Vulnerability in the Marketplace: Concepts, Caveats, and Possible Solutions

Abstract

Vulnerable consumers fail to understand their preferences and/or lack the knowledge, skills, or freedom to act on them. To protect them, some want to censor information, restrict choices, and mandate behaviors. One-fifth of the American public is functionally illiterate, K-12 performance is declining, and yet a substantial majority of American consumers (adolescents included) appear to be marketplace literate. Rather than curtail consumer prerogatives to protect a vulnerable minority, education reform focused on the values, knowledge, and skills necessary to create and navigate responsive markets is proposed. Reformed adult and K-12 education can refine, expand, and accelerate learners’ informal and experiential understanding of marketplace fundamentals. The aim is to significantly replace trial and error with a robust understanding of markets, markets habitually governed by social virtues. Evidence suggests that these aims can be better achieved via K-12 choice and should be the focus of adult basic education reform.

Children as vulnerable consumers: a first conceptualisation

“…Without exception the poor are considered more disadvantaged as consumers than the rich (Andreasen 1975(Andreasen , 1976(Andreasen , 1993Barnhill, 1972;Morgan & Riordan, 1983). Those with less formal education are viewed as more vulnerable than the highly schooled and trained (Mitra, Hastak, Ford and Ringold, 1999;Ringold, 2005;Smith & Cooper-Martin, 1997). In a US context, African American and Hispanic consumers are seen as more disadvantaged (D'Rozario & Williams, 2005;Marlowe & Atilies, 2005;Penaloza, 1995) as are those with poor native language skills (Barnhill 1972;Marlowe and Atilies, 2005).…”

“…Underpinned by this view, Ringold's (2005) contribution to the vulnerability literature makes the point that individual adolescent consumers are not necessarily vulnerable because, she maintains, they have the cognitive competence to 'protect' themselves. According to Ringold (2005, p.206) 9 essentially, adolescents appear to understand the nature and function of advertising, brands and product categories, retail environments, and prices as a product of demand and supply.…”

“…Past policy responses to vulnerable 26 child consumers have often emanated from old conceptualisations of consumer vulnerability; most notably class-based notions of disadvantage (Andreasen, 1975(Andreasen, , 1976(Andreasen, , 1993 and information processing models from cognitive psychology (John, 1999;Ringold, 2005). In line with this, regulations have been concentrated on advertising and marketing communications and have tended to emphasise protection and censorship (e.g.…”

“…Consumer groups have pointed out that the age at which children are no longer deemed to need protection from marketing varies wildly from 8 to 18 across different international marketing codes (Pitt, 2010) whilst research into children's capability for processing new advertising formats such as advergames (Nairn and Hang, 2012) has thrown doubt on the conclusions of the socialisation literature that adolescents are no more vulnerable than adults (Ringold, 2005).…”

“…Baker et al's (2005) refocusing on the individual and the self rather than the class also strongly reflects a large and dominant literature within the consumer research academy on the psychology of the individual consumer (John, 1999) and in particular their cognitive competences and processes. This is echoed vigorously in Ringold's (2005) interpretation of consumer vulnerability as an inability to 'navigate the marketplace' (p.202) and as manifest in limitations in individuals' decision-making capabilities. 'Vulnerable consumers fail to understand their own preferences and/or lack knowledge, skills or freedom… to act on them ' (p.202).…”