Consumers Understanding Towards Planned Product Obsolescence Marketing Essay

The aim of our research was to find the perceptual experience of consumers sing planned merchandise obsolescence that whether they know planned obsolescence is been adopted by a peculiar trade name or non. After this we determine, still cognizing that a merchandise has planned obsolescence would they prefer to purchase such a trade name or will they exchange towards another trade name holding more utile life or lastingness? For this intent we had chosen merchandise classs including computing machine, bet oning consoles, cell phone and accoutrements, text books, garments and cars.

Cars are now partly seen as symbol of manner and position that is why automobile makers make usage of it by presenting the same theoretical account of their autos with little decorative alterations every twelvemonth through which the bing theoretical accounts of autos losingss their lastingness psychologically. The aim of our research is to find the perceptual experience of consumers sing planned merchandise obsolescence that whether they know planned obsolescence is been adopted by a peculiar trade name or non. After this we would find, still cognizing that a merchandise has planned obsolescence would they prefer to purchase such a trade name or will they exchange towards another trade name holding more utile life or lastingness? For this intent we have chosen merchandise classs including computing machine, bet oning consoles, cell phone and accoutrements, text books, garments and cars.

This subdivision is related to all merchandises whether hardware or package those are related to the computing machine class. Under this subdivision we want to find whenever new engineering is introduced in footings of hardware or package, what is the penchant of consumers would they purchase such trade names that contain planned obsolescence or they prefer trade names with more lasting life.

Bet oning consoles:

Since planned obsolescence is besides practiced in bet oning consoles in such a manner that whenever houses launches a newer version of their console the games which so are developed for the newer version of consoles are non compatible with older version of consoles which forces consumers to purchase the newer version of consoles.

Cell Phone:

Cell phone makers besides pattern planned obsolescence because every clip houses launches their theoretical accounts of cell phones with little alterations but those little alterations are highlighted in such a manner that the consequence is amplified and consumers perceive that alterations made in new theoretical account of cell phone are truly drastic.

Family Appliance:

Firms that manufacture family contraptions besides launch newer versions of their merchandise with technological betterments and foregrounding alterations made in order to oblige consumers to purchase newer ascents of their merchandises.

Text books:

Text book publishing houses revise editions by little alterations and when class teachers follow the new edition the old edition users faced trouble in following the information which increases the chance of purchasing new edition.

Garments:

Manner alterations more quickly than anything else so the garment makers take advantage of it and often introduces new scope of out tantrums which are shortly adopted by people and becomes a manner.

Car:

Cars are now partly seen as symbol of manner and position that is why automobile makers make usage of it by presenting the same theoretical account of their autos with little decorative alterations every twelvemonth through which the bing theoretical accounts of autos losingss their lastingness psychologically.

1.2 Problem Statement:

To analyze the consumer ‘s understanding towards planned merchandise obsolescence and its consequence on their trade name penchant.

1.3 Hypothesis:

H1: Consumer trade name penchant is dependent on planned merchandise obsolescence.

1.4 Outline of the Survey:

Organizations are widely practising the scheme of frequent merchandise upgrading so that it increases gross revenues ( Lu, Thompson & A ; Tu, 2007 ) .

The grade to which the consumers favor planned merchandise obsolescence will find whether they prefer merchandises with planned obsolescence or non ( Levinthal & A ; Purohit, 1989 ) .

The survey contains planned merchandise obsolescence as an independent variable and trade name penchant as dependent variable.

Planned Product Obsolescence

Consumer Brand Preference

The survey measured trade name penchant through the questionnaire in which it was asked from respondents that which merchandise they would prefer whether merchandises that has planned obsolescence with frequent upgrading or merchandises holding more lastingness. Their reply to the inquiry determined whether they preferred the merchandises possessing planned obsolescence as a scheme or non.

Entire figure of respondents was 250 for our research out of which 70 % were male and 30 % were female. In this survey quota trying technique was used to roll up informations from the respondents. The convenience sampling technique was besides used to make respondents as per our convenience. Questionnaire was the instrument used in this research. Two statistical techniques used for our research were Correlation and Chi-Square.

1.5 Definitions:

Obsolescence: Obsolescence can be defined as loss in the betterments in footings of quality in approaching versions of the merchandise ( Mansfield & A ; Pinder, 2008 ) .

Planned Obsolescence: Planned or constitutional obsolescence is the procedure whereby a merchandise is made disused and/or become non-functional after a certain period or it may non be to the full utilized in the same sum as it was intended to by the maker ( Lamb, Hair & A ; Mc Daniel, 2004 ) .

