Env Influences on CB

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CONSUMER BEHAVIOR:

Social Influence on Consumer Decision Making

Reference Groups/Family/Social Class/Interpersonal

Communication/Opinion Leadership

Culture/Sub-Culture

Instructor:

Mahendra Singh

Centre for Business Administration, Central University of

Jharkhand

Source: Schiffman and , Kanuk, Wells and Prensky,Peter and Olson, Loudon and Bitta

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External Influences on

Consumer Culture

Subculture

Demographics

Social Status

Reference Group

Family

Marketing Activities

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CONSUMER GROUPS

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Agroupmay be defined as:

-two or more people who interact to accomplish either individual or

mutual goals.

There are many basis to classify groups:

- by regularity of contact,

- by structure and hierarchy,- by membership,

- by size.

The realm of consumer behavior, focuses on the fourth basis, andprimarily on the study of small groups, because such groups are

more likely to influence the consumption behavior of group

members.

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a) Primary Versus Secondary Groups:

Basis: The extent to which members interact.

b) Formal Versus Informal Groups:Basis: The extent to which the group structure, the members' roles,

and the group's purpose are clearly defined.

c) Membership Versus Symbolic Groups

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Consumer-Relevant Groups:

There are six basicconsumer-relevant groups:

-the family: the best position to influence his or herconsumption decisions.

Two or more people related by blood, marriage or adoption who

reside together

Functions of family:Economic well being

Emotional support

Suitable life style

Socialization of family members.

Family Consumption Roles:Influencers

Gate Keepers (Information controllers)

deciders

buyers, Prepares, Users, Maintainers, Disposers

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Dynamics of Husband-wifedecision making

1.Husband-dominated

2.Wife-Dominated

3.Joint-Decision4.Autonomic (Unilateral)

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Family Life Cycle

Stage I- BachelorhoodStage II-Honeymooners

Stage III-Parenthood

Stage IV-Post parenthood (Old couple, nochildren at home)

Stage V- Dissolution (1surviving spouse)

Type of family (slide 30)

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-friendship groups: In terms of relative influence, after an

individual's family, his or her friends are most likely to influence the

individual's purchase decisions.Consumers are more likely to seek information from those friends

they believe have values or outlooks similar to their own.

-formal social groups: Because members of a formal social group

often consume certain products together, such groups are of

interest to marketers.

Some members may copy the consumption behavior of other

members whom they admire.

-shopping groups: -Two or more people who shop together,

whether for food for clothing, or simply to pass the time, can becalled 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

pals.

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-consumer-action groups: Consumer-action groups can bedivided into two broad categories:

-those that organize to correct a specific consumer abuse and then

disband.

-those that organize to address broader, more pervasive problem

areas and operate over an extended or indefinite period of time.

-work groups: The sheer amount of time that people spend at their

jobs, provides ample opportunity for work groups toserve as a

major influence on the consumption behavior of members.

Bo th the formal work g roup and the informal friendship wo rk

group can inf luence con sum er behavior .

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THE ROLE OF GROUPS IN CONSUMER

SOCIALIZATION:

Throughout our lives, we learn about consumer behavior from our

family, friends, community, and the media.

During childhood, one is typically surrounded by relatives, friends, and

community members from the same subculture, with whom one

shares common background characteristics, such as race and

ethnicity, religion, social class, geography, and lifestyle.

These values, customs, and rituals are continually reinforcedthroughout childhood.

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As one grows, one is exposed to people from other sub-cultures

with different backgrounds, both directly, through face-to-face

interactions, and indirectly, through mass media vehicles such as

television, movies, and magazines.

This process, whereby people acquire the skills and knowledge

relevant to consumer purchase behavior, is referred to as

cons umer soc ial izationand involves various reference groups,

from the family to mass media.

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The major societal groupings that influence an individual's

consumer behavior are, in order: family, friends, social class,various subcultures, one's own culture, and even other

cultures.

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CONSUMER REFERENCE GROUPS

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REFERENCE GROUPS

A Reference group is any person or group that serves as a point ofcomparison (or reference) for an individual informing either general or

specific values, attitudes, or behavior.

AReference groupis a person or group that a consumer uses as a

standard of reference for his or her general or specific thoughts,

feelings, and actions.

From a marketing perspective, reference groupsare groups that

serve as frames of referencefor individuals in their purchase or

consumption decisions.

A consumer can have many different reference groups at any given

time and may turn to one group for guidance in making some

purchases and another group for other decisions.

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Broadening the Reference Group Concept-the meaning of "reference group" has changed over the years.

