MODULE- 5

External influences on Consumer

Behavior
A) Social Class and Consumer
Behavior

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SIMPLE MODEL OF
CONSUMER
BEHAVIOR
Motives
Attitudes

Needs Consumer
Purchase
Decision Learning

Family
Perception

Personality
Internal
Factors
Economic External
Factors
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INTRODUCTION

 Consumer purchasing decisions are often affected by factors

that are outside of their control but have direct or indirect impact on
how we live and what we consume.
 Consumers are faced with many external influences,
including an individual’s culture, subculture, household structure,
and groups that he/she associates with.
 Marketers and business owners call these external influences
because the source of the influence comes from outside the person
rather than from inside.
 Both internal and external factors are inter connected and
work together to assist the consumer decision making process.

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 INFLUENCING FACTORS
IN CONSUMER DECISION
MAKING

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 The division of
members of a society
into a hierarchy of
distinct status classes,
Social Class so that members of
each class have either
higher or lower
status than members
of other classes.

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 The dynamics of status consumption
Social Class and Social Status
• Status is frequently thought of as the
relative rankings of members of each social
class
– wealth Social Comparison Theory
states that individuals
– power
compare their
– prestige own possessions against those
of others to determine their
relative social standing.

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 The dynamics of Status Consumption

Status Consumption

The process by which consumers actively increase their social

standing through conspicuous consumption or possessions

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 Convenient Approaches to
Social Class
• Social status is usually defined in terms of
one or more of the following
socioeconomic variables:
– Family Income
– Occupational Status
– Educational Attainment

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 Percent Distribution of Five-Category
Social-Class Measure

SOCIAL CLASSES PERCENTAGE

Upper 4.3
Upper-middle 13.8
Middle 32.8
Working 32.3
Lower 16.8
Total percentage 100.0

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 Social Class Measurement
Subjective Measures: individuals are asked to estimate their own social-
class positions

 Lower class
 Lower-Middle class
 Upper-Middle Class
 Upper class
 Do not Know/Refuse to answer

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 Reputational Measures:
Informants make judgments concerning the social-class membership
of others within the community
The Variables are measured through questionnaires that ask
respondents several questions about themselves, families, etc.

Objective Measures:
Individuals answer specific socioeconomic questions and then are
categorized according to answers

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 Objective Measures
• Single-variable indexes • Composite-variable
– Occupation indexes
– Education – Index of Status Characteristics
– Income (Weighted measure of the
– Other Variables socioeconomic variables like
occupation, source of income,
house type etc
– Socioeconomic Status Score
(Combines three basic
socioeconomic variables:
occupation, family income &
educational attainment

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 Characteristic features of Social Classes
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 function 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

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 Social Class Mobility

• Individuals can move either up or down in social class standing from

the class position held by their parents

• Upward Mobility: is when Individuals move up in social class

standing from the class position held by their parents.

Reasons for upward mobility: free education and opportunities for self
development and self advancement

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 Downward mobility: is when Individuals move down in
social class standing from the class position held by their
parents.

Some young adults are likely to find it difficult to ‘do better'

than their successful parents, and may not do as well as
their parents (e.g. to get better jobs, own homes ,have more
savings)

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 Geodemographic Clusters
The families of similar socio economic backgrounds tend to
reside in the same neighborhoods or communities-that is
they cluster together.

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 A composite
segmentation strategy
that uses both geographic
variables (zip codes,
Geodemographic
neighborhoods) and
Clusters demographic variables
(e.g., income, occupation)
to identify target
markets.

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 Social Stratification

Social stratification is 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 members
of all other classes have either more or less.