Manufacturers design many merchandises with short lives and the purpose of maker is to coerce consumer to buy back the merchandise more often. This phenomenon is known as “ Planned Obsolescence ” ( Fishman, Gandal & A ; Shy, 1993 ) .

Chapter 2: Literature Reappraisal

When doing a purchase determination monetary value & A ; quality are non merely the lone factors in a merchandise that consumers ‘ return into history but they besides look into its hereafter value and its hereafter value is altered if new or even superior merchandise is introduced which in bend makes the old merchandise obsolete. Obsolescence can therefore is defined as loss in the betterments in footings of quality in approaching versions of the merchandise. Obsolescence can be more widespread and besides impossible to undertake with ( Mansfield & A ; Pinder, 2008 ) .

Planned or constitutional obsolescence is the procedure whereby a merchandise is made disused and/or become non-functional after a certain period or it may non be to the full utilized in the same sum as it was intended to by the maker. That is why planned merchandise obsolescence is widely used by sellers and makers to promote insistent buying ( Lamb, Hair & A ; Mc Daniel, 2004 ) . Introducing houses have advantage in often updating their merchandises so that they can obsolete out the non-innovating houses which have relatively old and out dated engineering ( Levinthal & A ; Purohit, 1989 ) . It is witnessed that for a house it becomes hard to last in such intense competition unless it shows marks of planned obsolescence ( Grout & A ; Park, 2005 ) . So planned obsolescence scheme is used by sellers to pull more net income borders from bing and every bit good as possible clients ( Lu, Thompson & A ; Tu, 2007 ) . When talking in footings of economic experts ‘ there is greater sum of inducement involved for houses to do merchandises that will go disused after certain period of clip, i.e. to pattern planned merchandise obsolescence ( Waldman, 1993 ) . The house has high incentive when they change the visual aspect of their merchandise because new units of a merchandise with typical manner occupy higher value among consumers as comparison to the old units of a merchandise ( Waldman, 1993 ) . There is a certain demand of houses to present new merchandises in order to avoid diminution in demand of their merchandises when engineering or the content of their merchandise becomes disused ( Iizuka, 2004 ) .

At times houses adopt scheme to sell their new and old merchandises at the same clip or selling new merchandise units and purchasing back the old merchandise units. Therefore this scheme of houses consequences in doing old merchandises to obsolete more rapidly and reduces monetary values of old merchandises, these both additions desirableness of buy-back policy ( Levinthal & A ; Purohit, 1989 ) . On the other manus the house merely implements buy-back policy when it does non sell the old version of merchandise in the same period when it introduces and sells new version of merchandise. This is because when the house at the same time sells old and new merchandise units in the same clip period it will gain less net incomes that is why they encourage gross revenues of new version of merchandise by presenting buy-back policy of old version of merchandise ( Levinthal & A ; Purohit, 1989 ) .

Planned or constitutional obsolescence scheme is widely used in bulk of merchandises runing from cars, computing machines, edifices and in package etc. If we take illustration of cassette tapes outmoded vinyl record player record, so besides compact phonograph record made cassette tapes disused, so this type of obsolescence is extremely appreciated by consumers so they are economically and socially desirable as it is in greater benefits to consumers and/or lower costs ( Etzel, 2008 ) . But obsolescence has certain disadvantages every bit good because some consumers may oppugn the lastingness of a merchandise and those consumers will choose to those organisations fabricating lasting goods with greater lives. Consumers are unwilling to put in such merchandises that will shortly go disused and this is most witnessed in markets where are frequent technological betterments. And since computing machine market is inspired by great sum of technological betterments in hardware and package every bit good, so a more effectual merchandise is a consequence of such proficient betterments ( Hui, 2004 ) . The economic life of a good is reduced when new engineering is introduced that is the merchandise with old engineering would be relatively of less usage with the merchandise holding latest engineering even if the old merchandises is still productive or non ( Lee & A ; Lee, 1998 ) .

In computing machine industry organisations use planned obsolescence schemes that ends the merchandise life Oklahoman or a superior merchandise is introduced which makes the old merchandise non-functional or is non compatible with the newer versions of other merchandises, to increase their gross revenues by insistent purchase of client. Frequent betterments in merchandises are widely practiced in computing machine sector to increase gross revenues of a merchandise. So upgrading is preferred because there is a demand for it and consumers want extra maps, hence by upgrading merchandises the organisations can non merely function that market but can besides pull possible clients to give rise to new demand. And all these betterments are at a fast rate in computing machine merchandises which provide greater flexibleness for new coevals of IT merchandises ( Lu, Thompson & A ; Tu, 2007 ) .