As originally used, reference groups were narrowly defined to

include only those groups with which a person interacted on a

direct basis (e.g., family and close friends).

However, the concept gradually has broadened to include both

direct and indirect individual or group influences.

Indirect reference groupsconsist of those individuals or groups

with whom a person 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:

Reference groups can be classified in terms of:

-a person's membership or degree of involvement with the group

-the positive or negative influences they have on his or her values,

attitudes, and behavior.

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a) Acontactual groupis one in which a person holds

membership or has regular face-to-face contact and of whose

values, attitudes, and standards he or she approves.

Thus, a contactual group is likely to have a congruent influence on

an individual's attitudes or behavior.

b) Anaspirational groupis a group in which a person does

not hold membership and does not have face-to-face contact but

wants to be a member.

Thus, it often serves as a positive influence on that person's

attitudes or behavior.

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Factors that affect Reference Group Influence:

The degree of influence that a reference group exerts on an

individual's behavior usually depends on:

-the nature of the individual

-the product

-specific social factors.

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Five major types of reference group appeals in commonmarketing usage are:

- celebrity appeals: Particularly movie stars, TV personalities,

popular entertainers, and sports icons

- expert appeals,

- common man appeals: slice of the life commercial

- executive appeals:An increasing number of firms have used theirtop executives as spokespersons in consumer ads

- trade or spokes-character appeals.

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Benefits of the Reference Group Appeal:

Reference group appeals have two principal benefits:

-they increase brand awareness.

-they serve to reduce perceived risk.

a) Increased Brand Awareness

Reference group appeals provide the advertiser with the opportunity to gain

and retain the attention of prospective consumers with greater ease and

effectiveness; particularly true of the celebrityform of reference group appeal.

Even in the case of less known or unknownspokesmodels(those withoutcelebrity status), it appears that a combination of their "good looks" (e.g.,

physical attractiveness) and consumers' perceptions of their personalities

contribute to positive judgments about the product being promoted.

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b) Reduced Perceived Risk

The use of a reference group appeal may also serve to lower the

consumer's perceived risk in purchasing a specific product.

The example set by the endorser or testimonial-giver may demonstrate to

the consumer that uncertainty about the product purchase is unwarranted.

On the basis of very positive experiences in the marketplace, advertisers

continue to use celebrities, experts, and common-man appeals, as well as

other reference group appeals, to promote and to differentiate theirproducts.

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Does Reference Group Influence Vary by Product?

Regardless of the type of group they turn to, consumers are more

susceptible to the influence of reference groups in choosing certain

products over others.

Bearden and Etzelexamined the effects of reference groups on both the

decision to purchase the type of product and the choice of a specific brand.

They investigated this issue and found that influence varied by:

a) the type of product

a luxury versus a necessity, and

b) its visibilitywhether it is used in public or private settings.

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FAMILY

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THE FAMILY:

Traditionally, familyhas been defined as two or more persons related byblood, marriage, or adoption who reside together.

In a more dynamic sense, the individuals who constitute a family might be

described as members of the most basic social group who live together

and interact to satisfy their personal and mutual needs.

Although families sometimes are referred to as households,not all

households are families.

However, within the context of consumer behavior, households andfamilies usually are treated as synonymous.

In most societies, three types of families dominate: the married couple,

the nuclear family, and the extended family.

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a) married couple: The simplest type of family; a husband and a wife.

As a household unit, the married couple generally is representative of

new marrieds who have not yet started a family, and older couples who

have already raised their children.

b) nucleur family: A husband and wife and one or more children;

c) extended family: The nuclear family, together with at least onegrandparent living within the household;

In contrast, because of divorce, separation, etc., there has been a rapid

increase in the number ofsingle-parent familyhouseholds consisting of

one parent and at least one child.

Also, which type of family is most "typical" can vary considerably from

culture to culture.

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i) Consumer Socialization of Children:

-consumer socialization: defined as the process by which children acquire the

skills, knowledge, and attitudes necessary to function as consumers.

Many children acquire their consumer behavior norms through observation of

their parents, who function as role models.

Preadolescent children tend to rely on their parents and older siblings as the

major sources of cues for basic consumption learning.

Adolescents and teenagers are likely to look to their friends for models of

acceptable behavior.

Shared shopping experiences also give children the opportunity to acquire in-

store shopping skills.

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iii) Intergenerational Socialization:

It is quite common for selected product loyalty or brand preferences to be

transferredfrom one generation to anotherintergeneration brand

transfermaybe even three or four generations within the same family.

Another type of transfer between family members is the giving or loaning of"things."

