Macro factors influencing Buying Decision Process Culture Subculture Social Class Reference Groups Family

Legacy

WHAT IS CULTURE?
Culture as the sum total of learned beliefs, values, and customs that serve to direct the consumer behavior of members of a particular society. Values also are beliefs. Values differ from other beliefs, however, because they meet the following criteria : (1) they are relatively few in numbers, (2) they serve as a guide for culturally appropriate behavior, (3) they are enduring or difficult to change, (4) they are not tied to specific objects or situations, and (5) they are widely accepted by the members of a society

CHARACTERISTICS OF CULTURE Culture Satisfies Needs Culture Is Learned -- informal learning and technical learning ENCULTURATION AND ACCULTURATION LANGUAGE AND SYMBOLS Culture Is Shared group customs Culture Is Dynamic

CULTURE
A complex set of values, ideas, beliefs, attitudes and other meaningful symbols, crated by human beings to shape human behavior and the artifacts for that behavior as they are transmitted from one generation to another.

 CONTENT ANALYSIS CONSUMER FIELDWORK VALUE MEASUREMENT SURVEY INSTRUMENTS

THE MEASUREMENT OF CULTURE

The distinct characteristics of field observation are that (1) it takes place within a natural environment, (2) it is performed sometimes without the subjects awareness, and (3) it focuses on observation of behavior. VALUE MEASUREMENT SURVEY INSTRUMENTS THE YANKELOVICH MONITOR DYG SCAN -- AN ENVIRONMENTAL SCANNING PROGRAM

Cultural Values
--------------------------------------------------------------------------------------------------Terminal values Instrumental values (end-states of existence) (modes of conduct) --------------------------------------------------------------------------------------------------A comfortable life (a prosperous life) An exciting life (a stimulating, active life) A sense of accomplishment (lasting contribution) A world at peace (free of ware and conflict) Equality (brotherhood, equal opportunity) Family security (taking care of loved ones) Freedom (independence, free choice) Happiness (contentedness) Inner harmony (freedom from inner conflict) Mature love (sexual and spiritual intimacy) National security (protection from attack) Pleasure (an enjoyable, leisurely life) Salvation (saved, eternal life) Self-respect (self-esteem) Social recognition (respect, admiration) True friendship (close companionship) Wisdom (a mature understanding of life) Ambitious (hardworking, aspiring) Broadminded (open-minded) Capable (competent, effective) Cheerful (lighthearted, joyful) Courageous (standing up for your beliefs) Forgiving (willing to pardon others) Helpful (working for others welfare) Honest (sincere, truthful) Imaginative (daring, creative) Independent (self-reliant, self-sufficient) Intellectual (intelligent, reflective) Logical (consistent, rational) Loving (affectionate, tender) Obedient (dutiful, respectful) Polite (courteous, well mannered) Responsible (dependable, reliable) Self-controlled (restrained, self-disciplined)

Variations in Value Systems -----------------------------------------------------------------------------------------------------Orientation Range -----------------------------------------------------------------------------------------------------Human nature Evil (changeable or unchangeable): Most people are basically evil and cant be trusted. Mixture of good and evil (changeable or unchangeable ): there are evil and good Good (changeable or unchangeable): Most people are basically good and can be trusted.

People-nature relationship

Subjugation to nature : Life is largely controlled by outside forces

Harmony with nature : Live in harmony with nature

Mastery over nature : People should challenge and control nature

Time sense

Past oriented (tradition bound) : People should learn from and emulate the glorious past.

Present oriented (situational) : Make the most of the present Moment : live for today

Future oriented (goal oriented): Plan for the future in order to make it better than the past

-----------------------------------------------------------------------------------------------------Orientation Range -----------------------------------------------------------------------------------------------------Activity Being : Spontaneously express impulses and Desires : stress who you Are. Being-in-becoming : Emphasize selfrealization. Development of all aspects of the self as on integrated whole. Collateral (group oriented ): A person is an individual as well as a group member participating in collective decisions. Doing : Stress action and accomplishment.

