resulted in a favorable brand attitude through past positive reinforcement. A new product, which is yet to be linked to the established brand, would be the conditioned impulse. For example, by giving a new anti-wrinkle lotion the benefit of its well-known and respected family name, Johnson & Johnson may be counting on an extension of the favorable attitude already associated with the brand name to the new product. They are counting on stimulus generalization from the brand name to the new product. It has been shown by research that the “fit” between a parent brand like in the case of J&J and a brand extension, for instance, J&J’s anti-wrinkle, is a function of two factors: (1) The similarity between the pre-existing product categories already associated with the parent brand and the new extension. (2) The “fit” or match between the images of the parent brand and the new extension. At times, attitudes follow the purchase and consumption of a product. For example, a consumer may purchase a brand-name product without having a prior attitude towards it, because it is the only product available like the last bottle of shampoo in a hotel store). Consumers sometimes make trial purchases of new brands from product categories in which they have little personal involvement. If they find the purchased brand to be satisfactory, then they are likely to develop a favorable attitude toward it. Life is too complicated to predict what attitudes will persist and which will change but early socialization experiences do shape attitudes. 9.5 SOURCES OF INFLUENCE ON ATTITUDE FORMATION The formation of consumer attitudes is strongly influenced by personal experience, the influence of family and friends, direct marketing, and mass media. Attitudes towards goods and services are primarilyformed through the consumer’s direct experience. Personality Factors We know that the personality of each individual is different and it plays a very crucial role in formation of attitude. Say for example, if you have a high need for cognition, i.e., you crave for information and enjoy thinking. Then you are likely to form a positive attitude in response to ads or direct mail that is rich in product related information. On the other hand, your friend Ravi, who is relatively low in need for cognition, is more likely to form positive attitudes in response to ads that feature an attractive model or well-known celebrity. 1. Attitude Change and Persuasion 2. Strategies of Attitude Change Bringing about a change in the consumer attitudes is a very important strategic consideration for us marketing people. When the product or brand is the market leader, the marketers will work at ensuring that their customers continue to patronize their product with the existing positive attitude. Such firms also have to ensure that their existing loyal customers do not 151 CU IDOL SELF LEARNING MATERIAL (SLM)
succumb to their competitor’s attitude change ploys. But it is the firm whose is not the brand leader, which tries to adopt marketing strategies so as to change the attitudes of the market leaders, customers and win them over. Among the attitude change strategies that are available to them are: 1. Changing the consumer’s basic motivational function 2. Associating the product with an admired group or event 3. Resolving two conflicting attitudes 4. Altering components of the Multi-attribute model, and 5. Changing consumer beliefs about competitor’s brands. Now let us look at each of these strategies in greater details. 1. Changing the basic motivational function This strategy calls for changing consumer attitudes towards a product or brand by making a new need prominent. One such method changing motivation is called the functional approach. As per this approach, attitudes can be classified in terms of four functions, viz: 1. The utilitarian function 2. The ego defensive function 3. The value - expressive function 4. The knowledge function. The utilitarian function: A consumer develops a brand attitude because of its utility. In other words; we develop a favorable altitude towards a product because of its utility function. So marketers try to change consumer attitudes in favor of their products or brand by highlighting its utilitarian purpose, which they (the competitors consumers ;) may not have considered. Ego defensive function: Most individuals want to protect their self-image. They want re-assurance about their self- image from inner feelings or doubts. Firms marketing personal care and cosmetics try to appeal to this need and develop a favorable attitude change towards their products or brands by communicating a re-assurance to the consumersself concept The value expressive function: A consumer develops an attitude based on his general value, life style and outlook. If the target consumers hold a positive attitude towards being fashionable, then they will have a positive attitude towards high fashion clothes. 152 CU IDOL SELF LEARNING MATERIAL (SLM)
The knowledge function:Human nature is such that individuals prefer to know and understand the people and things they are in contact. While product positioning, marketers try to do this and improve the consumers attitude towards their product or brand by highlighting its benefits over competing brands. 2. Associating the product with an admired group or event At times attitudes come to be attached to certain groups, social events or causes. So marketers could try strategies whereby their product or service comes to be associated with certain events, social groups or causes. 3. Resolving two conflicting attitudes Marketers also try to take advantage of actual or potential conflict between attitudes. At times firms make consumers see that their attitudes towards a brand is in conflict with another attitude, and then they may be inclined to change their evaluation of the brand. 4. Altering components of the Multi-attribute model In the earlier lesson we discussed a number of Multi-attribute models, which have implication for attitude change strategies. To be more precise, these models provide us with additional insights as to how to bring about attitudinal change: (1) Changing the relative evaluation of attributes (2) Changing brand beliefs (3) Adding an attribute, and (4) Changing the overall brand rating (1) Changing the relative evaluation of attributes Consumer markets can be segmented in the same product category according to brands that offer different features or beliefs. (2) Changing brand beliefs This calls for changing attitudes of consumers by changing beliefs or perceptions about the brand itself. (3) Adding an attribute This means either adding an attitude that p previously has been ignored or one that represents an improvement or technological innovation. (4) Changing the overall brand rating Altering the consumers overall assessment of the brand directly without attempting to improve or change their evaluation of a single brand attribute. Usually this strategy is used by using some form of global statement like “ this is the largest selling brand (5) Changing consumer beliefs about competitor’s brands 153 CU IDOL SELF LEARNING MATERIAL (SLM)
Usually it is seen that the attitude change agent is a well respected agent authority or peer group. The amount of attitude change is related to the credibility of the source of the message. The major purpose of changing attitudes is to eventually change consumer behavior. Thus an understanding of consumer attitudes towards their product will enable the marketer to adopt suitable strategies and create a positive image or attitude for that matter of their products in the minds of the consumer. Behavior can precede or follow attitude formation'. 9.6 COGNITIVE DISSONANCE THEORY According to cognitive dissonance theory, discomfort or dissonance occurs when a consumer holds confusing thoughts about a belief or an attitude object (either before or after the purchase). Post purchase dissonance occurs after the purchase. The consumer is not happy with the purchase so they adjust their attitudes to conform to their behavior. Post purchase dissonance is quite normal. Attitude change is frequently an outcome of an action or behavior. Dissonance propels consumers to reduce the unpleasant feelings created by the rival thoughts. Most marketing strategies that employ cognitive dissonance in the service of selling a product rely on our desire to be perceived favorably – for example, as sophisticated, hip, knowledgeable or affluent. We might ordinarily not buy the product because it doesn't interest us, too expensive or for any other good reason. This understandable desire to see ourselves favorably motivates the purchase, which is how a marketing strategy that relies on cognitive dissonance encourages consumers to resolve the dissonance in the situation. Cognitive dissonance strategies in marketing only work within limits. Generally and somewhat counter intuitively, the stronger the consumer's view that the advertising potentially opposes, the better the strategy can work. But if the distance between the consumer's view and that offered through the marketing strategy is too great, the consumer may reject the approach and the product. The end result can be active disdain for the product or the company that makes the product, along with the ad itself. Tactics that consumers can use to reduce dissonance include reduction By rationalizing the decision as being wise.By seeking out advertisements that support the original reason for choosing the product.By trying to “sell” friends on the positive features of the brand. By looking to known satisfied owners for reassurance. Marketers can help reduce post purchase uncertainty by aiming specific messages at reinforcing consumer decisions. Beyond these dissonance-reducing tactics, marketers increasingly are developing affinity or relationship programs designed to reward good customers and to build customer loyalty and satisfaction. 154 CU IDOL SELF LEARNING MATERIAL (SLM)
9.7 ATTRIBUTION THEORY What does attribution theory say about attitude? Attribution theory attempts to explain how people assign causality to events on the basis of either their own behavior or the behavior of others. It assumes that people draw upon their past experiences when facing a new situation. People assess the quality of a product as they are using it. Regardless of whether they are happy or disappointed with its performance, people draw conclusions about the product, the manufacturer, or perhaps the country of origin. When the consumer sees a similar product on the market, his past experience will influence his future purchase decisions. Personality Influences People influence the personality of others through their daily interactions. This influence extends to purchase decisions. As an example, an office manager prefers a certain mode of dress, such as wearing skirts every day instead of slacks. Other women in the office will start to dress similarly in the hope of impressing her enough for a promotion. The women’s past experience taught them that bosses usually promote people who are similar in appearance and interests. This past experience influences the present decision to buy skirts rather than slacks. Role Playing Attribution and role-playing are related. People learn the responsibilities and expectations of different roles. Their purchasing behavior can be attributed to those expectations. For example, an advertising executive will drive an expensive, late-model car and pay hefty membership fees to the best country club. He must exude success to convince the client that his advertising firm is the best choice for the product campaign. Businesses marketing high- end products, including cars and golf clubs, gear their advertising to consumers who need the products or services for the roles they play. Product Value Consumers attribute a value to a product they are considering purchasing. They consider the brand name, or lack of brand name, as some prefer name brands while others are willing to try generics. Price is another factor in attributing value, as some consumers may attribute poor quality to a product with an exceptionally low price. The third factor in product value is the consumer’s peer group. Most people prefer to fit in with their peers. Marketing experts consider product value when recommending pricing and packaging for a new line. If the target group is young singles, for example, then advertising will depict people in their 20s. 9.8 SELF PERCEPTION THEORY Self-perception theory addresses individuals’ inferences or judgments as to the cause of their own behavior. In terms of consumer behavior, self-perception theory suggests that attitudes 155 CU IDOL SELF LEARNING MATERIAL (SLM)