When one family member gives or loans another family member some

hand-me-down clothing, an old car or TV, a set of dishes or flatware, a

sofa, etc. these transfers serve as substitutes for the purchase of such

items in the marketplace.

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FAMILY DECISION MAKING:

Marketers recognize the family as the basic decision-

making unit.

However, they most frequently examine the attitudes and behavior

of the one family member whom they believe to be the major

decision maker.

In some cases, they also examine the attitudes and behavior of theperson most likely to be the primary user of the product or service.

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Influencing Spouses and Resolving Consumer Conflicts:

When it comes to making purchasing decisions, husbands and wives

frequently find themselves in disagreement.

To avoid or resolve potential disagreements, husbands and wivescommonly attempt to influence each other to arrive at what they feel to

be the best outcome.

Six influence strategies for resolving husband-wife consumption-

related conflicts have been identified:

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Dynamics of Husband-Wife Decision Making:

Marketers are interested in the relative amount of influence that a husband anda wife have when it comes to family consumption choices.

Most husband-wife influence studies classify family consumption decisions as

husband-dominated, wife-dominated, joint (i.e., equalor syncratic),and

autonomic (i.e., solitaryor unilateral).

Studies that have examined both the extent and nature of husband-wife

influence in family decisions have found that such influence is fluid and likely to

shift, depending on:

-the specific product or service,

-the family role structure orientation, (culture and sub-culture),

-the specific stage in the decision-making process.

These factors also are influenced by changing lifestyles, particularly the

changes in family lifestyle options associated with women working outside of the

home and the increased occurrence of dual-income households.

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Children:

Young children attempt to influence family decisions as soon as they possess the

basic communication skills needed to interact with other family members.

Specifically, children attempt to influence their parents to make a purchase (to

yield).

Children not only attempt to influence their parents to make purchases of special

interest to them (cereal, candy) but also products of remote interest (e.g., laundrydetergents) for which they see ads on TV.

Latchkey Kids:

Many consumer-goods firms target special marketing efforts at preteen "latchkey"

children (those who are home alone for at least part of each school day while theirparents work).

Latchkey kids constitute a special market with distinctive needs.

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THE FAMILY LIFE CYCLE:

Sociologists and consumer researchers have long been attracted to the

concept of the family lifecycle(FLC).

Looked upon as a means of depicting what was once a rather steady and

predictable series of stages that most families progressed through.

However, with the advent of many diverse family and lifestyle

arrangements, what was the rule has been on the decline.

Despite the decline in its predictive precision, the FLC remains a useful

marketing tool.

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FLC analysis enables marketers to segment families in terms of a series of

stages spanning the life course of a family unit.

The FLC is a composite variable created by systematically combining suchcommonly used demographic variables as marital status, size of family,

age of family members(focusing on the age of the oldest or youngest

child), and employment statusof the head of household.

The ages of the parents and the relative amount of disposable income

usually are inferred from the stage in the family life cycle.

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Traditional Family Life Cycle:

- A progression of stages through which many families pass.

- Starting with bachelorhood, moving on to marriage (and the creation ofthe basic family unit), then to family growth (with the birth of children), to

family contraction (as grown children leave the household), and ending

with the dissolution of the basic unit (due to the death of one spouse).

Different researchers have expressed various preferences in terms of the

number of FLC stages.

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STAGE IN FAMILY LIFE CYCLE BUYING OR BEHAVIORAL

PATTERN

1. Bachelor stage: young, single people Few financial burdens.

Recreation oriented.

Buy: basic kitchen equipment, basic

furniture, cars, equipment for hobbies,

vacations.

2. Newly married couples: young, no

children.

Better off financially than they will be in

near future. Highest purchase rate and

highest average purchase of durables.

Buy: cars, refrigerators, stoves, sensible and

durable furniture, vacations.

3. Full nest I: youngest child six or below. Home purchasing at peak.

Liquid assets low.Dissatisfied with financial position and

amount of money saved.

Interested in new products.

Like advertised products.

Buy: washers, dryers, TV, baby food, chest

rubs and cough medicines, vitamins, dolls,

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PATTERN

4. Full nest II: youngest child six or over. Financial position better.

Some wives work.

Less influenced by advertising.

Buy larger-size packages, multiple-unit

deals. Buy: many foods, cleaning

materials, bicycles, music lessons, pianos.

5. Full nest III: older married couples with

dependent children.

Financial position still better.

More wives work.

Some children get jobs.

Hard to influence with advertising.

High average purchase of durables.

Buy: new, more tasteful furniture, auto

travel, unnecessary appliances, dental

services.

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PATTERN

6. Empty nest I: older married couples, nochildren living with them

Home ownership at peak.Most satisfied with financial position and

money saved.