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 Factors responsible for social stratification

• Authority
• Income
• Occupation and achievement
• Education

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 Five social –class categories in
India
• Upper class
• Upper middle class
• Middle-middle class
• Lower-middle class
• Lower class

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 Upper class

• Top-level executives, celebrities, heirs; high-rung

politicians,
• Small number of well-established families
• sponsor major charity events
• Serve as trustees for local colleges and hospitals
• May be heads of major financial institutions,
owners of major long-established firms

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 Upper middle class
Career oriented

Young, successful professionals, corporate managers, and business owners

Most are college graduates, many with advanced degrees

Active in professional, community, and social activities

Have a keen interest in obtaining the “better things in life”

Their homes serve as symbols of their achievements

Consumption is often conspicuous

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 Middle-middle class
• White collar workers

• Want to achieve respectability and be accepted as good

citizens

• Want their children to be well behaved

• Prefer a neat and clean appearance

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 Middle-middle class in India
 An average family of 4.3 people lives typically in a 900sf apartment; 71% own properties, but only
9% have a mortgage

 19% own cars, 100% of households have TVs, 91% have mobile phones and 20% have credit cards

 Household savings are low at 13% of annual income; mainly to meet emergency needs, healthcare
and education costs.

 Risk aversion is high: 84% have not taken loans, only 11% have invested in equities (keeps
changing

 Land and properties account for 51% of wealth, with 30% in cash and deposits

 Half of households have seen their income rise in the past 12 months, of which one third saw income
rise more than 20%

 Children’s future and education a key concern and priority; other major concerns are rising prices
and medical costs

 Very high aspirations for children with 43% wanting their kids to get a master’s degree and 29% a
doctorate

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 Lower-middle class
 The lower middle class is said to consist of "semi-professionals" and
lower level white collar employees

 These are people in technical and lower-level management positions

who work for those in the upper middle class as lower managers,
craftspeople, and the like.
 They enjoy a reasonably comfortable standard of living. Generally,
they have a Bachelor's and sometimes Masters college degree.

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 THE LOWER CLASS--ROCK BOTTOM

•Poorly educated, unskilled laborers

•Often out of work

•Children are often poorly treated

•Tend to live a day-to-day existence

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  Culture is an underlying determinant of human
behavior

 Howard and Sheth have defined Culture as “A

selective ,manmade way of responding to experience, a
set of behavior pattern”

 [Link] and Naresh K Malhotra have defined

culture as “The complex whole that includes
knowledge, beliefs, art, law, morals, customs and any
other capabilities and habits acquired by humans as a
members of society”

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 Characteristics of culture
 Culture is learnt

 Culture is shared

 Culture include inculcated values

 Culture as gratifying responses

 Cultures are similar but different

 Culture is not static

 Culture shapes behavioral pattern in an individual.

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 Issues in Culture
 Enculturation and acculturation

 Language and symbols

 Ritual (Custom)

 Cultural values

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  Enculturation:
 Acquisition of one’s own culture-institutions of
enculturation include family, educational institutions,
houses of worship and mass media

 Acculturation: Learning of a foreign or a new culture-

through mass media

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 Language and Symbols
 Culture is learned and shared through a common language and
symbols

 Non-verbal communication includes the use of symbols as

figures, colors, shapes etc to lend additional meaning to print
or broadcast information & to packaging products & services.

 E.g. The world Mercedes has symbolic meaning- To some it

suggests a fine luxury automobile, to others it implies wealth
& status, to still others it reminds them of a woman named
Mercedes.

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 Rituals (Custom)
 A type of symbolic activity consisting of a series
of steps occurring in a fixed sequence and
repeated every time

 They can be public, elaborate, religious or they

can be individual and mundane

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 Cultural values
 Widely held belief that endures over time-they provide inclination
to respond in standard ways-criteria for standard behavior-core
values and instrumental values

 Core values or terminal values-are common across societies-end

states of existence-enables choice of product class

 Instrumental values-way to achieve core values varies from one

society to another—modes of conduct-enables brand choice

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 Selected Rituals
SELECTED RITUALS and ARTIFACTS
TYPICAL Associated Artifacts
Wedding Silk saris, jewellery, kurtas, beauty
packages
Baby care products, towels, baby wraps, silver bowls etc spoons
Birth of child
Birthday Greeting Card, balloons, presents, cake with candles

Wedding Catered party, card and gift, display of

anniversary photos of the couple’s life together
Graduation Pen, card
Valentine’s Day cards, flowers and gifts
New Year’s Eve Greetings, party,

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 Subcultures and Consumer
Behavior

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 A distinct cultural
group that exists as an
Subculture identifiable segment
within a larger, more
complex society.

