- KENDRIYA VIDYALAYA BALLYGUNGE -
Conspicuous Consumption
An Insight to our behaviour as Consumers
Aayush D. Bappa
Session : 2020-21
The following project aims to venture into the phenomena of conspicuous consumption and what it
means for the economy as a whole. From various historical researches, studies, theories and evidences
to multiple multinational articles and numerous national statistical analyses, with primary data
taken into account on the basis of an undertaken online survey, we delve into that part of economics
that still begs to question its impact as a psycho-economical behavior.
Certificate
This is to certify that Master Aayush D. Bappa, son
of J. D. Bappa (father) and Dali Das (mother), of class
XII – E of Humanities stream has successfully
completed the project on Economics (code: 030) on
the topic ‘Conspicuous Consumption’ under the
guidance of Sujata Chattopadhyay Ma’am (PGT
Economics) and Principal Suman Lata Ma’am, for
the session of 2020-21 for the AISSCE Examination
as per the instructions and the guidelines given by
CBSE. And as far as my knowledge is concerned, the
work completed is an original piece.
______________________
_____________________
Sign of internal examiner
Sign of external examiner
1
Acknowledgement
I would like to express my gratitude to my
Economics teacher SUJATA CHATTOPADHYAY
Madam and to Principal Madam, Dr. SUMAN
LATA for providing me all the facility that was
required for the completion of the project.
I would also like to extend my gratitude to my
parents for encouraging me during the course of
making the project.
Finally, I would like to thank CBSE for giving me
the opportunity to undertake the project work.
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Index
Certificate ……………………………………1
Acknowledgement ……………………………2
.
Introduction ………………………………...4
o Definition ………………………………4
Related Searches ……………………………5
o Overview ………………………………..5
o History ………………………………….6
o Brief …………………………………….9
Main Objective ……………………………10
Target Audience …………………………..12
The Questionnaire ………………………..13
Variables………………………………...17
Body……………………………………..17
Observations…………………………….20
Insights………………………………….26
o Interpretation …………………………26
o Spotlight…………………………….31
Conclusions ……………………………..36
Recommendations……………………….37
Bibliography …………………………….39
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Introduction
Definition
Conspicuous (which means „obvious to the eye or mind‟)
consumption is the spending of money on luxury goods
and services to display financial power to the public. In
the 19th century, the term conspicuous consumption was
introduced by the economist and sociologist Thorstein
Veblen in his book “The theory of leisure class: An
Economic Study in the Evolution of Institutions.” In that
19th-century social and historical context, the term
“conspicuous consumption” was used to describe the men,
women, and families of the upper class who showed off their
great wealth as a means of publicly manifesting their social
power and prestige either real or seeming.
4
Related Searches
Overview
In this project, we venture into the endeavour of trying to
find the extent to which people are willing to indulge in
such commodities. Briefly put, this project brings across a
variety of observations regarding consumer behaviour,
with emphasis on luxuries, which in turn is directly or
indirectly influenced by the accident of age or gender and
the more individually driven motives tangled with both
personal desires and social forces. I will interpret such
data of these aforementioned assertions through the
responses of a virtually conducted online survey due to
the limitations of personally done door to door surveys in
a restricted environment as a pandemic cloud loomed over
all of us.
5
History
Conspicuous consumption is a behaviour in which an
individual displays wealth through a high degree of
luxury expenditures on consumption and services (Trigg,
2001). Conspicuous goods are often segmented from
general shopping goods in the sense that the primary
need satisfied is prestige (Grubb and Grathwohl, 1967;
Belk, 1988; Shukla, 2008) and that product satisfaction is
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often derived from audience reaction as opposed to actual
product use (Wong, 1997).
The study of conspicuous consumption in the modern era
gained momentum in the times of the Industrial
Revolution, spurred by Veblen‟s (1899 republished in
1994) Theory of the Leisure Class. Veblen (1994)
presented a framework of this phenomenon whereby
consumer preferences are developed based on social
status. Adding to that framework, Duesenberry (1949)
posited that an individual‟s conspicuous consumption
takes into account personal expenditures on items in
comparison with the expenditures of others. In other
words, consumers buy certain goods in the hopes to be
seen more favourably in the greater social hierarchy. This
leads, in largely capitalistic societies, to the use of
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conspicuous consumption in an attempt to find greater
social status (Mullins, 1999), especially when one
considers the consensual nature of public meanings
related to conspicuous products (Richins, 1994).