Interested in travel, recreation, self-

education. Make gifts and contributions.

Not interested in new products.

Buy: vacations, luxuries, homeimprovements.7. Empty nest II: older married. No children

living at home, head retired.

Drastic cut in income.

Keep home.

Buy: medical appliances, medical-care

products that aid health, sleep, and digestion.

8. Solitary survivor, in labor force. Income still good but likely to sellhome.

9. Solitary survivor, retired. Same medical and product needs as other

retired group;

Drastic cut in income.

Special need for attention, affection, and

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Modifications to the FLC:

The traditional FLC model has lost it ability to fully represent the

progression of stages through which current family and lifestyle

arrangement move.

The underlying sociodemographic forces that drive this expanded FLCmodel include divorce and later marriages, with and without the presence

of children.

Nontraditional FLC Stages:

These nontraditional stages include not only family households but alsononfamily households: those consisting of a single individual and those

consisting of two or more unrelated individuals

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Consumption in Nontraditional Families:

When households undergo status changes (e.g., divorce, temporaryretirement, a new person moving into the household, or the death of a

spouse), they often undergo spontaneous changes in brand preferences

and, thus, become attractive targets for many marketers.

They also need to buy more products.

These requirements mean that a divorced person might need to contact

real estate agents, call the local and long-distance telephone companies,

visit furniture stores, and possibly contact a personnel agency or career

consultant.

In another sphere, the substantial increase in dual income households

has also affected the lifestyle and consumption patterns.

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SOCIAL CLASSES AND THEIR INFLUENCE ONCONSUMER BEHAVIOR

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WHAT IS A SOCIAL CLASS?

Social classcan be thought of as a continuuma range of social

positions on which each member of society can be placed.

Researchers have preferred to divide the continuum into a small

number of specific social classes, orstrata.

Within this framework, the concept of social class is used to assign

individuals or families to a social-class category.

Consistent with this practice, social classis defined 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

members of all other classes have either more or less status.

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Social Class and Social Status:

Researchers often measure social class in terms ofsocial status;

They define each social classby the amount of status the members

of that class have in comparison with members of other social

classes.

In social-class research (sometimes called "social stratification"),

statusis frequently thought of as the relative rankings of members

of each social class in terms of specific status factors.

When considering consumer behavior and marketing research,status is most often defined in terms of one or more of the following

convenient demographic variables: family income, occupational

status,and educational attainment.

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a) Social Class is Hierarchical, ranging from low to high status.

To many people, therefore, social-class categories suggest that others are

either equalto them (about the same social class), superior to them

(higher social class), or inferiorto them (lower social class).

This hierarchical aspect of social class is important to marketers.

Consumers may purchase certain products because these products are

favored by members of their own or a higher social class, and consumers

may avoid other products because they perceive the products to be "lower-

class" products.

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b) Social Class and Market Segmentation

The various social-class strata provide a natural basis for market

segmentation for many products and services.

In many instances, consumer researchers have been able to relate product

usage to social-class membership .

c) Social Class and Behavioral Factors

Consumer researchers have been able to relate social-class standing to

consumer attitudes concerning specific products and to examine social-

class influences on the actual consumption of products.

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d) Social Class as a Frame of Reference

Social-class membership serves consumers as a frame of reference (i.e., a

reference group) for the development of their attitudes and behavior.

In the context of reference groups, members of a specific social class maybe expected to turn most often to other members of the same class for

cues (or clues) regarding appropriate behavior.

In other cases, members of a particular social class (e.g., upper-lower

class) may aspire to advance their social-class standing by emulating the

behavior of members of the middle class.

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Social-Class Categories

Studies have divided the organization of specific communities into

five- or six-class social structures.

However, other researchers have found nine-, four-, three-, andeven two-class schemas suitable for their purposes.

The choice of how many separate classes to use depends on the

amount of detail that the researcher believes is necessary to

explain adequately the attitudes or behavior under study.

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Obj ti f i l l f ll i t t b i


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Objective measures of social class fall into two basic

categories:

-single-variable indexesandcomposite-variable indexes.

i) Single-Variable Indexes

A single-variable index uses just one socioeconomic variable to evaluate

social-class membership.

Some of the variables that are used for this purpose are:

-Occupation(eg. marketers frequently think in terms of specific

occupationswhen defining a target market for their products),

-Education(eg. Generally speaking, the more education a person has, the

more likely it is that the person is well-paid and has an admired or

respected position),

-Income(eg. used to approximate social-class standing) and,

-Other variables(eg. Quality of neighborhood and rupee valueof

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ii)Composite-Variable Indexes

Composite indexes systematically combine a number of socioeconomic

factors to form one overall measure of social-class standing.

