Correlates of Deficient Consumer Information Environments: the Case of the Elderly

ABSTRACT - Although much research attention has been given to the format of consumer information environments, there has been little study of the effects of consumer environments lacking in information. This paper describes an empirical study of elderly consumers functioning in information deficient environments. The relationship of lack of information and bat purchase experiences are discussed along with future research implications in public policy.


Rohit Deshpande and S. Krishnan (1982) ,"Correlates of Deficient Consumer Information Environments: the Case of the Elderly", in NA - Advances in Consumer Research Volume 09, eds. Andrew Mitchell, Ann Abor, MI : Association for Consumer Research, Pages: 515-519.

Advances in Consumer Research Volume 9, 1982      Pages 515-519


Rohit Deshpande, University of Texas at Austin

S. Krishnan, Pennsylvania State University

[This study was supported by a grant from the Administration on Aging (USDHEW 5-38131). The authors express gratitude to Dr. Gerald Zaltman for providing the data for the study.]


Although much research attention has been given to the format of consumer information environments, there has been little study of the effects of consumer environments lacking in information. This paper describes an empirical study of elderly consumers functioning in information deficient environments. The relationship of lack of information and bat purchase experiences are discussed along with future research implications in public policy.


The concept of a consumer information environment has been developed some years ago. As Bettman (1975) describes it, the term "denotes the entire array of product-related data available to the consumer. Some important characteristics of information environments are type of information available, amount of information available, modes of presentation, and modes of organization of information." As understood in a public policy setting, the purpose of a consumer information environment is to enable individuals to make improved decisions based on better information made available to them at the right time. (Thorelli, Becker, and Engledow 1975, McEwen 1978). Issues relating to the optimal structure of a consumer information environment have been discussed elsewhere (for e.g., Jacoby et al. 1977, Russo et al. 1975, Bettman 1979). The objective of this paper is to look at what occurs when the information environment is lacking in some regard, and to examine this problem in the context of consumer behavior of the elderly.

The reasons for focusing on elderly consumers are simple. This market segment has received extremely little empirical attention from consumer researchers despite demographic trends which indicate that the over-64 age group is growing more rapidly than several younger market segments. The limited discussions of the consumption patterns of the elderly indicate that this segment is quite substantial in purchasing power (Phillips and Sternthal 1977). More critically, however, studies of the elderly in the U.S. describe an extremely disadvantaged set of individuals. Medical fraud is estimated to be highest among the elderly (Butler 1975). Waddell (1975) indicates that elderly consumers are particularly susceptible to all kinds of fraud because of relatively lower education, a more trusting nature, and lower self-esteem than the rest of the population. Social isolation is a major problem with the elderly (Schiffman 1971), perhaps the reason that Zaltman, Srivastava and Deshpande (1978) found these consumers to be less likely to complain and ask for restitution when encountering unfair marketing practices. Due to all of these reasons, it is likely that the information environments of the elderly are seriously deficient thereby preventing them from making optimal purchase decisions. If this is correct, then both from a humanistic and a public policy perspective it is necessary to take some remedial action. The following sections describe a conceptual methodology designed to examine consumer information environments for deficiencies and an empirical study based on a nationwide cross-sectional survey of elderly consumers.


Data used in this paper come from a larger research program investigating the consumer problems of the elderly. Preliminary focus group discussions with elderly consumers revealed that the most critical aspects of product and service related information were accessibility of needed information. That is, how difficult was it to obtain information that was required to make a product choice decision? This is clearly a critical area in public policy program development. Several information programs have been developed without first ascertaining whether the target audience desired the information to be provided (Capon and Lutz 1979). After the marketing concept has been applied and the desired information product developed, it is still necessary to make a distribution decision, i.e., make the information available to consumers so that they can make use of it. These two information environment components may be referred to as "relative information demand" (perceived need for product related information) and "information availability" (accessibility of information by consumers). The two components can be conceptualized in terms of a 2x2 matrix described in Figure 1. This figure describes the conceptual scheme known as an Information Deficiency Matrix (Deshpande and Krishnan 1981) and can be used to determine the adequacy of information environments of elderly consumers. It is clear that the Northwest cell (i.e., information needed and difficult to obtain) is the key one in terms of a deficient consumer information environment. Conversely, the Southeast cell is of no importance except perhaps in comparison with its diagonally opposite cell. Further discussion in this paper will focus on the most critical, that is, the Northwest cell. Individuals will be referred to as having deficient consumer information environments when the conditions of information-need and information-unavailability coexist.




Two structured mail questionnaires were developed based on focus group discussions with elderly consumers. The discussions related to issues on susceptibility to fraud, perceptions of unfair marketing practices, dissatisfaction with products purchased, and complaint actions. Questionnaires were mailed two months apart to a national Market Facts panel of 4,000 persons aged 25 to 80. Response rates for each wave of the survey were extremely good (71.3% and 89.4%). Comparing the surveyed sample characteristics with those of the U.S. population revealed the following:

(1) a (intended) disproportionate number of individuals over age 64 (61% to 11: nationally),

(2) a lower representation of blacks and hispanics (3% and 0.1% versus 8% and 4%, respectively),

(3) A moderate under-representation of high school graduates and a slight over-representation of college graduates, and

(4) fewer individuals whose spouses were deceased.