develop as consumers look at and make judgments about their own behavior. Internal and external attributions attitudes develop as consumers look at and make judgments about their own behavior. These judgments can be divided into internal, external, and defensive attributions. Internal attribution giving yourself credit for the outcomes your ability, your skill, or your effort. External attribution the purchase was good because of factors beyond your control— luck, etc. Defensive attribution consumers are likely to accept credit personally for success, and to credit failure to others or to outside events. For this reason, it is crucial that marketers offer uniformly high quality products that allow consumers to perceive themselves as the reason for the success; that is, “I am competent.” Self-perception theory postulates the mechanism and the conditions under which a person uses his own behavior as data to make inferences about himself. For behavior to be used to infer individual characteristics, it must be a credible indicator of his internal state. In order to be credible, it must be perceived by the person as resulting from his internal motivations or true reactions to a stimulus, i.e., it must be attributed to properties of oneself as opposed to controlling aspects of the environment. [A note on terminology should be made here. Many authors refer to this process as internal (self) versus external (situational contingency) attribution, while others (notably Nisbett and Valins, 1971) prefer the terms stimulus (perceived intrinsic properties) versus circumstance (factors external to the stimulus). The difference is more apparent than real. Behavior that is perceived to be elicited by the person's intrinsic feelings about the stimulus (stimulus attribution) implies internal motivation or causality. Behavior elicited by a desire to gain a particular reinforcement or to avoid punishment or by some other aspect of the circumstances (circumstance attribution) implies external causality. For simplicity, the terms \"internal\" and \"external\" will be used here.] Thus, perceived causality of behavior is a primary determinant of the belief inference process. Attributions toward others Every time you ask “Why?” about a statement or action of another or “others”a family member, a friend, a salesperson, a direct marketer, a shipping company attribution toward others theory is relevant. Attributions toward things It is in the area of judging product performance that consumers are most likely to form product attributions toward things. Specifically, they want to find out why a product meets or do not meet their expectations. In this regard, they could attribute the product’s successful performance (or failure) to the product itself, to themselves, to other people or situations, or to some combination of these factors. 156 CU IDOL SELF LEARNING MATERIAL (SLM)
How we test our attributions We as Individuals acquire conviction about particular observations by acting like “naive scientists,” that is, by collecting additional information in an attempt to confirm (or disconfirm) prior inferences. In collecting such information, we often use the following: Distinctiveness-The consumer attributes an action to a particular product or person if the action occurs when the product (or person) is present and does not occur in its absence. Consistency over time-Whenever the person or product is present, the consumer’s inference or reaction must be the same, or nearly so. Consistency over modality-The inference or reaction must be the same, even when the situation in which it occurs varies. Consensus-The action is perceived in the same way by other consumers. 9.9SUMMARY Attitudes put people into a frame of mind for liking or disliking things and moving toward or away from them. Attitudes are defined as a mental predisposition to act that is expressed by evaluating a particular entity with some degree of favour or disfavour. A utility function representing the weighted product of attributes and criteria would be used to develop the final ranking and thus choice. Multi-attribute attitude models portray consumers’ attitudes with regard to an attitude “object” as a function of consumers’ perceptions and assessment of the key attributes or beliefs held with regard to the particular attitude “objects”. The attitude-toward object model is suitable for measuring attitudes towards a product or service category or specific brands. The theory of trying to consume has been designed to account for the many cases where the action or outcome is not certain, but instead reflects the consumer’s attempts to consume or purchase. 9.10KEYWORDS Personality factors: such as high/low need for cognition (information seeking), and social status consciousness. The utilitarian function:A consumer develops a brand attitude because of its utility. 157 CU IDOL SELF LEARNING MATERIAL (SLM)
Ego defensive function: Most individuals want to protect their self-image. They want re-assurance about their self-image from inner feelings or doubts. The value expressive function:A consumer develops an attitude based on his general value, life style and outlook. If the target consumers hold a positive attitude towards being fashionable, then they will have a positive attitude towards high fashion clothes. Role Playing: Attribution and role-playing are related. People learn the responsibilities and expectations of different roles. Product Value: Consumers attribute a value to a product they are considering purchasing. 9.11LEARNING ACTIVITY 1. Select three different print magazine advertisements. Rate your overall attitude towards each ad. What elements of the source (such as the spokesperson or company) or message (such as the visual elements, humour or fear appeals) influence your attitude towards each ad? If your attitude to any of the ads is not very positive, what could a marketer change in order to make your attitude more positive? ___________________________________________________________________________ _____________________________________________________________________ 2. Using the Internet, find two advertisements that are trying to persuade you. Try to find an advertisement that is trying to persuade you to buy something and one that is trying to persuade you to do something (e.g., vote for someone, donate money to something). ___________________________________________________________________________ _____________________________________________________________________ 9.12UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. State the meaning of consumer attitude? 2. Mention the structural models of attitude. 3. Explain the attitude towards object model. 4. How are attitudes formed? 5. How attitudes are learned? Long Questions 1. Explain the structural models of attitude. 158 CU IDOL SELF LEARNING MATERIAL (SLM)
2. Discuss about learning of attitudes 3. Summarize the sources of influence on attitude formation 4. Explain about the cognitive dissonance theory 5. Discuss about attribution theory B. Multiple Choice Questions 1. John has always loved Citroen cars and so he is delighted when he hears that a Citroen has won Top Gear’s award for car of the year. It takes his friends a long time to convince him that it was actually just ‘new hatchback of the year’ and the overall winner was a Jaguar. John has unintentionally changed the information he heard to match his own beliefs and attitudes. What is the term for that? a. Attitude reinforcement b. Selective distortion c. Enhanced perception d. Selective retention 2. What are the three components of an attitude? a. Behavioural, personality and motivation b. Learning, belief and lifestyle c. Family, school and work d. Cognitive, affective and conative 3. What is a disassociative group? a. A dysfunctional group of people b. A failing team c. A group that has no allegiance to any cause d. A group that a person does not want to belong to 4. 14-year-old Beth is a member of the Girls Aloud fan club. She accesses their Facebook page regularly and is strongly influenced by what Girls Aloud say and wear. What kind of reference group is this fan club for Beth? a. Aspirant group 159 CU IDOL SELF LEARNING MATERIAL (SLM)
b. Inclusive group c. Disassociative group d. Membership group 5. James recently purchased a new car, however now he is worried about whether he made the right decision. Consumer behaviourists have a term for this state of mind. What is it? a. Purchase concern b. Dithering c. Post-purchase dissonance d. Product evaluation Answers 1 – b, 2 – d, 3 – d, 4 – d, 5 – c 9.13REFERENCES References books Engel, James F.; Blackwell, Roger D.; Miniard, Paul W., Consumer Behavior, 6th ed. Chicago. Loudon, D.L. and Bitta A.J. Della, Consumer Behavior, Fourth Edition, 2002, Tata McGraw-Hill, New Delhi. Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy, Seventh Edition, 2005, McGraw-Hill Higher Education. Text books Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004, Prentice Hall, India. Wells W.D. and Prensky, D., Consumer Behavior, 1996, John Wiley & sons, Inc. Cr. S.L Gupta and Sumitra Pal., Consumer Behaviour, First Edition 2001. 160 CU IDOL SELF LEARNING MATERIAL (SLM)
UNIT – 10: VALUES AND LIFESTYLE STRUCTURE 10.0 Learning Objectives 10.1 Introduction to values and lifestyle 10.2 Consumer lifestyle 10.3 Factors showing social class differences 10.4 Characteristics of social class 10.5 Prominent social class 10.6 Impact of social class 10.7 Summary 10.8 Keywords 10.9 Learning Activity 10.10 Unit End Questions 10.11 References 10.0LEARNING OBJECTIVES After studying this unit, you will be able to: Explain about the values and lifestyle Discuss the impacts of consumer lifestyle Identify the factors which shows social class differences Examine the characteristics of social class Discuss the impact of social class. 10.1VALUES AND LIFESTYLE - INTRODUCTION Psychographic segmentation divides the market into groups based on social class, lifestyle and personality characteristics. It is based on the assumption that the types of products and brands an individual purchases will reflect that persons characteristics and patterns of living. The following are examples of psychographic factors used in market segmentation: Social class Is the single most used variable for research purposes, and divides the population into groups based on a socio-economic scale.