Such indexes are of interest to consumer researchers because they may

better reflect the complexity of social class than single-variable indexes.

For instance, research exploring consumers' perceptions of mail and

phone order shopping reveals that the higherthe socioeconomic status (in

terms of a composite of income, occupational status, and education), the

more positive the consumers' ratings of mail and phone order buying,

relative to in-store shopping.

Several of the more important composite indexes are theIndex ofStatus

Characteristicsand theSocioeconomic Status Score.

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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 common.

Because upward mobility has commonly been attainable, the higher social

classes often become reference groups for ambitious men and women of

lower social status.

Recognizing that individuals often aspire to the lifestyle and possessions

enjoyed by members of a higher social class, marketers frequently

incorporate the symbols of higher-class membership.

Another characteristic of social-class mobility is that products and services

traditionally within the realm of one social class may filter down to lower

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SELECTED CONSUMER BEHAVIOR APPLICATIONSOF SOCIAL CLASS:

a) Clothing, Fashion, and Shopping

Most people dress to fit their self-images, which include their perceptions of

their own social-class membership.

Members of specific social classes differ in terms of whatthey consider

fashionable or in good taste.

Social class is also an important variable in determining wherea consumershops.

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b) The Pursuit of Leisure

Social-class membership is also closely related to the choice of

recreational and leisure time activities.

For instance, upper-class consumers are likely to attend the theater andconcerts, to play bridge, etc.

Lower-class consumers tend to be avid television watchers.

Furthermore, the lower-class consumer spends more time on commercial

types of activities and craft activities rather than cerebral activities.

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c) Saving, Spending, and Credit

Saving, spending, and credit-card usage all seem to be related to social-class

standing.

Upper-class consumers are more future-oriented and confident of their financial

acumen; they are more willing to invest in insurance, stocks, and real estate.

In comparison, lower-class consumers are generally more concerned with

immediate gratification; when they do save, they are primarily interested in safety

and security.

Lower-class purchasers tend to use their credit cards to "buy now and pay later"

for things they might not otherwise be able to afford, while upper-class

purchasers use their credit cards as a convenient substitute for cash.

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d) Social Class and Communication

Social class groupings differ in terms of their mediahabits and in how they

transmit and receive communications.

Knowledge of these differences is invaluable to marketers who segment

their markets on the basis of social class.

When it comes to describing their world, lower-class consumers tend to

portray it

Generally speaking, middle-class consumers have a broader or more

general view of the world, while lower-class consumers tend to see theworld through their own immediate experiences.

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Selective exposureto various types of mass media differs by social class.

In the selection of specific television programs and program types, higher-

social-class members tend to prefer current events and drama, while

lower-class individuals tend to prefer soap operas, quiz shows, and

situation comedies.

Higher-class consumers tend to have greater exposure to magazines and

newspapers than do their lower-class counterparts.

Lower-class consumers are likely to have greater exposure to publications

that dramatize romance and the lifestyles of movie and televisioncelebrities.

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PERSONAL INFLUENCE

INTERPERSONAL COMMUNICATION

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(3) The sources purpose:


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Different people provide information to their friends and

acquaintances for different reasons.

a) People who are very involved in a product category may simplyenjoy talkingabout it;

b) Interpersonal communication gives them the opportunity to discuss

their interests, provide product news, express their opinions, or talk about

their experiences.

c) Others may experience a feeling of altruismby providing assistance,

or they may feel powerful or competent when other people come to them for

advice.

d) Still others may have their own reasons for recommending a

particular purchase.- They may want to try a new product only after someone else buys it first, or

they may be seeking to confirm their own purchase decision by enlisting

others as users.

e) Some people may give their opinionabout a product with which they

are dissatisfied in order to seize the opportunity to complain about it.72


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(4) Source Credibility:

Source credibility isthe belief that a communication source provides accurateand unbiased information.

Credibility results from expertise and objectivity.

People gain expertisein a product area through knowledge, training, and

experience.

Objectivityis an equally important component of credibility. People want the

sources they turn to provide information for their benefit, not for the source's

own profit.

That is why many consumers are skeptical of salespersons or celebrities whoappear in advertisementsthese individuals are paid to provide information to

consumers;

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(5) Source Evaluation: Complaint versus praise:

Word-of-mouth communication can be either positive or negative.

People are more likely to complain about a product when it is highlyinvolving or when they are still not satisfied after voicing a direct complaint

to the marketer, i.e., they are seeking another outlet for their

dissatisfaction.