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 Examples of Major Subcultural Categories
CATEGORIES EXAMPLES
Nationality Greek, Italian, Russian
Religion Hindu, Muslim, Christian
Geographic region North, South west, east

Race African, American, Asian etc

Age Senior citizen, teenager, elderly

Gender Female, Male

Occupation Professionals, businessman

Social class Lower, middle, upper

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 Sub cultural division and Consumption pattern in India
 Each state and religion has got its own traditional style of dressing,
wearing ornaments, food preferences etc

 In North India wheat and wheat products are consumed more, In South
India rice and rice products are consumed more

 Certain communities consume vegetarian food, certain communities

consume non-vegetarian food

 In Rural-urban sub cultural division the consumption pattern varies

with regard to preferences in food items, housing clothing, transport
vehicle used saving pattern etc

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 Types of Sub Culture
1. Nationality Subculture

2. Religious Sub cultures

3. Geographic and Regional Subcultures

4. Racial Subcultures

5. Age Subculture

6. Gender as a subculture

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 [Link] Subculture
Nationality subcultures serve their members in three ways:
– To provide a source of psychological group
identification

– To offer a patterned network of groups and institutions

supportive of the subculture

– To serve as a frame of reference through which to

evaluate the dominant culture.

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 E.g. to Nationality Subculture Marketing to African Americans
African American consumers expect respect within the marketplace
and must feel a sense of acceptance.

When they seek subculture-specific products they use media targeted to

the subculture.

Use of black models in advertising is important to them.

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 [Link] Based on Religion
 Beliefs are a major influence on marketplace behavior.

 Generalizing based on religion must be done carefully.

 Religious calendars influence product selection.

 Geographic concentrations of religious sects are also important

to marketers

 Media choice depends upon sensitivity to lifestyle and behavior

patterns.

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 [Link] and Regional Subcultures
 Many regional differences exist in consumption behavior

 In North India wheat and wheat products are consumed

more, In South India rice and rice products are consumed
more

 Westerners have a mug of black coffeeEasterners have a

cup of coffee with milk and sugar

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 [Link] Subcultures

 Subcultures based on one’s race

 The African-American Consumer

 Asian-American Consumers

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African
African Americans
Americans and
and
Mainstream
Mainstream Media
Media
Watch
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ofTV
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on
Major
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Heavy
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ofLocal
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Now
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Account for
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of the
thePeople
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areMore
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RaciallyIntegrated
Integrated

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Black-Oriented
Black-Oriented Media
Media
Depict
Depict Blacks
Blacks
Black
BlackSports
Sportsand
and More
MorePositively
Positively
Celebrity
CelebrityFigures
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are
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Retailers
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are Black-Oriented
Targeting New
NewGeneration
Generation
Targeting Media
African of
of Magazines
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AfricanAmericans
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Have
HaveSpecific
Specific
Romance
RomanceNovels
Novels

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Reaching
Reaching the
the Asian
Asian American
American
Consumer
Consumer
Translating Advertising Overlooked Complex
Messages Into Asian Differences Among
Media Asian Subcultures

Problems
Encountered
by American
Marketers
Lack of Media Available Been Insensitive to
to Reach Asian Cultural Practices
Americans

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 [Link] Subcultures

Generation X Generation Y
Market Market

Seniors Baby Boomer

Market Market

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 Born between 1977
and 1994; also called
Generation
echo boomers and
Y
millennium
generation

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 Born between 1965
Generation X and 1979; post baby
boomer segment

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 Individuals born
between 1946 and
1964 (approximately
Baby 45% of the adult
Boomers population).They are
broad category that
extends from about 40
to 60.