Lifestyle Involves classifying people according to their values, beliefs, opinions, and interests. There is no one standardized lifestyle segmentation model, instead market research firms, and advertising agencies are constantly devising new categories, which will best help target possible consumers of their clients products. Personality The innate characteristics in an individual that make him or her unique. It is a picture of how a person is looked upon by others around him. Psychographic Segmentation Provides information on personality, motives, lifestyles, geo-demographics Groups consumers based on Activities: work, hobbies, entertainment, shopping Interests: family, home, community, fashion, media Opinions: themselves, politics, economics, culture 10.2 CONSUMER LIFESTYLE It is a constellation of individual characteristics that reflect certain behaviors participation in groups, activities, hobbies, volunteer activities. Commitments to certain behaviours product constellations Lifestyle impacts on Consumer Analysis What type of buying behaviour is preferred? Foundation of time use and time preferences. Patterns of consumption are based on lifestyle People sort themselves into groups based on what they like to do - sports, reading, fishing, music enthusiasts Vales (Value & Lifestyle) Segmentation Based on Value & Lifestyle Orientation Actualizes - successful, many resources Fulfillers - career oriented, practical, principles Achievers - career-oriented, predictability Experiences - impulsive, young, action Believers - strong principles, proven brands Strivers - like achievers, fewer resources Makers - action, DIY Strugglers: difficult life 162 CU IDOL SELF LEARNING MATERIAL (SLM)
Social Class Social Class is the relative standing of members of a society. This means Higher positions imply higher status. We can say that Social class is more of a continuum, i.e., a range of social positions, on which each member of society can be place. But, social researchers have divided this continuum into a small number of specific classes. Thus, we go by this framework, social class is used to assign individuals or families to a social-class category. We can now define social class as the division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and the members of all other classes have either more or less status. 10.3 FACTORS SHOWING SOCIAL CLASS DIFFERENCES 1. Authority 2. Income 3. Occupations and Achievement 4. Education 10.4 CHARACTERISTICS OF SOCIAL CLASS 1. Persons within a given social class tend to behave more alike. 2. Social class is hierarchical. 3. Social class is not measured by a single variable but is measured as a weighted unction of one’s occupation, income, wealth, education, status, prestige, etc. 4. Social class is continuous rather than concrete, with individuals able to move into a higher social class or drop into a lower class. 10.5 PROMINENT SOCIAL CLASS Upper-Uppers Upper-Uppers are the social elite who live on inherited wealth and have well known families. They maintain more than one home and send their children to the best schools. They are in the market for jewelry, antiques, homes, and foreign vacations. While small as group they serve as a reference group to others to the extent that other social classes imitate their consumption decisions. 163 CU IDOL SELF LEARNING MATERIAL (SLM)
Lower Uppers Lower Uppers are persons who have earned high income Upper Middles or wealth through exceptional ability in their profession or Middle class business. They usually come from the middle-class. They Working class tend to be active in social and civic affairs and seek to buy Upper Lowers the symbols of social status for themselves and their children, such as expensive cars, homes and schooling. Their ambition is to be accepted n the upper-upper status, a status that is more likely to be achieved by their children than themselves. Upper Middles possess neither family status nor unusual wealth. The primarily concerned with “career”. They have attained positions as professionals, independent businesspersons, and corporate managers. They believe in education and want their children to develop professional or administrative skills so that they will not drop into the lower stratum. They are civic minded and are a quality market for good clothes, homes, furniture and appliances. The middle class is average paid white and blue-collar workers who try to do the proper things. Often they will buy products to “keep up with the trends”. The middle class believes in spending more money on “worth-while experiences” for their children and aiming them towards professional colleges. Working class consists of “average pay blue collar workers and those who lead a “working class life-style”, whatever income, school or job they have. The working class depends heavily on relatives for economic and emotional support, for tips on job opportunities, advice on purchase, and for assistance in times of trouble. The working class maintains a sharp sex-role division and stereotyping. They are found to have larger families than the higher classes. Upper Lowers are working, though their living standard is just above the poverty line. They perform unskilled work and are poorly paid. Often they are educationally deficient. Although they fall near the poverty line, they 164 CU IDOL SELF LEARNING MATERIAL (SLM)
manage to maintain some level of cleanliness. Lower Lowers Lower Lowers are visibly poverty-stricken and usually out of work. Some are not interested in finding permanent jobs and most are dependent in charity for income. Their homes and possessions are “dirty, ragged, and broken- down”. 10.6 IMPACT OF SOCIAL CLASS Provides a sense of identity Imposes a set of ‘normative’ behaviors Classes share values, possessions, customs and activities Marketing response to customers of different economic means Marketing to the low-income consumer Some marketers ambivalent as not perceived as long-term customers Constitutes a substantial group Target with value-oriented strategies Marketers must be very aware of the social class of their target market. If a marketer wishes to target efforts toward the upper classes, then the market offering must be designed to meet their expectations in terms of quality, service, and atmosphere. A marketer should understand the dynamic of the social class as well. For example, the upper-middle class are generally ambitious, future-oriented people who have succeeded economically and now seek to enhance their quality of life. Material goods often take on major symbolic meaning for this group. Effective marketers will understand that and be able to tailor their approach accordingly. 10.7 SUMMARY Psychographic segmentation divides the market into groups based on social class, lifestyle and personality characteristics. Involves classifying people according to their values, beliefs, opinions, and interests. It is a constellation of individual characteristics that reflect certain behaviors participation in groups, activities, hobbies, volunteer activities. 165 CU IDOL SELF LEARNING MATERIAL (SLM)
Social class is continuous rather than concrete, with individuals able to move into a higher social class or drop into a lower class. Upper Middles possess neither family status nor unusual wealth. The primarily concerned with “career”. They have attained positions as professionals, independent businesspersons, and corporate managers. 10.8 KEYWORDS Personality: The innate characteristics in an individual that make him or her unique. Social class: is not measured by a single variable but is measured as a weighted unction of one’s occupation, income, wealth, education, status, prestige, etc. Upper-Uppers: are the social elite who live on inherited wealth and have well known families. Lower Uppers: are persons who have earned high income or wealth through exceptional ability in their profession or business. Lower Lowers: are visibly poverty-stricken and usually out of work. 10.9LEARNING ACTIVITY 1. What kind of lifestyle will you follow to attract the customers in the store? How will you improve the values and goodwill at the store to retain the customers? ___________________________________________________________________________ _____________________________________________________________________ 2. You may have observed that recently trends in lifestyles are shifting towards personal independence and individualism and a preference for a healthy, natural lifestyle. How will you maintain a healthy lifestyle. ___________________________________________________________________________ _____________________________________________________________________ 10.10 UNIT END QUESTIONS A. Descriptive Questions 166 Short Questions 1. What is meant by social class? 2. State the meaning of lifestyle 3. Mention the segmentation based on values and lifestyle orientation 4. List the factors of social class differences. CU IDOL SELF LEARNING MATERIAL (SLM)
5. State the lower uppers prominent social class. Long Questions 1. Explain about the values and lifestyle 2. Discuss the impacts of consumer lifestyle 3. Explain the prominent social class in detail. 4. Examine the characteristics of social class 5. Discuss the impact of social class. B. Multiple Choice Questions 1. Different social classes tend to have different attitudinal configurations and _______ that influence the behaviour of individual members. a. Personalities b. Values c. Finances d. Decision makers 2. Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors are called__________ a. Cultures. b. Subcultures. c. Social classes. d. Social factors. 3. The stages through which families might pass as they mature over time is a description of what is called the_____ a. Adoption process. b. Lifestyle cycle. c. Values and Lifestyle. d. Family life cycle 4. A ______________ is a person’s pattern of living as expressed in his or her activities, interests, and opinions. 167 CU IDOL SELF LEARNING MATERIAL (SLM)
a. Role b. Status c. Position d. Lifestyle 5. _______are persons who have earned high income or wealth through exceptional ability in their profession or business. a. Lower uppers b. Upper uppers c. Middle class d. Lower lowers Answers 1 – b, 2 – c, 3 – d, 4 – d, 5 – a 10.11 REFERENCES References books Engel, James F.; Blackwell, Roger D.; Miniard, Paul W., Consumer Behavior, 6th ed. Chicago. Loudon, D.L. and Bitta A.J. Della, Consumer Behavior, Fourth Edition, 2002, Tata McGraw-Hill, New Delhi. Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy, Seventh Edition, 2005, McGraw-Hill Higher Education. Text books Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004, Prentice Hall, India. Wells W.D. and Prensky, D., Consumer Behavior, 1996, John Wiley & sons, Inc. Cr. S.L Gupta and Sumitra Pal., Consumer Behaviour, First Edition 2001. 168 CU IDOL SELF LEARNING MATERIAL (SLM)
UNIT - 11: FACTORS OF CONSUMER BEHAVIOUR I STRUCTURE 11.0 Learning Objectives 11.1 Culture 11.2 Ways of culture 11.3 Characteristics of culture 11.4 Determinants of culture 11.5 Dimensions of culture 11.6 Cultural influences 11.7 Variation in cultural values 11.8 The invisible hand of culture 11.9 Culture satisfies needs 11.10 Impact of culture on consumer behaviour 11.11 Effect of culture on consumers 11.12 Components of culture 11.13 Subculture 11.14 Problems of cross cultural marketing 11.15 Cross culture consumer analysis 11.16 Japanese and American cultural traits difference 11.17 Alternative global marketing strategies 11.18 Cultural variations and non-verbal communication 11.19 Summary 11.20 Keywords 11.21 Learning Activity 11.22 Unit End Questions 11.23 References 11.0LEARNING OBJECTIVES After studying this unit, you will be able to: Discuss the external factors of consumer behaviour
Explain the characteristics of culture Discuss the dimensions of culture Explain the impact of culture on consumer behaviour Examine the problems of cross cultural marketing Discuss about the alternative global marketing strategies 11.1CULTURE Consumers don't exist in a vacuum. Their behavior is influenced by the environment in which they live, and this behavior includes their buying behavior. This environment includes families and friends, lifestyle and lifecycle, and the culture and beliefs of their social class. When marketers understand how these influences work, they can often tap into them as they develop marketing strategies. Social factors represent another important set of influences on consumer behaviour. Specifically, these are the effects of people and groups influencing one another through culture and subculture, social class, reference groups, and family. Everybody in this world is a consumer. Every day of our life we are buying and consuming an incredible variety of goods and services. However, we all have different tastes, likes and dislikes and adopt different behavior patterns while making purchase decisions. Many factors affect how we, as individuals and as societies, live, buy, and consume. External influences such as culture, ethnicity, and social class influence how individual consumers buy and use products, and help explain how groups of consumers behave. The study of culture encompasses all aspects of a society such as its religion, knowledge, language, laws, customs, traditions, music, art, technology, work patterns, products, etc. Culture is an extremely critical and all pervasive influence in our life. Meaning For the purpose of studying consumer behavior, culture can be defined as the sum total of learned beliefs, values and customs that serve to guide and direct the consumer behavior of all members of that society. Howard and Sheth have defined culture as “A selective, manmade way of responding to experience, a set of behavioral pattern”. Thus, culture consists of traditional ideas and in particular the values, which are attached to these ideas. It includes knowledge, belief, art, morale, law, customs and all other habits acquired by man as a member of society. An accepted concept about culture is that includes a set of learned beliefs, values, attitudes, habits and forms of behavior that are shared by a society and are transmitted from generation to generation within that society. Culture 170 CU IDOL SELF LEARNING MATERIAL (SLM)
