The Family andThe Family andGenerational CohortsGenerational Cohorts

Chapter 13

The Family and Generational Cohorts

The family

The Census Bureau defines family as:“Two or more persons, related by blood, marriage, or adoption who reside together”

In the US today, 70% of the approximately 100 million households are families

Although all families are households, not all households are families

Despite changes, the family remains the central institution in providing for the welfare of its members

Types of families

In Western society, three types of families dominate:

1. Married couples

2. Nuclear families

3. Extended families Single-parent families are increasing in number

due to divorce and out-of-wedlock births In other cultures, different types of families

dominate

Consumer socialization of children Process by which children acquire the skills,

knowledge and attitudes necessary to function as consumers (consumption skills or consumer behavior norms)

Preadolescents acquire skills by observing parents and older siblings

Adolescents and teens more likely to see friends and peers as role models

Family consumption roles

Individuals in each family are the key decision makers

Marketers need to know who in the family makes decisions in order to know whom to target

Buying roles have changed significantly in recent times

Eight roles in the family decision-making process1. Influencers

2. Gatekeepers

3. Deciders

4. Buyers

5. Preparers

6. Users

7. Maintainers

8. Disposers

Number and identity of family members who fill these roles varies from family to family and from product to product

Roles vary based on culture as well Marketers need to know which family

members make which decisions in order to develop effective marketing strategies

The family decision process

Research identifies four categories of decision patterns:

1. Husband-dominated

2. Wife-dominated

3. Autonomic--each spouse makes an independent decision about half the time

4. Syncratic--decisions are made jointly

Figure 10.10 Husband-Wife Influence in Financial Tasks and Decisions

0 10 20 30 40 50 60 70 80 90 100

Gifts to Charities

Monthly Expense Budget

Insurance for Wife

Financing of Large Purhcase

Allocation of Funds for Savings

Insurance for Husband

Down Payment on a Large Purchase

Choice of Institution for Cetificate of Deposit

Choice of Type of Investment

Husband-dominated Equal partnership Wife-dominated

The family life cycle (FLC)

A steady and predictable (at one time) series of stages that most families progress through

FLC analysis enables marketers to segment families in terms of their current stage

At each stage there are differences in earning power and unique needs and demands placed on family resources

Traditional family life cycle

Divided into five stages

1. Bachelorhood

2. Honeymooner

3. Parenthood

4. Post-parenthood

5. Dissolution

Nontraditional FLC stages

Family households: Childless couples Couples who marry later in life Couples who have children later in life Single parents I (divorced) Single parents II (child out of wedlock) Single parents III (adoption) Extended family (adult children return home

or elderly parents move in)

Non-family households Unmarried couples (heterosexual or

homosexual) Divorced persons (no children) Single persons (most are young) Widowed persons (most are elderly)

Consumption in nontraditional families When households undergo status changes,

they often undergo spontaneous changes in consumption-related preferences and thus become attractive targets for many marketers

1. Divorce

2. Boomerang kids

3. Latchkey kids

Generational marketing

As we have seen, age is one method to segment and target a market

As consumers age, their preferences and their access to resources change

Age-related life transitions create demand for specialized goods and services

Age cohorts

Age also has meaning in terms of common experiences shared with others

Groups of people who have grown up during specific time periods and share experiences, memories and symbols that translate into similar preference patterns

The depression cohort

Born 1912-1921 Depression years remain the defining

moment Risk averse Frugal Avoid debt Invest only in safest investment vehicles

(e.g., government bonds)

World war II cohort

Born between 1922 and 1927 WWII is the defining moment of this

generation Also influenced by the depression Financially conservative Risk averse Housing and health issues are important

Baby boomers

Individuals born between 1946 and 1964 Huge segment: 40% of adult population in the

US Highly educated and thus affluent Represent 50% of those in professional and

managerial occupations Represent more than 50% of those with a

college degree or higher

Consumer characteristics of “boomers” Tend to be consumption-oriented Willing to borrow to support life style Socially conscious and willing to spend extra for

environmentally-friendly products “Yuppies” are a small but highly sought-after

segment of this market Well off financially, well educated and in

professional fields Often associated with expensive brand names As they age, shifting attention to physical fitness and

travel

Generation X (“busters” or “slackers”) People born (approximately) between 1965

and 1977 46 million in the US 21% of total population of US Children of divorce, day care and latchkeys Politically conservative with a “what’s in it for

me” attitude Many continue to live at home into their 20’s

and find good jobs hard to come by

Marketing to Gen-X’ers

Newspaper advertising isn’t effective The “MTV generation” MTV Fox television Comedy Central E!

Teens (Generation Y) Substantial segment of the population in the US and

abroad Enjoy enormous discretionary purchasing power Increasingly market savvy and involved with

consumer culture As rate of single- and working-parent families

increases, teens increasingly become primary shoppers for families

Regularly go through rapid periods of physical, mental, social and emotional changes, generating rapidly evolving physical, self-expression and self-realization needs

Children (Millenials and Generation Y) Children represent considerable market

opportunities for those who can meet their distinct needs and cognitive competencies

Greatest expenditures are in: Food and beverages (including sugared cereals) Entertainment (toys, games, movies, music) Clothing

Average child sees approximately 20,000 television commercials a year

Children as young as three recognize heavily advertised cartoon characters; this recognition produces positive attitudes toward products associated with these characters

Children are very brand conscious  

Table 10.4 Noteworthy Nontraditional FLC Stages

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 in life (in their late 30s or later)

More career-oriented men and women and greater occurrence of couples living together. Likely to have fewer or even no children.

Couples who have first child later in life (in their late 30s or later)

Likely to have fewer children. Stress quality lifestyle: “Only the best is good enough”

Alternative FLC Stages Definition/Commentary

Table 10.4 continued

Family Households

Single parents II Young man or woman who has one or more children out of wedlock.

Single parents III A single person who adopts one or more children.

Extended family Young single-adult children who return home to avoid the expenses of living alone while establishing their careers. Divorced daughter or son and grandchild(ren) return home to parents. Frail elderly parents who move in with children. Newlyweds living with in-laws.

Alternative FLC Stages Definition/Commentary

Single parents I High divorce rates (about 50%) contribute to a portion of single-parent households

Table 10.4 continued

Nonfamily Households

Unmarried couples Increased acceptance of heterosexual and homosexual couples.

Divorced persons (no children)

High divorce rate contributes to dissolution of households before children are born.

Single persons (most are young)

Primarily a result of delaying first marriage; also, men and women who never marry.

Alternative FLC Stages Definition/Commentary

Widowed persons (most are elderly)

Longer life expectancy, especially for women; means more over-75 single-person households.

Table 10.5 continued

ALL HOUSEHOLDS 101,018 100.0%

NONFAMILY HOUSEHOLDS 30,777

Living alone 25402

Female householders 14,861 14.7

Male householders 10,442 10.3 25.1

Living with others 5,375

Female householders 2,110 2.1

Male householders 3,266 3.2 5.3 30.5

Number of household by type in 1996

Distribution of Households by type