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 Baby Boomers
 The largest age category alive today

 Frequently make important consumer purchase decisions

 Include a small subsegment of trend setting consumers

(yuppies) who influence consumer tastes of other age
segments

 Yuppies constitute 5 percent of population, but they are well

off financially, well educated & often are associated with
brand names a such as BMWs , Rolex Watches etc.

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 Generally older
consumers. Consist of
Seniors subcultures, including
the “elderly
consumers” market.

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 Three Senior Subsegments
• The Young-Old (65-74)
• The Old (75-84)
• The Old-Old (85 and older)

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 [Link] as a Subculture
Gender Roles and Consumer Behavior
– Masculine vs. Feminine Traits
– A recent study found that men & women exhibit different
reactions to identical print ads. Women show superior affect &
purchase intention towards ads that are verbal, harmonious &
category-oriented.
– In contrast, men exhibit superior affect & purchase intention
towards ads that are comparative, simple & attribute oriented.
The Working Woman

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 Segmenting the Female Market
• Four Segments:
– Stay-at-Home Housewives
– Plan-to-Work Housewives
– Just-a-Job Working Women
– Career-Oriented Working Women

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 Cross-cultural consumer analysis

• A cross-cultural analysis involves the study of similarities and

differences among consumers in two or more nations or
societies

• The cross-cultural analysis creates an understanding about

values, customs, (Customs are the norms and expectations
about the way people do things in a specific country.)
symbols, & languages of other societies.

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 Some Comparisons
Chinese Cultural Traits American Cultural Traits
• Centered on Confucian • Individual centered
doctrine
• Emphasis on self-reliance
• Submissive to authority

• Ancestor worship • Primary faith in rationalism

• Values a person’s duty to • Values individual personality

family and state

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 • The greater the similarity between the nations ,the more
feasible it is to use relatively similar marketing strategies
in each nation. (International airlines commercials like
American Airlines, Continental Airlines etc for upscale
international business travelers)

• On the other hand ,if the cultural beliefs ,values, and

customs of specific target countries are found to be differ
widely ,then a highly individualized marketing strategy is
indicated for each country (Nike in china hiring Chinese
speaking people to develop the commercial)

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 The learning of a
Acculturation new “foreign”
culture.

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 Acculturation
• …process by which a culturally myopic view is
overcome

– First, the marketers must thoroughly orient

themselves to the values, beliefs and customs of the
new society to appropriately position and market
their products
• An appreciation of China’s ‘one child’ policy means that
foreign businesses will understand that Chinese families
are open to particularly high quality baby products for
their single child

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 The Growing global middle class
• A new global middle class is rising up from poverty in emerging economies around
the world, providing competition for labor and resources, but also enormous promise
for multinationals that tailor products and services to the budding ranks of first-time
consumers, according to Wharton faculty and analysts.

• Coca-Cola's newly appointed chief executive Muhtar Kent sees this market as
critical to his company's future and describes the scale of the opportunity as
equivalent to adding a city the size of New York to the world every three months.

• The World Bank estimates that the global middle class is likely to grow from 430
million in 2000 to 1.15 billion in 2030. The bank defines the middle class as earners
making between $10 and $20 a day

• A look at the geographic distribution is striking. In 2000, developing countries were

home to 56% of the global middle class, but by 2030 that figure is expected to reach
93%. China and India alone will account for two-thirds of the expansion, with China
contributing 52% of the increase and India 12%, World Bank research shows.

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 Basic Research Issues in Cross-Cultural
Analysis
FACTORS EXAMPLES
Differences in language and meaning Words or concepts may not mean the
same in two different countries.
Differences in market segmentation The income, social class, age, and sex of
opportunities target customers may differ
dramatically in two different countries.

Differences in consumption patterns Two countries may differ substantially

in the level of consumption or use of
products or services.

Differences in the perceived benefits of Two nations may use or consume the
products and services same product in very different ways.