1. Given the broad and pervasive nature of culture, its study generally requires a detailed examination of the character of the total society, including such factors as language, knowledge, laws, religions, food customs, music, art, technology, work patterns, products, and other artefacts that give a society its distinctive flavour. 2. In a sense, culture is a society’s personality. For this reason, it is not easy to define its boundaries. 3. Culture is the sum total of learned beliefs, values, and customs that serve to direct the consumer behavior of members of a particular society. 4. Beliefs consist of the very large number of mental or verbal statements that reflect a person’s particular knowledge and assessment of something. 5. Values also are beliefs; however, values differ from other beliefs because they must meet the following criteria: a) They are relatively few in number. b) They serve as a guide for culturally appropriate behavior. c) They are enduring or difficult to change. d) They are not tied to specific objects or situations. e) They are widely accepted by the members of a society. 6. In a broad sense, both values and beliefs are mental images that affect a wide range of specific attitudes that, in turn, influence the way a person is likely to respond in a specific situation. 7. Customs are overt modes of behavior that constitute culturally approved or acceptable ways of behaving in specific situations. a) Customs consist of everyday or routine behavior. b) Although beliefs and values are guides for behavior, customs are usual and acceptable ways of behaving. c) An understanding of various cultures can help marketers predict consumer acceptance of culture 11.2WAYS OF CULTURE A culture is learned through the following three ways: Formal learning: Parents and elders teach children the proper way to behave. For instance, you have been taught that you need to study to be successful and happy in life. This learning may influence your response both as a student and individual towards education. 171 CU IDOL SELF LEARNING MATERIAL (SLM)
Informal learning: We learn by imitating the behavior of our parents, friends, or by watching TV and film actors in action Technical learning: Instructions are given about the specific method by which certain things to done such as painting, dancing, singing etc. 11.3CHARACTERISTICS OF CULTURE Culture is learned. Culture regulates society norms, standards of behavior, rewards and punishments. Culture makes life more efficient All members follow same norms. Culture is adaptive. Culture is environmental. Multiple cultures are nested hierarchically. 11.4 DETERMINANTS OF CULTURE Culture also determines what is acceptable with product advertising. Culture determines what people wear, eat, reside and travel. Cultural values in India are good health, education, respect for age and seniority. But in our culture today, time scarcity is a growing problem, which implies a change in meals. Some changes in our culture: Convenience: As more and more women are joining the work force there is an increasing demand for products that help lighten and relieve the daily household chores, and make life more convenient. This is reflected in the soaring sale of washing machines, microwaves, pressure cookers, mixer-grinders, food processors, frozen food etc. Education: People in our society today wish to acquire relevant education and skills that would help improve their career prospects. This is evident from the fact that so many professional, career oriented educational centers are coming up, and still they cannot seem to meet the demand. As a specific instance count the number of institutions offering courses and training in computers that has opened in your city. Physical appearance: Today, physical fitness, good health and smart appearance are on premium today. Slimming centers and beauty parlours are mushrooming in all major cities of the country. Cosmetics for both women and men are being sold in increasing numbers. Even exclusive shops are retailing designer clothes. Materialism: There is a very definite shift in the people’s cultural value from spiritualism towards materialism. We are spending more money than ever before on acquiring products 172 CU IDOL SELF LEARNING MATERIAL (SLM)
such as air-conditioners, cars CD players etc, which adds to our physical comfort as well as status. Culture refers to the traditions, taboos, values and basic attitudes of the whole society within which an individual lives. It is essentially associated with a certain nationality or religious identity of an individual. Cultural norms are learnt by an individual from childhood and their influence is so ingrained that it is invisible in daily behaviour. Culture teaches an individual the acceptable norms of behaviour and tells him the rights and wrongs. When an individual deviates from acceptable norms, certain sanctions are imposed on him. Cultural values affect how business is conducted. Culture also affects consumption behaviour. Cultural influences can be seen in the food habits and dressing style of people. It also influences communication (language), attitudes and values that influence consumption patterns. For instance, attitude towards future security and prosperity affects the propensity to save and consume and also affects decisions about possessions. In many Asian countries, having one’s own house is one of the most important indicators of security (it is considered an investment) and lends social standing. 11.5DIMENSIONS OF CULTURE Hoffstede’s Five Dimensions of Culture Culture has a profound impact on the way consumers perceive themselves, products they buy and use, purchasing processes, and the organisations from which they purchase. Marketers, however, are giving more attention to understanding macro cultures and how they affect consumer behavior. Hoffstede found five dimensions of culture that are common among sixty six countries. These dimensions serve as a foundation for characterizing, comparing and contrasting specific national cultures, and they are helpful in identifying environmentally sensitive segments of the market. 1.Individualism versus collectivism (Pursuit of self or group interest) Individualism describes the relationship between an individual and fellow individuals, or the collectivity that prevails in society. Table below depicts the attitudinal and behavioral differences associated with individualism and collectivism. 2.Power distance ( Social inequality and submission to authority) Power distance reflects the degree to which a society accepts inequality in power at different levels in organisations and institutions. It can affect preferences for centralization of authority, acceptance of differential rewards, and the ways people of unequal status work together. Individualism (E.g., United Collectivism (E.g., Hong Kong, States, Australia, Canada Etc) Japan, India) 173 CU IDOL SELF LEARNING MATERIAL (SLM)
Self construal Defined by internal attributes, Defined by important others, personal traits family and friends Role of others Values Self-evaluation e.g., standards of Self-definition e.g., relationships social comparison, sources of with others define self and affect appraisal regarding self. personal preferences. Emphasis Emphasis on separateness, on connectedness, relationships individuality Motivational drives Focus differentiation, relatively Focus on similarity, relatively Behavior greater need to unique Reflective greater need to blend in of personal preferences and needs Influenced by preferences, needs of close others Table 11.1 Individualism versus Collectivism 3.Uncertainty avoidance (Tolerance/avoidance of ambiguity) Uncertainty avoidance concerns the different ways in which societies react to the uncertainties and ambiguities inherent in life. Some societies need well-defined rules or rituals to guide behavior, whereas others are tolerant of deviant ideas and behavior. 4. Masculinity/femininity (Segregation of male and female roles in society) This factor determines the extent to which societies hold values traditionally regarded as predominantly masculine or feminine. For instance, assertiveness, respect for achievement, and the acquisition of money and material possessions areidentified with masculinity; and nurturing, concern for the environment and championing the underdog are associated with a culture’s feminity. 5. Abstract versus associative thinking Creation of value in products based on cause/effect logic or association among events without a logical link. 11.6CULTURAL INFLUENCES Cultural influences are highly conspicuous in communication messages. Use of colours, symbols, language and message sources reflect culture. Many brands associate their messages with a country’s culture to adapt their messages. For instance, Honda, a Japanese brand communicates Indianness and its wide presence in India by using the brand logo in Mehendi (Henna, a local craft of painting one’s hands), Chevrolet uses a popular Indian festival to indicate cultural adaptation, while some food brands such as Pillsbury show the mother serving hot food to her children and thus communicating her love (signifying the role of the mother in the Indian culture) to position their brand’s superior product. The main aim of the multinational brands is to tune their messages according to the cultural specifications of various regions that they operate in. 174 CU IDOL SELF LEARNING MATERIAL (SLM)
11.7 VARIATION IN CULTURAL VALUES There are three broad forms of cultural values as shown in the following figure. Figure 11.1 Values Orientation influencing Behavior I. Other Oriented Values This shows the relationship between individuals and the society. The relationship influences marketing practices. If the society values collective activity, decisions will be taken in a group. It gives rise to following questions which affect consumer behavior. Individual/ collective: Whether individual initiation has more value than collective activity? Romantic orientation: This depicts whether the communication is more effective which emphasizes courtship or otherwise. In many countries a romantic theme is more successful. Adult/ child theme: Is family life concentrated round children or adults? What role do children play in decision-making? Masculine/ Feminine: Whether the society is male dominant or women dominant or balanced. Competitive/ Cooperation: Whether competition leads to success. This is achieved by forming alliances with others. Youth/ age: Are prestige roles assigned to younger or older members of the society. American society is youth oriented and Korean is age oriented. Decisions are taken by mature people in Korea. II. Environment Oriented Values Cleanliness: If a culture lays too much stress on cleanliness. There is scope for the sale of beauty creams, soaps, deodorants, insecticides, washing powder, vacuum cleaner, etc. In 175 CU IDOL SELF LEARNING MATERIAL (SLM)
