cb 8 (ref. grp flc)

8/7/2019 CB 8 (Ref. Grp FLC)

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REFERENCE GROUP &

FAMILY INFLUENCES

Prepared by:

Prof. Manu Priya Gaur

[email protected]

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Consumer Decision Process

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Influence of the Social Environment

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Consumers want to be

like the people theyadmire and respect.

They will

emulate them

aspire to be like them,

listen to them

identify with them

and buy what they buy.

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As the value of the group to the individual increases so too

does the likelihood that the group will guide consumption

decisions.

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A group may be defined as two or more

people who interact to accomplish eitherindividual or mutual goals.

What is a group ?

Types of GroupsTypes of Groups

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A group consists of two or more people who

interact with each other to accomplish some goal.

A reference group involves one or more people

used as a basis for comparison or point of

reference in forming affective and cognitive

responses and performing behaviors.

People to whom an individual looks as a source of

personal standards.

Reference Groups People or institutions whose opinions are valued and to

whom a person looks for guidance in his or her ownbehavior, values, and conduct, such as family, friends, or

celebrities.

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1. They serve as information sources and influence

perceptions.

2. They affect an individuals aspiration levels.

3. Their norms either constrain or stimulate consumer

behavior.

Marketers recognize interpersonal influences beyond the

family, including friends, coworkers, and others. These

sources of influence are often called reference groups, or

those others look to for help and guidance.

Influence of reference group depends on two conditions:

Purchased product must be seen and identifiable.

Purchased product must be conspicuous, something not everybody

owns.

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When do Group Exert Influence?

People use group norms to define themselves.

The group influence on an individual behaviour

depends on three factors.

1. Attitude Towards Group-

individuals susceptibility to group influence varies:

Views R G as credible source of information

Values the views & reactions of group members with

regard to buying decision. Accepts the rewards & sanctions allotted out by the

group for proper & improper behavior.

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2. The Nature of The Group- Reference more likely to

influence group members behaviour if they are:

Cohesive & having similar values & norms.

Frequently interacting

Distinctive & exclusive

3. The Nature Of the Product- the nature of the product

determines the degree of influences, if product are:

Visible as clothing

Exclusive that might speaks of status i.e.Mercedes.

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PrimaryPrimary InformalInformal GroupsGroups:: family & peers,important because of closeness & frequent

contact.

PrimaryPrimary FormalFormal GroupsGroups:: more formal structure,

contact less frequently. Advertisers use group

setting as a means of winning product approval.

SecondarySecondary InformalInformal GroupsGroups:: no formal structure &

meet once in a while. Ex. Womens kitty party ,sports groups.

SecondarySecondary FormalFormal GroupsGroups:: not very important tomarketers, meet infrequently. Ex. Teachers

associations, retailers associations.

Types Of Reference Group

Membership Groups

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Normative Reference Group

Group that directly influence general or broadly

defined values or behaviour. Childs normative reference group will be his family

Family plays a important role molding the childsconsumer behavior i.e. in food he consume, the

selection of food.

Comparative Reference Group

Group which serve as a bench mark or severe as a

point of comparison for evaluating own status. Neighbours & in college peers as comparative RG.

Comparative reference group can influenceindividuals drees code, life style etc.

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Indirect Reference Group

Movie stars, sports personality. No face-to-face

contact or interaction between. Fans try to imitate their hair styles, dressing, life

styles, behavior etc.

Their judgment on facts, & fashions or social

messages carries a lot weightage & this reflectedin their purchase decision.

Ex. Sachin Tendulkar promoting Action Shoes,

Sharukh Khan on Mayur Suitings, Saif Ali aboutHULS Clinic Plus. They act as Opinion Leaders.

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Indirect Reference Group

It is one which the individual wishes or aspire to

belong. Does not have face to face contact, but aspires to

be a member.

Teen-age cricket player hope to play some day for a

country.

So the consumer will select the brand of the

product because the personality matches &

express his own aspirations. Ex. Bagpiper Whisky promoted by film star

SUNNY DEOL,. Products like cigarettes, liquor,cosmetics, automobiles, fashion.

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Disclaiming Reference Group

This is a group whose values or behaviors does not

appeal to individual Person may have membership, but disapproves the

group values.

Avoidance Reference Group

Group with which the person may not hold

membership, nor have face to face contact. Person tend to avoid the group & adopt values &

attitude in opposition of the group.

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Analyzing reference groups Analyzing reference groups

± Reference groups are cultural groups in that

members share certain common cultural meanings ± Marketers try to determine the content of the

shared meanings of various reference groups

± Can have both positive and negative effects on

consumers ± People identify and affiliate with particular reference

groups for three reasons

To gain useful knowledge

To obtain rewards or avoid punishments

To acquire meanings for constructing, modifying, or

maintaining their self-concepts

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Selected Consumer-Related Reference Groups

FriendshipFriendship

GroupsGroups

They are unstructured, friends fulfill wide rang of needs, provide companionship, security,

opportunities, discussions. Marketers depicts

friendship situations for clothing, fine jewelry, snacks.

Consumers influenced by diverse range of people:

ShoppingShopping

GroupsGroups

WorkWork

GroupsGroups

Two or more people who shop together, for clothing,

households. Motive is to share time together, helps in

reducing the risk while making decisions. People feel

more confident in collective decision making.

35 hrs per week people spend at their workplace.

People who work together as part of team, sustained

opportunity to influence each other¶s consumption

related attitude, brand choices.

