MKT201 - Week 11

Group Influence and Opinion Leadership

(Ch. 11)

Reference Groups

• Reference Group– An actual or imaginary individual or group

conceived of having significant relevance upon an individual’s evaluations, aspirations/intentions, or behavior

– Three ways reference groups influence consumers

1. Informational2. Utilitarian3. Value-Expressive

– Some people are more influential than others in affecting consumers’ product preferences.

Reference GroupsReference GroupsA Reference Group Reference Group is an Actual or Imaginary Individual or Group Conceived

of Having Significant Relevance Upon an Individual’s Evaluations, Aspirations, or Behavior.

Reference Groups Influence Consumers in Three Ways/Forms:

InformationalInformational Value-ExpressiveValue-Expressive

UtilitarianUtilitarianInformation, brand-related knowledge, experts’ experience

Influenced by other social/family members, etc.; as expected

Image enhancement, admired or respected by others;

Help showing as: athlete, successful person, good parents, etc.

When Reference Groups Are ImportantWhen Reference Groups Are Important

Luxuries Rather ThanNecessities

Luxuries Rather ThanNecessities

SociallyConspicuous or Visible to

Others

SociallyConspicuous or Visible to

Others

A Reference Groups Influence Is More Powerful

and Important for Purchases

That Are:

e.g. sailboats

e.g. living room furniture, clothing

Relative Reference Groups’Influence on Purchase Intention

(2 dimensions of the “degree of importance” of reference group:publicly/privately consumed, luxury/necessity product)

Figure 11.1

When Reference GroupsAre Important (or so Persuasive)?

• Social Power:– The capacity to alter the actions of others– different sources or basis of social power:

• 1. Referent Power:– When consumers imitate qualities by copying behaviors of

a prominent person they admire.

• 2. Information Power:– Able to influence consumer opinion by virtue of their

(assumed) access to the “truth”

• 3. Legitimate Power:– Granted to people by virtue of social agreements,

sometimes conferred by a uniform

When Reference GroupsAre Important (cont.)

• 4. Expert Power:– Derived from possessing specific knowledge about a

content area

• 5. Reward Power:– When a person or group has the means to provide

positive reinforcement

• 6. Coercive Power:– Influencing a person by social or physical intimidation

The Power of Reference GroupsThe Power of Reference Groups

Referent Power

Referent Power

LegitimatePower

LegitimatePower

InformationPower

InformationPower

ExpertPower

ExpertPower

CoercivePower

CoercivePower

RewardPower

RewardPower

Types of Reference

Group Power e.g. Michael Jordan

– admired person

e.g. Editor of a newspaper

e.g. policemen, professors, doctors

e.g. a famous scientist, expert in Robotics

e.g. reward, social acceptance – awards or medals

e.g. social or physical intimidation/threat - gangsters; fear appeals SOCIAL POWER-

Capacity to alter the actions of others

Expert Power

• A physician has expert power, and a white coat reinforces this expertise by conferring legitimate (legal or high professional quality) power.

Types of Reference Group Influence

• Reference Group:– Any external influence that provides social cues

(signals)

• (1) Normative Influence:– The reference group helps to set and enforce

fundamental standards of conduct. (e.g. parents’ influence on marriage attitude; a Photo club)

• (2) Comparative Influence:– When decisions about specific brands or activities

are affected. (e.g. Harley-Davidson club)

• Marketers often portray products being used in groups that represent favorable reference groups to the target market.

• What type of message does this ad convey? What type of influence is this ad designed to exert on its target audience?

Discussion Question

• What type of message does this ad convey?

– Persuasive message with the use of Reference Group’s influence

• What type of influence is this ad designed to exert on its target audience?

– Comparative influence

Discussion Question

Brand Communities and Tribes• Brand Community:

– A set of consumers who share a set of social relationships based upon usage or interest in a product. (don’t necessary live near each other)

• E.g. Brandfests (e.g. organized events sponsored by Nike)

• Consumer Tribe: – A group of people who share a lifestyle and who can

identify with each other because of a shared allegiance (loyalty) to an activity or product (such as skateboarding, basketball, car driving)

• Tribal Marketing:– To link one’s product to the needs of a group as a whole.

(e.g. Mini Cooper, Mustang – car racing)

Products as a Way to be Popular

• Many products, especially those targeted to young people, are often touted/promoted as a way to take the inside track to popularity. This Brazilian ad lets us know about people who don’t like a certain shoe.

Bonehead – stupid person

Membership vs. AspirationalReference Groups

• Aspirational Reference Groups– Comprise idealized figures such as successful business

people, athletes, or performers.

• Membership Reference Group– Ordinary people whose consumption activities provide

informational social influence. Membership are affected by several factors:

• Propinquity: Physical nearness.• Mere Exposure: Liking persons or things simply as a

result of seeing them more often (mere exposure phenomenon)

• Group Cohesiveness: The degree to which members of a group are attracted to each other and value their group membership.