Merchandise does non alterations when trade name or manner alterations but it changes the head of consumer because the manner shifting is attached with utmost distinction of merchandise. Therefore consumers would be compelled to replace their bing goods when manner alterations often ( Gregory, 1947 ) .

Manner is non about individualism but it conforms uniformity that is why consumers easy become victims because they themselves do non desire to acquire out dated alternatively they want to follow the same manner tendency ( Gregory, 1947 ) .

The alteration in manner forces consumers to abandon the usage of garments that have now turned old fashioned but they may still hold a utile life. The makers and Sellerss of outfits deliberately destroy the psychological utility of vesture those are presently in manner in order to supply infinite for the new manner. Manner alterations quickly in adult females ‘s frocks ; a adult female may fling her properties much early in order to be in manner and avoids to be tagged as old fashioned. Fashion tendencies are largely based upon societal credence and are destroyed instantly every bit shortly as the society abandons its usage. No affair how much utile life garments have they would be discarded shortly as the new garments possessing latest tendency occupies the market ( Gregory, 1947 ) .

Though the merchandise obsolescence is widely practiced in necessities instead than luxuries and an car will give ample sum of service to its user holding greater lastingness and more utile life. But the present market competition had become such terrible that an car user thinks of flinging his/her car after some use and particularly when advertizement of a much appealing car work stoppage his/her senses. The makers does non pattern any major discovery in the development of a new car but their accent is to bring forth the same theoretical account for as many old ages but with considerable proficient betterments ( Gregory, 1947 ) .

The sum of obsolescence depends upon to what extent betterments are made in the new merchandise and the degree interaction between the old and new merchandises ( Levinthal & A ; Purohit, 1989 ) . Now this brings in the uncertainness factor among consumers that to what extent betterments would be made in new merchandise and what will be the grade of fight interaction between old and new merchandise merchandises ( Levinthal & A ; Purohit, 1989 ) . To undertake uncertainness related with the extent of betterments made in new merchandise peculiarly in cars industry heavy advertizement is been done to convert the consumer that the new theoretical account of an car is loaded with plentiful of proficient alterations consequences in the loss of the market value of the old theoretical account of the car much faster than they lose their lastingness or utile life ( Gregory, 1947 ) . While the uncertainness related to the grade of fight interaction of old and new merchandise is been dealt in such a mode that houses implements buy-back policy by non selling the old version of merchandise in the same period when it introduces and sells new version of merchandise. This is because when the house at the same time sells old and new merchandise units in the same clip period it will gain less net incomes that is why they encourage gross revenues of new version of merchandise by presenting buy-back policy of old version of merchandise ( Levinthal & A ; Purohit, 1989 ) .

The alteration in one-year car by a user is the consequence of titling obsolescence ( Purohit, 1992 ) . The heavy advertizement been done to convert the consumer that the new theoretical account of an car is loaded with plentiful of proficient alterations consequences in the loss of the market value of the old theoretical account of the car much faster than they lose their lastingness or utile life ( Gregory, 1947 ) . Another position is that lastingness is non a satisfactory replacement for obsolescence because the loss in value of a merchandise is non because of going less utile but it is because the new merchandise has outdated the current merchandise ( Levinthal & A ; Purohit, 1989 ) .

Obsolescence is besides practiced in books. The phenomenon of obsolescence in books is really much similar to that of the obsolescence practiced in engineering or garments industry that is the newer versions or editions of books does non convey alterations in that book out of the box but the alterations are in signifier of extension in cognition and content the old editions of those books had ( Gregory, 1947 ) . When presenting new version of text edition the publishing house must do two of import determinations. First, how frequently the publishing house must revise the edition where the new version of text edition could ensue in sudden bead of value of old versions. Second, how what should be the grade of similarity between old and version of text edition that is how much compatible the new version of text edition is with the old version of it. If they revise the current version with more drastic alterations so it could besides ensue in the discontinuance of old version and thereby it might adversely impact the old version ‘s value ( Waldman, 1993 ) . The books that are published round the twelvemonth with newer editions possesses merely little alterations in respect to some to alterations in chapters or add-on of fewer new pages. The end point is that the new editions of books released become superior turning the old versions of books to go disused. With such alterations the professor demands the newer editions of books to be bought and thereby cut downing the market value of older versions of the same book busying infinite in library or bookstore ( Gregory, 1947 ) . It is a common pattern of text edition publishing houses to revise the edition when they saw addition in figure of used text editions users to kill-off the used text edition. Harmonizing to an estimation the chance of edition alteration increases up to 15 % if the portion of used text edition additions by 10 % ( Iizuka, 2004 ) .

