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Assignment 1: 'Needs' of consumers are artificially created (Producer)
Producers play an essential role in satisfying consumer needs today. Not only do they provide consumers with valuable products, but producers generally possess the best ability to determine the needs and wants of consumers. The latter economic agent often makes irrational choices because of a perverted understanding of what goods actually provide most value. Producers, who are more competent in understanding the true needs of consumers, should therefore guide consumers towards buying products which satisfy them. Indeed, through extensive research on consumer behavior and preferences, producers obtain a thorough understanding of what consumers require to improve their lives.
According to Maslow's "Hierarchy of Needs" - an established business theory -, modern needs can be classified into five levels (in ascending order from most basic): physiological, security, social, self-esteem and self-actualizing. In order to understand what consumers need and want, producers use market research (the process by which producers gather, analyze and interpret information about a market) - a key component of the marketing process. Since market research is largely based on feedback from consumers - obtained via questionnaires, customer interviews and other methods of gathering data -, producers are able to understand what the market wants or needs from a consumer standpoint. This information is naturally valuable to the producers yet it may not fully reflect the actual needs of consumers. This is because consumers' views are influenced by those of third-parties, such as the mass media, advertisement campaigns or society as a whole. This may indeed sway consumers' opinions on what goods provide value to them, which in turn prevents firms from supplying valuable products. Moreover, consumers may base their judgment and decision-making on biased emotions...