Match.com

Positive Versus NegativeReference Groups

• Avoidance Groups– Groups that consumers purposely try to distance

themselves from• Nerds (stupid, unattractive)• Druggies (addicted to drugs)• Preppies (manner and dress like in traditional

preparatory school)

– The motivation to distance oneself from a negative reference group can be as powerful or more powerful than the desire to please a positive group

Positive Reference Groups

• This recruiting ad presents a compelling role model for young women contemplating a career in the armed forces.

Consumers Do it in Groups

Some Phenomena • Deindividuation:

– A process in which individual identities become submerged within a group.

• Social Loafing:– People do not devote as much to a task when their

contribution is part of a larger group effort• Risky Shift:

– Group members are willing to consider riskier alternatives subsequent to group discussion

• Diffusion of Responsibility:– As more people are involved in a decision, each individual

is less accountable for the outcome

Consumers Do it in Groups (cont.)

• Value Hypothesis (to explain the increased riskiness/risky shift):– Riskiness is a culturally valued characteristic to which

individuals feel pressure to conform to attributes valued by society

• Decision Polarization:– Whichever direction the group members were leaning

toward before discussion becomes more extreme subsequent to discussion (risky choice Vs conservative choice)

• Home Shopping Parties:– Capitalize on group pressures to increase sales (e.g.

Tupperware party)

Deindividuation

• Costumes hide our true identities and encourage deindividuation.

Home Shopping Parties

• Women at a home Tupperware party.

Group Influences

• Group pressure often influences our clothing choices.

Group Effects on IndividualBehaviorGroup Effects on IndividualBehavior

Deindividu-alism

Deindividu-alism

SocialLoafing

SocialLoafing

Risky Shift

Risky Shift

Group Effects

Group Effects

BandwagonEffect

BandwagonEffect

ShoppingBehavior

ShoppingBehavior

Decision Polarization

Decision Polarization

e.g. behave wildly at costume parties

greater willingness to take risk following group discussion

moving toward extreme; risky - conservative

more purchase with one other person

devote less effort for group work

more & more group members, more conform

Conformity• Conformity

– A change in beliefs or actions as a reaction to real or imagined group pressure.

• Norms– Informal rules that govern behavior (for a society to function)

• Factors Influencing the Likelihood of Conformity– Cultural Pressures– Fear of Deviance (resulted in punishment or sanctions)– Commitment

• Principle of Least Interest (person/group that is least committed to staying in a relationship has the most power)

– Group Unanimity (same opinions), Size, and Expertise – as groups gain in power, compliance increases

– Susceptibility to Interpersonal Influence• Role-relaxed consumers (those are low in susceptibility to

influence of others)

InformationalConformity That Occurs Because

the Group’s Behavior is Takenas Evidence About Reality.

InformationalConformity That Occurs Because

the Group’s Behavior is Takenas Evidence About Reality.

ConformityConformity

ConformityConformity Refers to a Change in Beliefs or Actions as a Reaction to Real or Imagined Group Pressure.

Types of Social InfluenceTypes of Social Influence

NormativePerson Conforms to Meet

the Expectations of aPerson or Group.

NormativePerson Conforms to Meet

the Expectations of aPerson or Group.

e.g. clothing; ?? wearing masks in public (SARS)

e.g. mimic others’ behavior, gift-giving

Situation is uncertain, ambiguous

Factors Affecting the Likelihood of Conformity Factors Affecting the Likelihood of Conformity

Cultural PressuresCultural Pressures

Fear of DevianceFear of Deviance

CommitmentCommitment

Group DynamicsGroup Dynamics

Sex DifferencesSex Differences

Interpersonal InfluencesInterpersonal Influences

China/Japan - collectivism

e.g. terrorists’ willing to die

As groups gain in power, compliance increases

susceptibility to be influenced by others

Social Comparison• Social Comparison Theory:

– Asserts that people look to the behavior of others to increase the stability of their self-evaluation

– People tend to choose co-oriented peer: a person of equivalent standing

• Resisting Conformity:– Independence: Being oblivious (unaware of) or indifferent

to the expectations of others

– Anticonformity: Defiance (opposing) of the group is the actual behavior

– Reactance: The negative emotional state that results when we are deprived of our freedom to choose

Resistance to InfluenceResistance to Influence

Vs.

Anticomformity

Defiance of the Group is the

Object of Behavior

Independence

Oblivious to (unaware of) what

is expected by others

Reactance

Need to Preserve Freedom of Choice; People try to Overcome a

Loss of Freedom; Negative to extremely overbearing promotions.

• This ad for a video game says, “Conformity Bytes!”, but then captions (titles), “Join the Revolution!” Why?

• Does this ad encourage independence or anticonformity?

Discussion Question

Word-of-Mouth Communication

• Word-of-Mouth (WOM):– Product information transmitted by individuals to

individuals.

• Negative WOM and the Power of Rumors:– Negative WOM: Consumers weigh negative info

from other consumers more heavily than they do positive comments

Word-of-Mouth CommunicationWord-of-Mouth CommunicationMuch Information About Products and Services is Actually Conveyed by Individuals on an Informal

Basis called Word-of-Mouth Communication (WOM)Word-of-Mouth Communication (WOM)

Factors That Encourage WOM Are:

Person is Highly Involved With the ProductPerson is Highly Involved With the Product

Person is Highly Knowledgeable About the Product Person is Highly Knowledgeable About the Product

Person Has a Genuine Concern for Someone Else (benevolence)

Person Has a Genuine Concern for Someone Else (benevolence)

Person May be Uncertain About a Recent PurchasePerson May be Uncertain About a Recent Purchase

Word-of-Mouth

• The U.S. Postal Service hopes to create a buzz via word of mouth.