Complaints tend to be more influential than positive word-of-mouth.

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(6) Type of communication partner:

Communication partners can come from a wide variety of settings.

Consumers may seek information from members ofpositive reference

groupsbecause they want to choose the same products as the members

in order to gain approval.

Following the advice of these members helps ensure that the consumer

continues to be a part of a positive membership group;

In some cases, it helps the consumer gain entry into a positive aspirational

group to which he or she wantsto belong.

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(7) Type of product:

a) Consumers need information and advice from credible sources when they are

considering the purchase of a product that is newto them.

The consumer is unlikely to have the necessary knowledge or experience with the

product and will likely turn to highly involved consumers with whom he or she has

direct contact.

b) People are more likely to seek word-of-mouth communication about a

technically complexproduct.

In this case, the consumer is seeking explanatory information, advice about theproduct's attributes and their associated benefits, or any experiences others have had

with the product.

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c) People are more likely to seek information when theyperceive risk

from using a product.

People look for experts who can help them estimate the risks involved in

making a certain purchase, and they consult with others like them who canreassure them that their product experience has been successful.

d) People are more likely to seek information from members of their

positive reference groups about products they use in visible settings.

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THE OPINION LEADERSHIP PROCESS

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WHAT IS OPINION LEADERSHIP?

One of the parties in an informal product-related communicationsencounter usually offers advice or information about a specific product or

product category, such as which of several brands is best, or how a

particular product may be used. He is the opinion leader.

Individuals who actively seek information and advice about productssometimes are calledopinion seekers.

Opinion leadershipis the process by which one person (the opinion

leader) informally influences the actions or attitudes of others, who may be

opinion seekers or merely opinion recipients.

Theopinion leader,may become an opinion receiverwhen another

product or product category is brought up as part of the discussion.

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Anopinion leaderplays a dominant role in a specific instance of

word-of-mouth communication by providing product news, advice, or

personal experience to others.

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DYNAMICS OF THE OPINION LEADERSHIP PROCESS:

The opinion leadership process is very dynamic.

1. Opinion Leaders are Persuasive:

Opinion leaders are remarkably effective at influencing consumers in their

product-related decisions. Some of the reasons for the effectiveness of opinion

leaders are:

a) Credibility

Opinion leaders are highly credible sources of product-related information,

because their intentions are perceived as being in the best interests of the opinion

recipients. This is because they receive no compensation for the advice.

b) Positive and Negative Product Information

Opinion leaders provide both favorable and unfavorable information adds to their

credibility.

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c) Information and AdviceOpinion leaders are the source of both information and advice. They may

simply talk about their experiencewith a product, relate what they know about

a product, or, more aggressively, adviseothers to buy or to avoid a specific

product.

d) Opinion Leadership is Category-SpecificOpinion leadership tends to be category-specific;that is, opinion leaders often

"specialize" in certain product categories about which they offer information

and advice.

e) Opinion Leadership is a Two-Way Street

Consumers who are opinion leaders in one product-related situation maybecome opinion receivers in another situation.

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2.The Motivation behind Opinion Leadership

a) The Needs of Opinion Leaders

Motivation theory suggests that people may provide information or advice toothers to satisfy some basic need of their own.

However, opinion leaders may be unaware of their own underlying motives.

I) Opinion leaders may simply be trying to reduce their ownpostpurchase

dissonance.

Thus, the opinion leader's true motivation may really be self-confirmation or self-

involvement.

II) Furthermore, the information or advice that an opinion leader dispenses may

provide all types of tangentialpersonal benefits: it may confer attention; implysome type of status, grant superiority; demonstrate awareness and expertise, and

give the feeling of possessing inside information and the satisfaction of

"converting" less adventurous souls.

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III) Opinion leaders who are motivated byproductinvolvementmay find

themselves so pleased or so disappointed with a product that they simply must

tell others about it.

IV)Those who are motivated by social involvementneed to share product-related experiences. In this type of situation, opinion leaders use their product-

related conversations as expressions of friendship, neighborliness, and love.

V)The pervasiveness of advertising in our society encourages message

involvement.Individuals who are bombarded with advertising messages and

slogans tend to discuss them and the products they are designed to sell.

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A PROFILE OF THE OPINION LEADER


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CULTURE, SUB-CULTURE, CROSS CULTURE

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WHAT IS CULTURE?


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S CU U

Culture is a society's personality.

- In the context of consumer behavior, culture is defined as the sumtotal of learned beliefs, values, and customs that serve to direct the

consumer behavior of members of a particular society.

The beliefand valuecomponents:

-Imply the accumulated feelings and priorities that individuals have

about "things" and possessions.