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 continued
FACTORS EXAMPLES
Differences in the criteria for evaluating The benefits sought from a service may
products and services differ from country to country.
Differences in economic and social The “style” of family decision making
conditions and family structure may vary significantly from country to
country.

The availability of
Differences in marketing professional consumer researchers
research possibilities may vary considerably from country
to country.

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  Research technique should also be customized
according to the countries they are evaluating as
potential markets

 Marketers must learn how to design research that

will yield useful data

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 Cross cultural Marketing problems and
Strategies to over come
 Product Problems

 Promotional Problems

 Pricing Problems

 Distribution Problems

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 Product Problems: International marketers have to select
product to meet local customs and tastes.

They have to be careful in product selection. Especially in

food products, soft drinks and personal care products they
have to be extra cautious

Marketers need to ensure that products are matched with the

needs of the specific overseas market

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 There's No Beef or Pork in Any
McDonald's in India...

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  McDonald's doesn't serve any beef or pork in any form, in
ANY of their 123 outlets (and counting) across the
country!

 Instead of ground beef and pork patties, the McDonald's

Menu in India features Indian burgers that are 100 percent
vegetarian - burger look-a-likes of potatoes, peas, and
carrots, with a little Indian spice thrown in

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 Consider Color
• Meanings of Blue • Meanings of Yellow
– Holland - warmth – U.S. - warmth
– Iran - death
– Sweden - coldness
– India - purity

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 Promotional Problems
Marketer has to communicate with the unfamiliar
target audience with unfamiliar communication
modes

Cultural dynamics and the specific buying motives

of the target customers must be kept in mind while
forming the promotional tool

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 Pricing Problems:
Each country has its own method of deciding on the
price front for foreign products

Marketers have to adopt a market oriented pricing

policy suitable to the economic environment

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 Distribution Problems
Since there is distance between the producer and the
foreign consumer, marketer has to cope with
problems related to selecting a suitable channel.

Distribution channel must be such that it should be

adapted to an individual foreign market

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 What is a Group?

• Two or more people who interact to

accomplish either individual or mutual
goals

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 NATURE OF GROUPS
• Two or more people
• Collective identity
• Interaction
• Shared goal interest

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 Types of Groups
• Primary Group Groups consisting of intimate, face-to-face interaction
and relatively long-lasting relationships. 
• Secondary Group Groups with large membership, less intimate, and
less long lasting.
• Formal Group :Formerly structured in a hierarchical order like
president-executive-secretary.
• Informal :The structure of the group is loosely defined
• Membership: A membership group is one to which a person either
belongs or would qualify for membership
• Symbolic Groups: A symbolic group is one in which an individual is
not likely to receive membership despite acting like a member
(aspirational group)

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 Reference Group
A person or group that serves as a point
of comparison (or reference) for an
individual in the formation of either
general or specific values, attitudes, or
behavior.

From marketing perspective ,reference groups are groups that

serve as frames of reference for individuals in their purchase or
consumption decisions.

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 Broad Categories of
•
Reference
Normative Reference
Groups
Groups
• Comparative
Reference Groups

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 • Normative Reference Groups: Reference group
that influence general or broadly defined values or
behaviors are called Normative Reference
Groups.
• E.g. Child’s normative reference group is
immediate family .It plays a major role in molding
the child’s general consumer values and behavior
(such as which food to select for good nutrition
,appropriate way to dress for specific occasions)

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 • Comparative Reference Groups:
Reference groups that serve as benchmarks for
specific or narrowly defined attitudes or behaviors
are called comparative reference group.
E.g. A comparative reference group might be a
neighboring family whose life style appears to be
admirable and worthy of imitation .Their home,
furniture, clothing style etc seems to be attractive .

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 Indirect Reference Groups

Individuals or groups with whom a

person identifies but does not have direct
face-to-face contact, such as movie stars,
sports heroes, political leaders, or TV
personalities.