Conspicuous consumption relates to the consumer‟s
behaviour of seeking to purchase goods and services for
the status they confer, regardless of that consumer‟s
objective income or social class (Belk 1988; Eastman et al.
1999). It differs from mainstream consumption of
regularly purchased goods as it satisfies not just material
needs but also social needs e.g. social status and prestige.
Mason (1984) observes that the classical „rational‟ theories
of consumer expenditure and decision processes do not
readily accommodate conspicuous consumption due to the
atypical nature of such behaviour.
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Brief
Marketing of luxury goods involves a different mind-set
and strategy. It is a different type of marketing warfare as
the consumers involved in this area have a different
perception and they belong to a different class and
different mindscape altogether. Here, the buyers always
stand out of the mass, are more influenced by glamour
and style. It is, therefore, necessary to view the luxury
branding from dual perspective-first, the relationship with
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the „non-luxury‟ brands and secondly but most
importantly, the strategic differences between the two.
In economics, luxury products are those whose demand
rises more than proportionately with income in contrast
to non-luxury goods. Luxury brands are associated with a
high degree of creativity, aesthetic beauty, exclusivity,
pricing, quality and/or a combination of all these.
Main Objective
The reason because of which I chose this particular
topic is that I want to observe the behaviour of
consumers of luxury goods in a country like India,
which is a major market, an economy with a lot of
rising growth. People are in a continual process of
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consumption, under normal conditions of course.
With this project :
o I wish to understand about the motivations
through the behaviour of consumers who engage
in the activity of consuming goods, broadly nonessential and that exude an obvious attention
seeking or visibly noticeable quality.
o I want to derive conclusions of such conspicuous
consumption between certain age brackets
(mainly the youth) and their respective incomes.
o This must be complemented with different types
of goods and services that various people may be
attracted to, with their given age and income.
.
This purchase of luxury goods will have been, no
doubt, affected by the pandemic due to the COVID-19
outbreak, which had radically caused a cessation in
production and consumption in various places,
putting economies under total lockdown and people
stuck in their homes.
To understand their particular consumption
behaviour, I have drawn out an online survey to
complement the secondary data I have collected
through various sources.
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The Target Audience
The target audience, considering my reach on various
internet platforms, such as social media and the social
circle that I possess, is mostly consisted of young school
and college goers (aged 15 to 25 years), along with a
handful of middle aged and slimmer number of senior
citizens. The age of school goers and college do not
hesitate when it comes to spending, although their
behaviour is more dependent on family income. They still
have a basic idea of what constitute possessions that
would make them more obvious to the eye. Thus, I would
like to get to the bottom of their consumption pattern in
their tender age. College students have higher probability
of earning and thus, spending on luxury items, so it is also
very interesting to look at their pattern of consumption.
It is also very interesting to look at the differences in the
behaviour and choices of the respondents according to
their gender, which may provide further insight as to
what they choose to consume in order to be more noticed.
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The Questionnaire
Survey on 'Conspicuous Consumption'
Section 1
1. Name? (if you prefer)
2. Age?
a. 15-20
b. 20-25
c. 25-35
d. 35-45
e. 45-60
f. Above 60
3. Gender?
a. Female
b. Male
c. Other…
4. Education?
a. Elementary (0-8)
b. High School (9-12)
c. Bachelor's Degree
d. Master's Degree or PhD
e. Other…
5. Employment Status?
a. Student
b. Housewife/Homemaker
c. Part Time Employed
d. Fully Employed
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e. Currently looking for jobs
f. Retired
g. Other…
6. Marital Status?
a. Unmarried
b. Married
c. Divorced
7. Monthly Income? (If student, then family income) (In
Rs.)
a. Below 10,000
b. 10,000-40,000
c. 40,000-70,000
d. 70,000-1,00,000
e. Above 1,00,000
8. Average Daily Expenditure? (In Rs.)
a. Below 500
b. 500 to 1500
c. 1500 to 3000
d. Above 3000
Section 2
(As a Consumer... how do we behave?)