western countries, a lot of emphasis is placed on this aspect and perfumes and deodorants are widely used. Performance/ status: A status oriented society cares for higher standards of living, and chooses quality goods and established brand names and high prices items. This is true for the United States, Japan, Singapore, Malaysia, Indonesia, Thailand and most Arabic countries. In performance oriented societies, where rewards and prestige is based on an individual’s performance, less importance is given to brand names. Products which function equally well and may not be big brand names are used. Germans do not give the same amount of emphasis to brand names. The marketers adopt strategies accordingly. Tradition/ change: Traditional oriented societies stick to the old product and resist innovation or new techniques. In traditional societies, there is less scope for new products, and old traditional products are in greater demand. In some societies which are upwardly mobile, consumers are looking for modern methods, new products, new models and new techniques. Risk taking/ security: An individual who is in a secure position and takes a risk can be either considered venturesome or foolhardy. This depends on the culture of the society. For developing new entrepreneurs risk taking is a must. It leads to new product development, new advertising themes and new channels of distribution. Security oriented societies have little chances of development and innovation. Problem solving/fatalist: A society can be optimistic and have a problem solving attitude or, be inactive and depend on fate. This has marketing implications on the registering of complaints when consumers are dissatisfied with the purchase of the products. Advertising plays an important part and gives guidance to the consumer, and removes these doubts to a great extent. Nature: There are differences in attitude over nature and its preservation. Consumers stress on packing materials that are recyclable and environment friendly. Some countries give great importance to stop environmental pollution and to recycling of products. Companies like P&G, Colgate-Palmolive captured a great extent of the market by offering products which are less harmful to the environment. They also use ingredients in the products which are not harmful in any way. III. Self-Oriented Values Active/passive: Whether a physically active approach to life is valued more highly than a less active orientation. An active approach leads to taking action all the time and not doing anything. In many countries, women are also taking an active part in all activities. This makes the society a highly active one, where everybody is involved in work. 176 CU IDOL SELF LEARNING MATERIAL (SLM)
Material/ non-material: In many societies money is given more importance, and a lot of emphasis is on being material minded. While in many societies things like comfort, leisure and relationships get precedence over being materialistic. Materialism can be of two types. Instrumental materialism: which is the acquisition of things to enable one to do something or achieve something. Cars are used for transportation. People like to possess things of material value which would help them to bring efficiency. Terminal materialism: is the requisition of materialism for the sake of owing it rather than for use-Art is acquired for owing it. Cultural differences play art important role in this type of materialism. Instrumental materialism is common in the United States of America, where as Japanese advertisements are mostly dominating terminal materialism. Hard work/leisure: This has marketing implications on labor saving products and instant foods. Some societies value hard work and consider it as a fuller life. Others adopt labor saving devices and instant foods to have more leisure time at their disposal. Postponed gratification/ immediate gratification: Should one save for the rainy day or live for the day? Sacrifice the present for the future, or live only for the day? Some countries like The Netherlands and Germany consider buying against credit cards as living beyond one’s means, whereas credit cards are very popular in America and other countries having a different cultural orientation, some prefer cash to debt. Some societies save for tomorrow; others enjoy the present and spend lavishly. Humor/ serious: Should we take life lightly and laugh it off on certain issues or, take everything seriously? This is an- other aspect of culture. Advertising, personnel selling techniques and promotion may revolve around these themes and the way the appeal for a product is to be made in various cultures. 11.8 THE INVISIBLE HAND OF CULTURE 1. The impact of culture is so natural and automatic that its influence on behavior is usually taken for granted. 2. Often, it is only when we are exposed to people with different cultural values or customs that we become aware of how culture has moulded our own behavior. 3. Consumers both view themselves in the context of their culture and react to their environment based upon the cultural framework that they bring to that experience. Each individual perceives the world through his or her own cultural lens. 4. Culture can exist and sometimes reveal itself at different perceived or subjective levels. 5. Those interested in consumer behavior would be most concerned with three “levels of subjective culture: 177 CU IDOL SELF LEARNING MATERIAL (SLM)
a) Supranational level – reflects the underlying dimensions of culture that impact multiple cultures or different societies. b) National level factors – such as shared core values, customs, personalities, and predisposition factors that tend to capture the essence of the “national character” of the citizens of a particular country. c) Group Level factors – are concerned with various subdivisions of a country or society. They might include subcultures’ difference, and membership and reference group differences. 11.9 CULTURE SATISFIES NEEDS 1. Culture exists to satisfy the needs of people within a society a) It offers order, direction, and guidance in all phases of human problem solving by providing “tried and true” methods of satisfying physiological, personal, and social needs. b) Similarly, culture also provides insights as to suitable dress for specific occasions (e.g., what to wear around the house, what to wear to school, what to wear to work, what to wear to church, what to wear at a fast food restaurant, or a movie theater). 2. Cultural beliefs, values, and customs continue to be followed as long as they yield satisfaction. 3. In a cultural context, when a product is no longer acceptable because it’s related value or custom does not adequately satisfy human needs, it must be modified. 4. Culture gradually evolves to meet the needs of society. Cultural influences are highly conspicuous in communication messages. Use of colours, symbols, language and message sources reflect culture. Many brands associate their messages with a country’s culture to adapt their messages. For instance, Honda, a Japanese brand communicates Indianness and its wide presence in India by using the brand logo in Mehendi (Henna, a local craft of painting one’s hands), Chevrolet uses a popular Indian festival to indicate cultural adaptation, while some food brands such as Pillsbury show the mother serving hot food to her children and thus communicating her love (signifying the role of the mother in the Indian culture) to position their brand’s superior product. The main aim of the multinational brands is to tune their messages according to the cultural specifications of various regions that they operate in. 11.10 IMPACT OF CULTURE ON CONSUMER BEHAVIOUR In the process of globalization of a business, one thing that stands out is the need to connect with the customer. A consumer is more than just an asset for a company, he is a parameter through which that company can gauge its success in a market. This is the reason understanding consumer behavior is so important and the factors which shape this behavior are even more so. 178 CU IDOL SELF LEARNING MATERIAL (SLM)
One thing that highly affects the way a consumer behaves is culture. A society’s culture is a reflection of its traditions, norms, values, and customs. The shopping habits of individuals are particularly shaped by these factors. To define a consumer behavior would be akin to defining an umbrella concept of many factors. Consumer behavior depends on attitudes, motives, experiences, perceptions, values, self-concept, culture, family, profession, and reference groups of society. Not surprisingly, a change in any of these would cause a change in consumer behavior too. While it is a well-known fact that a marketer is able to control the consumer buying behavior, the reality is far away from that. A marketer can indeed attract the buyers, but he cannot control them as other factors affect the choices they make. These choices, on the other hand, are dependent upon extrinsic factors such as culture. Here’s a look at how the culture of a place affects the way a consumer thinks, makes choices, and purchases: The Concept of Belief An international market brings with it some financial and cultural limits that are difficult to assess for a new entrant. In order to understand the consumer mindset, therefore, it is critical to know the cultural aspects that they practice. This culture is not just limited to the traditions and customs, it also includes consumers’ thinking style, likes, dislike, language, customs, tools, feelings, and attitudes. The consumer also has different beliefs that he projects on to his choices when purchasing a product. Likewise, different countries have different beliefs according to which they practice the sale and purchase of items. It must be kept in mind, though, that there can also be similarities in the beliefs of different countries which makes it easier for marketers to target more than one country with the same tagline or product. Nevertheless, some of the traditions and beliefs are confined to a single region only which must be considered by marketers. For instance, number four is considered unlucky in Japan, which is why most of the items sold in the country are sold in a group of five. Another example is that of France, where men tend to buy more cosmetic brands and hence the cosmetic industry markets its products differently than in other countries. A Look at Consumer Behavior Before defining the role of culture in consumer buying habits and behaviors, it is important to define what consumer behavior typically depends on. Consumer behavior principally relies upon cultural elements that involve equal and united operating systems, tools, norms, unstated assumptions and values, as well as standards for believing, perceiving, communicating, and evaluating. Migrants from other countries find it particularly difficult to alter their purchasing habits according to the current market, as they are exposed to an extensive variety of cultural groups which ultimately affects their purchasing behavior. 179 CU IDOL SELF LEARNING MATERIAL (SLM)
Additionally, reference groups may contain conflicting beliefs and ideas about products that greatly impacts their purchase habits and choices. This is why marketers should strive to enhance their marketing communication channels that would address these reference groups both locally and globally. Other than that, they should engage micro-marketing and market segmentation to provide tailored marketing messages for each region so that buyers are motivated to purchase the advertised services and products. To prepare tailored marketing messages for each region, it’s better to hire professional localization services. 11.11 EFFECT OF CULTURE ON CONSUMERS To define the culture of a nation, it is imperative to first examine the belief system and values of the people residing there. A culture can be defined as the total average of beliefs, values, and traditions that are directly linked to the consumer behavior of members of a specific society. Generally, both beliefs and values are mental images that affect particular attitudes which, consequently, variates the methods a person uses to make choices in brands and services. For example, a product category like “Audi vs Volvo” would entail customers choosing from among these alternatives, and his preference of a brand over the other will be affected by his common values and beliefs. In contrast to values and beliefs, traditions are habits and suitable ways of behaving, whereas the former is just rules of behavior. An example is the addition of ketchup on an omelet and the preference of green tea over milk tea. Culture determines the consumer’s experiences, beliefs, and values, which in turn is directly linked to attitudes, emotions, social norms, intentions, and behaviors. Personal culture represents the local area. For instance, the people residing in several states in a specific area of South America have similar cultural habits. Religious differences or similarities, on the other hand, are backed by aspects like common core values, personalities, and customs, etc. Groups that influence the choice of consumers are typically sorted into workgroups, shopping groups, friendship groups, and families. 11.12 COMPONENTS OF CULTURE Culture is reflected through the various components that it comprises, viz., values, language, myths, customs, rituals and laws. These are briefly explained as follows: Values Values are the beliefs and ideals shared by the people of a society, for which they have great respect and regard. They could assume both positive (do’s) and negative (dont’s) connotations, and are indicative of appropriate thoughts, feelings and acts of behavior. Language 180 CU IDOL SELF LEARNING MATERIAL (SLM)
