Conspicuous Consumption the Relationship Between Luxury Purchase

Conspicuous Consumption

The Relationship between Luxury Purchase as Conspicuous Consumption and Y Generation -Take Designer Brands for Example

Conspicuous consumption is a complex concept that requires a great deal of quandary. Conspicuous consumption is often thought of as unnecessary spending or the purchasing of products that are not necessities. Increases in upward mobility have increased conspicuous consumption patterns in nations around the world.

Marketing professionals are eager to find the target markets that engage in conspicuous consumption. The purpose of this thesis was to examine the conspicuous consumption of the Y Generation in Taiwan.

Our research found that there are clear differences between luxuries and necessities and that the characteristics that distinguish each can differ from country to country. The discussion also discovered that conspicuous consumption is defined as "the consumption of goods and services on a grand scale for the purpose of demonstrating pecuniary power rather than that of providing utility through use." (Bell et al.) The thesis demonstrated that Generation Y is likely to engage in conspicuous consumption and should be targeted as a potential market. We also found that the conspicuous spending of the Y generation has been greatly influenced by Baby boomers and Generation Xers that preceded them. We also discussed the results of a survey, which measured the conspicuous spending of Generation Y

The survey, consisting of 112 participants, focused on the frequency with which they purchased brand named products. The study suggests that many in this generation desire to purchase brand name products even if they can't afford them. The survey also suggest that generation Yers decision to purchase name brand clothing is based on the quality of the product, peer pressure and, psychological factors. The study also found that females in this generation are more likely to make conspicuous fashion purchases than their male counterparts were.

The implications of the study suggest that marketing professionals should attempt to market products to this segment of the population. The findings of the literature review and the subsequent survey illustrate that individuals in this generation have money and are willing to make conspicuous purchases. Marketers must grab hold of the potential that exist with this generation and attempt to get and keep their business.

1.0 Introduction

Organizations trading merchandise in the marketplace realize that it is impossible to appeal to all consumers from different generations in the same manner. Therefore, market segmentation has always been considered one of the most important practices in marketing for the two following reasons. On the one hand, market segmentation is crucial because it directly affects how a market is understood and defined in the minds of consumers. On the other hand, market segmentation has strategic function in the process of target market selection and the subsequent development of successful and effective marketing programmes accordingly.

Due to the important role market segmentation plays in strategic marketing implementation, generation Y is a distinguishable target market segment that business operators must play close attention to. These operators must gain insight into behavioural purchase patterns as well as the underlying psychological motivation for the consumption of luxury products. With emerging massive purchasing power in years to come this generation will be a force to be reckoned with. Generation Y differs greatly from its preceding generations. Therefore, understanding what consumers are looking for from luxury products is increasingly important for marketers from luxury industries.

Luxury goods are expensive and sometimes considered as "trivial" products without any clear functional advantage over their "non-luxury" counterparts (Dubois and Duquesne, 2001). Therefore, it is generally believed that there should be some additional emotional appeal attached to the purchase of luxury goods that force people to spend a greater sum of money on luxury goods anything else. In her book The Consumer Society, Baudrillard (1983) proposed the following: only when physical objects become a chain of signifiers can they provide significant meanings of consumption, and upon which consumers are enabled to differentiate themselves from others by this ownership. (Baudrillard 1983) In other words, sometimes when people conduct a series of consumption, it is no longer a particular object in its specific utility that matters; but the underlying meaning of that object in representing personal identity, status or other symbolic values. (Baudrillard 1983)

Buadrillard's (1983) attitude toward consumption is quite similar, to a certain extent, to the previous theory known as conspicuous consumption from the initial U.S. publication of The Theory of the Leisure Class. According to the author, Veblen (1912) conspicuous consumption was defined as the purchase of more improved and elaborate goods as an indication of wealth, thus followed by a sense of personal comfort and well-being. Therefore, under the influence of conspicuous consumption, the value of physical goods is transformed into a kind of cultural signifier that is used by people as medium to communication with the outside world by offering the messages of abundance and affordability of high-priced items among certain individuals (Campbell, 1987).