1. Do you like buying luxury goods?
a. Yes
b. No
c. Depends
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2. How do you define a good as a luxury? (You can
choose more than 1)
a. Goods which reflect your
PROFESSIONAL/ECONOMIC WELL BEING
b. Goods for which you hold some
EMOTIONAL/PERSONAL VALUE
c. Goods which reflect your HAPPINESS
d. Other…
3. What could be the main cause of buying luxuries?
a. Social Status
b. Personal Desires
4. What are the forms of Luxury Goods and Services
that you prefer? (You can choose more than 1)
a. Automobiles (e.g. Cars, Bikes, Premium App Cab
Services etc.)
b. Clothes and Accessories (e.g. Watches, Shoes etc.)
c. Dining (e.g. Restaurants)
d. Gadgets (e.g. Phones, Computer)
e. Grooming
f. Fashion
g. Furniture/Home Appliances
h. Vintage/Antique Items
5. Does a brand label influence what you buy?
a. Yes
b. No
c. Maybe
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6. Do you like buying luxury goods more than once in a
month?
a. Yes
b. No
c. Maybe
7. Do you like to show your luxury goods?
a. No, I like to keep them to myself
b. Yes, I like to flaunt it too
c. A bit of both
8. Does a product made in India or abroad influence
what you buy?
a. A little
b. A lot
c. Not at all
9. How badly has this pandemic affected how you buy
luxuries?
Very 1
badly
2
3
4
5
Not
at all
10. Do you think that buying luxury goods would be
normal again after the pandemic?
a. Yes
b. No
c. Maybe
d. Hard to say/Unsure
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Variables
Main factors:
Age
Income Brackets
Types of products
Further, factors such as gender, education and
employment level, along marital status have been taken to
observe any pattern in consumption behaviour.
Body (Methodology)
Collected Data
No. of Samples taken: 174
Method used for Collection: Online Survey
Type of Collection: Random Sampling Survey
Type of Data Collected: Primary Data
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18
Preview of the survey online –
Difficulties faced during the survey
Hands on approach to ask people questions directly was
restricted due to the complexities caused by the pandemic.
Thus, the survey was given to individuals found in
proximity and spread further forward through the means
of social media and online platforms, such as Google
Forms. Here is the a snapshot of the resultant dataset -
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Observations
Types of consumers
We can see, from the results of the datasheet, that out of
174, there are the following observations from the above
mentioned questions -
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Total Respondents
Male
43%
Female
57%
Age-wise distribution
60
No. of consumers
50
40
30
20
10
0
Female
Male
15-20
57
60
20-25
11
4
25-35
7
6
35-45
5
5
45-60
8
5
Above 60
5
1
21
Do you like buying luxury goods?
Yes
14%
No
16%
Depends
70%
Cause of buying luxuries?
17%
Personal Desires
Social Status
83%
22
Preferred forms of luxuries
140
120
121
100
104
80
71
60
60
56
53
40
38
20
29
0
Does a brand label influence what you
buy?
Yes
No
Maybe
0
Total
20
Maybe
75
40
60
No
44
80
Yes
56
23
Do you like buying luxuries more
than once in a month?
Yes
21
No
100
Maybe
54
0
20
40
60
80
100
120
Do you like to show your luxury
goods?
3%
A bit of both
47%
50%
No, I like to keep them
to myself
Yes, I like to flaunt it
too
24
Does a product made in India/Abroad
influence what you buy?
A little
36%
Not at all
50%
A lot
14%
How badly has thus pandemic
affected you in buying luxuries?
70
No. of Consumers
60
50
40
30
20
10
0
Total
1
22
2
33
3
58
4
20
5
42
25
Do you think that buying luxuries
will be normal after the pandemic?
Yes
32
No
13
Maybe
62
Hard to say/Unsure
68
0
10
20
30
40
50
60
70
80
Insights
Interpretation
From the above done survey, several observations have
been made.
Here, classifying all data and picturing the significant
responses in visualized forms, we can derive the following
observations from the collected data:
- Out of the respondents, we can see that females (57%) of
various ages are higher than males (43%)
- The most reached age demographic through the online
portal of survey show the respondents of tender ages
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between 15-20 (67%), followed by the adjacent group of
the youth consisting of age 20-25 (8%)
- When on being asked about their preference of buying
luxuries, few (14%) were outright with a positive
response, similar for those who denied (16%). This habit
of owing luxuries must thus be more situational and
conditional, also personally motivated. The following
questions try to find exactly those answers.
