Consumer Goods: Definition, Types and Examples

What’s it: Consumer goods are goods for end-use by consumers without further commercial process. They range from durable products such as furniture and household appliances, clothing, and electronics, to non-durable products such as food and beverages.

Why are consumer goods important?

Consumption is vital to promote economic growth. In some countries with large populations, such as Indonesia, consumption accounts for more than half of gross domestic product (GDP). So, increasing demand for consumer goods is vital for growing the economy.

Businesses produce consumer goods to meet our needs and wants. These items are essential for our standard of living.

Abundant and varied supplies make our lives more comfortable. It helps us save time and increase productivity. For example, we can use cell phones to chat and talk with other people wherever we are. With computers, we can also produce reports or articles faster and more fun than by handwriting.

But, indeed, relying on several items also makes us lazier. This also affects the quality of health, such as the adverse effects of electromagnetic waves from cellphone use. A more significant impact is consumerism, where more people buy goods excessively.

The difference between consumer goods and capital goods

We call consumer goods final products because they are the final production output and don’t require further processing. For example, you can buy food and drinks on retail store shelves and consume them. You don’t need to process it further to get the benefits.

Consumer goods are different from capital goods such as machinery, equipment, computers, and furniture. Businesses use capital goods to produce other products and services, including consumer goods.

Likewise, raw materials or semi-finished goods such as copper and steel plates aren’t consumer goods. Businesses must process them further to produce the final output.

Types of consumer goods

Based on the useful life, consumer goods consist of:

1. Durable consumer goods
2. Non-durable consumer goods

Durable consumer goods have a long useful life (usually more than 3 years). You can still use it during this time span without losing its benefits. Furniture and electronics are examples.

Conversely, non-durable consumer goods have a shorter useful life. This is because they usually run out once we consume. Examples are food and drinks.

Besides, marketers also classify consumer goods into four categories based on their buying patterns.

1. Convenience goods
2. Shopping goods
3. Specialty goods
4. Unsought goods

Convenience goods are regularly consumed and sold by wholesalers and retailers. Examples include dairy and tobacco products.

Two types of convenience goods are necessities and impulse goods. As the name implies, necessities are to meet our basic needs, such as food and drinks.

• Impulse goods are items you buy without prior planning. Candy near the cashier is an example. You immediately buy it when paying, without thinking about buying it first.

Shopping items have a higher unit value and are rarely purchased (for example, clothing and furniture). Therefore, their purchasing usually requires more thought and planning than convenience items. Likewise, the price of these items is generally higher and has a longer endurance and life span than convenience goods.

Specialty items are high-value items. Customers easily recognize it through their brand names and often are willing to sacrifice to get them. Therefore, marketers pay special attention to marketing these items. For example, they only target the upper-class market rather than the mass market. Examples of specialty items are jewelry and luxury cars.

Unsought goods were previously unthinkable by consumers. Desires appear, for example, because of danger or fear of loss. These items are usually not purchased repeatedly and only serve specified needs, such as life insurance.

In addition to the above classification, you might also hear the following consumer goods:

Fast-moving consumer goods (FMCG) – include products that are quickly and widely consumed. As a result, they promptly disappear from retail store shelves because consumers regularly buy them. Examples are:

• Meat and meat products
• Fish and fish products
• Fruit and vegetables
• Vegetable and animal oils and fats
• Dairy products
• Grain mill products
• Bakery products
• Sugar
• Cocoa, chocolate, and sugar confectionery
• Macaroni, noodles, couscous
• Wines
• Malt liquors and malt
• Soft drinks, mineral waters
• Tobacco products
• Paper, and paperboard
• Corrugated paper, containers
• Soap and detergents, cleaning preparations, perfumes
• Men’s and women’s inner garments, deodorants, shaving gels, personal care, home care

White goods – comprise large household appliances such as freezers, stoves, refrigerators, and washing machines. In the past, this product generally had a white color, that’s why we call it that.

Brown goods – consist of relatively lightweight electronic devices such as radios, computers, and digital media players. Like white goods, in the past, wood or the like framed the outside of these products, making them look brown.

List of consumer goods companies in Indonesia