Traditionally, luxury goods have long been treated as something one's mother / father used, or it was the preserve of rich and older people as only they could afford it. However, people's attitude toward luxury consumption nowadays is quite different, especially among those who are categorized as generation Yers (born between 1977 and 1994) mainly because of the following two reasons. On one hand, they have not experienced major risks as baby boomers and generation Xers have. Generally, generation Yers would describe themselves as "happy," "upbeat" and "confident" and enjoy the pleasure of purchasing material goods. (Dias, 2003)

On the other hand, due to the rise of technology, Internet companies and global economic warm up, there has been a so-called "nouveau-riche" young group of wealthy consumers created. In addition, there is also an increase of more than 50% in average household income. As a result, middle-class Generation Yers get more money to spend than any other group over the past 30 years. Because of the changes of generation Yers' behavioural attitude toward the outside world and the economic advantages they can both exploit and contribute to the growth of world luxury goods market to the tune of 9%. This is up in real terms from 1996-2000 as shown in Figure 1. From Figure 2, it is clear that watches and jewellery made up the fastest growing sector within in the five years, mainly because of the expansion of designer fashion brands into this category (Anon, 2001).

1.1 Focuses of This Dissertation

Although the changes of behavioural attitude and a better economic situation explain why consumers from generation Y are trading up from mass commodity goods to luxury products, it is still not comprehensive enough. A mentioned previously luxury goods, do not provide consumers with any obvious functional advantage over its counterpart. Therefore, luxury goods should be attractive to consumers only if there are other psychological benefits that they can acquire throughout the process of the consumption. In Tu-Chia Ling's (2001) dissertation, she has already identified that more and more generation Yers tend to buy luxury goods because of conspicuous reasons. Therefore, designer fashion will be selected out of other luxury categories, such as cars, cosmetics and jewellery, to focus upon because they are more concerned with everyday life.

There are three objectives to be met by this dissertation:

a. How do generation Y view designer goods? Do they view designer brand goods and mass merchandise differently?

b. Do generation Yers from different age ranges differ from one another in the way they view designer brand purchases as conspicuous consumption? Does the age difference have any influence on generation Yers' brand loyalty, product category preference/selection and price sensitivity?

c. How could designer brand fashion marketers adjust the marketing programme to the finding accordingly?

2.0 Literature Review

2.1.1 Luxury VS. Necessity

Distinguishing luxury from necessity can be a bit of a challenge in the 21st century. According to a book entitled Living It Up: Our Love Affair with Luxury, the word luxury is defined as "those things that you have that I think you shouldn't have." (Twitchell 2002) The book goes on to explain that those things that are defined as necessities today were once considered luxuries. The book explains that,

Almost without fail, one generation's indulgence becomes the next generation's necessity. Think buttons, window glass, rugs, fermented juice, the color purple, door handles, lace, enamel, candles, pillows, mirrors, combs, umbrellas.... As the nineteenth century gave way to the twentieth, indoor plumbing was thought a horrible waste of living space and an environmental hazard. Our government now considers its lack to be one of the markers of poverty. If you don't have it, you're considered destitute." (Twitchell 2002)

Although this explanation of luxury and necessity is accurate and relevant, there are concrete definitions of both words. Over the next few paragraphs, we will discuss these definitions and the ways in which luxury and necessity differ from one another. Let us begin our discussion with a more technical definition of luxury.

According to Webster's dictionary luxury is "A free indulgence in costly food, dress, furniture, or anything expensive which gratifies the appetites or tastes... Anything which pleases the senses, and is also costly, or difficult to obtain; an expensive rarity; as, silks, jewels, and rare fruits are luxuries" (Dictionary) Indeed, luxury can take on many different forms. In prosperous nations, luxury often consists of nice cars, brand name clothing, houses and expensive jewellery. In less developed countries luxury might consist of having clean water or toilet paper. For the purposes of this discussion, we will focus on luxury as it is defined in nations that are more prosperous.

The obsession with luxury has caused many problems in nations around the world. Many consumers are in a great deal of debt because they have chosen to purchase luxury products that they cannot afford. In some extreme cases, people have been killed for their luxury products such as expensive shoes, cars and expensive clothing. It is evident that societies desire to have extravagant possessions had led to less than positive outcomes.

