Swann – Six Types of Consumer
By Peter Swann
Any textbook on microeconomics will introduce the student to the neoclassical economic theory of the consumer. According to this theory, the consumer has an innate utility function (or preference ordering) defined for all possible bundles of goods and services. Given a particular budget for shopping and information on all relevant prices, the consumer works out the best possible allocation of the budget so as to maximize utility.
Some may ask: do people really behave like that? A fair answer would be that most people behave like that some of the time, but few if any people behave like that all of the time. It is therefore a good idea for the student to learn a bit about some alternative theories of the consumer. Here we shall briefly consider five other theories. Further details are available in Swann (2009, Chapter 15).
1. The economist John Kenneth Galbraith described a quite different theory of consumption. He described a consumer whose wants and tastes were not innate but were largely formed by companies’ advertising and marketing strategies. This Galbraith consumer is clearly very impressionable and can easily be persuaded (or even manipulated) by companies. While many people would probably deny that they can be manipulated in this way, it is hard to see how the advertising industry could have grown to its present size if advertising were never effective in shaping wants.
2. The economic anthropologist Mary Douglas described another consumer who can be persuaded to consume in a particular way, but here the formative influence is not advertising but peer group pressure. The most important decision for the Douglas consumer is this: who are my comrades and my peers? Once that choice is made, decisions about lesser matters are mostly determined by the norms observed in that peer group.
3. The economist Thorstein Veblen and the sociologist Pierre Bourdieu described another type of consumer whose decisions are influenced by the consumption behaviour of peers. But in this case, the consumer is driven by a desire to be different from his or her peers – not a desire to conform. There is a subtle difference between their two theories. The Veblen consumer seeks distinction in conspicuously expensive consumption, while the Bourdieu consumer usually seeks distinction without great expense.
4. The economist Alfred Marshall recognised another type of consumer who could, in effect, be described as an innovator. This Marshall consumer is not a passive consumer dependent on innovative firms to create new consumption experiences.On the contrary, the Marshall consumer is constantly seeking and inventing new and different consumption opportunities, and actively making the most of each consumption experience.
5. Finally, it is recognised that some consumers are none of the above. The sociologist Alan Warde coined the term routine consumer, who does not compute optimum consumption behaviour but just sticks to familiar routines in consumption. The routine consumer is not influenced by advertising, does not seek to mimic or to distinguish himself from a peer group, and is definitely not an innovator.
Readers can decide which of these consumption traits they recognise in themselves. Some would say that, at different times and in different contexts, they could follow the behaviour of any one of these six consumer types.
Swann, G.M.P. (2009), The Economics of Innovation: An Introduction, Cheltenham UK and Northampton MA: Edward Elgar Publishing
Commentary added, 2 March 2015