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 Types of reference groups
1. Normative Reference Groups
2. Comparative Reference Groups
3. Indirect Reference Groups
4. Contactual group (the group in which the person interacts and has
regular contact like family, friends coworkers)
5. Aspirational Group( an individual wishes to belong)
6. Disclamant group: here a person may have membership face to
face contact but he disapproves the group values, attitudes and
behaviors
7. Avoidance group: here a person may not have membership nor
have face to face contact and also disapproves the group values,
attitudes and behaviors

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 Friendship Groups

Shopping Groups

Work Groups

Virtual Groups or Communities

Brand Communities

Consumer-action Groups

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 Friendship groups are typically classified as informal groups because they
are usually unstructured and lack specific authority levels.

In terms of relative influence, after an individual’s  family, his or her friends

are most likely to influence theindividual’s  purchase decisions.

Seeking and maintaining friendships is a basic drive of most people.

Friendsfill a wide range of needs: They provide companionship, security,

and opportunities to discuss problems that an individual may be reluctant to
discuss with family members.
Marketers of products such as brand-name clothing, fine jewelry,
snack foods, and alcoholic beverages recognize the power of peer
group influence and frequently depict friendship situations in their
advertisements.

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 Two or more people who shop together, whether for food, for clothing, or
simply to pass the time, can be called a shopping group.

Such groups are often offshoots of family or friendship groups and

therefore, they function as what has been referred to as purchase pal.

 The motivation for shopping with a purchase pal range from a primarily
social motive to helping reduce the risk when making an important
decision.

A special type of shopping group is the in-home shopping party, which
typically consists of a group that gathers together in the same home of a
friend to attend a “party”   devoted to demonstrating and evaluating a
specific line of products.

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 Thesheer amount of time people spend at their jobs, frequently more than
35 hours per week, provide ample opportunity for work groups to serve as
a major influence on the consumption behavior of the members.

Formal Work Group: it consists of individuals who work together as part

of a team, and thus have a sustained opportunity to influence each other’s
consumption related attitudes and actions.

Informal Work Group: it consists of people who have become friends as

a result of working for the same firm, whether or not they work together as
a team, and they can influence the consumption behavior of other members
during coffee or lunch breaks or at after-work meetings.

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 A virtual team (also dispersed
known as a geographically
team or distributed team) is a group of individ
space and organizational boundaries with links strengthened by webs
of communication technology.

Powell, Piccoli and Ives define virtual teams in their literature review
article "as groups of geographically, organizationally and/or time dispersed
workers brought together by information and telecommunication
technologies to accomplish one or more organizational tasks.”
Ale Ebrahim, N., Ahmed, S. & Taha, Z. in their recent (2009) literature
review paper, added two key issues to definition of a virtual team “as  small
temporary groups of geographically, organizationally and/ or time
dispersed knowledge workers who coordinate their work predominantly
with electronic information and communication technologies in order to
accomplish one or more organizationtasks”.

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 Members of virtual teams communicate electronically and may
never meet face-to-face.

Virtual teams are made possible by a proliferation of fiber

optic technology that has significantly increased the scope of off-
site communication.
Virtual teams allow companies to procure the best talent without
geographical restrictions.
According to Hambley, O’Neil,  & Kline (2007), "virtual teams
require new ways of working across boundaries through systems,
processes,
technology, and people, which requires effective
leadership...despite the widespread increase in virtual teamwo
there has been relatively little focus on the role of virtual team
leaders."
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A brand community is a community formed on the basis of attachment to
a product or marquee.

Recent developments in marketing and in research in consumer

behavior result in connection
stressing the
between brand, individual identity and cu
developed to explain the behavior of consum
community focuses on the connections betw
A brand community can be defined as an enduring self-selected group of
actors sharing a system of values, standards and representations (a culture)
and recognizing bonds of membership with each other and with the whole.

Brand communities are characterized in shared consciousness, rituals and

traditions, and a sense of moral responsibility.