With all this being understood, we can conclude that luxuries are simply those things that are nice to have but do not necessitate human survival. We can also conclude that the most prosperous the nation the more luxuries become necessities. Now that we have a better understanding of what constitutes luxury, let us discuss the definition of necessities.

According to Webster's dictionary a necessity is "A thing that is necessary or indispensable to some purpose; something that one can not do without; a requisite; an essential; -- used chiefly in the plural; as, the necessaries of life." (Dictionary) When one thinks of necessities the words food, water, and shelter come to mind. In addition to these necessities, some would argue that people also need love, acceptance and affirmation. All these things are essential to the physical and mental well-being of any human.

As we mentioned earlier, some of the things that were once thought of as luxuries are now considered necessities. This situation occurs for reasons other than greed and the desire to "show off." Science and education have contributed to our understanding that some things are necessary and can ensure that we live healthier lives with fewer diseases. For instance, there was a time when doctors did not wash their hands after delivering babies and as a result many women died during childbirth. Once scientist figured out that not washing hands between deliveries was contributing to these deaths, washing the hands became a necessity. Likewise, there are people in developing countries that do not have clean water and the dirty water that they use contains bacteria and causes all kinds of diseases and even death. Therefore, from this we understand that just having water is not good enough we must have clean water -- clean water is a necessity.

In most societies, education is also a necessity. This is certainly true in Westernized countries such as Taiwan. If an individual wants to be able to purchase food and shelter, they must have an education so that they can work to provide such things. Even in third world countries an individual has to know how to do something to make a living.

Indeed, there are things that are necessary for survival, but name brand clothes are not one of them. The purpose of a necessity is not to make an individual look good or relate to peers -- but to sustain life.

Necessities are anything that allows you to live healthfully in both mind and body.

With all this being understood we can conclude that while luxuries and necessities are two different things, they can often become intertwined. Luxuries are products that are costly and are often used to display ones wealth and opulence. On the other hand, we found that necessities are those things that allow us to live.

2.1.2 Modern Consumer Society of Luxury

Nations around the world have adapted an attitude of luxury. Nowhere is this more evident than in Westernized countries including Japan, Hong Kong and Taiwan. For the purposes of this discussion, we will focus on the modern consumer society of luxury as it relates to Taiwan. A discussion of this type must begin with an explanation of the Taiwanese economy the "Economic Miracle" that occurred in the country.

A book entitled "Contemporary Taiwan" explains that Taiwan's economic performance from the mid-1950s to the mid-1980s is regarded as that of an archetypal Asian Newly Industrializing Economy (ANIE). It achieved rapid growth, marked structural change and an exceptional export performance. During the 1980s, however, important changes in the pattern of growth and associated policy challenges became evident. These changes partly reflected the internal evolution of the economy as it began to exhaust both its labour intensive comparative advantage and also, arguably, some of the benefits of the regulated and protective institutional structure that underlay early economic successes. This internal evolution coincided with two important external changes. One was the unfolding development of the PRC under the policies of economic reform and the open door." (Shambaugh 1998)

The book goes on to explain that the rapid economic growth of the country gave way to an increase in luxury spending. In addition, technological advances made certain products such as cell phones readily available. In addition, more Western businesses begin to set up shop in Taiwan. The influx of Westerners and their clothing brands along with an influx of new types of music and movies created an environment that was ripe for conspicuous consumption.

The rapidly growing economy also seemed to erode some of the traditional values of the Taiwanese culture. Eventually this erosion led to an increase in conspicuous consumption. The book asserts that the increase in wealth created a class struggle that still exists today. The book explains,

With the phenomenal expansion of the middle class and its attendant "bourgeois" mentality, Taiwan is not likely to witness class struggle as defined in Maoist terms. Still, the widening of the actual and perceived gaps between rich and poor seems inevitable and the conspicuous consumption of the nouveaux riches has already led to a great deal of jealousy and frustration, or "red-eye disease" (hongyanbing), as a new socio-pathological concept in Taiwan. The perception that undisciplined democratization has cheapened the political process and that electoral behaviour has been corrupted by money and violence further enhances the general impression that, despite the rhetoric that "sovereignty resides in the people," power and influence are in the hands of the few." (Shambaugh1998)

The impact of a rapidly growing economy and increases in education has had an impact on the conspicuous consumption of generation Y Generation Y's parents are more affluent than previous generations and therefore there is more disposable income. In addition, many generation Yers are now entering the workforce. These individuals are college educated and making significant incomes and have money to spend.