Variations in Value Systems

Social relations

Linear (authoritarian): Lines of authority are clearly established, with dominant-subordinate relationships clearly Defined and respected

Individualisitc : Each person is autonomous and should have equal rights and control over his or her own destiny.

SUMMARY OF AMERICAN CORE VALUES

VALUE GENERAL FEATURES RELEVANCE TO CONSUMER BEHAVIOR _______________________________________________________________________________________________ Achievement and Hard work is good;success flows Act as a justification for acquisition of goods Success from hard work (You deserve it)

Activity
Efficiency and Practicality Progress

Keeping busy is healthy and natural Admiration of things that solve problems (e.g., save time and effort)
People can improve themselves; tomorrow should be better than today The good life

Stimulates interest in products that are time-savers and enhance leisure time Stimulates purchase of products that function well and save time
Stimulates desire for new products that fulfill unsatisfied needs;ready acceptance of products that claim to be new or improved Fosters acceptance of convenience and luxury products that make life more comfortable and enjoyable Stimulates acceptance of customized or unique products that enable a person to express his or her own personality Fosters interest in wide product lines and differentiated products

Material Comfort

Individualism

Being oneself (e.g., self-reliance, self-interest, self-esteem)

Freedom

Freedom of choice

SUMMARY OF AMERICAN CORE VALUES

VALUE GENERAL FEATURES RELEVANCE TO CONSUMER BEHAVIOR _______________________________________________________________________________________________ External Conformity Uniformity of observable behavior; Stimulates interest in products that are used or desire for acceptance owned by other in the same social group Humanitarianism Caring for others, particularly the underdog A state of mind that stresses being Young at heart and having a Caring about ones body, including the desire to be physically fit and healthy Stimulates patronage of firms that compete with market leaders Stimulates acceptance of products that provide the illusion of maintaining or fostering youthfulness Stimulates acceptance of food products, activities, and equipment perceived to maintain or increase physical fitness

Youthfulness

Fitness and Health

WHAT IS SUBCULTURE?
We define subculture, then, as distinct cultural group that exists as an identifiable segment within a larger, more complex society Thus, the cultural profile of a society or nation is composite of two distinct elements : (1) the unique beliefs, values, and customs subscribed to by members of specific , subcultures; and (2) the central or core cultural themes that are shared by most of the population, regardless of specific subcultural memberships.

SUBCULTURAL CATEGORY EXAMPLES ________________________________________________________________________ Nationality ( i..e.,birthplace of ancestors French, puerto Rican, Korean) Religion Catholic,Hindu, Jew Geographic Region Southeastern, Midwestern,Eastern Race African-American, Caucasian, Asian-American Age Elderly, Teenage, Middle Age Gender Female, Male Occupation Engineer, Cook, Plumber Social Class Lower, Middle, Upper

RELATIONSHIP BETWEEN CULTURE AND SUBCULTURE

Subcultural Traits of Northerners

Dominant Cultural Traits of U.S. Citizens

Subcultural Traits of Southerners

AGE SUBCULTURES : (BASIC NEEDS,CONVENIENCE, PLACE PREFERENCES ETC) GENERATION X..18-29 YEAR

BABY BOOMERS ..35-55

OLDER CONSUMERS SENIOR CITIZENS PROFESSIONAL SUBCULTURES (SHOPPING PATTERN, TYPE OF PRODUCTS , BRAND PREFERENCES) WORKING WOMAN CALL CENTRE YOUTH

Social Standing
Social Standing : How it is Derived and How it Influences Behavior

Socio economic factors

Occupation Education Ownership Income

Social Standing
Upper Class Middle Class Working Class Lower Class

Unique behaviors
Preferences Purchases Consumption Communication

WHAT IS SOCIAL CLASS ?

