advice would you give these store owners who have lost customers to the internet?
How many adults in your local community shop on line? To answer this question conduct a survey interviewing five to ten adults using the form. Print one survey form for each adult you interview. Share your findings with the rest of your classmates and write a brief summary of the findings. What generalization can you make about people's use of e-commerce? Write a thank you letter to the individuals you interviewed and include a summary of your class findings.
Price influences consumer decisions because consumers will substitute a lower priced item for a more expensive item if they feel the higher priced item is not worth the difference in price. When prices go up, consumers look for other products that can be substituted that are cheaper and still fulfill their wants. Through substitution, consumers make their income will go further. If there is little variation in price, consumers base their decisions on habit, brand name recognition, advice from friends and family, and advertisements. With e-commerce, the buying and selling of goods and services on the internet, the number of consumers purchasing items online is increasing. E-commerce provides consumers with another source of information when determining the best place to purchase a good or service.
Your teacher will assess your work based on your answers to the worksheets and questions in Part 1 and in Part 2. Be prepared to discuss your findings in Part 3 as well.
Your friend has been saving his allowance and money from doing chores. He wants to buy a CD player. Your friend has asked you to help him. Using what you have learned in this lesson, what advice would you give him and why?