The alteration of a text edition besides depends upon the text edition class for illustration text editions of “ History ” are less likely to be revised because their information and content would ne’er go out-of-date. So this supports an statement that textbook publishing houses ‘ motivation behind presenting newer version of books is to convey the latest information and content to the text edition readers ( Iizuka, 2004 ) .

Chapter 3: Research METHODS

3.1 Method of Data Collection & A ; Procedure:

Personal study was conducted from the respondents of Karachi. The respondents were approached personally and were asked to make full self administrated questionnaire designed to mensurate the penchant of consumers for merchandises which have used planned obsolescence. The information was collected from literate respondents of Karachi, who atleast had the capableness to understand the scenario in the ego administrated questionnaire sing penchant for the planned obsolescence merchandise. The entire figure of respondents was 250 out of which 70 % were male and 30 % female because males really go and purchase a peculiar merchandise. The age of respondents was above 19 because the respondents were mature adequate to reply our inquiries, and they were able to state what their penchants were. Respondent had instruction equivalent to Intermediate or O’level base on balls or more because it goes about similar with the above ground that the respondents were literate plenty to understand the inquiries and answered harmonizing to it.

3.2 Sampling Technique

In this survey quota trying technique was used to roll up informations from the respondents. By utilizing quota technique the figure of respondents was divided into 30 % of female respondents and 70 % male respondents because males are largely involved in purchases for most of the merchandises. The convenience sampling technique was besides used to make respondents as per our convenience.

3.3Sample Size:

250 respondents were approached for the survey.

3.4 Instrument/s of Data Collection:

Questionnaire was the instrument used in this research and was near ended. The questionnaire contained two subdivisions the first subdivision was about the behaviour of the consumer through which consumer penchants were measured sing the trade name that has used planned obsolescence scheme. The 2nd subdivision was of the demographics which asked the respondents about their age, educational makings and income.

3.5 Research Model Developed

Planned Product Obsolescence

Consumer Brand Preference

3.6 Statistical Techniques:

Correlation & A ; Chi-Square trials were used to mensurate the relation between variables.

Chapter 4: Consequence

4.1 Findingss and Interpretation of consequences:

The hypothesis to be tested was as follows:

H1: Consumer trade name penchant is dependent on planned merchandise obsolescence.

Two statistical techniques used for our research were Correlation and Chi-Square. The Correlation trial was used to happen the relationship of all inquiries that whether consumer trade name penchant is positively or negatively related to planned merchandise obsolescence. The Chi-Square trial was used to happen out the dependence of consumer trade name penchant on planned merchandise obsolescence. The Chi-Square technique was used separately for each inquiry to happen in which trade name consumer penchant is dependent on planned merchandise obsolescence.

4.1.1 Correlations

Planned Product Obsolescence

Planned Product Obsolescence

Pearson Correlation

1

Sig. ( 2-tailed )

Nitrogen

250

Consumer Brand Preference

Pearson Correlation

-.084

Sig. ( 2-tailed )

.187

Nitrogen

250

As the Correlation tabular array shows that there is no significance between consumer trade name penchant and planned merchandise obsolescence. So this tabular array shows an overall consequence of all the inquiries that planned merchandise obsolescence has no consequence on consumer trade name penchant.

When Chi-Square trial for happening dependence between planned merchandise obsolescence and consumer trade name penchant were used for each inquiry separately, the consequences showed that out of 12 trade names ( inquiries ) there were merely 2 trade names in which consumer penchant was dependent on planned merchandise obsolescence.

4.1.2 Chi-Square Trials

Value

df

Asymp. Sig. ( 2-sided )

Exact Sig. ( 2-sided )

Pearson Chi-Square

4.255a

1

.039

Continuity Correctionb

3.661

1

.056

Likelihood Ratio

4.152

1

.042

Fisher ‘s Exact Test

.052

Linear-by-Linear Association

4.238

1

.040

N of Valid Cases

250

a. 0 cells ( .0 % ) have expected count less than 5. The lower limit expected count is 23.10.

b. Computed merely for a 2×2 tabular array

The above tabular array is an end product of Chi-Square tested for Microsoft ‘s Windows trade name and the tabular array shows that there is significance between consumer trade name penchant and planned merchandise obsolescence.

