Hypothesis Identification Article Analysis
“The income effect in personal shopping value, consumer self-confidence and information sharing (word of mouth communicating) research” by Terrence Paridon, Shawn Carraher and Sarah Carraher, has a hypothesis statement that states, “Income will moderate the effects of personal shopping value and consumer self-confidence in word of mouth communication research” (Terrence, Carraher & Carraher, 2006). The hypothesis meant that shopping was determined by the amount of money the shopper had. It could also be said that shopping was determined by what the consumers are willing and able to buy in the shop. This was because the shopper might have the knowledge of the availability of a commodity but without the income or the money to shop, he or she is not able to buy the commodity. Additionally, the hypothesis meant that people with high income are very confident while shopping as compared to those people with low incomes who are confident while shopping but limited by their incomes.
The hypothesis was accepted because in according to the data that was collected, people with high incomes often expressed confidence while shopping because they had money to buy whatever they wanted. Additionally, because of communication through the word of mouth the different shoppers were more confident since they believed what they were told by other shoppers was true. For example, when a shopper wanted to buy a commodity like a detergent, he or she was consulting first with the other shoppers thus boosting his or her confidence while shopping (Terrence et al., 2006). Therefore, it could be said that the hypothesis was accepted since the data provided of the high-income group was true.
This was also similar to the low-income group despite the fact that they did not have that much money to shop for the various commodities. This is because when the shoppers are buying a commodity, they often communicated about what they are intending to buy with the other shoppers. This kind of communication gave them the confidence that they need while shopping for the commodities. However, their only problem was that they could not shop much because they were limited by the income they had (Terrence et al., 2006). Therefore, the hypothesis was acceptable because the available data proved that this was very true with the different shops from the different groups.
One of the implications of this hypothesis was that the companies could employ a marketing tactic by employing some of the shoppers to spread the good word about their products to the other shoppers. This means that the companies could create confidence by employing the shoppers to go outside in the market and spread the word that their products are the best (Terrence et al., 2006). This will automatically lead to an increase in sales since the different groups of shoppers are very confident in whatever they are buying.
Another implication of the hypothesis is that the retailers should create a good atmosphere for the shoppers to shop for the products. This is to create a good environment for the shoppers to communicate by word of mouth thus increasing the confidence in their clientele. Therefore, when the shoppers are shopping for the commodities and they are able to interact freely, they tend to share their experiences about the different products thus boosting the confidence amongst themselves (Terrence et al., 2006). This can be referred to as social confidence since they are all confident with what one another has to say about the commodities.
Lastly, due to the income effect, the different retailers should consider location depending on the different customers they are targeting. For instance, the retailer who is targeting the high-income shoppers should give them an enjoyable and conducive environment for shopping since they are not that price-sensitive. This is because they do not want to destroy the pleasurable moment they are experience while they are shopping. On the other hand, they should create an atmosphere for the low-income earners since they are price sensitive despite these individuals being confident in what they are going to shop.
References
Terrence, J. P., Carraher, S. & Carraher, S. (2006). The income effect in personal shopping value, consumer self-confidence and information sharing (word of mouth communication) research. Dream Catchers Group. Retrieved from http://findarticles.com/p/articles/mi_hb6167/is_2_10/ai_n29362904/
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