- By dividing the motivational cause on a broader scale,
the audience is asked about their motivations to buying
luxuries, if they do engage in such an activity. The
differences are significant, although slightly expected, as
only few respondents were openly accepting that their
buying habit had to do more with social status (17%),
whereas most (83%) will give their personal desires the
higher cause of their buying behaviour.
- Now, with the understanding of their motivation, there
also is a need to get to the root of the preferences of
certain commodities of luxuries over another. Given the
ability of taking multiple options, what topped the charts
of most wanted luxury is clothing (22.7%). (It has been
seemingly quite apparent that clothing has a luxurious
and conspicuous sense to it, that people enjoy the
attention clothing brings, may it be classy or stirring, it is
an indulging habit that motivates people to buy more in
quantity with their respective prices being often high for
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the name of the brand and the more uniquely it can set the
person apart).
- On people's mind, what came following clothing is the
trending category of gadgets (19.5%). The newest and
more technologically more convenient of crafty gizmos
does put a lot of highlight on the owner's modern
lifestyle, that calls for a bringing of new 'toys', from
stylish fitness devices to the latest flagship phones, all
these gadgets makes one's presence more noticeable.
- The following few of the preferred choices of luxuries
ranked behind clothing and gadgets are furniture (13.3%),
automobiles (11.3%) and fashion (10.5%).
- The bottom three of preferred commodities of luxuries
are dining (9.96%), grooming (7.33%) and antiques
(7.14%).
- The presence of a brand label has often been associated
with the calling of being an influencing factor in driving
market forces to attract consumers. They do answer that
in a quite positive way (32%), fewer responded in the
negative (25.1%) whereas more are in the middle ground
between them (42.9%), indicating that perhaps only
certain commodities get the drive of certain branding and
labelling in a telling manner, while the others depend
more on the products themselves, which may give the
room for rare, unique and underrated makers to get
involved in the luxury market.
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- All consumer behaviour must be also understood with
its frequency in its occurrence, thus, it is asked to the
audience to give the repetition of buying luxuries in a
certain period of time and here the period is taken as a
month. In huge numbers, they deny (57.1%) buying
luxuries more than once in a month, perhaps since most of
the respondents (28.5%) earn in the middle income
(monthly) earning category of INR 40,000-70,000,
whereas it is more situational for some (~31%), while
some do buy luxuries more than once (~18%).
- It is also quite visible that people are more inclined to
keep their luxuries to themselves and experience in the
indulgence more personally, as half of the population
openly agrees.
- However, 47% of the population does put the
'conspicuous' before 'consumption', however so partially
along with personal use, while only a miniscule minority
openly show the luxuries solely for display (3%), which
includes a certain degree of the act of flaunting and
presenting.
- Since for the last few years, our country has been
pushing heavily for self-reliance, as we can see the push
for "Made in India" and "Atmanirbhar Bharat", the vision
of a country that does not rely on the production of goods
and services done internationally, along with the
resistance to give away to foreign dependence and
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interference. Hence it is asked in the survey on the
influence and preference they feel when it comes to
products made within the domestic territory. However,
production done in abroad in incorporated into the query
as well since it has noted by the general populace that
foreign goods have a certain level of prestige attached to
it, which sets the consumers of such goods apart from
others. Thus, when asked about the influence of the
location of the production of the products, half of the
population still is not convinced. A marginal push is felt
by 36% of consumers, while only a handful (14%) of the
population feels great level of push by the place where
their commodities are made.
- On the scale of the 1-5 about how badly the pandemic
affected their luxury consumption pattern, where 1 being
the lowest and 5 being the highest degree to which their
consumption pattern was affected, most (33%) had a
moderate degree of shift, perhaps backed by the little
security and stability their income provided. Only a pinch
of the respondents (12.6%) weren't affected as much.
However, this was swiftly followed by a concerning
number of highest degree of shift occurred to 24% of the
population, given the odd circumstances along with the
absurdity of the market caused by the pandemic, where
the trade and money flow were severely stunted.