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Reference Group will influence choice of

clothes in Group members

Ad shows RG influences among youth for

Duke T-shirts & Shorts

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Consumer Consumer--ActionAction

GroupsGroups

Celebrities &Celebrities &other RGother RG

AppealAppeal

A Particular kind of consumer group, has emerged in

response to the consumerist movement. Providingconsumers with assistance in right purchasing

decision, consume products & services in healthy

manner.

The experts, The Common man, the executive &

employee spokesperson, trade or spoke-characters

VirtualVirtual

Groups/Groups/CommunitiesCommunities

People on their computers, logging onto the we,

visiting special interest with chartrooms. These

communities provide members with extensive amountof information covering large variety of topics. Help

good product sells fast.

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Groups Influence Buying

in Two Ways:

They affect thepurchases made by

individual consumers

Group memberssometimes make

decisions as a group

You and your partner/friends have decidedto go out to dinner and want to try some

place new, and a little classier. How do you

choose which restaurant to go to?

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Factors that Affect

Reference Group InfluenceInformation and experience (more informed and

experienced individuals in a product category are less

likely to be influenced by groups)

Individual difference factors, e.g.personality/involvement

Conspicuousness of the product (e.g. public use of a

product can influence acceptance of group attitudes)Credibility, attractiveness, and power of the reference

group.

Degree of perceived risk (economic, social, physical)

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Who would you go to for

information or advice on skinCare products?

Friend 30.2%

Doctor (Specialist) 22.1

Hair dresser/beautician) 18.6

Other 14.0

Pharmacist 8.1

Spouse 7.0Total 100%

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U sing students as the market segment, describe the most

relevant reference group(s) and indicate the probable degree of

influence for each of the following decisions:

a. Brand of mouthwash

b. Purchase of Car Insurance

c. Purchase of a Pet

d. Choice of Restaurant

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FAMILY INFLUENCES

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Family

How does the family affect consumer

behavior?

(consumer socialization)

Roles in Family Decision Making

Who is the Decision Maker(Husband dominant, wife dominant, and joint

decision making)

Family Life Cycle

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Group/Family Decision Making

Decision Roles: ± Influencer: influences the purchase decision.

± Gatekeeper: Role to control as in organization.

± Decider: makes the final decision regarding a purchase.

± Buyer: engages in the actual transaction/ purchase.

± Preparer: prepares the purchased goods for use.

± User: uses the purchased good(s).

± Maintainer: maintains or takes care of the good(s).

± Disposer: chooses when and how to dispose of the

good(s).

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FAMILY INFLUENCES

F our roles of spouses:

Autonomic Autonomic rolerole ² partners independently make an equal number

of decisions.

Husband Husband--dominant roledominant role ² husband usually makes certain buying

decisions, such as purchasing life insurance.

WifeWife--dominantdominant rolerole ² wife makes buying decisions, such as buying

children¶s clothing.

SyncraticSyncratic rolerole ² buying decision made jointly.

(Increasing occurrence of two-income households increases likelihood of spouses

making joint buying decisions.)

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Who Buys the Pants?

Although many men still wear the pants in the family, its

women who buy them.

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Family Influences

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Families and HouseholdsHouseholds are

composed of all those

people who occupy a

living unit

±

The Nuclear Family ± The Extended Family

± The Detached Nuclear

Family

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Family Households: Married couples

Married with children at home

Married with no children at

home

Single fathers

Single mothers

Other families

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Nonfamily Households:

Men Living

Alone

Women Living

Alone

Other

Nonfamilies

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Some Household Trends

Childless couples 45-64 have the most

buying power.

± Single parents/childless singles over 45 have

the least.

Size has shrunk from 3.14 to 2.67 persons.

± Increase in divorce: children leave home prior

to marriage: older people maintain ownhomes.

Later marriage.

2-career families.

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Relationships among Purchasers and

Consumers in the Family

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Traditional Family Life Cycle StagesTraditional Family Life Cycle Stages

StageStage II:: BachelorhoodBachelorhood-- Young single adult

living apart from parents. Spend their

income on rent, basic home requirements,

lifestyles, entertainment.

StageStage IIII:: HoneymoonersHoneymooners-- Young married

couple. Start-up expenses on appliances,

utensils, accessories, vacations.StageStage IIIIII:: ParenthoodParenthood-- married couple

with atleast one child at home. Expenses

on education

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StageStage IVIV:: PostparenthoodPostparenthood-- older married couple

with no children living at home. Worrying about

marriage of remaining children. Higher disposable income because of savings &

investments.

Expenses on travel, entertainment, club fee,

refurnishing home, market for new automobiles,luxury goods.

StageStage VV:: DissolutionDissolution-- occurs at the death of one

spouse.Expenses on health, donations etc.

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Marketers use the family life cycle toMarketers use the family life cycle to

±Segment the market

±Analyze market potential

±Identify target markets

±Develop more effective marketing

strategies

Developing marketing strategies for the

bachelor segment is a challenge

Some stages in the family life cycle are

more important markets than others

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Family Life Cycle StagesFamily Life Cycle Stages1. Young Single

2. Young Married with no Children (DINKS)

3. Young - married with children- divorced without children

- divorced with children

4. Middle Aged

a. married without children

b. divorced without children

c. married with children

d. divorced with children

e. married without dependent children

f. divorced without dependent children5. Older

(i) older married (ii) older unmarried (divorced, widowed)

6. Other- SSWDs

single separated widowed / divorced

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MODERN FAMILY LIFE CYCLE

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Functions of Family

1.Economic Well-Being

2.Emotional Support

3.Suitable Family

Lifestyle

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cb 8 (ref. grp flc)

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