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THE IMPACT OF SOCIAL INFLUENCE

ON CONSUMER BEHAVIOR

CONSUMER DECISION MAKING


PROCESS

Cognitive process of
selecting an action
among alternatives
Steps in decision
making

WHERE DOES SOCIAL INFLUENCE COME


IN THE DECISION MAKING PROCESS?

Social factors
affect
decision
making at all
stages.

WHAT IS SOCIAL INFLUENCE?


Occurs when one's emotions, opinions, actions,
reaction, thoughts or behaviors are affected by
others.
It can take many forms and can be seen in:

CLASSIFICATIONS OF SOCIAL INFLUENCE

TYPES OF SOCIAL INFLUENCE

REFERENCE GROUPS AND


MEMBERSHIP GROUPS
Many brands look to target opinion leaders to spread
the use and purchase of their product in a social group.
Can be an internal person of the group when it comes to a
small social group
Can be through a sponsorship or a partnership with a
reference leader (celebrity, actor, musician, athlete, etc.)
for larger groups

FAMILY
Forms an environment of socialization in which an individual will
evolve, shape his personality, acquire values.
People will tend to keep the same as those acquired with their
families.
For example, parents describing Coke as a product full of sugar and
not good for health
For Brands Especially for Fast-Moving Consumer Goods (FMCG) or
Consumer Packaged Goods (CPG) successfully integrating the
family is both a real challenge and an opportunity.

SOCIAL ROLES AND


STATUS

Reflects the rank and the importance of role in society or in social


groups
For example, a consumer may buy a Ferrari for the quality of the
car but also for the external signs of social success that this kind
of cars represents
CEO driving a small car like a Ford Fiesta would be taken less
seriously by its customers and business partners than if he is
driving a German luxury car
Many brands have understood it by creating an image.

STATISTICS
Forbes conducted research to see how
consumers engage with different industries
including retail & travel.
81% of respondents indicated posts from their
friends and family directly influence their
purchase decisions.
In the same survey, they found out that 38% of
moms are more likely to buy products from
brands that other women Like on Facebook

78% of people say that a companys social


media posts impact their purchase decision.
9 out of 10 users watch videos about the tech
products they buy.
After marking an item as a favourite 50% of
social media purchases take place within a
week, and 80% of purchases take place within 3
weeks.

What does the HBR say?


Implications for Marketers?
Guide peoples behavior at any given
moment.
Successful athletes tend to buy
similar cars and read similar
magazines.

Waiting in the business lounge to


board a plane, we might reach for
Harvard Business Review,not just
for its content but also,
subconsciously, to reinforce our
identity as a successful executive.
Our social identity helps us
understand how to act in a context
in a way that enhances our
distinctiveness and status.

Unilever Italy
Unilever has used real-time tracking
in its marketing campaigns for the
deodorant Axe (known as Lynx in
some countries).
Its ads focus on how the product
makes its target market of young
men more attractive to women.

Young men in Italy were often still living


with their parents.
They saw the ads on TV at home, their
relevant social identity was dutiful son
rather than available man.
As a result they rejected the ads message,
since it focused on behavior that seemed
uncomfortable in front of mom.

SOCIAL INFLUENCE

HOW DOES IT AFFECT


CONSUMER BEHAVIOR?
Consumers not handcuffed by
information asymmetries
Extent of theinfluence of social media
Two Key Agents of Social Influence
1. Bonding
2. Trusted Expert

Social Influencer #1: Bonding


People much like us, similar needs
If we believe in the idea that we share a like
mind with someone or something, we have
a connection
Preference for similar product is
subconsciously elevated in our preference
ladder, and will influence our own decisions

Social Influencer #2: Trusted Expert


Sources we perceive know more
than us
When the knowledge is a product of
experience, the level of influence
expands
The important influencer is not the
expertise so much as ourperception
of expertise

Social Influence

SOCIAL NETWORKING
A platform to buildsocial
relationsamong people who share
similar interests, activities,
backgrounds or real-life connections.

Cultural Favorites
India worlds largest growth of social media
users
An increasing amount of people are looking to
social media to fulfill cognitive, affective,
personal integrative, social integrative, and
tension free needs

The things you share are things that make you


look good, things which you are happy to tie
into
your
identity.
Hilary
Mason,
Chief Data Scientist,Bitly,
Venture Beat, 2012

Data Mining Network Analysis Software


Facebooks Social Ads to tailor content
Facebook Beacon tracks the websites used
outside of Facebook
Brand Networking

IMPLICATIONS
Incentivization

Integration (IMC)

Word of Mouth

Relationship
Building

Brand Loyalty

Brand Equity

Wants to Needs
Social
Media
and
Consum
ers

Keeps Stakeholders
informed
Empowered
Consumerism

Convenience

IMPLICATIONS

(Deloitte, 2015

Consumers who use social media during their shopping


process are four times more likely to spend more on
purchases than those who do not.

Pakistans Perspective
Consumers Behavior and Effectiveness of Social
Media - Ghulam Rasool Madni

RESULT
- 47% of respondents buy items using social
media portals
- More females than males
- > Rs. 30,000 salary
- 53% consumers conduct pre-purchase search
- Interactive games, linked ads and behavioral

Examples
Microsoft (Windows live photo gallery)
Kylie 4 and half year child
Excitement
Ease of use

McDonalds

Parents
Teenagers
Business customer - Time value
Fun place for children

Videos link
Microsoft
https://
www.youtube.com/watch?v=DtilW
L4mnhI
Redbull
https://
www.youtube.com/watch?v=qj7gTz
2ugvw

REFERENCES
Ioanas, E., Stoica, I., 2014, Social Media and its impact on
Consumer Behavior, International Journal of Economic
Theories and Practices, pp. 295-303.
Madni, R, G., 2014, Consumers Behavior and Effectiveness
of Social Media. Global Journal of Management and
Business Research: E Marketing, pp. 57-62.
http://www.buzzle.com/articles/types-of-social-influence.html
http://journalofbusiness.org/index.php/GJMBR/article/viewF
ile/1582/1485
https://hbr.org/2015/01/why-your-customers-social-identities
-matter
http://www.forbes.com/sites/marketshare/2012/05/07/are-bra
nds-wielding-more-influence-in-social-media-than-we-though
t
http://www.adweek.com/socialtimes/files/2014/01/social-med
ia-purchase-decisions.jpg
http://www2.deloitte.com/content/dam/Deloitte/us/Document