Critically evaluate and discuss the advantages and disadvantages of Customer Boycotts. Compare and contrast two consumer boycotts and discuss appropriate microeconomic theoretical models.
2590 WordsFeb 17, 200411 Pages
Microeconomics Coursework Essay
Critically evaluate and discuss the advantages and disadvantages of Customer Boycotts. Compare and contrast either Coca Cola or Bacardi with another consumer boycott of your choice and discuss appropriate microeconomic theoretical models.
Firstly to understand this question we need to understand what a customer or consumer boycott actually is. Well it is normally called by an organisation or a group of individuals, asking consumers not to buy a specific product, or the products of a specific company, in order to exert commercial pressure. This is usually done to get the company to change behaviour, to cease an activity or to adopt a more ethical practice.
For this essay I am going to discuss many…show more content…
(Can Consumer boycotts work, 2002 [online]. Available at:
I mentioned briefly earlier something called a primary effect, well this would be where the target organisation changes its practice. Many targets are however reluctant to change as the result of hostile pressure, and even if changes are made they may try to hide the fact that the consumer action had any effect. There is also the fact that most boycotts are small by comparison to the overall sales, so a target can ride out a boycott. Thus the primary effects may be small and many boycotts may be judged not to have succeeded. So this could be seen as a disadvantage. But the secondary effects are an advantage and are the effects that are not connected to the target. They are effects on other organisations that are not in conflict and can therefore change without the public knowing. Secondary effects can be changes to regulations, lasting change in industry practices, allowing substantial growth entrance of ethical players into the market or effects on decisions of similar organisations to the target. (Why Secondary Effects, [online]. Available at:
An example of secondary effects is if someone refuses to buy Nescafe (the coffee brand from Nestle) then he may choose to buy a brand from a much smaller company. The positive effect to this smaller company is much larger than the negative effect to Nestle. The new company may find out that many people are switching to it on ethical grounds and position itself