Is 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. SOCIAL CLASS AND SOCIAL STATUS Social Class is Hierarchical Social Class and Market Segmentation Social Class and Behavioral Factors Social Class as a Frame of Reference

SOCIAL CLASS
Requirements for a Social Class System

Upper Class

Middle Class

Working Class

Lower Class

ELEMENTS OF SOCIAL STATUS

WEALTH
POWER(DEGREE OF PERSONAL CHOICE
OVER OTHERS)

OR INFLUENCE

PRESTIGE

(THE DEGREE OF RECOGNITION

RECEIVED FROM OTHERS)

Different Social Class

Life-style Orientations & Purchasing Tendencies of the Different Social Classes ----------------------------------------------------------------------------------------------------------Social Class Life-style Orientation Purchasing Tendencies ----------------------------------------------------------------------------------------------------------Upper Class Good taste Quality merchandise Graceful living Expensive hobby and Good Things in life recreation equipment Individual expression Art Interest in arts and Books Culture Travel Middle Class Respectability Conformity Propriety social esteem Items in fashion Items related to self presentation Nice clothing, and home Items for Children

Different Social Class

Life-style Orientations & Purchasing Tendencies of the Different Social Classes ----------------------------------------------------------------------------------------------------------Social Class Life-style Orientation Purchasing Tendencies ----------------------------------------------------------------------------------------------------------Working Class Fun oriented Newest appliances Parochial /narrow minded Sporting events Unsophisticated taste Newest and biggest item Focus on Possessions, not ideas Lower Class Close family relationships Not interested in world affairs Neighborhood oriented Immediate gratification Status symbols Products enhancing self-esteem Pseudo symbols of prosperity, such as used scooters Readily available products

Upward Pull Strategy Targeted at Middle Class

Middle Class

Aspirations To belong to upper-middle class

Prefer Products consumed by uppermiddle class

Positioning Upper class symbolism for middle class products

Target market

the measurement of social class

Two-category social-class schemas Blue collar, white collar Lower, upper Lower, middle Three-category social-class schemas Blue collar, gray collar, white collar Lower, middle, upper Four-category social-class schema Lower, lower-middle, upper-middle, upper Five-category social class schemas Lower,working-class, lower-middle, upper-middle, upper Lower, lower-middle, middle, upper-middle, upper Six-category social-class schema Lower-lower, upper-lower, lower-middle, upper-middle, lower-upper, upper-upper Seven-category social-class schema Real lower-lower, a lower group of people but not the lowest, working class, middle class, uppermiddle, lower-upper, upper-upper Nine-category social-class schema Lower-lower, middle-lower, upper-lower, lower-middle, middle-middle, upper-middle, lower-upper, middle-upper, upper-upper.

the measurement of social class

The upper-upper class-Country Club Establishment Small number of well-established families Belong to best country clubs and sponsor major charity events Serve as trustees for local colleges and hospitals Prominent physicians and lawyers May be heads of major financial institutions, owners of major long-established firms Accstomed to wealth, so do not spend money conspicuously The Lower-upper Class -- New Wealth Not quite accepted by the upper crust of society Represent new money Successful business executives Conspicuous users of their new wealth The upper-middle class - Achieving Professionals Have neither family status nor unusual wealth , 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 of often conspicuous ; and Very child-oriented

the measurement of social class

The lower-middle class -- Faithful Followers Primarily nonmanagerial white-collar workers and highly paid blue-collar workers Want to achieve respectability and be accepted as good citizens Want their children to be well-behaved Tend to be churchgoers and are often involved in church-sponsored activities Prefer a neat and clean appearance, and tend to avoid faddish or highly-styled clothing Constitute a major market for do-it-yourself products The upper-lower class -- Security-minded Majority The largest social-class segment Solidly blue collar Strive for security (sometimes gained from union membership) View work as a means to buy enjoyment Want children to behave properly High wage earners in this group may spend impulsively Interested in items that enhance their leisure time (e.g.. TV sets, hunting equipments) Husbands typically have a strong macho self-image Males are sports fans, heavy smokers, beer drinkers The lower-lower class -- Rock Bottom Poorly educated, unskilled laborers, Often out of work Children are often poorly treated and Tend to live a day-to-day existence.