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- On asking about their optimism regarding buying
luxuries going back to normal, few (~18.3%) did present a
strong show of affirmation that things might go normal,
while only a tiny portion responded with a strong
incredulity that things will normalise. Most (~38.9%)
were unsure while another whole set of the population
(35%) had a weak confidence on the luxury market
returning as such.
Spotlight
On spotlight, I'll put special attention and emphasis on
some of the observations I found during the process of
surveying regarding this subject.
As I have asserted earlier, the consumption choices do
experience the implications of possible differences in the
choices considered and followed if we are to take the
genders and the age groups to take for example.
Following is the table showing the different choices in the
top five categories of commodities by females and males:
From the choices of females, we can see that:
- Clothing ranked the highest among all categories for
women collectively with a strong account of 73.12%. This
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shows that perhaps the marketable distribution of
apparels is a very influencing cause for women to make
such purchases. Clothing has a personal and yet a strong
social motivation that leads to people trying to make
themselves more looked at, being affirmative of their
existence among other beings and doing it in presentable,
relatable manner that is constantly up keeping with new
trials of notice by buying often branded or imported
dresses.
- A slightly far off second for women was the category of
gadgets, with a sizeable showing of 48.39%, considering
the fact that new gadgets in various fields are being
produced on a frequent basis such as in health and fitness,
mobiles phones, timekeeping, and others, it is quite
expected to see such as an expressive behaviour to be in
possession of them.
- A major player, the category of fashion, sits at third with
a noticeable (approximately) 40% (39.78), for women,
which has developed into a much broader term than just
clothing. Beyond than apparels, it is consisting of
accessories, jewelleries or various body decorations that
have become a thing of luxury for many in the
mainstream market.
- A little more than 1 woman out of 3 shows open interest
in dining (34.41%), which can be agreed upon as a
luxurious activity. Since dining is an activity that is taken
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rather occasionally and is generally an open outgoing
extravagance, it surely took a hit during the pandemic.
Thus, it would be safe to assume that under normal
circumstances, the respondents would be more conscious
of answer possibly, more positively. Lastly, among the top
five categories, came the choice of automobiles, which
women selected. It secured an overall percentage of
around 24, reflecting that it is probable that about onefifth women think and act upon purchasing cars or other
vehicles of transport as a choice of luxurious good. An
automobile is a big statement, a sign of prosperity and
success, a show of personal growth, economically and
career-wise, thus it has that sense of social upstanding
among others, making it a significant choice for women.
From the viewpoint of the choices of males, we find that:
- The top was secured by the category of gadgets, with a
whopping near 73%. Since the major noticeable
psychological trait, interest in things, is most
characteristic of men, gadgets are a display of the massive
choice of interest. From watches to mobiles to gaming,
the variety is vast.
- What follows close by is clothing, with a noteworthy
65.43%, is a marker of the huge pool of male consumers
who are exploited by the industry. Clothing has that
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obvious social and personal appeal that captures the male
demographic.
- Automobiles (46.91%) constitute as the third most
favoured category chosen by men as a form of luxury.
Since already discussed about the status symbolising
quality of automobiles, we can find it pretty obvious that
it has a noticeable pull.
- The bottom most pile of consumer favoured luxuries
consist of dining (29.95%) and fashion (23.46%). Thus,
men don't really show high enthusiasm for both of these
activities, but still assert some presence.
Following is the table showing the different choices in the
top five categories of commodities by broad age groups :
From the younger group of the population, it is observed
that:
- The contentious top was won by clothing, with a strong
show of 67.7%, followed by gadgets with 63.2%.
- The youth is surely interested in furniture (37.6%) as a
whole, while automobiles stood at a near 36.8%.
- Fashion (30.8%) and Dining (30.1%) swiftly take up as
the next most popular choices.
- The youth lacks high interest in both antiques (21.8%)
and grooming (17.3%), of which antiques seems to be
34
falling low for the younger side of 15-20 age groups, but
sparks up for groups of 20-25 years of age.
From the older group of the population, it can be asserted
that:
- Clothing (71.4%) and gadgets (47.6%) again seem to
peak the interests of this broad age group.
- Fashion (35.7%), furniture (33.3%) and dining (30.9%)
are the next groups of commodities that draw favour for
consumption by the older demographic.
