Consumer Behavior New Zealand Consumer Behavior This

Consumer Behavior New Zealand Consumer Behavior This research paper has to do with the consumer behavior of the people of New Zealand. The structure of the paper is broken down into how consumer buying behavior is affected by "income status, occupation, Education, geographic, demographics, lifestyles and culture, possessions and level of influence" in their desire to purchase a product such as Hennessey Cognac.

Income status means a great deal when looking at whether a person will purchase a high priced specialty item such as cognac, and New Zealanders vary by their ability to purchase the product because of wealth. Occupation is not as great a factor because people in different occupations have differing levels of pay. Education does not seem to matter a great deal either except for the fact that people who are better educated earn more over their lifetimes.

This could be more of a factor in other countries, but New Zealand has a higher percentage of people who get secondary educations and nothing more than other OECD members (OECD, 2012). The geographic regions could be a greater deciding factor because the people on the South island are mainly European in origin, which would mean that they would be more likely to purchase the drink, while people on the North island are largely Maori. Demographics play a role in the same way that geography does. Lifestyle, for example rich vs.

poor, is probably the biggest factor anywhere. In New Zealand, there is less disparity of wealth, and so this may not be as big a determinant as other factors. Possessions speaks to the wealth factor, as does level of influence. As to the last, a person who wants to be seen as someone who has influence is more likely to drink high-end spirits than someone who does not have that particular issue.

Income Status A person's income will greatly affect what someone buys, the stores they frequent and how often they buy goods (Booth, 2008). Consumer behavior is linked to many different factors that account for how people buy what they do, but as their income increases, it is invariable that people will purchase more in a free market economy such as New Zealand's.

It may seem that the reason for this is simply that as a person has more wealth they are able to purchase more so they do, but it is more complicated than that. According to research conducted by Bauman, Barton and Elliot (2007) regarding how consumers act when they are seeking a banking establishment, people will increase their spending habits up to a point (a point that is different for every individual or couple) and then they will begin saving back the excess.

The reason for this could be that people reach a termination point where they have bought everything that they need and want, but this does not explain it all either. It just seems that people have a set threshold in their minds that is predetermined by personality and experience beyond which they will not go when it comes to consumption.

Looking at middle income spending is not that interesting because people basically consume at a level of their income (basically buying what they need and the few luxuries that the income allows them to afford (Booth, 2008)), but lower income individuals may be the most puzzling until the data is examined. Different countries use different thresholds of income when considering someone to have a "low" income, but the term "poor" is often associated with it.

This is the family that only makes enough money to supply its basic needs, and does not have any extra to purchase what would be considered luxury goods. This class of earners would generally be thought of as very conservative with their money because they cannot afford enough to be liberal. However, this does not seem to be the case with some of this type of earner.

People who earn less, in some cases, spend more than they seem to have money for either because they are more savvy consumers or because they are receiving subsistence cash from their government (Godwin, 2003). Many of the people in this category are in the store more than people at other income levels because they have to search longer for deals that will stretch their income. However, people who are earning part of their income through government assistance programs will often be very irresponsible with their money (Godwin, 2003).

The reason for this, according to the research, is that there is less a feeling of ownership. This type of income is seen as "free money," so it is not guarded as closely as it would be if it was earned by the individual. This means that is spent frivolously in many cases because of how it is seen by the person receiving the handout. New Zealand is not a rich country in terms of average income. The average worker earns $35,304 equivalent in 2012 U.S. currency.

This makes it a solidly middle income country. Therefore, based on the research previously reported, New Zealand consumers will buy what they need, and spend what little disposable cash they have on luxuries and savings. The savings rate is actually negative in the country, but it has been making a recovery over the last few years (NZ Treasury, 2011). This means that people are spending more than they earn because of credit expenditures.

This consumption is in line with many Western countries (which New Zealand is considered because of its ties to the UK). Occupation Occupations in New Zealand match those in most other countries among the British commonwealths, and most of the people in the country have full employment. Consumer behavior in every nation is affected by the occupations that the people hold because they determine what goods the individual will need to purchase, and this also determines what quality of goods the consumer will be able to purchase.

Some occupations dictate that a specific type of tool or resource be used, and the cost is generally high because of the exclusivity of the purchase. But, purchases made specifically for the job are usually either handled by the employer or they are purchases that occur so rarely that they do not make up a large part of the overall spending income of the individual. Occupation matters mainly because it speaks to the money that the person can generate from which they can purchase goods (Olsen, 2005).