Man is a social animal and needs to communicate with others. Language is used as a means to communicate with people in a social set up. It is the common language that binds together the people in a social structure. Myths Myths are legendary folktales and stories that describe events and occurrences, and teach values to society. They are imaginary and fictitious, and comprise characters that are gods, heroes and common men, ultimately aimed at giving lessons to the people, with respect to the causes and effects, good and bad, right and wrong, etc. Myths describe the values that members of a social structure should share. Customs Customs are habitual practices that formulate the established way of doing things and reflect culturally accepted patterns of behavior. They reflect practices that have permanent continuance and are so long established that they have the force of law; in other words they are conventions. People in a social system follow such practices collectively, and the habitual activity gets transmitted from one generation to another. Rituals Rituals are prescribed processes and procedures for conduct of religious or social rites. They are established rites, ceremonies and proceedings that are symbolic in nature. Rituals are collective in nature, comprising many patterns of behavior that are interdependent to each other. Laws Laws are principles, rules and regulations that are formulated/sanctioned by an authority (ruler, government, constitution etc.), and supported/protected by judicial authority. Their basis can actually be found in the society’s values, customs, and rituals. Laws are universally applicable across people in a society/country. They are written collection of rules and regulations to be adhered to by the people, and non-adherence to which would lead to legal action from the judiciary. 11.13 SUB CULTURE Culture can be divided into subcultures. A subculture is an identifiable distinct, cultural group, which, while following the dominant cultural values of the overall society also has its own belief, values and customs that set them apart from other members of the same society. Subcultures are cohesive groups that exist within a larger culture. Subcultures develop around communities that share common values, beliefs, and experiences. They may be based on a variety of different unifying factors. For example, subcultures exist around the following: Geography: Southerners, Texans, Californians, New Englanders, midwesterners, etc. 181 CU IDOL SELF LEARNING MATERIAL (SLM)
Ethnicity: Latinos, Asian Americans, African Americans, etc. Religion: Catholics, Jews, Mormons, Baptists, Muslims, etc. Nationality: Italians, Koreans, Hungarians, Japanese, Ethiopians, etc. Occupation: military, technology worker, state department, clergy, educator, etc. The other important aspect or feature of subculture is that members of a subculture are very much part of the dominant culture. Behaviors of the members of a subculture largely coincide with those of the main culture as shown in the following figure, which is self-explanatory. Figure 11.2 Main cultural behaviour Subcultures can represent huge opportunities for marketers to make a significant impact within a population that may feel underserved by companies operating in the mainstream market. Individuals with strong subculture identity are likely to welcome organizations that seem to understand them, speak their sub cultural language, and satisfy their subculture- specific needs. Based on the varying criteria, there can be different types of sub-cultures. The important subcultural categories are nationality, geographical location, religion, race and caste, gender and age. From a marketing perspective, these could also be discussed as market segments, which need to be studied and assessed carefully before deciding on a product/service offering and formulating a marketing mix for a particular segment(s). - Nationality 182 CU IDOL SELF LEARNING MATERIAL (SLM)
Sub-cultures could be based on nationality. While we are all Asians, we are distinct with respect to culture, and are different in terms of language, customs and traditions etc. Thus, we are classified as Indians, Burmese, Nepalese, Pakistani etc. Geographical location Within a country, we could be different across geography, climatic conditions, regions and terrains, and density of population. This is more so in cases where the country is large and borders spread across a huge population occupying a vast territory. People tend to develop regional affinity and identification, and this gets reflected in the food they eat, clothes they wear, interests they pursue, etc. They constitute as distinct sub-cultures and people across such sub-cultures are different to each other. For example, we can be classified as North Indians and South Indians. As consumers, our needs are different and would translate into various wants, for example i) Differences in food habits, and demand for poori-sabji, paratha, idli-vada etc.; ii)Differences in clothing, and demand for cottons, woolens and silk. Religion People also exhibit differences when it comes to the religions that they belong to. Hindus, Muslims, Christians, Sikhs, Parsis etc. are all different from one another and have different values and beliefs, customs and traditions etc. As consumers, they make purchase choices and purchase decisions that are influenced by the dictates of their religious leaders, scriptures, and holy books. In fact, many products/services are symbolically and ritualistically associated with religion. For example, as per Islam, non-vegetarian food must be “Halal”, and this itself comprises a huge segment that marketers across national boundaries are catering Race and caste Culture and its components also vary across race and caste. Jats, Jaats, Rajputs, Pathans and Yadavs are all different from one another. Such racial sub-cultures also impact buying behavior and consumption patterns. Gender Because gender roles have an impact on acts of behavior, gender constitutes an important cultural sub-group. Males and females across all cultures are assigned different traits and characteristics that make them masculine and feminine. They also perform different roles in society and are two distinct sub-groups. It is true that gender roles have got blurred, and both men and women are performing such roles that they did not perform earlier. Product usage is common to both man and woman; for example, a man shown as using a LG washing machine or making Act II popcorn. Similarly products like shavers and razors exclusive to usage by men, are also being used by women (Gillette thus introduced a razor for 183 CU IDOL SELF LEARNING MATERIAL (SLM)
women). All this has brought about a big socio-economic change and led to cultural transformation. The values espoused by the generation of today is much different to the one espoused by the previous generation. The pace of change has been further accelerated with households no longer being single income households, but turned to dual-income households. The role of women is no longer restricted to bearing children and managing the home. Women have started working outside, and are contributing to household income. This has impacted consumer needs and wants as also the priorities. The impact is evinced on consumption behavior, where the ‘decider’ role is no longer confined to a single person, i.e. the man of the family. Today buying decisions are jointly taken by husband and wife. - Age: Infants, kids, teenagers and adolescents, adults and the aged, may all be looked up as distinct sub-groups. They have different values and beliefs, and all this impacts upon their priorities in life. Daily lifestyles, activities and interests, fashion and accessories, food and diet, etc. receive varying priorities across the various sub-groups. In the United States, many organizations and marketing activities focus on major ethnicity- based subcultures such as Latinos, Asian Americans, and African Americans. Each subculture has distinct experiences living and working within the broader U.S. culture, and it has shared customs and values that shape their consumer needs and preferences. As each of these subcultures grows in size and buying power, they become a distinct market for companies to woo. A noted example of effective marketing to a subculture is Ford Motor Company’s approach to serving the African American community. Ford invests in advertising campaigns that specifically target the black community and celebrate its diversity. Ford supports a number of scholarship and community-building programs at historically black colleges and universities (HBCUs). Through public relations activities, Ford maintains a presence at significant events, such as the Essence Festival and the BET Awards. Major Sub-Cultural Categories and Their Influences on Consumption Subculture may be categorized into many different classes. Here in this unit we shall consider some of the important subcultural groups and show how they affect consumption and marketing decision. Following table shows (though not extensive) major subcultural categories: 184 CU IDOL SELF LEARNING MATERIAL (SLM)
Table 11.2 Major subcultural categories 11.14 PROBLEMS OF CROSS CULTURAL MARKETING Cross-cultural marketing is defined as “the effort to determine to what extent the consumers of two or more nations are similar or different. This will facilitate marketers to understand the psychological, social and cultural aspects of foreign consumers they wish to target, so as to design effective marketing strategies for each of the specific national markets involved.” 1.Problems related to product selection: The marketer going for cross cultural marketing has to select the customers/ market not on the basis of the superficial similarities of age or income, but by using the real motivating factors that prompt them to accept or reject products. 2.Problems related to promotion/marketing communication: e.g. Ariel in the middle east and also Pepsi 3.Problems related to pricing: the marketer has to adjust his pricing policies according to the local economic conditions and customs. 4.Problems related to selection of distribution channels: In Japan, P & G used this to sell soap. 11.15 CROSS CULTURAL CONSUMER ANALYSIS To determine whether and how to enter a foreign market, we need to conduct some form of cross-cultural consumer analysis. Cross-cultural consumer analysis can be defined as the effort to determine to what extent the consumers of two or more nations are similar or different. Such analysis can provide marketers with an understanding of the psychological, social, and cultural characteristics of 185 CU IDOL SELF LEARNING MATERIAL (SLM)
the foreign consumers they wish to target, so that they can design effective marketing strategies for the specific national markets involved. 11.16 JAPANESE AND AMERICAN CULTURAL TRAITS DIFFERENCE Japanese Culture Traits American Culture traits Homogenous Diverse Harmony to be valid and preserved Fight for one’s beliefs/positions Group, not individual, important Individualistic Ambiguous Clear cut General Specific Hold back emotions in public Display emotions in public Process oriented Result oriented Make a long story short Make a short story long Nonverbal communication important Verbal communication important Interested in who is speaking Interested in what is spoken 11.17 ALTERNATIVE GLOBAL MARKETING STRATEGIES Some of us may argue as markets are becoming more and more similar, standardized marketing strategies are becoming more and more feasible. But, some more would argue back that differences between consumers of various nations are far too great to permit a standardized marketing strategy. Whether to use shared needs and values as a segmentation strategy or to use national borders as a segmentation strategy? Shared needs and values would mean to appeal to consumers in different countries in terms of their common needs, values, and goals. Using national borders as a segmentation strategy would mean to use relatively different local or specific marketing strategies for members of distinctive cultures or countries. Product Strategy Standardized Communications Localized Communications Standardized Product Global strategy: Uniform product/ Mixed strategy: Uniform Product/ Localized Product Uniform Message Customized message Mixed Strategy: Customized Local strategy: Customized Product/ Uniform Message Product/ Customized Message Table 11.3Alternative Global Marketing Strategies 1.Favoring a World Brand: A lot of companies have created world brand products that are manufactured, packaged, and positioned in exactly the same way regardless of the country in which they are sold. For instance, Sony sells its Walkman in this fashion. 186 CU IDOL SELF LEARNING MATERIAL (SLM)