4.1.3 Crosstabulation

Count

Will respondent still purchase this trade name or exchange to another trade name?

Entire

Still Buy

What respondent thinks that whether this trade name is following planned obsolescence or non?

Yes

128

45

173

No

47

30

77

Entire

175

75

250

The above tabular array shows that bulk of consumers think that Microsoft Windows is utilizing planned obsolescence and cognizing this consumers prefer Microsoft Windows.

4.1.4 Chi-Square Trials

Value

Df

Asymp. Sig. ( 2-sided )

Exact Sig. ( 2-sided )

Pearson Chi-Square

5.791a

1

.016

Continuity Correctionb

5.135

1

.023

Likelihood Ratio

5.710

1

.017

Fisher ‘s Exact Test

.018

Linear-by-Linear Association

5.768

1

.016

N of Valid Cases

250

a. 0 cells ( .0 % ) have expected count less than 5. The lower limit expected count is 29.44.

b. Computed merely for a 2×2 tabular array

The above tabular array is an end product of Chi-Square tested for Toyota ‘s Corolla trade name and the tabular array shows that there is significance between consumer trade name penchant and planned merchandise obsolescence.

4.1.5 Crosstabulation

Count

Will respondent still purchase this trade name or exchange to another trade name?

Still Buy

Switch to another

What respondent thinks that whether this trade name is following planned obsolescence or non?

Yes

116

42

No

54

38

Entire

170

80

The above tabular array shows that bulk of consumers think that Toyota Corolla is utilizing planned obsolescence and cognizing this consumers prefer Toyota Corolla.

4.2 Hypothesis Assessment Summary:

There was merely 1 hypothesis for our research which is as follows:

H1: Consumer trade name penchant is dependent on planned merchandise obsolescence.

Against it an alternate hypothesis was:

H0: Consumer trade name penchant has no dependence on planned merchandise obsolescence.

The findings of our research showed that there is no dependence between consumer trade name penchant and planned merchandise obsolescence, therefore it rejected our hypothesis 1 ( H1 ) . We could reason by stating that planned merchandise obsolescence does non hold any impact on consumer trade name penchant.

Chapter 5: Discussion, IMPLICATIONS, FUTURE RESEARCH AND CONCLUSION

5.1 Discussions:

The findings of our research are that the consumer trade name penchant is non dependent on planned merchandise obsolescence i.e. whether the consumers understand or non about planned merchandise obsolescence it has no impact on consumer trade name penchant. Our questionnaire consisted of 12 inquiries based on 7 classs i.e. computing machine, cell phone, bet oning consoles, family contraptions, text books, garments & A ; car. Merely two inquiries showed important consequence out of 12, one is computing machine class i.e. inquiry 4 on Microsoft Windowss trade name and 2nd is of car class i.e. inquiry 11 on Toyota corolla. So as a whole the consequence was that there is no important relationship between planned merchandise obsolescence and consumer trade name penchant.

5.2 Deductions and recommendations

For more item survey of this subject figure of respondents should be increased, item demographic features of the respondents should be taken into history i.e. acquiring questionnaire filled from assorted country of Karachi, from different age group and from different professional people and so on. In short quota system should be more in-depth this might increase the opportunity of acquiring important consequence between the variables studied in this research. Giving more clip and more item survey of the subject and utilizing tonss of more resources as possible. Analyzing this subject with respect to many questionnaires based on each class and acquiring filled by the expert on the several country, besides presenting other merchandise classs in which planned merchandise is widely practiced. Besides to measure the overall Pakistani perceptual experience of planned merchandise obsolescence and its impact on consumer trade name penchant more metropoliss of Pakistan should be considered like Islamabad, Lahore, Peshawar etc.

5.3 Future Research

For future research on this subject a separate questionnaire for each class of the merchandise should be used that will dwell of several inquiries on each class therefore increases the opportunity of important consequence and to decently estimate the consumer penchant with regard to planned merchandise obsolescence. Another method could be alternatively of utilizing the convenience sampling technique, experts should be consulted on their several country harmonizing to the classs and for that merely one class should be taken into history to measure that whether there is a important relation between planned merchandise obsolescence and consumer trade name penchant is or non.

5.4 Decision:

The aim of research was to happen out whether planned merchandise obsolescence has any impact on consumer trade name penchant or non and from our findings we concluded that there is no dependence between consumer trade name penchant and planned merchandise obsolescence and thereby it rejected our hypothesis 1 ( H1 ) . In this respects we could state that planned merchandise obsolescence does non hold any impact on consumer trade name penchant.