CONSUMER BEHAVIOUR

LECTURE 9
INTERNET & CONSUMER BEHAVIOUR

Marketing Implications of Reference Groups

 Marketers need to accurately represent membership reference groups in their

adverts / marketing communications campaigns
 Marketers may attempt to create normative influence by using adverts’ messages
emphasising rewards or sanctions that can follow from product use (or non-use)
 Marketers create brand communities and avoid associating with dissociative
reference groups in communications
 Reference groups help marketers understand how information is transmitted
among and between groups of consumers
 If marketers know their target consumers’ aspirational reference groups, they can:
 associate their product with that group
 use spokespeople who are influential to group members

*Marketers will create brand communities to aspire and encourage you to get excited about
their brand

SOCIAL IDENTITY THEORY

 Social Identity Theory argues we all have several selves that relate to groups
 These linkages are important - they make us think of we rather than I
 Minimal group paradigm – we naturally favour people who are in our group
 Horizontal Revolution – communications flow across users and groups
through social media
 Social media platforms enable a culture of participation in an online
community – leading to fear of missing out (FOMO)

– B2C E-Commerce – business to consumers

– C2C E-Commerce – customers to customers

 Social networks are each a set of socially relevant nodes, connected by one or more
relations. Flows occur between nodes and across networks – media multiplexity

SOCIAL MEDIA & CONSUMERS

 Online community - the collective participation of members who together build and maintain a site
 Helps to fulfil the need to belong - it’s about connection
 Consumers derive both utilitarian and hedonic value from social media
why do we post?
  To manage the impression we make on others
 To regulate emotions - by expressing affective reactions
 To share and acquire information
 To bond with others
 To persuade others to change their opinions
 Desire for self-enhancement

BRAND
COMMUNITIES

Brand Communities - “a specialised, non-geographically bound community, based on a

structured set of social relationships among admirers of a brand. It is specialised because at
its centre is a branded good or service.” (Muniz & O’Guinn, 2001, p. 412)

*Harley Davidson is a great example of a brand community who connect with one another
  A brand community is a group of consumers who share a set of social relationships
based on interest / usage of a product *works really well w/ tech and gaming
 Members may be physically distant but they share social relationships based on
usage or interest in a brand
 Members often meet for brief periods at organised events such as brand festivals
 Activities in brand communities enhance brand loyalty through consumers
emotional commitment to the brand
 Marketers seek to monitor, support and control the brand communities as well
as the brand
 However, brand communities are owned by consumers, not companies

 Referred to as geographically bound brand communities or offline brand communities

(Madupu & Cooley, 2010)
 During the pre-internet days, brand communities were available in face-to-face form
 Development of more advanced information and communication technologies in
parallel with the rise of the internet, have served as platforms that simplify interaction
with and among consumers, and so the formation of virtual brand communities
(Brodie et al., 2013)

DYNAMIC NATURE OF BRAND COMMUNITIES - Brandfests

• Geography - consumers from geographically diffused areas come together in one location
• Temporality - members are all brought together in a compact timeframe
• Social Context - members begin as strangers but develop deep acquaintance, even lasting
friendships
• Consciousness of Kind - attending raises the consciousness of there being a community

e.g. Comic Con International, Jeep Fest

VIRTUAL BRAND COMMUNITIES

Virtual

Communities
are a collection
of people who
share interests
and
information. They provide fellowship and social interaction without face-to- face
contact
 The intensity of identification with a virtual community depends on:
 Centrality of the brand to a person’s values and self-concept
 The intensity of the social relationships the person forms with other
community members

they…

 Provide marketers w/ more appropriate & effective marketing communication

 Increase brad use
  Create interest in products
 Enhance sales
 Generate positive WOM communication
 Promote brand trust and loyalty
 Share their consumption experiences
 Allow members to interact w/ each other

SUCCESSFUL ONLINE SOCIAL NETWORKS

 Standards of behaviour - rules that specify what members can and can’t do on the
site
 Member contributions - a healthy proportion of users need to contribute content
 Degree of connectedness - powerful groups are cohesive; this means the members
identify strongly with them and are highly motivated to stay connected
 Network effects - the quality of the site improves as the number of users increases

DIGITAL WORD OF MOUTH

 Viral marketing occurs when marketers persuade visitors to share information with
friends / contacts
 Driven by interesting or unusual brands, and the motivation for self-enhancement
 Also known as Megaphone Effect – due to capacity to reach wider audience and less
spontaneous
 Video Word of Mouth (WOM) increases likelihood of product purchase
 Dispreferred Marker Effect – online posts which are negative may create an adverse
impression of writer
 Influencers / Opinion Leaders / Power Users are therefore becoming an
increasingly important strategy for brands

Different types of WOM

 Electronic Word of Mouth (eWOM): “any positive or negative statement made by

potential, actual or former customers about a product or company, which is made
available to a multitude of people and institutions via the Internet” (Hennig-Thureau
et al., 2004; p. 39).