2.2.1 Meanings of Conspicuous Consumption

Consumption becomes a process of displaying pecuniary status and command over resources; it becomes a competitive process, each family seeing which can spend, or seem to spend, more money. The appearance of frugality, of saving, of economy is to be avoided; conspicuous consumption and "honorific" waste are the order of the day." (Kyrk 1923)

The term Conspicuous consumption was first used by Veblen in his book Conspicuous consumption is thought to be a man made phenomenon that has always existed in some form. Many assert that human beings have an inherent need to be seen and to have more possessions than the people around them do. A book entitled The Economics of Consumption: Economics of Decision Making in the Household, asserts that many individuals simply consume products "for the sake of display." (Bell et al.) The book defines conspicuous consumption as the consumption of goods and services on a grand scale for the purpose of demonstrating pecuniary power rather than that of providing utility through use. The very essence of conspicuous consumption is waste; utility is produced for the consumer through extravagance and waste rather than use." (Bell et al.)

The book also contends that the ideology behind conspicuous consumption has its roots in primitive tribes. (Bell et al.) The authors explain that primitive tribes would practice certain forms of consumption as a means of proving their superiority over other tribes. For instance, only the individuals that were successful hunters or triumphant in battle were allowed to have certain luxuries. (Bell et al.) The luxuries included the best foods, the prettiest feathers and the best skins. (Bell et al.)

The book also argues that conspicuous consumption is universal but varies in degree from place to place and from generation to generation. The authors assert that conspicuous consumption is a characteristic that is present at every income level. (Bell et al.) The book explains that conspicuous consumption is often tied to the appearances of one's family. (Bell et al.) The book argues that the wife of a businessman is more than just a wife and is often a sign of the amount of affluence that an individual or family has. (Bell et al.) This affluence is seen in the type of home that they live in, the car one drives, the clothes that members of a family wear, and the type of entertainment that the family can afford. (Bell et al.)

Finally, the book explains that conspicuous consumption can also become competitive. The authors assert that conspicuous act or activity is by its very nature competitive since to be conspicuous it has to be bigger or more costly or louder than some other act or activity. So then, one act of conspicuous consumption leads to another. And an individual or family need not be counted among the socially prominent to get into the game. At different income levels, minor competitions involving ostentatious displays of consuming power are to be found. And no matter how far down in the procession a family may be, it will find some way on some occasion to display its power to consume. Until recent years, for example, it was common for poor families in city tenements to put on a conspicuous display of wasteful consumption at least once or twice in a lifetime in the form of elaborate weddings and funerals. (Bell et al.)

2.2.2 Characteristics of Conspicuous Consumers

Conspicuous consumers tend to be well educated and affluent. The baby boom generation, Generation X and Generation Y are all conspicuous consumers. Although, conspicuous consumption has existed for a long time, the baby boom generation brought it back to the forefront in modern times. This is due to the fact that the baby boom generation was more educated than there parents and the economic conditions were better than those that their parents experienced.

Indeed one of the trademarks of conspicuous consumers is their level of education. Generally speaking the more educated an individual is the more conspicuous spending that they partake in. This phenomenon is due to the fact that as the amount of education that a person acquires increases the amount of money that they make also increases. Therefore, the more education that an individual has, the more likely they are to be conspicuous consumers.

2.3.1 Comparison of Generation Y, Generation X and Baby Boomers

Generation X and Y are the children of the baby boomers.

