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BSNS111 Full Notes
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Full notes for the lectures in BSNS111 - grade A+
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Business and SocietyFULL NOTES
Semester 1, 2022
University of Otago
BSNS111
,Lectures 1, 2 & 3: An Introduction
Mercantilism: promoted governmental regulation of a nation’s economy for the purpose of
augmenting state power at the expense of rival national powers.
The emergence of the bourgeoisie:
● Aristocracy lost more and more power towards the end of 17th century
● Citizens began to amass property and production facilities during the 18th century
● The rise of Bourgeoisie marks the turn towards capitalism
● Industrialisation promoted the rise of capitalism
Industrialisation and Capitalism:
Mass production of textiles
Affected:
● Income
● Daily life
● Sustained population growth
● Rise of the Working Class
● Rise of the Middle Class (Bourgeois)
● Targeted use and increase of capital
Economic systems and forms of governance:
● While nomadism and feudalism define forms of (non) governance, mercantilism and
capitalism are economic systems
● With Adam Smith (late 18th century), capitalism and economics began to compete with
and influence the system of governance.
● Other systems emerge (in 20th century): democracy, socialism, communism, social
democracy
For capitalism to function, it needs:
● Private ownership of the means of production
● A property rights system legitimising private property
● A price system (money for the valuation of goods, production and distribution)
The previous history of marketing and social development produced behaviour and knowledge
patterns shaping beliefs and ideology (including through the use of propaganda by church and
government.
How does capitalism thrive?
● Capitalist production creates ‘surplus value’ (value created by workers in excess of their
own labor cost)
● Max profit is set by minimum wages necessary to sustain labor
● Profit = what capitalists keep less wages and costs - usually reinvested in more capital to
create more profit
● Accumulation of capital has no ceiling: capitalism exploits resources without any
mechanism that sets boundaries
Capitalists need markets: free markets - prices derived from supply and demand which seek to
exist without government intervention
Political systems and markets:
, ● Socialism: means of production, distribution and change should be owned or regulated
by the community (private property exists). Supply and demand are
socially/democratically managed
● Communism: all property is owned by the community and each person contributes and
receives according to their ability and needs. Supply and demand is measured and
planned
● Capitalism: all is controlled by private owners for profit. Exchange is organised by ‘the
market’: supply and demand, survival of the fittest.
○ Humans are consumers = destroyers of the value produced by firms
○ Business competitors are the new ‘foes’
○ Business language is the new language of confrontation and war.
Lecture 4: The Cooperation
Capitalism and Industrialisation: created the need for new social orders and a social contract -
we need government and leaders. Even though they can be tyrants. We need informed users
(education). Labour laws for people producing to stop ‘relentless production’. We need holidays
and recreation. Health services etc.
People were initially called brutes - need and uneducated. this changed with education. people
as consumers were treated incidentally and as a side issues, purchasers.
The rise of industrialisation saw the market go from a producer-focussed market to a
consumer-focussed market, due to producers realising that consumers needs were of greatest
importance.
Consumption creates identities
Consumption as:
● Need satisfaction
● Identity project
● Market creator (experience design; counter-movements; Burning Man)
Need satisfaction and identity projection shift according to country, culture and situation.
Business needs to understand how these identities come about, how many of them there are,
and when they become active.
Maslow’s Hierarchy:
We are looking at consumption at the ‘needs’ level. Each level, we find different interpretations
of the same product/brand, or different situations/brands. The market/producers react to
consumers by creating product categories based on consumer behaviours.
Consumer Behaviour (CB):
● Convenience goods - non-durables or fast moving consumer goods
● Convenience services - entertainment, finance, health, news, telephone
○ Durables - appliances, cars, furniture
○ Speciality products - luxury items such as diamonds and premium watches
● Unsought services - services that consumers do not usually seek
, ● Services - we understand products and services as service systems that produce
benefits for the consumer. Only the consumer can define value, as value is subjective, or
phenomenological.
Consumer needs have become dynamic and situationally defined.
At the same time as the consumer developed identity, and consumption styles, more and more
counter movements came into being (Burning Men).
● Decisions and processes
● How and why
● Actions, reactions and consequences
● Dynamic interaction of affect and cognition, behaviour and environmental events.
CB is defined as (1) the mental and physical acts of (2) individuals, households or other
decision making units concerned with ultimate consumption involving (3) the acquisition, own
production, use and, in some cases, the dispossession of products and services.
Consumer decision making process
1. Need recognition
2. Search for information
3. Evaluation of alternatives
4. Purchase decision
5. Post-purchase evaluation.
Often, consumers purchase on impulse, or copy others’ behaviour. Therefore, steps are jumped,
or this model is not followed at all. A rational consumer goes through these stages.
Companies seek to develop more sensitive ways to catch consumer attention.
Consumers International
Principles are that consumer has the right to satisfaction of basic needs, safety, information,
consumer education, healthy environment, choice, to be head and to have rights of redress.
Consumer international views the consumer as highly vulnerable in front of businesses.
Public Sector
Provides government services for consumers and organisations. Many nations market their
cities or countries to attract tourists, residents and investments (consumers). Governments were
beginning to be included in business.
Private Sector:
Commercial companies marketing goods, services, ideas and experiences to consumers (as
well as to the private, public and non-profit sectors).
With private, public, and non-profit sectors, they all put consumers into sectors into markets
which they target with their products.
Collaboration of companies can be due to cause related marketing. This means that some
companies can change the consumers view on their brand if they collaborate with, say, a
hospital, or a charity, as consumers want to support good brands.
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