2.Adaptive Global Marketing: In contrast to the above, some other organizations imbibe a strategy that adapts their advertising messages to the specific values of particular cultures. A very good example here would be that of McDonald’s, which tries to localize its advertising to consumers in each of the cross-cultural markets in which it operates. 11.18 CULTURAL VARIATIONS AND NON VERBAL COMMUNICATION In a culture we have many variations in non-verbal communications. Each culture assigns a meaning to non-verbal signs utilized by it. There are some variables in non-verbal communication. These are: (a) Use of time (b) Use of space (c) Friendship (d) Agreements (e) Things (f) Symbols (g) Etiquette Time Time is a resource which is distributed equally amongst everybody. Every person has the same amount of time at his disposal. What view individuals and societies take of time makes them different. Some can be classified under monochromic culture and others in polychromic culture. Some of the important differences between monochromic a polychromic culture are give in the table below. Monochromic culture Polychromic culture Do one thing at a time. Do many things at once. Concentrate on the job. Highly distractible and subject to interruption. Take deadlines and schedules seriously. Consider deadlines and schedules secondary. Committed to job. Committed to people and relationships. Adhere religiously to plans. Change plan often and easily. Emphasize promptness. Base promptness on relationship. Accustomed to short term relationships. Prefer long term relationships Table 11.4Differences between Monochromic and Polychromic Culture The meaning of time may be different in different cultures. Some people take time in making decisions according to the importance of decisions. Some insist on coming to the point 187 CU IDOL SELF LEARNING MATERIAL (SLM)
directly in business transactions and are well prepared. Some keep appointments by the minute; others make people wait for a long time. Space Space may be related to prestige rather than the need. The higher the office, the bigger the office space and so on. Americans have the offices of executives on the top floor and tend to separate the office of subordinates. Japanese have their discount stores on the upper floor. Some cultures and individuals maintain a fair distance while transacting, others co-mingle easily. Americans maintain a fair distance while interacting with associates. Arabs stand very close to each other. Friendship Friendship plays an important role in business transactions. Good personal relationship and feelings matter most in a long term agreement. Social contacts developed by parties gain priority over technical specifications. Americans make friends easily, and drop them easily as well, because of both social and geographical mobility. Some cultures like Indian or Latin Americans have lasting relationships that endure for a long time and so does the business. Personal ties, personal trust leads to cooperation and a lot of transaction can take place between parties. Some want to transact business only with those whom they get along and, making money is secondary. Agreements All business when transacted is done under some agreements. These agreements may be written or just on an understanding between the two parties. Most people enter into an agreement, but friendship and kinship are also given a lot of importance. Verbal commitments are also binding in some cultures, where signing a contract is just a mere formality. Things Different cultures attach different meaning to things. Things include products as well as gifts given in certain business and social situations. An appropriate product in the form of a gift is to be carefully chosen. The gifts can be big or small. They can be given openly or presented privately. This depends on the practices followed in that particular country. Some want to make a show of the gift, by giving it in front of others. Others are secretive about it. Symbols and Colours Different countries attach different meanings to symbols, numbers and colours. Symbols can be flowers, triangles, pictures and animals, etc. Some numbers are considered lucky, and others not so lucky, or even unlucky. Colors have different interpretations. Pink is associated with a female, and blue with the male in the US, whereas it is just the opposite in Holland. A list of colors and their interpretations is given below: 188 CU IDOL SELF LEARNING MATERIAL (SLM)
White:Symbol of mourning or death in the Far East, happiness, purity and peace in the United States. Purple:Associated with death in many Latin American countries. Blue:Symbolizes feminity in Holland and masculinity in the United States, Sweden, India, etc. Red:Color for brides and children in India. Sign of masculinity in the UK and France, negative in Nigeria, Germany and positive in Denmark, Rumania and Argentina. Yellow:Sign of death in Mexico, infidelity in France, celebrations in many countries including India. White lilies:Suggestion of death in England. Symbol of Numbers 7: Lucky in India, USA, Morocco, Nicaragua and Czechoslovakia. 13: Unlucky in many countries including India. 4: Symbol of death in Japan. Packing in 4s is avoided. Triangle: Negative in Hong Kong and Taiwan, positive in Columbia. Owl: Wisdom in the United States, bad luck in India. Deer:Speed, grace in the United States; Homosexuality in Brazil. Etiquette These are accepted norms of behavior. Some behavior may be rude or abusive in one culture and quite acceptable in other cultures, e.g. sitting with legs crossed or sitting in a manner that shows the sole of a shoe. In Japan it is considered impolite to say no directly to a business offer. They put it differently, by saying it is very difficult, which means no. The exchange of business cards in Japan is essential, and indicates the level of your status in your business. Similarly, there are many different habits and ways of doing things socially that affect the making of advertisement. Eating with the fork in the right hand and the left hand kept under the table is quite common in America, whereas, in European culture, the fork should be in the left hand and the right hand holding the knife or spoon. These non-verbal communications in different countries or different languages have a direct bearing on the marketing activity and must be taken care of. As people recognize verbal languages, they act accordingly. In a similar manner, non-verbal communication must also be recognized and understood so that there is less misinterpretation. The advertisement of the communication we want to give should be appropriate and match with the culture of the country. 189 CU IDOL SELF LEARNING MATERIAL (SLM)
11.19 SUMMARY An accepted concept about culture is that includes a set of learned beliefs, values, attitudes, habits and forms of behaviour that are shared by a society and are transmitted from generation to generation within that society. Myths are legendary folktales and stories that describe events and occurrences, and teach values to society. A subculture is an identifiable distinct, cultural group, which, while following the dominant cultural values of the overall society also has its own belief, values and customs that set them apart from other members of the same society. Cross-cultural consumer analysis can be defined as the effort to determine to what extent the consumers of two or more nations are similar or different. Friendship plays an important role in business transactions. Good personal relationship and feelings matter most in a long term agreement. Social contacts developed by parties gain priority over technical specifications. Different countries attach different meanings to symbols, numbers and colours. Symbols can be flowers, triangles, pictures and animals, etc. 11.20 KEYWORDS Culture: is the sum total of learned beliefs, values, and customs that serve to direct the consumer behaviour of members of a particular society. Risk taking: An individual who is in a secure position and takes a risk can be either considered venturesome or foolhardy. Values: are the beliefs and ideals shared by the people of a society, for which they have great respect and regard. Customs: are habitual practices that formulate the established way of doing things and reflect culturally accepted patterns of behaviour. Time: is a resource which is distributed equally amongst everybody. Every person has the same amount of time at his disposal. 11.21LEARNING ACTIVITY 1. Culture satisfies the needs and wants of the people within a society.Interpret it ___________________________________________________________________________ _____________________________________________________________________ 190 CU IDOL SELF LEARNING MATERIAL (SLM)
2. Is it practical to assume that people aged 55 and older constitute one large consumer market? What are some approaches to further segmenting this age subculture? ___________________________________________________________________________ _____________________________________________________________________ 11.22 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Define culture 2. List the ways of culture. 3. Explain the characteristics of culture 4. Differentiate individualism versus collectivism 5. List the components of culture 6. What is meant by subculture? Long Questions 1. “Culture is learned through three ways”. Explain 2. Discuss the determinants of culture 3. Examine the dimensions of culture 4. Classify the types of subculture 5. Discuss the values orientation influencing behavior 6. Explain the impact of culture on consumer behavior. B. Multiple Choice Questions 1. _____________ is the most basic cause of a person’s wants and behaviors. a. Culture. b. Social class c. Personality d. Lifestyle 2. In large nations, the population is bound to lose a lot of its homogeneity, and thus _________________ arise. a. Multilingual needs 191 CU IDOL SELF LEARNING MATERIAL (SLM)
b. Cultures c. Subcultures d. Product adaptation requirements 3. Marketing managers should adapt the marketing mix to ___________________ and constantly monitor value changes and differences in both domestic and global markets. a. Sales strategies b. Marketing concepts c. Cultural values d. Brand images. 4. ________plays an important role in business transactions. a. Space b. Friendship c. Agreement d. Things 5. Many sub cultural barriers are decreasing because of mass communication, mass transit, and ________________. a. The rising unemployment situation b. An influence of political power c. The use of new technology d. A decline in the influence of religious values. Answers 1 – a, 2 – c, 3 – c, 4 – b, 5 – c 11.23 REFERENCES References books Engel, James F.; Blackwell, Roger D.; Miniard, Paul W., Consumer Behavior, 6th ed. Chicago. 192 CU IDOL SELF LEARNING MATERIAL (SLM)
Loudon, D.L. and Bitta A.J. Della, Consumer Behavior, Fourth Edition, 2002, Tata McGraw-Hill, New Delhi. Peter, P.J. and Olson, J.C., Consumer Behavior and Marketing Strategy, Seventh Edition, 2005, McGraw-Hill Higher Education. Text books Schiffman, L.G. and Kanuk, L.L., Consumer Behavior, Eight Edition, 2004, Prentice Hall, India. Wells W.D. and Prensky, D., Consumer Behavior, 1996, John Wiley & sons, Inc. Cr. S.L Gupta and Sumitra Pal., Consumer Behaviour, First Edition 2001. 193 CU IDOL SELF LEARNING MATERIAL (SLM)
UNIT - 12: FACTORS OF CONSUMER BEHAVIOUR II STRUCTURE 12.0 Learning objectives 12.1 The influence of roles on consumer purchasing 12.2 Influence of family on consumer purchasing 12.3 Reference groups 12.4 Types ofreference groups 12.5 Influence of reference groups 12.6 Opinion leaders and its charactersitics 12.7 Opinion leaders in marketing 12.8 Major influence on consumer behavior 12.9 Diffusion of innovation 12.10 Stages of innovation 12.11 Summary 12.12 Keywords 12.13 Learning Activity 12.14 Unit End Questions 12.15 References 12.0LEARNING OBJECTIVES After studying this unit, you will be able to: Discuss on the influence of roles on consumer purchasing. Discuss onthe influence of family on consumer purchasing Explain the types of reference groups Interpret the diffusions of innovation Explain the stages of innovation
12.1THE INFLUENCE OF ROLES ON CONSUMER PURCHASING Consumers have different roles in purchasing products and services. Here, a role is defined as the expected behavior of an individual in a society. These roles can be as part of the consumer’s family, employment, or social status, among other things. For example, the role of father can be different than the role of mother in purchasing consumer goods. Although there are many different roles that can influence how a consumer behaves, three in particular are presented here: influencers, prosumers, and personas. The consumer decision process helps you understand the steps people go through when they are deciding whether and what to buy. Many different factors can influence the outcomes of purchasing decisions. Some of these factors are specific to the buying situation: what exactly you are buying and for what occasion. Other factors are specific to each person: an individual’s background, preferences, personality, motivations, and economic status. Because no two people are exactly alike, it is difficult to predict how the tangled web of influencing factors will ultimately shape a final purchasing decision. For marketers, an understanding of these factors provides a more complete view into the mind of the customer. As you learn more about what influences decisions for your particular target segment, product category, brand, and competitive set, you can use these influencing factors to your advantage. What you say to customers, the words you use, the people who say them, the images they evoke all of these things can link back to that web of influencing factors at work in a purchaser’s mind. Great marketing uses those connections powerfully and effectively to win the minds and hearts of customers. Influencers Influencers are people who have a relatively large audience in which to tout their beliefs. In the consumer world, influencers can impact the success or failure of a product by using it or shunning it. A marketer often targets influencers rather than the entire target market, because these influencers can alter the behaviour of other people. Influencers can be influential buyers, retailers, or people, such as journalists or industry professionals (among others). Influencers are sometimes ranked according to six criteria: market reach (how many people the influencer will connect with), independence (no vested interest in product), frequency of impact, expertise, persuasiveness, and thoroughness (the extent to which influence is exerted across the decision lifecycle). Prosumers In its most common usage, a prosumer is usually a serious hobbyist, with similar interests and skills of professionals. For example, the availability and relatively low cost of photography equipment have given rise to many people who are serious about photography but are not usually paid for their work. This is an important role for marketers to consider, as the 195 CU IDOL SELF LEARNING MATERIAL (SLM)