The baby boomers, born for 1946 to 1965, are amongst the most talked about generations in history. Baby boomers came of age during Vietnam and witnessed monumental changes in the world. The baby boom generation was also influenced by Reagonomics and technological growth. This generation is highly educated and actually better off than there children. Many individuals in this generation are considered to be hard workers and have acquired a great deal of materialistic products. An article entitled Segmenting Baby boomers explains

Older Boomers reached adolescence during the Vietnam War. At that critical life passage, they learned that they had some control over not only their lives but over their society. By fighting against the war, they learned that they could overthrow many "rules and structures established by older generations." [1] As the civil and women's rights movements caught their attention, they fought against prejudice and racial bias. They developed determinism, optimism and a "can do" attitude....The younger boomers "was influenced more by emerging technology and Reaganomics. They adopted Macintosh computers and designer sneakers to produce more with less effort, but answering machines soon became their technological symbol. It symbolized their preference for sex over romance and false intimacy over committed relationships. They couldn't take time for "anybody who wasn't immediately useful or pertinent to one's own life."(Morton 2001)

Because of their pursuit of education and money, the offspring of this generation known as generations X and Y became latchkey kids that lacked parental supervision. Generation X, individuals born from 1961 to 1976 has long been vilified as the slacker generation that have put off adulthood and opted for an extended adolescence. In all actuality, Generation X is full of ambitious young people that desire to balance work and career. This group is the first generation that was profoundly impacted by divorce. For this reason, they often have problems with authority figures and are often self-starters. An article entitled "Managing Our Future: The Generation X Factor" asserts that "competition, MTV, AIDS, and new technological advancements every six months have shaped Generation X lives. They value flexibility, life options, and the achievement of balancing work and life issues. While money is important as an indicator of career performance, they are willing to sacrifice salary and status for more time to themselves and a greater variety of options... (O'Bannon 2001)

Generation Y born between 1977 and 1994, are much like generation X However, more than the previous Generation they are independent and have grown up in a wealthy world. Many have been influence by world travel and have garnered a global perspective through the access to information provided via the internet. Like generation X many Yers come from divorced homes and have been left to rear them selves. This generation is known as the most technologically savvy as all the generations that have ever been. An article explains,

Y's are in tune with technology. Of the average household, 40% of Gen Y's are likely to be online while 77% say they prefer to look up something on the Internet rather than in a book. This group, also known as the "Net Generation," is 60 million strong. They rival the size of the Baby Boomers (72 million) and dwarf the 17 million Gen X'ers. Typically defined as those born between 1977-1994, they range in age from 8-25. This group of young adults, teens and preteens can be categorized into three distinct markets: primary, influence and future. These young adults come from a generation of philosophers and thinkers and make-up the bulk of the primary market." (Grow 2002)

Now that we have a better understanding about how each generation differs from the other, let's discuss generation Y's spending patterns and conspicuous consumption in Taiwan.

2.3.2 Characteristics of Generation Yers in Taiwan

Generations Yers refers to those individuals that were born between 1977 and 1994. An article entitled, "Targeting Generation Y" explains some of the characteristics of this generation. The article asserts that this generation is poised to have a major influence upon consumer spending and the way that products are marketed. The author asserts that "Not since the first Baby Boomers began their teen years, have so many Americans been adolescents. Now almost half of the Boomers' 71 million children are teenagers, (3) making them "the largest teen population in history." (Morton 2002)

The article asserts that boys in this age group earn about $88 per week and girls earn about $75 per week. (Morton 2002) The article also reports that one in six have access to their parents credit cards or have their own credit cards. For this reason, the article reports that some companies have designed money cards that allow them to shop on the internet. The article also reports that during 1997 Generation Y spent an estimated $84 billion of their money. (Morton 2002) However, by the year 2000 their spending dropped considerably. (Morton 2002)

The article goes on to assert that Generation Y is rather picky when it comes to the types of products that they purchase. The article explains that they want the latest technologies in the quickest time possible. The article also explains that brands and fashions are important to this generation. The author asserts

They are "brand and fashion-conscious," but as one advertising manager has learned, you have to get the "merchandise in front of them without being in their face." No matter what they are buying, Gen Ys prefer brands with a core identity based on core values. They won't buy a product just because it's in the mall. It's more important to them that a product is "credible on the street." (Morton 2002)

The article asserts that marketing professionals should understand how to customize advertisements to fit the lifestyles of Generation Yers. The article argues that the most successful advertisements geared at this generation are emotional and humorous. This generation also wants to know the facts about a product but they will seek to find this information on their own.