Analyses in this paper deal with 1,767 usable responses from the elderly (over 64) subsample or 68% of the final sample. Space constraints do not permit a fuller description of the larger sample. Additional information and analyses can be found in Deshpande and Krishnan (1981), Lawther (1978), Zaltman et al. (1978).


The two components of the Information Deficiency Index, relative information demand and information availability were posed as part of one question in the second wave of the mail survey. The question is shown below:

I've listed below some different types of products or services. In Col = A, "X" all those where you feel that you, personally, need information. In Col = B, "X" the products or serves where you feel the information you need is difficult to get.


The nine product/service categories represent those most frequently mentioned by elderly consumers as areas where they had felt cheated or taken advantage of during recent purchase experiences. Further, in the first wave instrument, a question asked respondents to indicate with which products and services they had felt cheated or bad about their buying experience. This question listed 33 products and services but the data used here come from the top nine most frequently cited categories which are identical to those shown above. This question can therefore be thought of as measuring the incidence of bad buying experiences.

Finally, a separate question in the second wave of the survey asked respondents to indicate the extent of general dissatisfaction perceived (4-item scale from Generally Very Satisfied to Generally Very Dissatisfied) with a listed set of products and services. The question was worded:

"Several products and services are listed below. We are interested in how satisfied you generally are with the items you occasionally or frequently buy or use. If you do not buy or use a product or service, "X" the box 'Rarely or Never Use.' "

Once again this analysis deals with the 9 most critical product categories.


The first part of the analysis was to examine the extent of information deficiency. How is the consumer information environment deficient across product categories? In order to answer this question the number of product categories for which each respondent had answered "Yes/Yes" (i.e., the Northwest cell of the Information Deficiency matrix) were counted. Frequency data are reported in Table 1.



As Table 1 indicates, the majority (58.8%) of elderly consumers perceived an information deficiency on two or fewer product categories. The mean response for this "Information Deficiency Index" was 2.32 with a standard deviation of 0.039. This is valuable information in that it appears that very few elderly consumers perceive information deficiencies across all 9 product categories (only 12 people or 007% of the sample). Yet further analysis is necessary to determine whether it should concern us at all whether or not elderly consumers perceive both a need for, and an unavailability of product-related information. This is indeed the crux of the issue initially proposed in the introduction of this paper. What are the correlates of deficiencies in the consumer information environment.

To respond to this query, it is necessary to look at the relationship between information deficiencies and both general dissatisfaction with products and reports of bad buying experiences. Simple cumulative indices were formed of consumers' responses to the dissatisfaction, bad buying experience, and information deficiency measures described earlier. In the case of the dissatisfaction question, the index was formed by first eliminating cases where "Rarely or Never Use" the product category had been checked by the respondent. Next, responses were standardized by dividing the aggregate dissatisfaction score by the number of product categories mentioned (thereby ensuring comparability of respondents in terms of participation in the marketplace). This standardized score then represented the Dissatisfaction index score for each respondent. Similarly, the bad buying experience index was formed by first including those respondents who had checked one or more of the 9 product categories, and aggregating their responses to form a Bad Buying Experience score for each respondent. In an analogous manner. an Information deficiency index was computed by counting the number of different product categories that a respondent had indicated where both information was needed and unavailable.

In order to test for associative relationships, zero-order Pearson correlations were computed between the Information Deficiency score and each of the Dissatisfaction and Bad Buying Experience indices. These correlation coefficients are reported in Table 2.



Table 2 shows evidence of positive and highly significant relationships. It appears that as the information environment of elderly consumers becomes more deficient in produce-related information, consumers' general dissatisfaction with chose products increases. This result is shown by a Pearson coefficient of 0.571 (significant at p <.001). Additionally (and perhaps explaining the above result), as the information environment of elderly consumers becomes more deficient in product-related information. consumers' reports of buying experiences where they felt cheated or bad, increases. The latter relationship shown by a Pearson coefficient of 0.567 (significant at p < .001).

Before any further conclusions are drawn from these results, however, it is important to turn again to the distribution of Information Deficiency responses reported in Table 1. It is true that general dissatisfaction and bat buying experiences seem to be associated with a deficient consumer information environment. But if, on the average, only two product categories are thus affected, then perhaps the problems are more localized, or at least can be isolated.

In order to shed light on this issue, a more micro level of analysis was conducted. Cross-classifications were performed investigating the reports of bat buying experiences on a product by product basis. The results of these cross-classification analyses are displayed in Table 3.