The reality is that New Zealand remains the same type of occupational nation that it has been for most of its history. The main industries are no longer agricultural, but a significant portion of the population still derives its income from rural sources. These industries include dairy, sheep, lumber and other occupations that are considered rural. The country has never become a large producer of either electronic or other manufactured goods; many of these products are imported.

A large boom has occurred in tourism, especially ecotourism, over the past two decades. This is largely due to the exposure that the country has received over the past couple of years from the movies that have been shot in the country. New Zealand is seen as an unspoiled land that people want to visit to see some of the last first growth forests that exist in the planet (Ecotours New Zealand, 2012). It has also become clear that New Zealand has become a much desired movie location.

All of the "Lord of the Rings" films were shot there and the two "Hobbit" epics are shooting there now. This influx of Hollywood money has increased exposure to the country, and it has created a new industry that previously did not exist. Movie companies pay a great deal of money for occupations from location scout to extra, and the people of New Zealand are benefitting from this. Occupation relates to consumer behavior in the form of confidence (Halstead, Jones & Cox, 2007).

When people are satisfied with their present position, they are actually more likely to spend. This seems to be the case because the person is more likely to stay in the job, which means that they will have a long-term, steady income with which to purchase goods and services. In New Zealand, the average length of job tenure is comparable to that in the rest of the industrialized world, so spending habits are also comparable.

Education The country has become one of the world's leaders in providing education for all of its people. The human development index from the United Nations says that they have a 1.000 education rating (UN, 2010). This means that every person on the islands has the ability to achieve any education that they want to. Primary, secondary and tertiary education is open to all people, and it is highly subsidized by the government.

Education is seen as a priority not only by the government, but also by the citizens of the country (Ministry of Education, 2012). Also, the educational attainment of the people in the country has risen as an average over the past two decades. The Ministry of Education reports that more than 82% of the children in the country will receive their secondary school diploma (Ministry of Education, 2012). This is comparable to the graduation rates of other Organization for Economic Cooperation and Development (OECD) countries which stands at 79% (Quebec Ministry of Education, 2001).

These are the countries which are most like New Zealand as far as population, language and government. Educational achievement and consumer behavior would seem to be two entirely separate things. People have to buy goods no matter what their educational level may have been. However, many studies have proven that the higher a person goes in education, the more their income will be for their lifetime (Polachek & Polachek, 1989). The actual direct correlation has more to do with earning power than it does with education level reached.

In New Zealand, it is still not necessary to have a college-level education to do most jobs. There are many general labor positions which are held by people who have just obtained their secondary school diploma, and these people occupy many low-level positions also (Ministry of Education, 2012). The fact that there are the jobs available for the population has more to do with people's buying behavior than whether they finished either a secondary school education or a college one.

Geographic This is an interesting section because it would seem that geography would have very little to do with buying behavior. But consider this example. A person who lives in an isolated location, such as the Australian outback or Alaskan wilderness, is less likely to be a purchaser of goods than someone who lives within striking distance of a major population area. The reason for this is the availability of goods to that consumer (Reklama, 2008).

People who do not have a grocery store close to them, or the prices are high for grocery items because of transportation costs, are more likely to use their purchasing power buying seeds, plants and livestock feed. These types of people are more likely to purchase items that are consistent with their self-sufficient lifestyles. A person purchases due to location as a function of how expensive it is to buy goods due to remoteness, and how much easier it is for them to make the goods themselves.

New Zealand has a great deal of citizens who live in remote areas. Although these may not be as isolated as locations in the Australian outback (due to the relative size of the islands), the remoteness is still reflected in their buying behaviors. People in rural areas, across the globe, are more likely to purchase fewer goods, and rely on what they can produce themselves.

This is also reflected in the city where people are more likely to purchase a large variety of goods from local sellers rather than produce it themselves because they do not have the space to produce. Demographics The demographics of a country can encompass many different elements of a society. The primary categories that researchers look to are what the urban/rural breakdown of the country is, how diverse the population is in terms of immigrants, language, education, religion and income.

It is interesting to note that demographics such as these do influence the buying behavior of the individual because there are some products that people buy specifically due to their demographics Language a big factor, and education and the urban/rural breakdowns have already been discussed, but religion and the diversity of the population can have a great deal of effect on how consumers in nation behave. New Zealand is divided into two main islands which house the majority of the population.

The South Island has approximately two-thirds of the population, leaving 33% on the smaller Northern island. The diversity of the population is comparable to other nations in the OECD (OECD, 2012), however there is a difference because the natives on the Islands are called the Maori. These native islanders (actually originally migrated from Southeastern Asia and East Africa) are the largest population group on the Northern island, and they have very different buying habits from the people on the Southern Island.