Statistical information related to young people in Taiwan is often lumped together with information about China because Taiwan is a province of China. According to an article in The Economist young people have benefited greatly from the rapidly growing economy in the region. The article asserts that this generation of young people enjoys brand name items and will use credit cards. Unlike, their predecessors they are not afraid to borrow in order to obtain some luxuries. The article asserts that this generation is more educated and has more disposable income than previous generations. For this reason they do not save as much and enjoy certain luxuries. ("Golden boys and girls")

3.0 Methodology, Research Design and Data Collection

This research was conducted through a survey that was distributed via email. The survey was distributed to 157 people and 112 responded to the survey. Sixty-nine out of the 112 respondents was female and 43 of them were male. Of the 69 female respondents, 23 of them were between 28-25, 35 of them were aged from 24-20, 11 of them were aged between 19-15 and none of them was younger than 15.

About the male respondents, 11 of them are aged between 28-25, 25 of them are from 24-20, 9 from 19-15.

Eighteen out of the 34 respondents (including male and female) aged from 28-25 (52%) had a Masters degree, 11 had bachelors degrees (32%), and 5 had a high school diploma (14%). In this age group, 15 of them have monthly income above £700, 9 have income of £600-700, 6 have income of £ 500-600, and four have income of £400-500. The income of 32 (94%) respondents is from full-time work, and two (5.8%) is from part-time work. In terms of their occupation, 5 (14.7%) work in the IT industry, 7 (20.5%) work in the Finance/Business industry, 15 (44.1%) are employed by the service industry, 2 (5.8%) were free-lancers, 3 (8.8%) were from the Mass Communications field, and the rest 2 (5.8%) are employed by other industries.

Two out of the 60 respondents (including males and females) aged 20-24 (3.3%) already have Master's degree, 51 (85%) of them obtained bachelor degrees, and seven of them have diplomas. All have attained at least a high school degree.

In this age group, 22 (36.6%) of them are still students. 8 (13.3%) are in the IT industry, 10 (16.6%) in the service industry, 9 (15%) in the Finance/Business industry, 3 (5%) are public servants, 2 (3.3%) are free-lancers, 5 (8.3%) are from mass communications related business and one (1.6%) is from another industries. In this age group, 21 out of 22 students have a monthly income of below £ 500, only one has income of £ 500-1000. All of this income is from parents or relatives. The remaining 38 respondents have full-time jobs, 4 of them have income over £700, 3 of £600-700, 20 of £ 500-600, 9 of £400-500, and 2 of £ 300-400.

Five (4.4%) of the 112 respondents have a total monthly household income over £3500, 8 (7.1%) of £3000-3500, 5 (4.4%) of £2500-3000, 16 (14.2%) of £2000-2500, 27 (24.1%) of £1500-2000, 44 (39.2%) of £1000-1500, and 7 (6.2%) of £ 500-1000.

3.1 Preliminary Survey Design (about 100 respondents)

Part I General Questions: (Please type your answers on the front)

____1) I have ever bought designer branded goods before.

____2) Reason(s) I purchase designer branded goods would be: (You may choose more than one answer).

With higher quality

Favourable style

Good post-purchase service

Good in-store shopping environment.

Psychological factors (self-confidence, self-image, self-esteem, etc.)

Peer pressure

Other (please specify)

____3) How frequent do you purchase designer branded goods?

Once every two weeks

Once every two months

Once every three months

____4) I spend ____% of my total monthly income on designer branded goods purchase.

____5) In terms of money spent on designer branded goods, I spend ____ my peers per month.

A lot more than little more than About the same as little less than lot less than Part II Attitude toward luxury goods and mass commodity goods

____1) When purchasing fashion items, which one do you prefer?

Designer brands (DKNY, Chanel, Prada etc.)