Identify the following concepts

Roles and Status

Life cycle

FAMILY BUYING INFLUENCES

The Reciprocal Influences of Family Members
Husband Wife

Cognitions Behaviors Environments

Cognitions Behaviors Environments

Child

Cognitions Behaviors Environments

CONSUMER SOCIALISATION
A model of consumer socialization
Background factors Socioeconomic status Sex Age Social Class Religious background

Socialization agents Media Family members Peers Teachers

Learning mechanisms Modeling Reinforcement Stage of cognitive development

Outcomes The socialized consumer

INTERGENERATIONAL INFLUENCES
The Concept of Intergenerational Carryover
Grandparents
(Knowledge, values, habits,preferences)

Parents
(Knowledge, values, habits,preferences)

Children

Time

----------------------------------------------------------------------------------------------Stage Consumption Patterns ----------------------------------------------------------------------------------------------1) Young single Outdoor sporting goods, sports, cars fashion clothing, entertainment and recreation services Recreation and relaxation, insurance, home furnishing, travel, home appliances, high purchase rate of durables

Consumption Patterns of Families in Life Cycle Stages

2) Young married with no children

3) Young married with children

Baby food, clothing, and furniture : starter housing, insurance, washers-dryers, medical services/supplies for children, toys for children
Childrens lessons (piano,dance, etc.) large food purchases (respond to bulk buying deals), dental care, higher-priced furniture, autos, and housing, fast-food restaurants Luxury products, travel, restaurants, condominiums; recreation, make gifts and contribution, high discretionary incomes, solid financial position.

4) Middle-aged with children at home

5) With no children at home

Consumption Patterns of Families in Life Cycle Stages ----------------------------------------------------------------------------------------------Stage Consumption Patterns ----------------------------------------------------------------------------------------------6) Older (married or single) Health care, home security, specialized housing, specialized food products, recreation geared to the retired, generally ash poor. Money-saving products, frozen foods, rental housing, child care, time-saving appliances and foods, cash poor

7) Divorced

Assignment
What is the impact of your friends or family on products features and brands to be selected for the following products. Watch Clothes for casual wear Clothes for some special occasion Your mobile phone Your toothpaste Your undergarments Your vacations Your barber Your hair color

WHAT IS A GROUP ?
A group may be defined as two or more people who interact to accomplish either individual or mutual goals. A reference groups is any person or group that serves as a point of comparison (or reference) for an individual in forming either general or specific values, attitudes, or behavior. Types of Groups : PRIMARY VERSUS SECONDARY GROUPS FORMAL VERSUS INFORMAL GROUPS MEMBERSHIP VERSUS SYMBOLIC GROUPS CONSUMER-RELEVANT GROUPS THE FAMILY FRIENDSHIP GROUPS FORMAL SOCIAL GROUPS SHOPPING GROUPS CONSUMER ACTION GROUPS WORK GROUPS

Distinctions between Types of Reference Groups

Type of Reference Group

Formal versus informal Primary versus secondary

Distinctions

Formal groups have clearly specified structure and mission; informal groups do not. Primary groups involve face-to-face interaction; secondary groups do not. Memberships groups are those in which the individual is a member; aspirational groups are those an individual wants to join; dissociative groups are those an individual wants to avoid.