prosumergenerally uses professional (or nearly professional) equipment and has relatively high disposable income. Other examples of prosumers are found in home improvement and cooking segments. Personas A persona is a social role. Marketers often create a “persona” for their products and services in order to represent the different user types in a target market. A marketer may decide his product is best suited for a specific demographic and will define that demographic as clearly as possible. For example, “soccer mom” might be the target market for minivans. A persona may be created to capture the “soccer mom,” perhaps by giving her a name or other defining characteristics. A persona simply helps a marketer get a clearer picture of who will be buying his product. Family Families have a tremendous influence on consumer purchasing. Many factors influence purchasing. A consumer’s family is one of the most significant factors because a family helps shape an individual’s attitudes and behaviours. One way to understand the family’s impact on consumer behaviour is to identify the decision maker for a purchase. A decision maker for a purchase can be a husband, wife, or even a child, and sometimes decisions are made in collaboration. Often, the decision maker changes based on the type of purchase or the size of the purchase. A new refrigerator, for example, is likely to be a joint decision, while a week’s groceries might be selected by a single member of the family. 12.2INFLUENCE OF FAMILY ON CONSUMER PURCHASING Families influence purchases in many ways. At first, the influence of parents is significant because of how parents help their children to develop political and religious beliefs, lifestyle choices, and consumer preferences. Most people are who they are because of their parents. A spouse and children, however, can exert an even more significant force on a consumer’s purchases. Interaction between spouses and the number and ages of children play a particularly powerful role on buying behaviors. These family influences affect how consumers look at purchases more directly than most other social influences on consumer purchasing. Family Life Cycle Another aspect of understanding the impact of families on buying behavior is the family life cycle. Most, though certainly not all, individuals and families pass through an orderly sequence of life stages that can be used to understand their purchasing patterns. A typical adult starts in the bachelor stage of being young and single and then moves to being part of a married couple without children. Then the married couple transition to Full Nest stages, where the family has dependent children living at home. Once the children leave, the family enters the Empty Nest Stage, which is typically where older married couples (working or 196 CU IDOL SELF LEARNING MATERIAL (SLM)
retired) no longer have dependent children living with them. Finally, the individual reaches the “solitary survivor” stage of being an older single person. Consumer behavior and purchasing is different in each of these stages. Understanding the family life cycle is beneficial for marketers because it helps in defining target customers. 12.3REFERENCE GROUPS Reference groups are groups that consumers will look to for help in making purchasing decisions. Figure 12.1 Reference groups Reference groups are groups that consumers compare themselves to or associate with. Reference groups are similar to opinion leaders in that they can have a profound influence on consumer behavior. Reference groups are considered a social influence in consumer purchasing. They are often groups that consumers will look to to make purchasing decisions. So if a reference group endorses a product, either through use or statements about the product, those that look to the group will often purchase that product. On the other hand, if a 197 CU IDOL SELF LEARNING MATERIAL (SLM)
reference group disapproves of a product, those that associate with that group will probably not purchase the product. Reference groups provide points of comparison by which to evaluate attitudes and behaviour. A consumer can either be a member of a reference group (like family) or aspire to belong to agroup. In first case, the individual is said to be in a membership group and in the second, the individual is part of an aspiration group. When an individual joins a group and then rejects the group’s values this type of group is a dis-claimant group for the individual. If an individual avoids the membership of a certain group, this type is called as dissociative group. This means reference groups can also be viewed negatively. 12.4 TYPES OFREFERENCE GROUPS Reference groups can be either formal or informal. Schools, friends, and peers are examples of informal reference groups. Clubs, associations, and religious organizations are usually formal reference groups. Individuals can also be reference groups (usually known as opinion leaders). Additionally, celebrities can be used as a reference group. A company might use a celebrity it feels will match its target market to get that market to purchase its product. For example, a few years ago Shaquille O’Neal was used to endorse Pepsi because Pepsi felt he represented the spirit of teenagers of the time. Reference groups can be divided into two major types: A normative reference group influences your norms, attitudes, and values through direct interaction. Examples of your normative reference groups include your parents, siblings, teachers, peers, associates and friends. A comparative reference group is a group of individuals whom you compare yourself against and may strive to be like. Examples include celebrities and heroes. 12.5 INFLUENCE OF REFERENCE GROUPS Reference groups can and do have a tremendous influence on purchasing decisions. This is evident in a number of ways, such as through roles. Everyone is expected to behave in a certain way based on the reference group we belong to. Students act like students. In keeping with this idea, people will often modify their own behavior to coincide with group norms (even those that profess non-conformity are in some ways conforming with other people who want the same thing). Reference groups communicate through opinion leaders, who influence what others do, act, and buy. In the consumer world, this means that if a reference group purchases a product, those that associate with the group likely will as well. 198 CU IDOL SELF LEARNING MATERIAL (SLM)
12.6OPINION LEADERS AND ITS CHARACTERSITICS Opinion leaders are people consumers look to for guidance in making purchase decisions, usually someone with more knowledge of the subject. Our purchase decisions are influenced by any number of people or groups. We often look to opinion leaders for help in our consumer decisions. Opinion leaders are usually people who are more knowledgeable about a certain product or service than the average consumer. As such, opinion leaders can shape how a product is viewed. Consumers are constantly seeking out the advice of knowledgeable friends or acquaintances who can provide information, give advice, or actually make the decision. For some product categories, there are professional opinion leaders who are quite easy to identify–for instance, auto mechanics, beauticians, stock brokers, and physicians. All these professionals can influence the decisions consumers make within their area of expertise. Sometimes, these opinion leaders can actually be groups, known as reference groups. Characteristics Opinion leaders are generally people who have the ability to influence others. They usually have deeper expertise in a certain area, and are often looked to for help in making consumer decisions. For example, a local high school teacher may be an opinion leader for parents in selecting colleges for their children. Often, an opinion leader is among the first to use a new product or service, and can then pass on his or her opinions of the product to others. Opinion leaders are often trusted and unbiased and have the social network of friends, family, and coworkers necessary to disperse information. 12.7OPINION LEADERS IN MARKETING Opinion leaders are particularly useful in marketing. If a marketer can identify key opinion leaders for a certain group, she can then direct her efforts towards attracting these individuals. In marketing, celebrities are often used as opinion leaders. Although they may not actually know more about a product or service, there is usually the perception that they do. Celebrity endorsements in marketing are a way to give clout to a product or service. Opinion leaders can have a profound influence on the success of a product, and on one’s own consumer purchases. 12.8MAJOR INFLUENCE ON CONSUMER BEHAVIOR Marketers should understand that a person’s social class will have a major influence on the types and quantity of consumer goods purchased. A major influence on one’s purchasing habits and consumer behavior is the social class in which one finds him or herself. Social class is considered an external influence on consumer 199 CU IDOL SELF LEARNING MATERIAL (SLM)
behavior because it is not a function of feelings or knowledge. Social class is often hard to define; in fact, many people dispute the existence of social classes in the United States. Usually, however, people are grouped in social classes according to income, wealth, education, or type of occupation. Perhaps the simplest model to define social class is a three- tiered approach that includes the rich, the middle class, and the poor. Other models have as many as a dozen levels. People in the same social class tend to have similar attitudes, live in similar neighbourhoods, dress alike, and shop at the same type of stores. Social class can have a profound effect on consumer spending habits. Perhaps the most obvious effect is the level of disposable income of each social class. Generally, the rich have the ability to purchase more consumer goods than those with less income, and those goods are of higher quality. There is also a distinction in the type of goods purchased. For example, the upper class tend to be the primary buyers of fine jewelry and often shop at exclusive retailers. The lower class, in contrast, are much more concerned with simply getting by; they focus more on necessities. 12.9DIFFUSION OF INNOVATION Products tend to go through a life cycle. Initially, a product is introduced. Since the product is not well known and is usually expensive (e.g., as microwave ovens were in the late 1970s), sales are usually limited. Eventually, however, many products reach a growth phase sales increase dramatically. More firms enter with their models of the product. Frequently, unfortunately, the product will reach a maturity stage where little growth will be seen. For example, in the United States, almost every household has at least one color TV set. Some products may also reach a decline stage, usually because the product category is being replaced by something better. For example, typewriters experienced declining sales as more consumers switched to computers or other word processing equipment. The product life cycle is tied to the phenomenon of diffusion of innovation. When a new product comes out, it is likely to first be adopted by consumers who are more innovative than others they are willing to pay a premium price for the new product and take a risk on unproven technology. It is important to be on the good side of innovators since many other later adopters will tend to rely for advice on the innovators who are thought to be more knowledgeable about new products for advice. 200 CU IDOL SELF LEARNING MATERIAL (SLM)
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