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The Influence of Dressing and Bargaining Strategies on Sales Outcomes

Bachelor Thesis 2007 72 Pages

Psychology - Social Psychology

Excerpt

CHAPTER ONE

1.1. INTRODUCTION

Every potential buyer wants to maximize his or her satisfaction at the possible minimal cost and therefore would be happy to know what factors would help him or her achieve that. The seller on the other wants profit maximization and would as a result take advantage of available factors that would enable him achieve that end.

The seller is interested at getting the buyer pay at the most favourable price offer. It is against this background that this research is considering a factor which the author feels has strong influence on sales; the mode of dressing of the buyer.

This research work is aimed at investigating dressing as a strategy of bargaining as it influences sales, so the buyer will be informed on how to use this factor to his or her advantages.

Investigation into this factor becomes necessary as we are daily engaged in buying or selling; we all (as buyers) negotiate price so as to get the best at the lowest possible price. And because of the elements of discrimination and stereotypes that seem to pervade the market scene, especially the processes of bargaining or pricing.

Has it ever occurred to you why two different people buy the same item from the same shop on the same day but at different prices? Don’t you think this is subject to other forces outside the generosity and kindness of the seller or the ability of the buyer to negotiate prices? A buyer who is well dressed (in neat and costly clothing) seems more often to be given a higher price for a product or item in the open market than someone who is poorly dressed (shabby clothing). Consequently the well-dressed buyer in most cases ends up paying more. What then is the reason? Does the way you dress predict your purchasing power; financial buoyancy? Or does the outcome depend completely on something else?

Discrimination and stereotypes affect all social aspect of our daily lives. From the interactions that are experiences on a day-to-day basis to the first observations of individuals as they walk through the chaotic streets of the world, prejudice influence all decisions that are made. While these stereotypes are commonplace, they limit the social interactions of individuals. A stereotype is an idea many people have about a thing or a group and that may often be untrue or only partly true. Franzol (2000) sees stereotypes as fixed ways of thinking about people that put them into categories and don’t allow for individual variation. Within these definitions is the fact that everyone has and hold stereotypes. People hold stereotype either to generalize an object as being a certain shape, size or colour or to generalize the behaviour or attitude of a group of people (Matthew E.K, 2007).

A prime example of stereotype is in the field of sales. Some of stereotypes within sales include racial, gender and age stereotypes. An example of sales is the exchange that occurs in the grocery store. After concluding the product selection process, the buyer walks to the seller. While the first of observation which last less than a second in the brain says-oh well, yes that is the seller; the next observation already occurring is the race, sex and age of the seller, while the same things happens for the buyer-he or she is also being stereotyped and categorized. This occurs before bargaining of prize commences and may continue through the process.

According to Cannon (2003) Bargaining is to converse with a view to finding terms of agreement. Bargaining is also defined as the discussion of prices, conditions etc with the aim of reaching an agreement that is satisfactory (Hornby, 2000). The terms bargaining and negotiation will be used interchangeably in this work. There are basically two types of bargaining strategies. One is referred to as distributive bargaining and the other as integrative bargaining. The simplest form of bargaining is distributive bargaining; here one party wants one item from the other (Saner, 2000). This is a win-lose situation. In such situation, it is likely that one wins at the cost of other. In such negotiation, each party has an aspiration position (a position that the party want) and a reserve position (the lowest acceptable negotiation position). Agreement normally falls between the two reserve positions of the two parties. If there is consideration overlap, it is possible that both parties may be satisfied (Saner 2000; citing Walton & Mckensie, 1965).

Integrative bargaining (also called “interest based bargaining” “win-win bargaining”) is a negotiation strategy in which parties collaborate to find a “win-win” situation or solution to their dispute or disagreement (Spangler, 2003). This strategy focuses on developing mutually beneficial agreement based on the interest of the disputants. These interests include the needs, desires, concerns and fears important to each side. (Spangler, 2003). Integrative refers to the potential for the parties interests to be combined in ways to create joint value or enlarge their chances. Potentials for integration only exist when there are multiple issues involved in the negotiation (Watkins & Rosegrant, 2011). This is because both parties must be able to make trade-offs across issues in order both sides be satisfied with the outcomes. Integrative solutions are generally more gratifying for all involved in the bargaining as the true needs and concerns of both sides will be met to some degree (Spangler, 2003).

Dressing on the other hand has been found to have great influence on the way other perceive and accept us. Dressing often determines the kind of reception you get. For instance, even a stranger in Nigerian clothing receives great admiration and trust. It s a good way to impress and earn confidence (consulate general of Nigeria, Atlanta Georgia, 2007). Buying and selling is often determined by the buyer’s liquidity or social class usually given away by mode of dressing, carriage, unfamiliarity with pidgin English and sometime the local language, (consulate general of Nigeria, 2007). Dressing is a very potent tool and factor in the concept of impression formation and management. Consequently dressing affects to a very large extent our perception of others and our attitude towards them. According to Adamski (2007) “to make a good first impression is to dress in a way that fits the setting”.