The Maori and the peoples of the smaller islands considered to be in the New Zealand chain are much more traditional in their buying habits. They also are a much more rural culture than that of the Southern island. This isolation and native heritage means that these people are more likely to purchase goods made locally. The Southern island is much more cosmopolitan because most of its population is of European heritage and lives in cities.

The buying behavior of this group follows that of other commonwealths of the British crown. People are more urban in their tastes and are more likely to make purchases that are pre-made or processed. Religion also effects consumer behavior in positive and negative ways. People who adhere to a certain religion are more likely to buy products which they feel agree with that lifestyle, while they are more likely to boycott products that they feel do not fit their values (Huefner, Parry, Payne & Otto, 2002).

This has happened for many years in the United States where conservative groups have boycotted such organizations as Disney and Target for decisions that those retailers have made that seem counter to their religious ideals. This is also a factor for many other religions whose adherents may not be as vocal as some, but who do actively refuse to buy certain products because of religious preferences. This is not a large factor in the buying patterns of New Zealand.

Although the country is largely Christian in belief (because of the European influence), they are not as conservative as other countries. Thus, boycotting certain products is not an issue because of religion. Lifestyles and Culture Lifestyle and culture are distinct, but they are very correlated at the same time. People who live a jet-setting lifestyle are consumers on a grand scale, and every country has some people who would fit that category.

However, people who are on the low end of the economic spectrum are less likely to spend a great deal of money. Economics is a part of a person's lifestyle, but culture can tell a researcher a great deal more about the purchasing behavior of individuals than whether they are poor or wealthy. This is due mainly to the fact that wealth is calculated and esteemed differently in different places. There are two predominant cultures in New Zealand: European (mainly British) and Maori).

The European side of the culture consume much the same as do their counterparts in other parts of the world. This means that they are buying what they need and spending a small amount (what they can afford) on luxury items. The Maori are much different. Only approximately 52% of the people who consider themselves ethnically Maori are full-blooded Maori (OECD, 2012). However, this does little to effect the buying attitude of these people.

Since most of them live in the much more rural North island, they have many of the same habits of rural people around the globe. Also, some goods are more expensive on the North island because there is a small channel that separates it from the South island. The largest ports and manufacturers are on the South island, so goods have to be shipped to the North island.

The North island is also more agricultural in nature because of the better overall climate (the South island is much closer to the South Pole), so North islanders pay less for many agricultural products. Because of the isolation and the culture, people on the North island do not seem to need to compete for status in the same way that many of their European neighbors do.

There is not the competition for wealth because of the laid back Maori culture, so people seem to be more content with what they have. Thus, researchers have had to look at the two distinct versions of culture and have generally concluded that the main difference between the two islands is the urban/rural difference rather than the cultural difference (Rosenberg, 2005). Possessions This can be a definite issue when considering consumer behavior because many people are attracted to the newest items that come on the market (Hall, 2007).

Even if a person's values run counter to this type of consumerism they may be drawn into it because of the newness of the gadget. A good example of this is the recent influx of products from Apple. The iPad was first introduced in 2010, and there have been two new versions introduced since then. It is ridiculous to think that the original version of the iPad differs greatly from the new version, but people will scrap the old model to purchase the new one anyway.

It is more of a status buy than an actual need. Of course, the new product is probably an upgrade over the old one, but that does not mean that it is such an upgrade that the new product is a must-have. The reality is that people who have a drive for possessions are more likely to purchase than people who do not (Boyd & McConocha, 1996). This is not a factor of relative income because some people (no matter the income bracket) are more likely to purchase than other.

This seems to be more a question of personality and desire for status than because the person actually has the wealth to be a consumer. New Zealand demographics dictate how much of a consuming and status driven society it is. People from the Maori are most likely less driven to accumulate possessions because that is not valued in their culture, whereas the people who live on the South island and have European heritage are more likely to have this drive because of their culture.

This gathering of possessions then is both a cultural and a personality drive that not all people possess. It does not seem to be a significant part of the consumer behavior in New Zealand. Level of Influence This section looks at how people consume based on either who they are because of a title, or who they think they are because of status in society. Status can be a very large factor in whether a people consumes a great deal of goods or not.

People who desire status consume more because they believe that this will enhance their status, whereas people who already have acknowledged status are either happy with where they are and do not feel the need to consume or they feel that need to be more extravagant because of their relative status (Halstead, Jones & Cox, 2007). Thus, buying behavior can definitely be affected by status if someone desires some or has some, but is less likely a factor for those who have none.

The people of New Zealand are much like the people in other parts of the world. There are some who desire status, some who have status, and some who could not care less about.