Membership versus aspirational Or dissociative

TYPES OF REFERENCE GROUPS

POSITIVE ATTITUDE NEGATIVE ATTITUDE Positive Membership Group Disclaimant Group Aspiration Group Avoidance Group

TYPES OF MEMBERSHIP GROUPS INFORMAL PRIMARY SECONDARY Family/Peer Groups Shopping Groups Sports Groups FORMAL School Groups Business Groups Alumni Groups Tenant Organization

TYPES OF ASPIRATION GROUPS

CONTACT NO CONTACT Anticipatory Symbolic

FACTORS THAT AFFECT REFERENCE GROUP INFLUENCE

Information and Experience Credibility, Attractiveness, and Power of the Reference Group Conspicuousness of the Product REFERENCE GROUPS AND CONSUMER CONFORMITY 1. Inform or make the individual aware of a specific product or brand; 2. Provide the individual with the opportunity to compare his or her own thinking with the attitudes and behavior of the group; 3. Influence the individual to adopt attitudes and behavior that are consistent with the norms of the group; and 4. Legitimize an individuals decision to use the same products as the group.

APPLICATION OF THE REFERENCE GROUP CONCEPT

CELEBRITIES

How Celebrities Are Used

1. 2. 3. 4.

Testimonials Endorsement Actor Spokesperson

Reference Group Influence on Product & Brand

NECESSITY Weak reference group influence on product (-) Public Necessities Influence : Weak product and strong brand Examples : wristwatch, automobile,mans suit Private Necessities Influence : Weak product and brand Examples :mattress, floor lamp, refrigerator

LUXURY Strong reference group influence on product (+) Public Luxuries Influence : Strong product and brand Examples :golf clubs, sailboat Private Luxuries Influence : Strong product and weak brand Examples : home video game, icemaker

PUBLIC Strong reference group influence on brand (+) PRIVATE Weak reference group influence on brand (-)

WHAT IS OPINION LEADERSHIP?

Opinion leadership is the process by which one person (the opinion leader) informally influences the actions or attitudes or others, who may be opinion seekers or merely opinion recipients.
DYNAMICS OF THE OPINION LEADERSHIP PROCESS Opinion Leaders Are Persuasive Credibility Positive and Negative Product Information Information and Advice Opinion Leadership is Category-Specific Opinion Leadership is a Two-Way Street

MEASUREMENT OF OPINION LEADERSHIP

In measuring opinion leadership, the researcher has a choice of four basic measurement techniques: (1) the self-designating method, (2) the sociometric method, (3) the key informant method, and (4) the objective method.

Self-improvement Motivations Reduce post purchase uncertainty or Reduce the risk of making a purchase dissonance commitment Gain attention or status Reduce search time (e.g., avoid the Assert superiority and expertise necessity of shopping around Feel like an adventurer Experience the power of converting others Product -Involvement Motivations Express satisfaction or dissatisfaction Learn how to use or consume a product with a product or service Learn what products are new in the marketplace Other-Involvement Motivations Express neighborliness and friendship Buy products that have the approval by discussing products or services that of others, thereby ensuring acceptance may be useful to others Message-Involvement Motivations Express ones reaction to a stimulating advertisement by telling others about it.

A PROFILE OF THE OPINION LEADER

KNOWLEDGE AND INTEREST CONSUMER INNOVATORS PERSONAL CHARACTERISTICS SOCIAL CLASS DEMOGRAPHIC CHARACTERISTICS MEDIA HABITS :

GENERALIZED ATTRIBUTES CATEGORY-SPECIFIC ATTRIBUTES ACROSS PRODUCT CATEGORIES __________________________________________________________________ Innovativeness Interest Willingness to talk Knowledge Self-confidence Special-interest media exposure Gregariousness Same age Same social status Social exposure outside group

The Opinion Leadership Process

Mass Media Market Target Customers

Direct Flow
Opinion Leader Two-step-Flow

Opinion Leader

Opinion Leader

Multi-Step Flow

Factors Influencing the Consumer Decision-Making Process

Marketing mix influences Psychological influences
Perception Attitudes Learning Motivation Product Price Place Promotion

Sociocultural influences
Reference groups Family Social class Culture Subculture

Situational influences
Type of purchase Social surroundings Physical surroundings Previous experience

Problem recognition Information search Alternative evaluation Purchase decision Postpurchase evaluation