Let us examine the first cross-tabulation in Table 3 describing reports on Automobile Repair services. As can be seen a substantial number of consumers had encountered problematic purchase experiences (229 out of 1747 respondents or 13% of the elderly sample). Looking now at reports of information deficiencies: Out of 404 respondents reporting lack of needed information on automobile repair, 113 (or 28%) also reported encountering a bad buying experience. This compares with only 10.4% (116/114) of consumers who claimed to have a bad buying experience when no information deficiency existed. These results are statistically significant at less than the 0.001 level (chi square of 49.3 with 1 degree of freedom). Clearly a strong relationship exists between lack of relevant automobile repair service information and the encountering of negative purchase experiences in this product category.

Similar results of significant relationships between information deficient consumer environments and reports of bad buying experiences can be seen in other product categories in Table 3. This is particularly true for automobile purchases, utility services, insurance, appliance repair, and to a lesser extent in home repair and improvements, nonmedical professional services, appliance purchases and health care services.


Briefly summarizing the results of the above analyses, it appears that when elderly consumers perceive a deficiency in their information environment (defined here as an unavailability of product-related information needed for making purchase decisions), there exists also a general dissatisfaction with those product categories. Additionally, there is a strong positive relationship between information deficiencies and reports of bad buying experiences (where consumers felt cheated or bad about their purchases). At a more micro level, the latter relationship holds across almost all product categories. For instance, those elderly consumers who indicate an information deficiency concerning automobile repair services are also more likely to have encountered bad buying experiences with these services (when compared with individuals who did not perceive an information deficiency).

Given the cross-sectional nature of the survey research design used for data-collection in this study, it is not possible to input causality based on this data alone. However, by referring to other related consumer research, some inferences can be made. [This inferential logic follows the process of theory construction in marketing suggested by Zaltman and his colleagues (forthcoming).] All nine product/service categories are those where consumer information processing follows the traditional hierarchy of effects suggested by a non-routinized buying situation (Howard and Sheth 1969). The product categories are characterized by a high price, relatively long purchase cycle, and generally high functional and psychosocial risk. Purchasing repair services for one's automobile and buying a new car or insurance would classify as high rather than low involvement decision situations (Krugman 1965, Rothschild 1979, Kassarjian 1981, Ray et al. 1973). This is especially true for elderly consumers, many of whom live alone and survive on fixed incomes ---conditions leading to a heightened concern for getting special bargains to make limited resources go further (Zaltman et al. 1978). The combination of social isolation (Schiffman 1971, Lawther 1978) and low self-esteem (Waddell 1975) translate into a situation where elderly consumers frequently find themselves unable to access the product-related information they need to make optimal purchase decisions. This can lead in several instances (ant does, as the data in this study appear to indicate) to a less than satisfactory buying experience. Elderly consumers feel mistreated, cheated and bad about certain purchases. These feelings develop into a generalized dissatisfaction with the product category. That is, the inferred directionality is a deficient consumer information environment lending itself to bat buying experiences which in turn lead to a general dissatisfaction with the product and service categories where the negative purchase experiences occurred.


Much consumer research in the area of consumer information environments has focused on issues of type of information that is available, the optimum format for information presentation, and the associated information search and processing heuristics of consumers. This paper has focused on a different and as yet under-researched dimension of consumer information environments: The impact on consumers of an environment depleted in its most crucial element, product-related information. The specific consumer segment studied here is that of the elderly.

As the results of this study indicate, elderly consumers perceive information deficiencies in several major product and service environments. The inability of elderly consumers to get the information they need leaves them not only generally dissatisfied with the products themselves, but also with feelings of being cheated during actual purchase experiences. Since the objective of this paper was to describe the correlates of deficient consumer information environments rather than to make normative public policy recommendations, the latter will not be an area of conjecture here. Rather, it might be helpful to describe some directions for future public policy research suggested by this study.

Although we now have knowledge about a relationship between insufficient product information and the likelihood of dissatisfactory buying experiences, there is still inadequate understanding of why elderly consumers are unable to find the information that they need. Is it that elderly consumers require specific kinds of information that are currently unavailable? Or is the information available but perhaps presented in a form that is not easily comprehended? Or is the same type and quantity of information available to both younger and older consumers, but the latter are simply not able to access it (due to social isolation, ambulatory problems, or other reasons)? Additionally, although causality was inferred in this study (i.e., information deficiency g bad buying experience b general dissatisfaction with products) does an alternative process actually occur (for e.g., bad buying decisions being the result of personal competence factors yet the negative experience being attributed to unavailability of product-related information)? Finally, a critical issue for further exploration is the comparison of different age cohorts. The data reported here have been on the elderly exclusively. The purpose of this paper was not to make a comparative analysis of older versus younger consumers. Some of this comparative analysis has been reported in work cited earlier (for instance, Zaltman, Srivastava and Deshpande 1978), however much more needs to be done in order to develop policy that is sound, informed, and most importantly, beneficial to elderlY consumers.


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Rohit Deshpande, University of Texas at Austin
S. Krishnan, Pennsylvania State University


NA - Advances in Consumer Research Volume 09 | 1982

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