Rumors

• Hoaxkill.com is a Web site dedicated to tracking hoaxes/tricks and debunking/exposing product rumors.

The Transmission of Misinformation

Figure 11.2

Cutting-Edge WOM Strategies

• Virtual Communities– Virtual Community of Consumption: A

collection of people whose online interactions are based upon shared enthusiasm for and knowledge of a specific consumption activity.

• Multi-user Dungeons (underground chamber) (MUD)

• Rooms, rings and lists (e.g. chat rooms)• Boards• Blogs (weblog)

Multi-User Dungeons

Four Types of VirtualCommunity Members

• Tourists:– Lack strong social ties to the group

• Minglers (merger, mixer):– Maintain strong social ties, but are not interested in

the central consumption activity• Devotees:

– Express strong interest in the activity, but have few social attachments to the group

• Insiders:– Exhibit both strong social ties and strong interest

in the activity

Virtual Communities

Figure 11.3

2 factors: self-centrality (dominance of activity towards self-concept); intensity of social relationship/ties

Guerrilla and Viral Marketing

• Guerrilla Marketing– Promotional strategies that use unconventional

locations and intensive word-of-mouth campaigns to push products.

• Brand Ambassadors

• Viral Marketing– Refers to the strategy of getting customers to sell a

product on behalf of the company that creates it. (e.g. a small ad embedded in Hot Mail)

Guerrilla Marketing Ads

• Ads painted on sidewalks are one form of guerrilla marketing.

Social Networking

• Web sites letting members post information about themselves and make contact with similar others– Share interests, opinions, business contacts

THEFACEBOOK.COM

MYSPACE http://www.myspace.com/

http://www.facebook.com/

Opinion Leadership

• The Nature of Opinion Leadership– Opinion Leaders: People who are knowledgeable about

products and whose advice is taken seriously by others.– Homophily: The degree to which a pair of individuals is

similar in terms of education, social status, and beliefs. (appear to be more convincing than heterophily)

• How Influential Is an Opinion Leader?– Generalized Opinion Leader: Somebody whose

recommendations are sought for all types of purchases.– Monomorphic: An expert in a limited field.– Polymorphic: An expert in many fields (in a broad domain

such as electronics or fashion).

Reasons to Seek Advice from Opinion Leaders

• Expertise

• Unbiased knowledge power

• Highly interconnected in communities (social standing)

• Referent power/homophily

• Hands-on product experience (absorb risk)

Opinion Leaders Market Shoes

• Opinion leadership is a big factor in the marketing of athletic shoes. Many styles first become popular in the inner city and then spread by word-of-mouth.

Types of Opinion Leaders

• Innovators– Early purchasers

• Innovative Communicators– Opinion leaders who also are early purchasers– Opinion leaders also are likely to be opinion seekers

• The Market Maven (Expert) – a consumer category– Describes people who are actively involved in transmitting

marketplace information of all types. (not necessarily have interests or have purchased the products)

• The Surrogate Consumer – a class of marketing intermediary– A person who is hired to provide input in purchase decisions.

(e.g., interior decorators, stockbrokers, college consultants)

Perspectives on theCommunications Process

Figure 11.4

(tend to be opinion seekers)

Fashion Opinion Leaders

• Fashion opinion leaders tend to be knowledgeable about clothing and highly motivated to stay on top of fashion trends.

Identifying Opinion Leaders

• Many ads intend to reach influentials rather than average consumer– Local opinion leaders are harder

to find

– Companies try to identify influentials in order to create WOM “ripple effect”

– Exploratory studies identify characteristics of opinion leaders for promotional strategies

Identifying Opinion Leaders

• Self-designated Opinion Leaders• Sociometric Methods

Trace Communication patterns among members of a group.– To better understand Referral Behavior – Network Analysis: Focuses on communication in social

systems• Referral Network• Tie Strength: The nature of the bond between people.

– Bridging Function (weak ties): Allows a consumer access between subgroups.

– Cliques: Subgroups (friends or associates, etc.; sharing preferences or brand choices for various products)

Characteristics of Opinion LeadersCharacteristics of Opinion Leaders

Appearance-Conscious and

Narcissistic

Appearance-Conscious and

Narcissistic

Own More Clothing With aBroader Range

of Styles

Own More Clothing With aBroader Range

of Styles

Are Opinion Seekers

Are Opinion Seekers

EarlyCommunicators

EarlyCommunicators

InnovatorsInnovators

KeyCharacteristics

ofOpinionLeaders

KeyCharacteristics

ofOpinionLeaders

Socially Active

Socially Active

Like Music andMagazines

Like Music andMagazines

Self-worship, love of oneself

Revised Opinion Leadership Scale

Figure 11.5