- Automobiles (26.2%) and antiques (21.4%) are the
following categories.
- Grooming seems to be of least significance for the older
demographic, but still enough to have some notice, with a
percentage of 14.3.
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Conclusion
Thus, we can conclude that though the population was
surely hit by the pandemic, there was some consistency in
the behavioural pattern of consumers when it came to
luxuries. It had been backed mostly by personal motives
and there were some noticeable differences in the
consumption pattern between men and women due their
differences in various interests, also followed by the
dynamic choices of commodities in varying age groups,
most noticeably in the young population. The population
seems to be most stimulated to buy conspicuous products
that fall under the seemingly popular category of clothing
and gadgets. The frequency to which different consumers
buy luxuries was also noticeable. Also, there was more
hope than conviction about the future health status of the
market. With people urging to splurge a bit again, the
markets steadily in preparation to recover, luxuries will
surely find themselves in the palms of wanting hands,
with a hope that they can make people be more looked at
again.
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Recommendations
Following this project, I‟d like to present these below
mentioned works and articles for further reading:
“Is conspicuous consumption good or bad?” - Vidya
Hattangadi; issued in
https://drvidyahattangadi.com/ on June 6, 2016
“Status (luxury) consumption among British and
Indian consumers” (i) and “Conspicuous consumption
in cross-national context: Psychological and Brand
antecedents” (August 2009) (ii) - Paurav Shukla
((i),(ii)), Dr. Ekta Shukla (ii), Dr. Sangeeta Sharma (ii)
International Journal of Social Sciences And
Humanity Studies (Vol 3, No 2, 2011 ISSN: 13098063) - “A Field Survey On The Conspicuous
Consumption Trend In Turkey (Case Study Of Mugla
Province)” - Gülay Hiz
International Journal of Business Management &
Research (IJBMR) (ISSN 2249-6920 Vol. 3, Issue 3,
Aug 2013, 85-100) - The Conspicuous Consumption
Phenomenon In Egypt: A Field Study - Ezzat Molouk
Kenawy
The Review of Economics and Statistics (Vol.
XCIII November 2011 Number 4) “A Test Of
37
Conspicuous Consumption: Visibility And Income
Elasticities” - Ori Heffetz
Ori Heffetz, 2004, Ph.D. dissertation, “Conspicuous
Consumption and the Visibility of Consumer
Expenditures” Cornell University, S.C. Johnson
Graduate School of Management
Int. J. Indian Culture and Business Management
(Vol. 9, No. 3, 2014 Copyright © 2014 Inderscience
Enterprises Ltd.): “Attitude of Indian consumers
towards luxury brand purchase: an application of
„attitude scale to luxury items‟” - Shamindra Nath
Sanyal, Saroj Kumar Datta, Asok Kumar Banerjee
The Quarterly Journal of Economics (Vol. Cxxiv
May 2009 Issue 2) “Conspicuous Consumption and
Race” - Kerwin Kofi Charles, Erik Hurst, Nikolai
Roussanov
“Conspicuous Consumption” – “An Empirical Analysis
of Sub-Saharan Africa” - Valérie Wijnen
International Journal of Consumer Studies –
“Materialism and conspicuous consumption in China:
a cross-cultural examination” - Jeffrey S. Podoshen , Lu
Li and Junfeng Zhang
Journal of International Consumer Marketing – “A
Cross-Cultural Analysis of Consumers‟ Conspicuous
Consumption of Branded Fashion Accessories” Nizar Souiden, Bouthaina M’Saad, Frank Pons
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Bibliography
Basic idea was understood from Wikipedia;
https://en.wikipedia.org/wiki/Conspicuous_consumption
Corporate Finance Institute article on “Conspicuous
Consumption”
The Journal of Industrial Distribution & Business
– “A Treatise on the Cross-Cultural Analysis of
Indian Consumers‟ Conspicuous Consumption of
Veblen Products” (by Rajasekhara Mouly Potluri,
Rizwana Ansari, Siva Kumar Challa, Lavanya Puttam)
“What drives sustainable luxury consumption in a
status driven society like India?” –
https://medcraveonline.com/; by Mukta
Ramchandani, Julia van Holt, Coste-Maniere Ivan
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Aayush D Bappa