Decision Making and Coping of Functionally Illiterate Consumers and Some Implications for Marketing Management

Abstract

A study of the decision making and coping of functionally illiterate consumers reveals cognitive predilections, decision heuristics and trade-offs, and coping behaviors that distinguish them from literate consumers. English-as-a-second-language and poor, literate consumers are used as comparison groups. The strong predilection for concrete reasoning and overreliance on pictographic information of functionally illiterate consumers suggest that companies should reconsider how they highlight the added benefits of new products or the differentiating aspects of existing product offerings across channels such as advertising, in-store displays, and positioning. Concrete reasoning also has strong implications for the execution and presentation of price promotions through coupons and in-store discounts, because many consumers are unable to process the information and thus avoid discounted products. Finally, the elaborate coping mechanisms identified and the loyalty that functionally illiterate consumers display toward companies that are sensitive to their literacy and numeracy deficiencies reveal a potential for loyalty programs aimed at this population that do not involve price discounts.

Information Search, Alternatives Evaluation, and Coping Mechanisms of Functionally Illiterate Consumers in Retail Settings: A Developing Economy Context

“…It is estimated that 10 million South Africans lack the literacy skills they require to make informed purchase decisions. The absence of such skills creates significant challenges for consumers (Viswanathan, Rosa, & Harris, 2005).…”

Marketing and Poverty Alleviation: Synergizing Research, Education, and Outreach through the Subsistence Marketplaces Approach

“…Self-esteem can be involved in the most mundane of transactions when coming from a background of low income and low literacy. We have elaborated elsewhere on the role of trade-offs involving emotions (Viswanathan Rosa and Harris 2005; see also parallel work by Adkins and Ozanne 2005) and the importance of trusted relationships . The role of emotions in a state of survival and subsistence is often counter-intuitive to understand from a background of certainty with respect to day-to-day aspects of life.…”

“…Our understanding of how subsistence consumers think developed from our observation of the buying behavior of low-income and lowliterate consumers (Viswanathan, Rosa and Harris 2005; also see parallel work by Ozanne and Adkins 2005). A fundamental aspect is that low-literate consumers have difficulty in understanding nutrition labels, unit prices, magnitudes and taxes.…”

“…We refer to an underlying cognitive predilection as 'concrete thinking or reasoning', whereby consumers have difficulty in drawing more abstract inferences from pieces of information. This difficulty with abstraction limits the ability of subsistence consumers to make computations or complex decisions, which results in sub-optimal purchases (Viswanathan, Rosa and Harris 2005). Another feature of how subsistence consumers think, referred to as 'sight-reading' by one of our informants, is in words and numbers being processed pictographically or as images -sometimes resulting in ingenious ways of processing information to overcome constraints.…”

“…Such unpacking lead to the insights about how poverty is not about the material alone but about the thinking, feeling, and consequent coping (cognitive, affective, and behavioral) as well (Viswanathan, Rosa and Harris 2005). Income constraints and the urgency to fulfill immediate basic needs, cognitive constraints, and emotional focus combine to lead to a focus on the immediate.…”