Millionaire next door and consumer

Consumer Behavior

Name

Institution

Pop culture millionaire

They spend huge amounts of money on expensive and luxurious items. They put on expensive clothes, wear expensive watches and drive recent luxurious car models. This is majorly brought about by the occupation they have that requires an expensive lifestyle. They are popular people known for what they do and because of their high social status. Most of them have proper media coverage. They have very high monthly income from the work they do. They live in upscale neighborhoods and have top positions in top organizations in the country. One reason that makes them different is the kind of high lifestyle they live. This is based on the way they spend. Their expenditure is well above their means and they would only survive on paycheck. They are more concerned with consuming rather than investing. They seek to boost their image in the eyes of the people (Stanley & Danko, 1996).

Real millionaire

One reason that makes them different is their low social status. This is based on their expenditure and the kind of occupation they have. They spend averagely and their expenditure is so far below their means. They are more concerned with making investments rather than consumption. Their household expenditure is an insignificant figure of their income. They are engaged in businesses that do not require a high social status. Their net worth is greatly higher than the expected and they would survive ten or more years without working (Stanley & Danko, 1996). Their focus is on how to minimize costs and have little time for activities that only aim at improving the image and not bring money. Because they do not have the time and interest for media coverage, they are unpopular.

Contributing factors to the misconception of who millionaires really are

Most of the people who have a lot of wealth have inherited it from their families and did not acquire it in one generation. Wealth is related to the family background and someone with poor parents would not be thought to having the capacity to be wealthy. This is not the true description of who millionaires really are. Millionaires accumulate their wealth progressively over time and their wealth is as a result of their savings and investments over time (Stanley & Danko, 1996).

High spending is attributed to people who have a lot of money. There is the perception that people who buy expensive things have a lot of wealth. People are regarded as wealthy depending on their consumption and not investments and savings. This is not true as those who are taken to be wealthy spend so much above their income. The real millionaires spend well below their income and prefer to invest rather than consume.

Popularity is taken as a measure of wealth someone has. The people with high profile jobs in reputable organizations will therefore be taken to be millionaires. Those who have wide media coverage are said to have a lot of wealth and that is why they are the center of discussion. In this case, people running businesses such as welding and garages would not be viewed as wealthy to be millionaires.

People that believe in better jobs rather than self-employment would view high ranking employees as the wealthiest people in the country. The real millionaires on the other are not wealthy because of the kind of job they do but because of extra things they do to earn the money. Those who earn salaries in millions are taken to be millionaires yet they might be having a very low net worth. Therefore, salaries, lifestyle, family background and popularity are wrong measure of identifying millionaires. There should be looking at the net worth of individuals, their ability to be independent and the investments they have made.

Consumer behavior concepts from the book that describes Mr. Friend’ consumption

He is an experiencer. It states from the book on page 243 that experiencers are consumers who have enough resources but are impulsive, young and enjoy risky experiences ("Consumer+BehaviorBuying,+Having+-+Michael+R.+Solomon 12th.pdf", 2016). Mr. Friend is impulsive from the way he does not think over the effects of the consumption decisions he makes. According to his income, he has enough resources which are ruined by the decisions he makes. He would increase debts and use it as a motivation yet it is so risky in case he lost his job. His consumption behavior best describe him as an experiencer. He is a striver. On the same page, strivers are the kind of consumers who have few resources and are concerned about more about the approval of others ("Consumer+BehaviorBuying,+Having+-+Michael+R.+Solomon 12th.pdf", 2016). This is a concept that best describes Mr. Friend as he aims at maintaining a high social status. He lives a life of pleasing people and does not realize the harm he is causing himself. The amount of resources he has barely meets his demands and is way above his expenditure. These aspects of him qualify him as a striver.

How parents affected Mr. Friend

It states from the book on page 247 that socialization agents such as parents, teachers and friends impact on us due to the interactions we have with them ("Consumer+BehaviorBuying,+Having+-+Michael+R.+Solomon 12th.pdf", 2016). Through these interactions, there is discovery of crescive norms. One of the norms is convention which performs regulation of the conduct of people in their daily lives. This is concerned with the subtleties of consumer behavior. This is how the parents of Mr. Friend got to influence him. Through his stay and interaction with his parents, Mr. Friend developed these norms which relate to consumer behavior. He developed the norm of spending all money without saving. The other norm is custom which relates to the basic behavior.

References

Stanley, T. & Danko, W. (1996). The millionaire next door. Atlanta, Ga.: Longstreet Press.

Consumer+BehaviorBuying,+Having+-+Michael+R.+Solomon 12th.pdf. (2016). Google Docs. Retrieved 26 October 2016, from https://drive.google.com/file/d/0BzJyuUPHCOXhRnpkWG9ibFh4SWc/view?usp=drive_web