In contrast to beliefs and values,customsare overt modes of

behavior that constitute culturally approved or acceptable ways of

behaving in specific situations.

Customs consist of everyday or routine behavior.

Thus, while beliefs and values are guides for behavior, customs are

usual and acceptable ways of behaving.89


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COMPONENTS OF CULTURE

A) Values

B)Language

C) Myth

D) Customs

E) Rituals

F) Laws

G) Material artifact s

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Marketers must understand the components of culture so that they

can:

(1) use advertising and product design to link their products to

values in consumers' minds, and,

(2) identify the consumer subcultures for whom those links will be

appropriate.

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CHARACTERISTICS OF CULTURE

1. The Invisible Hand of Culture

The impact of culture is natural and automatic and it influences behavior.

2. Culture Satisfies Needs

Culture exists to satisfy the needs of the people within a society.

Cultural beliefs, values, and customs continue to be followed as long as they

yield satisfaction.

Marketers also must be alert to newly embraced customs and values.

For example, as people have become more health- and fitness-conscious, there

has been an increase in the number of gyms, spas etc.

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3.Culture is Learned

Consumers are not biologically endowed with culture; instead, they learn from

family and friends about what is acceptable and unacceptable.

At an early age, we begin to acquire from our social environment a set of

beliefs, values, and customs that make up-our culture.

Enculturationis the process of learning one's native culture.

By contrast,acculturationis the process of learning a new or foreign culture.

Marketers who wish to introduce products in other countries need to understand

the process of acculturation so that they can develop ways to help consumersaccept new customs.

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4. Culture is Shared

Culture is viewed as group customsthat link together the members of a

society.

Various social institutions within a society transmit the elements of culture

and make the sharing of culture a reality.

Chief among such institutions is the fami ly ,educat ional ins t i tu t ionsand

houses of worsh ip .

A fourth, frequently overlooked, social institution that plays a major role in

the transfer of culture throughout society is the mass media.

We are exposed daily to advertising, an important component of the

media.

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5.Culture is Dynamic

Culture changes and expands to reflect the dynamic environment.

To fulfill its need-gratifying role, culture continually must evolve if it is to function in

the best interests of a society.

For this reason, the marketer must carefully monitor the socio-cultural environment

in order to market an existing product more effectively or to develop promising new

products.

Changes mean that marketers have to consistently reconsider whoare the

purchasers and the users of their products (males only, females only or both),when they do their shopping, howand wherethey can be reached by the media,

and whatnew product and service needs are emerging.

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THE MEASUREMENT OF CULTURE

A wide range of measurement techniques are used in the study of

culture.

a) Projective tests

b)Attitude measurement techniques

In addition, the value measurement instrumentsare are

frequently used to examine culture.

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WHAT IS SUBCULTURE?

Despite the pervasive nature of culture, not all of the consumerswithin asociety think, feel, and act the same way.

Every society hassubculturesgroups of consumers that share

values but exhibit them in different ways.

In other words, a single culture can be divided into consumer

subcultures that exhibit shared values in different ways.

The members of a specificsubculturepossess beliefs, values, and

customs that set them apart from other members of the same

society.

Subculture, is a distinct cultural group that exists as an identifiable

segment within a larger, more complex society.

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Subcultural analysis enables the market ing manager to focus on

sizable and " natural" market segments.

Subcultures, therefore, are relevant units of analysis for market research.

There are a number of important subcultural categories: nationality,

religion, geographic location, race, age, and gender.

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Acquiring Exposure to Other Cultures:

As more and more consumers come in contact with the material


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As more and more consumers come in contact with the material

goods and lifestyle of people living in other parts of the world, they

have the opportunity to adopt these different products and

practices.

How consumers in one culture secure exposure to the goods of

other people living in other cultures is an important part of

consumer behavior.

Consumers' exposure to different cultures tends to come about

through:

1. Consumers' own initiatives

2. Marketers efforts: that is, seeking to expand their markets

by "bringing" new products, services, practices, and ideas topotential consumers residing in a different country and possessing

a different cultural view.

Within this context, international marketing provides a form of

"culture transfer."

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CROSS CULTURE:

Cross-cultural consumer analysis:

To determine whether and how to enter a foreign market,

marketers need to conduct some form ofcross-cultural consumer

analysis.

Cross cultural consumer analysisis defined as the effort to

determine to what extent the consumers of two or more nations are

similar or different.