In impression formation, inferences are made from external factors such as individual’s attractiveness, height, verbal expression and mode of dressing e.t.c. and these Impinge on our social precept of the person either negatively or positively. Social perception allows us to go beyond the information that is immediately available. We can infer additional facts. (Such as how financially buoyant a buyer is) by looking at his physical appearance (Myer & Mitchner, 2007).

Other factors implicated as affecting bargaining outcome or sales include the buyer’s prior knowledge of the reservation prices. Scott, Zettelmeyer and Silvo-Risso, (2004), Opine that; “transaction price are lower when the seller’s reservation price is common knowledge as opposed to only to the seller”. Bolles and Manighan (2003) also noticed that, studies have constituently show that proposer make (an responders accepts) significantly lower offers when the responders do not know the size of the pie and when his lack of information is common knowledge. suggesting that customers would pay more for an item when they do not know the actual selling price, and the seller know this.

Nigerians seems to lay much emphasis on mode of dressing because of cultural inclinations and religious convictions. Strategies or styles of bargaining in our open market appear to be region and cultural dependent, and therefore differ from one region of the country to another. It is hoped that, this research will be able to lay bare to some extent, the degree to which our mode of dressing affects sales and the other factors that so influences our product pricing behaviours.

1.2. STATEMENT OF PROBLEM:

In an effort to improve our understanding of the open market system, we need to first understand the dynamics of the market that is, the factors that influence sales in the open market system.

Although, not much work has been done on these factors influence on the market system, daily observations and experiences shows that indeed, these factors affect our day to day transactions. It is believed that if dressing so affect on perception and impression of others, it is very likely that it also influence sales to some extent. Outcomes of bargaining whether good or bad do have psychological effects on the lives of the people. This research sees these outcomes from the viewpoint of the buyer.

This research becomes necessary not just because it seeks a better understanding of the dynamics on the market system but also because it is an attempt to consider how the factors of dressing can be employed by the consumer so as to get a fair price or sale from bargaining.

To cap it all, it is better for buyers to understand and know what to expect from a pricing session taking into cognizance the aforementioned factors and learn to use it to his or her advantage. This research is concerned with investigating what relationship exists between mode of dressing and price bargaining outcomes.

1.3 RESEARCH QUESTIONS:

In investigating the problem of the influence of dressing on sales, this research will address the following research questions;

a. Does mode of dressing influence prize bargaining outcomes?
b. To what extent or degree does mode of dressing affects price bargaining?
c. Is there a positive or negative relationship between mode of dressing and bargaining outcomes?
d. Are there other factors that influence bargaining outcomes?
e. Is there a significant difference in the degree of influence of dressing and other factors on bargaining outcomes?

1.4 AIMS/OBJECTIVES OF THE STUDY:

This study pursues the following objectives;

a. To establish the relationship between mode of dressing and price Bargaining outcomes.
b. To determine the degree to which mode of dressing influences price negotiation in the market.
c. To find out what other factors likewise influence sales in the open market.
d. To ascertain the difference in the degree of influence of dressing and other factors in sales.
e. To investigate the price regime or pricing decision of sellers and the factors that generally influence them.

1.5 RELEVANCE OF THE STUDY:

(i) This study is of great relevance to the extent that it will give us a better understanding of the degree to which dressing influence price bargaining outcomes and consequently sales.
(ii) It will also be useful in explaining the influence of dressing on our daily perceptions of other people.
(iii) It will explain how dressing impinges on our daily transactions with others.
(iv) It will seek to explain how the perceptions of others we form affect our interaction and relationship with them.
(v) Finally, it will help us see the factors that make sellers attach certain prices to goods or products.

1.6 SCOPE OF THE STUDY

The scope of this study cover the following: the sample type or participants shall mainly include people or buyers of different occupations, students, civil servants and also from different ethnic groups, sex, and age. The age of participants will range from 18 and older, participants shall also include sellers of some categories as the buyers: this include shop owners.

The context of this study shall be limited to the open market and shall not consider sales in departmental stores or supermarkets where the price regimen is fixed. This is because, it is only in the open markets that price bargaining can take place.

CHAPTER TWO LITERATURE REVIEW

2.1 INTRODUCTION:

In this section we shall analyze theories and concepts that seek to explain how internal and external social factors influence our perception, attitudes. Such external factors that are of particular interest to this research work includes dressing, physical attractiveness, socio-economic status, and age e.t.c; their roles in the pricing process and the extent to which they influence sales outcomes.

