CONSUMERS AND SUBCULTURES

Age education occupation social class Ethnic group gender composition family size and composition distribution of population

What are some demographics

So What Are demographics?

Objective quantifiable Characteristics of a population

Important variables for market segmentation

What are some Recent Demographic Trends in Canada

• Change in age distribution• Increased urbanization; though there have been some

moves to non-urban areas• Change in the structure of the family• Increased participation by women in the workforce• Women more focused on careers• Couples having fewer children• Increased incomes and greater consumer confidence• Increased educational opportunities

EVEN though Calgary accountant "Michelle" (not her real name) and her husband, "Jim," an elementary school teacher, could afford to have more children, they are not going to. Jim is scheduled for a vasectomy next month. "We already have one child," Michelle explains. "We just don't want any more. One is enough. Kids are expensive, and they take up so much time. We want our life back."

Michelle is not alone. Canadian women are now having fewer children than ever before, according to a new Statistics Canada study, released in July. The latest figures mean that for the first time in 100 years, Canada's population growth rate has fallen below the United States. At least three factors explain the decline, including increased abortions and birth control, more women in the workforce who are starting their families later in life, and high taxation.

Marketing Implications of Demographic Trends

You are the marketing manager of a telecommunications company that manufactures cell phones.

Until recently you have targeted businessmen for these phones. How would you use the information that more women are entering the workforce in Canada to refocus your marketing strategy?

What Problems might there be with Relying on Demographics

Information may be old Data on various demographics may be unavailable Summary data may be too broad and hide

opportunities in niches Psychological or social factors that affect people’s

buying patterns are not considered Demographics do not provide the reasons that

people make certain purchases Consumers with similar demographics may differ in

purchase behavior

CONSUMER SPENDING AND ECONOMIC ACTIVITY

What does the demand for goods and services depend on?

the ability to buy

the willingness to buy

a measure of consumers’ opinions on the financial position of their own household and the economy as a whole

and to what extent they think it is a good time to buy large expensive items such as a TV or a computer. Demand for necessities remains stable over time

A component of consumer confidence that gives an approximate indication of the development of consumption growth in the subsequent months, especially with respect to durable goods. The underlying data are taken from the consumer confidence survey.

What is Consumers’ willingness to buy?

The Conference Board's Consumer Confidence Survey based on a representative sample of 5,000 U.S. households across the country.

Consumer assessment of current economic conditions. Covers things such as

•Employment•Spending intentions over the next six months•Feelings about business conditions over the next six months

The Conference Board's Consumer Confidence Index declined sharply in February 2003, the third consecutive monthly decline. The Index now stands at 64.0 (1985=100), down from 78.8 in January, an almost 15-point drop. The last time the Consumer Confidence Index was lower was in October of 1993 when it reached 60.5.

Confidence and willingness to buy varies by market segment and is usually higher among younger than older consumers

And among higher income consumers than lower,

college college graduates over high school graduates whites or other ethnic groups men or women

Willingness to buy by telephone

Social ClassWhat is Social Class?

relatively permanent strata in a society that are distinct subcultures

– Occupation– Education attained– Behavioral standards – taste culture– Source of Income– Level of Income; wealth– Dwelling area– Power– Religious Affiliation; Associations– lifestyles, buying patterns, motivations and values– possessions

What are the typical factors that differentiate the social classes?

Social Classes in CanadaA. The upper class.

– 1. The upper-upper class. (1%; ‘old money)– 2. The lower-upper class. (2-4%)

B. The middle class (40-50% considerable racial & ethnic diversity)– 1. The upper-middle class. ($100k +)– 2. The middle-middle class. ($50-$100,000, upper managerial or professional fields)– 3. lower-middle: under $50,000, less prestigious white collar, or highly

skilled blue collar jobs.

C. The working class. (1/3 of population) (lower incomes than middle class, no accumulated wealth less personal satisfaction in jobs

D. The lower class. (20% of population) (either supported by welfare, or are ‘working poor’)

tastes Lifestyles access to such resources as education, health care,

housing and consumer goods. Self Image Values Political orientation Consumption behaviour I.e. who spends how

much and on what

The Importance of ClassWhat sort of things does social class affect

CelineBoogie Bag$990

Vuitton Credit Card

Holder $96.00

Harry Rosen’s

How Do the Lower and Upper Classes Differ in Their Consumption Behaviour?

Lower classes generally focus on more immediate and more utilitarian needs

Upper classes are often likely to

approach consumption from a more aesthetic perspective

Marketing ImplicationsYour company XYZ corp. manufactures inexpensive furniture

and has targeted the less well off. In an effort to upgrade your image the company has decided to target higher-class consumers. What will the marketing implications be on the following.