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 The term "brand community" was first presented by Albert Muniz Jr. and
Thomas C. O'Guinn in a 1995 paper for the Association for Consumer
Research Annual Conference in Minneapolis, Minnesota.
In a 2001 article titled "Brand community", published in the Journal of
Consumer Research (SSCI), they defined the concept as "a specialized, non-
geographically bound community, based on a structured set of social relations
among admirers of a brand." This 2001 paper has been acknowledged
by Thomson Scientific & Healthcare to be one of the most cited papers in the
field of economics and business.
Many brands provide examples of brand communities. In computers and
electronics: Apple Inc. (Macintosh, iPod, iPhone), Holga and LOMO cameras,
and Palm and Pocket PC Ultra-Mobile PCs.
In vehicles: Ford Bronco, Jeep, automobiles, and
Royal Enfield and Harley-Davidson motorcycles.
In toys: Barbie and Lego.

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A particular kind of consumer group-A Consumer Action Group-has emerged
in response to the consumerist movement. Today there are a large number of
such groups that are dedicated to providing consumer products in a healthy and
responsible manner, and to generally add to the overall quality.
For example, a diverse range of consumer concerns being addressed by private
and public consumer-action groups: neighborhood crime watch, youth
development, forest and wildlife concerns, children and advertising, race and
ethnicity, community volunteerism, legal assistance, public health, disaster
relief, energy conservation, education, smoking, the environment, access to
telecommunications, science in the public interest, credit counseling, privacy
issues, and children and internet.
Two broad categories of Consumer Action Groups:
Those that organize to correct a specific consumer abuse and then disband
(Agitation against liquor shop in a community) .

Those that organize to address broader, more persuasive problem areas and
operate over an extended or indefinite period of time (Group against drunk
driving).

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 Factors that affect reference group
influence
• Information and experience (firsthand
experience and no experience)
• Credibility, attractiveness and power of the
reference group
• Conspicuousness of the product (luxury item
vs. ordinary item)

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 Reference Group Appeals

• Celebrities
• The expert
• The “common man”
• The executive and employee
spokesperson
• Trade or spokes-characters

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 Types of Celebrity Appeals
TYPE DEFINITION EXAMPLE
Testimonial Based on personal usage, a Shahrukh khan in
celebrity attests to the quality Navratna tel
of the product or service
Endorseme Celebrity lends his name and Rahul Dravid for
nt appears on behalf of a product anti AIDS campaign
or service with which he/she
may not be an expert
Actor Celebrity presents a product or
service as part of a character
endorsement
Spokespers Celebrity represents the brand Amitabh for pulse
on or company over an extended polio
period of time

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 (a) Actual referent is a “typical” consumer (b) Symbolic referent The famous cricketer

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A second type of reference group appeals used by
marketers is the expert, a person who, because of his or
her occupation, special training, or experience, is in a
unique position to help the prospective consumer
evaluate the product that the advertisement promotes.

e.g. An ad for a quality frying pan may feature the

endorsement of a chef.

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 A reference group appeal that uses the testimonials of satisfied
customers is known as the common-man approach.

The advantage is that it demonstrates to prospective customers

that someone just like them uses and is satisfied with the good
or service being advertised.

The common man appeal is especially effective in public

health announcement (such as antismoking or high B.P.
messages), for most people seem to identify with people like
themselves when it comes to such messages.

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 The popularity of this type of advt. probably is due to the
success and publicity received by a number of executive
spokespersons.

Like celebrity spokespersons, executive spokespersons seem

to be admired by the general population because of their
achievements and the status implicitly conferred on business
leaders.

e.g. Ratan Tata, K. Birla, Mukesh Ambani etc.

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 These are often employed as attention grabbers, acting
as spokespersons to promote children’  products.

Trade characters are intended to bond a child to a brand

so that the child’s   brand awareness might form the
basis of brand preference either immediately or later in
life.

e.g. Animated characters used by marketers in

advertisements for children products

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 A variety of other promotional strategies can function
creatively as frames of reference for consumers.
Respected retailers and the editorial content of selected
special interest magazines can also function as frames
of reference that influence consumer attitudes and
behavior.
 e.g. Indian Dental Association’s  seal of approval for
toothpaste.