Mass commodity brands (Next, Gap, FCUK etc.)

____2) Despite of the different price level, do you feel any difference between designer brands and mass commodity brands in terms of product/service quality and reliability?

____3) If engaging in designer branded goods other than mass commodity goods, will you feel more confident in any way?

____4) When you use designer branded goods, do you want people to recognize it?

Answer Question 5 if your answer is Yes)

____5) (Continued from Question 4) And when you use mass commodity fashion items, do you still wish people to recognize it as when you use designer branded goods?

Part III Customers' brand loyalty, reaction to different product categories and price sensitivity

Please answer in complete sentences if possible)

Is there any designer brand in particular upon which you make purchase repeatedly? If yes, what is it and what makes it superior to other brands?

A skip this question if you give 'no' as answer in Question 1)

Will you find other non-designer brand substitute when the product quality and style are similar to the designer brand merchandise?

3. How often do you regret after purchasing an expensive luxury fashion good? If so, what would be the reasons?

4. Among the following four product categories (clothing, footwear, handbags and watches) as designer branded goods, which one do you purchase the most frequently?

5. Among the following four product categories (clothing, footwear, hand bags and watches) as designer branded goods, which one, in your opinion, would worth you spend a premium price on than others?

6. Are there any designer branded goods that you would like to purchase, but can't afford it at present?

7. (Continued from Question 7) Will you consider the junior lines of that good, for example Miu (sub-brand) instead of Prada (main line)? Why or why not?

8. Do you buy designer branded goods only when it is on sale or having discount?

9. Usually, how do you make the payment when purchasing designer branded goods?

By credit/debit card

By check d. Others (please specify)

Part IV Background Information

This survey will only be used on academic purpose by all means, and remained confidential.)

____1) What is your gender?

Male

Female

____2) How old are you?

Below 15

____3) What is your educational level?

Master or above Bachelor

Diploma

High school degree or below ____4) What is your current occupation?

IT industry

Finance

Business

Free-lancer

Service industry

Public servant

Mass communication

Others (please specify)

____5) Your average monthly income is:

100 or below Above £700

____6) Your Income Comes From:

Parents or relatives

Part-time job

Full-time job

Others (Please specify)

____7) The average monthly household income of your family is:

500 or below 1000-1500

2000-2500

2500-3000

3000-3500

Above £3500

3.2 Depth Interview (about 10 respondents)

4.0 Research Finding and Analysis

Part I General Questions

1. Fifty-eight out of 69 female respondents had purchased designer branded goods. Only 16 out of 43 male respondents had purchased designer brands. Moreover, within the female group that purchased designer branded goods, their occupation and age are quite even, from students to high-income IT employees, who aged from 15-28, and have income from £ 100-200 to above £700. However, in terms of the male group, they were mostly from the IT Industry (7 of them), Business/Finance (5 of them) and Service Industry (4 of them). And 10 of them are aged from 25-28 and have a monthly income of £600-700 or above.

2. All the 74 respondent who have ever bought designer branded goods (including F&M) chose "with higher quality" as one of the reasons for them to purchase brand name goods. Therefore, it is clear that generation Y pays attention to the quality of the products. "Good post-purchase service" was chosen by the least respondents. Maybe this is because respondents do not think they will need post-purchase service as much as for other products like electronic goods, when purchasing designer branded goods. Moreover, 48 respondents chose "Psychological factors" as one of the reasons, and 39 of them were female while 9 were male, most of them were aged from 20-24. "Peer pressure" was also chosen by 33 respondents, most of them female aged from 20-24, and they were students.

3. Only 2 female respondents (aged from 25-28 from finance/business industry and service industry, with monthly income of £600-700 and above) indicated that they purchase designer branded goods once per week. The majority of the respondents make the purchase from once per month to once every 3 months.

4. According to the results, no respondent would spend over 60% of their total income on designer branded goods. However, 7 (6 female and 1 male) of them would spend 40-60% of their income on the products. Twenty-five of them would spend 20-40% and the rest 0-20%. This question illustrates that more respondents from age 25-28 would spend a relatively greater amount of their income on designer branded goods and most students from age group of 20-24 chose 0-20%.