Market research Product choices and development Product design and packaging Distribution Price Advertising and other marketing communications

Status SymbolsWhat are They?

Conspicuously consumed goods which are used to provide evidence of wealth

Why do some people feel the need for status symbols

The need to display status through purchase and use of products is at least partially derived from the anonymous nature of much of our social interaction

If most people are unknown in public, status cannot be conveyed by reputation

Anonymity exacerbates the need for uniqueness

Status SymbolsExamples

Parody Display

Paper Denim Retro Torn Jeans $140.00

When consumers deliberately mock a trend by carefully selecting products and consumption patterns that are not the current fashion or style.

Fraudulent Symbolism

When too many others use or possess a status symbol such that it loses much of its former power

Your company has just introduced a digital camera. It has been decided that a key element of the marketing strategy will be to position it as a status symbol. What will be some of the highlights of the marketing campaign?

SUBCULTURES

What is a Subculture?A distinct cultural group that exists as an identifiable

segment within a larger, more complex society/culture

How do you distinguish one group from another?

Members of a subculture possess beliefs, values, customs that distinguish them from other groups in the wider culture

Subcultures create their own worlds that are complete with their own norms, language, and product insignias

Every consumer belongs to many subcultures

What are some Types of Subcultures in Canada

EthnicRacialAgeRegional Religious

What is an Ethnic Subculture? Possess common cultural and or genetic ties which are

identified both by its members and by others as a distinguishable category.

Ethnic identity is a significant component of a consumer’s self concept

What makes Ethnic Subcultures Different?

Immigration in CanadaImpact of immigration – Canada has one of the

world’s most liberal immigration policies and is considered a multicultural or pluralistic society (as opposed to melting pot)

New immigrants tend to cluster together geographically which makes them easy to reach.

Concentrated in major Canadian citiesBring with them customs, traditions, values, etc. New immigrants are likely to be Asian and are

best marketed to in their native language.

Population reporting at least one Ethnic Origin other than British, French or Canadian, 1986, 1991 and 1996 Censuses

63%

37%

1986 Census58%

42%

1991 Census

56%

44%

1996 Census

LegendBritish, French or Canadian OriginsOther Ethnic Origins

Percentage of Visible Minority Population by All Age Groups, for Canada, Provinces, Territories and selected Census Metropolitan Areas, 1996 Census

0%

5%

10%

15%

20%

25%

30%

35%

1% 1% 1%

3% 3% 3% 3%

6%7%

10%

16%

18%

8% 8% 8%9%

10%11%

12% 12%

14%

16%

31%32%

11%

Visible Minority Population for Provinces and Territories 1996 Census

3,815 1,520 31,320 7,995

433,985

1,682,045

77,35526,945

269,280

660,545

1,000 1,6700

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

Shown in Absolute Numbers

Visible Minority Population in selected Census Metropolitan, 1996 Census

2,370 22,320 2,555 9,815

401,425

115,460

1,338,095

48,91073,31010,35511,250

127,555115,430

564,600

22,915

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

Shown in Absolute Numbers

Percentage of the Visible Minority Population Aged 0 to 24, for Canada, Provinces, Territories and selected Census Metropolitan Areas, 1996 Census

0%

5%

10%

15%

20%

25%

30%

35%

40%

1% 1% 1%2%

3%4%

5%

8% 8%

11%

19%

21%

10%11% 11%

12%13%

14%15%

16% 16%

18%

37% 37%

13%

Asian Canadians

Asian Canadians are the Fastest Growing Minority Group in Canada

College Graduation Rate is Twice That of

Whites.

Average Household Income is $2,000

Greater Than Whites, and tend to be more

brand and price conscious

Characteristicsof Asian

Subcultures

Small,Diverse,Growing

EducationOriented

NativeLanguage

PrintMedia

AboveAverageIncome

Marketing Implications of Subculturebasis for market segmentationMarketers need to be aware of different needs

for products, different patterns of usage, preference for certain brands

Advertising-media habits may be different; different media to reach different subcultural groups

Distribution-geographic concentration of many ethnic subcultures means that marketers can reach them more easily; also in some cases certain groups prefer to shop in certain stores.

Marketing Implications of SubcultureYour company manufactures, markets and sells

kitchen utensilsAware that Canada’s population increase now

results primarily from immigration rather than by natural means and that most of these immigrants are from Asia your company realizes that there is a vast untapped market for its products and decides to go after it.

How will this affect your company’s Marketing mix?

What difficulties might you encounter?

Reaching the Asian Canadian Consumer

Overlooked Complex Differences Among

Asian Subcultures

Translating AdvertisingMessages Into Asian

Media

Lack of Media Availableto Reach Asian

Americans

Been Insensitive to Cultural Practices

Problems Encountered by Canadian

Marketers