 Exogenous WOM - occurs as a direct result of the firm’s advertising efforts
 Endogenous WOM - passing on information about their experiences with a product
or brand (e.g. through Facebook groups)

 Negative reviews of hedonic products may be considered less useful /
attributed to the reviewer
 Negative reviews for utilitarian products are more likely to be considered
more useful / attributed to the product
 OPINION
LEADERS / INFLUENCERS

 Opinion leaders are people (e.g. friends, neighbours, and co- workers in close physical
proximity) who are knowledgeable about specific products and whose advice is
taken seriously
 They are credible and unbiased sources – they don’t have vested interest in whether
people listen to them
 Their product knowledge is relevant and relates to the needs linked to the
acquisitions, usage, and disposal of products
 They are often heavy users of media
 Tend to buy new product variants when they are first introduced to the market (i.e.
early adopters)

personality traits…

• High involvement with the product category.

• High need for cognition (enjoy acquiring new information on a product category)
• Self-confident (consider themselves
competent to give advice)
• Extrovert (willing to share product
information)

GLOSSIER EXAMPLE
Consumer Tribes

“A tribe is a group of people connected to

one another, connected to a leader, and
connected to an idea.” Seth Godin,
Tribes

People who share a lifestyle based on

loyalty to an activity.
• The members of a tribe identify with
each other on the basis of shared lifestyles, interests, views, and practices • These are
independent of social background
• Marketers view consumer tribes as target markets
• Membership to these tribes is elective rather than socially ascribed
• Membership is highly fluid

IMPORTANCE OF WORD OF MOUTH

  Millennials (25-40) and Gen X (41-56) trust advertising the most
 Men and women globally have similar overall levels of trust in advertising
 89% of people most trust recommendations from people they know (word of mouth)
 23% of people trust ads from influencers. Advertising and opinions about brands and
products were less trusted when delivered via an influencer
 90% of customers will choose a product that comes with a person’s recommendation
(even if they don’t know that person) over one lacking this endorsement
 Millennials are 38% more likely to cite word-of-mouth advertising as the way they
discovered a company
 Word of mouth can generate up to five times as many sales as paid ads

Sources - SEMRush & Nielsen Trust in Advertising Survey (2021)

TROLLINNG

 Trolling is a form of consumer misbehaviour that involves deliberate, deceptive, and

mischievous attempts to provoke reactions from other online users.
 Trolling behaviours are pervasive, comprising “a substantial fraction of user activity
on many web sites” (Cheng et al. 2017, 1217).
 38% of US adults reporting seeing trolling on social media on a daily basis (Statista
2017)
 Trolling is seen on comments sections, discussion sites, review sites, and various
online services and applications, such as dating apps and video games (Pew Research
Center 2017; Statista 2017; YouGov 2014)

ELECTRONIC WORD OF MOUTH – FAKE NEWS AND REVIEWS

 Online product reviews are major drivers in influencing consumers’ purchase

decisions (Tran and Strutton, 2020).
 In the United States, more than 80% of consumers indicate they use online reviews
before purchasing a product (Smith and Anderson, 2016)
 UK legislation to be introduced in 2022 will prohibit companies from writing and
commissioning fake reviews - average UK household spends £900 each year
influenced by online reviews and spends £60 on "unwanted subscriptions” (BBC,
2022)
 It is estimated that up to one third of all online reviews are fake (Streitfeld, 2012)
 Fake reviews can be created in two main ways.
1. Human-generated - paying human content creators to write reviews which seem authentic
but are not real
2. Computer-generated - using text-generation algorithms to automate fake review creation

implications for brands…

 Fake news is specifically designed to create mistrust and exacerbate the existing
social and cultural dynamics by misusing political, regional and religious
undercurrents (Wardle and Derakhshan, 2017)

 Fake news has an adverse impact on individuals and society - it deliberately persuades
consumers to accept false beliefs that are shared to forward specific agendas. (Shu et
al. (2017)
  Sharing of fake news on social media platforms is a global concern
 Poses significant challenges for brands (Potthast et al., 2017). such as McDonald's
(Taylor, 2016)

LECTURE RECAP

• Social Media is becoming increasingly important in influencing

consumer behaviour and developing communities

• A brand community is a group of consumers who share a set of social relationships based
on interest / usage of a product. Exist online and offline.

• A brand tribe is a group of people connected online based around an idea or shared
lifestyle trait – in a digital world it is arguably becoming a new way to segment customers

• Fake news, fake reviews and trolling are increasing concerns for brands