Such analyses can provide marketers with an understanding of thepsychological, social, and cultural characteristics of the foreign

consumers they wish to target, so that they can design effective

marketing strategies for each of the specific national markets

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C OSS C CO S S S


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CROSS-CULTURAL CONSUMER ANALYSIS:

Comparisons of Consumers of Different Countries

a) Similarities and differences among people:

A major objective of cross-cultural consumer analysis is to determine how

consumers in two or more societies are similar and how they are different.

Such an understanding of the similarities and differences that exist between

nations is critical to the multinational marketer, who must devise appropriate

strategies to reach consumers in specific foreign markets.

The greater the similarity between nations, the more feasible it is to use

relatively similar strategies in each nation.

On the other hand, if the cultural beliefs, values, and customs of specific target

countries are found to differ widely, then a highly individualizedmarketing

strategy is indicated for each country.

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b) Acculturation Is a Needed Marketing Viewpoint:

Marketers must also go through a kind of accul turat ion process.

They must learn everything that is relevant about the usage or potential usage of

their products and product categories in the foreign countries in which they plan

to operate.

In a sense, cross-culturalacculturationis a dual process for marketers.

1. First, marketers must thoroughly orient themselves to the values, beliefs, and

customs of the new societyto appropriately position and market their products

(being sensitive to and consistent with traditional or prevailing attitudes and

values).

2. Second, to gain acceptance for a culturally new product in a foreign society,

they must develop a strategy that encourages members of that society to modify

or even break with their own traditions(to change their attitudesand possibly alter

their behavior).

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To maximize opportunities in foreign markets, it is essential to learn

about culture and values;

Every elementof that culture has an impact on marketing

strategies.

a) Language:

Product names should be checked for double meanings, to see whether

they can be pronounced in cultures lacking certain phonetic sounds, and to

ensure that another product in another culture does not use the same

name.

b) Customs:

Marketers have had to make adjustments for certain local customs in their

marketing strategy.

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c) Color:

Colors have different connotations and traditional uses across cultures.

When designing advertisements and packages, marketers must be careful

to avoid using colors that will send the wrong message to the consumers

of another culture.

d) Time:How consumers view and use their time differs greatly across cultures.

e) Space:

The distance at which business is conducted varies across cultures.

Cultural rules about physical contact and social distance are usually

unwritten but are extremely important to the people of a culture.

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ALTERNATIVE MULTINATIONAL STRATEGIES:GLOBAL VERSUS LOCAL

Some marketers have argued that world markets are becoming

more and more similar and that standardized marketing strategies

are, therefore, becoming more feasible.

In contrast, other marketers feel that differences between

consumers of various nations are far too great to permit a

standardized marketing strategy.

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a) Favoring a "World Brand"

An increasing number of firms have created world brandsproducts that are

manufactured, packaged, and positioned in exactly the same way regardless of

the country in which they are sold.

b) Adaptive Global Marketing

In contrast to the marketing communication strategy that stresses a common

message, some firms embrace a strategy that adapts their advertising messages

to the specific values of particular cultures. Eg McDonald's.

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Some marketers feel that the world-brand concept may he going too far.

Eg. Procter & Gamble The company believes that globally standardized

products may not be desirable.

Differences between countries are often sufficiently glaring to makelocalizedmarketing more appropriate than a global approach, which may

sometimes prove to be too costly.

Following a "mixed" strategy, firms such as Coca-Cola and Unilever have

augmented their global strategies with local execution.

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A global marketing strategyis one that maintains the marketing planacross all countries; that is, the product name, function, and ingredients

remain the same in all markets.

A global approach yields a consistent worldwide image and global name

recognition.

The company name and product names are not translated into many

languages, and few, if any, adjustments in product attributes are made.

Examples of companies that use global approaches include Coca-Cola,

Pepsi, IBM, Singer, Ford, and McDonald's.

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A localized marketing strategytakes into account the differences in consumer

behavior, such as culture and behavioral processes, as well as the differences in

the systems needed to market products, such as technology, law, the media, and

transportation.

Often the name of the product varies, and some firms alter product characteristicsfor other cultures.

Procter & Gamble manufactures many formulas of Tide detergent.

In these cases, using a local strategy requires that marketers be aware of cultural

differences in terms of product preferences, product use, promotionalcommunications, and product formulations.

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MARKETING MISTAKES:

A FAILURE TO UNDERSTAND DIFFERENCES:

a) Product Problems

International marketers frequently neglect to modify their products to

meet local customs and tastes.

b) Promotional Problems

When communicating with consumers in different parts of the world, the

promotional message must be consistent with the language and

customs of the particular target society.

c) Pricing and Distribution Problems

International marketers must adjust their pricing and distribution

policies to meet local economic conditions and customs.

Env Influences on CB

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