Do you know what is meant by consumption activities? Consumption activities are one of the economic activities. What are included in consumption activities? Let’s see the definition, examples, characteristics, and functions of consumption activities below!
What is Consumption Activity?
Consumption activities are activities carried out with the aim of using up utility value. Consumption activities can also be carried out to meet collective or individual needs. Consumption activities can be carried out by three parties, namely households, companies, and countries.
The group of people who consume goods and services to meet their own needs is the family household (RTK). In addition, there is also a group of people who consume goods and services to meet the needs of the company, called the company household (RTP).
The following are consumption activities, namely buying goods and services, buying basic necessities, and buying entertainment needs. Consumption activities are one part of economic activities, precisely the final part of economic activities. In addition, other economic activities are production and distribution activities.
Examples of production activities include:
- Farmers who produce rice
- Bread production
- Production of jewelry from precious metals
- Clothing production
- Shoe production
- Tempeh and tofu production
- Mining of oil, coal, etc.
Meanwhile, examples of distribution activities include:
- Vegetables and fruits are distributed from farmers to markets
- Fish are distributed from suppliers to supermarkets
- Selling tempeh and tofu at the market
- Selling products in online stores.
Purpose of Consumption Activities
There are several purposes for consumers to carry out consumption activities. The purposes of consumption activities are:
1. Using up the utility value of an item at once
Items such as food and drinks are those that must be consumed immediately before they go stale. This includes other items such as skincare products, body care products, and others that have an expiration date.
2. Reducing the utility value of goods/services gradually
Next, the purpose of a person doing consumption activities is to reduce the utility value of goods or services gradually. This includes the use of durable goods. For example, furniture, electronic devices, bicycles, motor vehicles, and so on.
3. Satisfy Physical Needs
Satisfying physical needs is buying goods or services that are useful for the consumer’s body. For example, women who buy make-up supplies to beautify their bodies and men who buy shaving tools and creams to improve their appearance. Buying clothes and other fashion items also includes fulfilling physical needs.
4. Fulfilling Physical & Spiritual Needs
The next goal is to buy something that can fulfill physical and spiritual needs. For example, food, drinks, and sports can fulfill physical needs. While needs such as entertainment, worship, and pursuing hobbies can fulfill spiritual or spiritual needs.
Characteristics of Consumption Activities
In order to better understand consumption activities, here are the characteristics:
- Done directly to meet the needs of the community
- Buying items from a store
- Goods and services used are always reduced
- Goods have useful value.
What Factors Influence a Person’s Consumption Patterns?
The main factors that influence the level of public consumption are:
- Income
- Number of family members
- Level of education
- Prices of goods and services
- Taste and style
- Customs and habits.
Examples of Consumption Activities
To better understand consumption activities, we can find out examples. First, economic activities that include consumption activities are purchasing goods, whatever the type of goods. The process of purchasing goods includes choosing, buying, and bringing the goods home or wherever the goods are needed. Not only buying goods, buying services is also included in consumption activities. The process is also more or less the same as buying goods. Consumers will first choose a service whose services are in accordance with what they are looking for, then buy, and use the service.
In addition, buying various communication and technology devices for entertainment is also included in consumption activities. The forms of entertainment are very diverse, but usually the goal is to get a positive experience and improve the quality of life. Entertainment can be in the form of vacations, playing games, watching, culinary tours, sports, and so on that require costs. Due to the shift in the lifestyle of modern society, some technological devices such as smartphones have become something that cannot be avoided. To be able to communicate with family, friends, and colleagues, you must have a smartphone. In addition, other technological devices such as laptops, computers, and other electronic devices are also included in consumption activities.
Now there are many online media that are free and we can consume them every day anytime. But there are also various paid online media that we can only read or watch after paying a subscription for 1 month, 3 months, and so on. Related to the development of technology, currently just to communicate requires an internet connection. Therefore, consumers buy internet quotas or subscribe to Wi-Fi for home or work.