5. There are four respondents (2 female and 2 male) believe that they spend a lot more money on designer branded goods than their peers do. Twenty-eight chose a little more than. Sixty-eight chose about the same as, and 12 chose a little less than. No one choose a lot less than.

Part II

1. More than the actual number that had experienced the purchasing of designer branded goods (83-74) gave responses saying they prefer designer brands. Perhaps some of them prefer designer brands but they are not affordable to them. Therefore, only 29 would prefer mass commodity goods when compare to designer brands. And within the 29 respondents, 17 of them are males, mostly current students who aged from 20-24 which might indicate that females consumers are more brand conscious than male consumers, and also male consumers are less fancy about designer brands in their early age when they don't have much income.

2. In this question, 100 respondent give "yes" as response, and 12 say "No."

3. 63 respondents say "yes," they will feel more confident and 49 say "no."

4. 44 respondents say "yes," they want people to recognize that they're wearing designer brands, and most of them are female who have full-time jobs and 68 say "no."

5. And continuing from question 4, 14 out of the 44 respondents give "yes" as response as that they still want people to recognize the mass commodity goods they are wearing as much as when they wear designer brands.

Part III (open questions)

1. The result shows that most of the young people aged below 25 don't purchase a certain brands on a regular basis. There are only 3 respondents from this age group that indicate they purchase Louis Vuitton, Calvin Klein, and Prada regularly because of the high quality, high reputation of the brands and personal preference. Respondents from 25-28 show more brand loyalty compared to younger people in percentage. Eleven female respondents and 6 male respondents from age 25-28 have already formed a habit of purchasing certain brands regularly. The brands listed by the respondents included Giorgio Armani, Louis Vuitton, Prada, Burberry, Calvin Klein, DKNY, and Gucci. The reasons they provide for such purchase are high product quality, high reputation, brand heritage, and favourable style.

2. Most respondents show brand loyalty to certain brands and would not find another non-designer-brand substitute even if the style and quality were similar.

3. The result shows that the younger the respondents are, or the less financial advantageous they are, the more likely they will feel regretful when purchase an expensive designer brand. For example, 38 respondents (25 of them are female aged from 15-24, 7 of them are male aged from 20-24) say they've been regretful after a purchase. The reasons for the regret were that the products were too expensive, the products become old-fashion after few seasons, there is not much occasion to use the product, or they do not like the style anymore. On the contrary, males or respondents who are elder and show brand loyalty to certain brands will buy what they like and seldom regret the purchase.

4. Overall, clothing is the category that is purchased by the Y generation the most frequently, followed by handbags, footwear and then watches. However, when analyzed by age group, the result is slightly different. Customer aged from 15-24 still purchase designer brands the most frequently, followed by handbags, footwear and watches. However, consumers aged from 25-28, the result would be handbags > clothing > footwear > watches.

5. Almost every respondent regarded "watches" as the fashion categories that is the most popular one to spend a premium price on. Watches were followed by handbags, clothing and footwear.

6. 55 respondents gave a "yes" that they have something they want but cannot afford it at present. Twenty-eight of them are female aged from 15-24. Ten of them are female aged from 25-28 and the rest are male.

7. Around 94.5% (52 out of 55) of respondents would consider junior lines as an alternative, because they are much cheaper, with similar style and quality as the main line and with a more youthful look.

8. Thirty-eight respondents said that they would still buy designer brands at full price if they really like the products. Most of them have full-time jobs and earn a higher monthly income. However, a majority of the respondents (74) would buy the designer brands only when they are discounted or on sale.

9. Respondents would mostly pay by credit/debit card when purchasing designer brands. Only few pay by cash, check or voucher by occasions.

5.0 Discussion (limitation, application and so on) and Conclusion

The survey found that there is a great deal of conspicuous spending on brand name goods in the Y Generation. The survey determined that most of the respondents had spent money on brand name goods. This finding is no surprise because the review of the literature found that generation Y enjoys purchasing brand name clothing. The survey simply verified the finding that generation Yers are "brand and fashion-conscious."