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 Family

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 Family
• Two or more persons related by
blood,marriage or adoption and reside
together
• Basic social group who live together and
interact to satisfy their personal and mutual
needs

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 3 types of families
• Married couples: Husband and wife( new
couples or older couples)
• Nuclear family: A husband and wife and
one or more children
• Extended Family: The nuclear family
together with at least one grand parent
living within the family is Extended Family

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 Family trends (changing family structure)

• Falling numbers of marriage.

• Increasing number of divorces.
• Increased incidence of remarriage.
• Women want smaller families.
• Steady increase in the number of unmarried adults and one
person households.
• Rapid increase in single parent family (one parent ,at least
one child). It is mainly due to divorce

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 Effects of family structure on consumption

A family’s needs and expenditures are affected by the

following factors:

• the number of people in the family.

• ages of those in the family.
• the number of adults employed in the family.

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Table 10.6 Eight Roles in the Family Decision-Making
Process
ROLE DESCRIPTION
Influencers Family member(s) who provide information to other members about
a product or service
Gatekeepers Family member(s) who control the flow of information about a
product or service into the family
Deciders Family member(s) with the power to determine unilaterally or jointly
whether to shop for, purchase, use, consume, or dispose of a specific
product or service
Buyers Family member(s) who make the actual purchase of a particular
product or service
Preparers Family member(s) who transform the product into a form suitable
for consumption by other family members
Users Family member(s) who use or consume a particular product or service

Maintainers Family member(s) who service or repair the product so that it will
provide continued satisfaction.
Disposers Family member(s) who initiate or carry out the disposal or
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discontinuation of a particular product or service
 Dynamics of Husband-Wife
Decision Making
1. • Autonomic role
partners independently make an equal number of
decisions

2. • Husband-dominant role—
husband usually makes certain buying decisions, such as
purchasing life insurance.
3 • Wife-dominant role—
wife makes buying decisions, such as buying
children’s clothing.
4. • Syncratic role—buying decision made jointly.

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 The expanding role of children in
family decision making
• Due to family having fewer children
• Due to dual income couples
• Encouragement of media to allow children
express themselves

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 Children’s impact on family decision-making

Children undergo consumer socialization

(process by which children acquire the skills, knowledge,attitude,and
experiences necessary to function as consumers) to learn the skills,
knowledge and attitudes relevant to their functioning in the
market place.
Parents play an important part in this socialization process as
they expose their children to different marketing stimuli.
Television and other advertising mediums, which bombard
children with messages also play an important role.

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 The Family Life Cycle
• Traditional Family Life Cycle
– Stage I: Bachelorhood-single men and women establishing
household away from parents (staying as Paying guest after
getting job,before marriage)
– Stage II: Honeymooners-after marriage before arrival of first
child
– Stage III: Parenthood-from first child to the marriage of
children-full nest
– Stage IV: Post-parenthood-when children have left home for
studies or marriage
– Stage V: Dissolution-after the death of one of the spouses

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 Nontraditional FLC Stages

Alternative FLC Stages Definition/Commentary

Family Households
Childless couples It is increasingly acceptable for married couples
to elect not to have children. Contributing forces
are more career-oriented married women and
delayed marriages.
Couples who marry later More career-oriented men and women and greater
in life (in their late 30s or occurrence of couples living together. Likely to
later) have fewer or even no children.
Couples who have first Likely to have fewer children. Stress quality
child later in life (in their lifestyle: “Only the best is good enough”
late 30s or later)

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 Alternative FLC Stages Definition/Commentary
Family Households
Single parents I Divorce resulting in a single-parent household

Single parents II Young man or woman who has one or more

children from a marriage
Single parents III A single person who adopts one or more children.
Extended family/joint Young single-adult children who return home to
family-traditional avoid the expenses of living alone while
household in India establishing their careers. daughter or son and
grandchild(ren) return home to parents. Elderly
parents who move in with children. Newlyweds
living with in-laws.

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