The first part of this section shall include theories that seeks to explain formation of impressions in social setting, social perceptions, factors that influences consumers decision making, pricing strategies, impression formation, personality factors in consumer’s behaviour, cultural and psychological factors in marketing and pricing, social influences in pricing and the extent to which these factors impinges on sales outcome.

The second part summarizes the relevant empirical literatures. It shall contain classical studies of social factors’ influences on behavour. We shall also describe the theoretical predictions we will be able to test empirically.

2.2 THEORETICAL BACKGROUND

In keeping with the concern that social factor such as dressing, age and gender impacts on the outcome of pricing, these theories, will be practically explained to show how these factors relate.

Affect control theory

Beginning with the affect control theory of impression; Sociologist Ervin Goffman (1969) argued that people conduct themselves so as to generate impressions that maintain the identities of faces that they have in social situations. Human activities-aside from accomplishing tasks functions expressively in reflecting actors’ social position and in preserving social understanding. After control theory (Heise, 1979), Smith-lovin and Heise, 1988; Mckinnon, forthcoming) continued Goffman’s thesis.

This theory suggests that an individual could dress in ways that makes others form and maintain good impressions of him in a social context. Consequently it also implies that the behaviour of others towards him will be based on what impression they have of him.

Gross-cultural research among people speaking diverse languages in more than twenty-five nations around the world (Osgood; May and Miron, 1975) revealed that any person, behaviour, object setting or property of person evokes an effective response consisting of three components;

One component consist of approval or disapproval of the entity-an evaluation based on morality (good versus bad), aesthetics (beautiful versus ugly), functionality (useful versus useless) hedonism (pleasant versus unpleasant) or some other criterion.

Another component of the affective responses is a potency assessment made in terms of physical proportions (large versus small, deep versus shallow), strength (strong versus weak) forcefulness (powerful versus powerless) or some other criterion.

The third component of affective responses,- an appraisal of activity – main depend on speed (fast versus slow) perceptual stimulation (noisy versus quite, bright versus dim) age (young versus old), keenness (sharp versus dull) or other criterion. Worthy of note here is that all these criteria generalizes to some degree.

It is safe to infer from the foregoing that evaluation of perceptual stimulation of dressing would be “nice” versus “poor” and generalizes to mean that the person is either “rich” or “poor”. Combination of cognitive element bring affective meaning together and create outcome impressions through psychological processes that are subtle and yet highly predictable (Averett and Heise, 1987, Anderson, 1981).

Information pickup theory

Differing a little from the affect control theory is the information pickup theory by Gibson J. (1979). The theory of information pickup suggests that perception depends entirely upon information in the “stimulus array” rather than sensations that are influenced by cognition. Gibson proposes that the environment consist of affordances (such as terrain, water, vegetation, clothing, age, sex etc) which provides the clue necessary for perception. Furthermore, the ambient array includes invariants such as shadows, texture, colour, congruence, symmetry and layout that determines what is perceived. According to Gibson, perception is a direct consequence of the properties of the environment and does not involve any form of sensory processing.

Our perception of others depends therefore on what we see of them, these includes their physical characteristics such as height, weight, complexion, age gender, adornments such as clothing, jewelries, makeup etc. the information we pickup from these external stimuli determines our perception of people. An individual decked in costly clothing and jewelries is perceives as rich and vice-a-visa. The act of perception depends upon an interaction between the organism and the environment (Gibson J. 1977).

Information pickup theory opposes most traditional theories of cognition that assume past experiences play a dominant role in perceiving. It is based upon Gestalt theories that emphasize the significance of stimulus organization and relationships. Information pickup theory is intended as a general theory of perception, although it has been developed most completely for the visual system. One attractive feature of this theory is that perception according to it is solely influenced by visual stimulation from the environment. be it objects, structures, vegetation, persons that is, what the perceiver sees.

Taken together, these theories suggests that our outward appearances, age, gender affects what impressions others form about us and by extension their perception about us. Social perception as this is often referred to as the process through which we use available information to form impression of others to assess what they are like. Mitcher et al (2007). Social perception can be flawed-even skilled observers can misperceive, misjudge and reach wrong conclusions. Once we form wrong impressions, they are likely to persist (and influence our behaviours). According to Mitcher et al (2007) if we perceive a neighborhood as friendly, we can walk down the street without looking back. In the same vein, in the open market, if we perceive a potential buyer as rich, it will reflect in the statement of the opening price and through the process of pricing and ultimately in the sales outcome.

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Title: The Influence of Dressing and Bargaining Strategies on Sales Outcomes