Family Influences and Decision Making

Introduction 

 The family is a major influence on the consumer behavior of its members. There are many examples of how the family influences the consumption behavior of its members. A child learns how to enjoy candy by observing an older brother or sister; learns the use and value of money by listening to and watching his or her parents. Decisions about a new car, a vacation trip, or whether to go to a local or an out-of-town college are consumption decisions usually made within the context of a family setting. As a major consumption unit, the family is also a prime target for the marketing of many products and services.

 The Family 

 The importance of the family or household unit in consumer behavior arises for two reasons: 

1. Many products are purchased by a family unit. 

2. Individuals’ buying decisions may be heavily influenced by other family members. 

 How families or households make purchase decisions depends on the roles of the various family members in the purchase, consumption, and influence of products. Household products like food and soaps may be purchased by a person but consumed by many, whereas personal care items, such as cosmetics or shaving cream, might be purchased by an individual family member for his or her own consumption. Homes and cars, on the other hand, are often purchased by both spouses, perhaps with involvement from children or other member of the extended family. 

 Visits to shopping malls often involve multiple family members buying clothing and accessories, something with a heavy dose of influence by family members-children may buy clothing paid for and approved of by parents, whereas teenagers may influence the clothing purchase of a parent.

 Regardless of how many family members are present when items are being purchased, the other family members play an important role in the purchase. Just because of being mother for two young children, it is her responsibility for buying food for the family and act as an individual in the market. It does not mean that her decisions are not influenced by the preferences and power of other family members. Although marketing communications are usually directed to individuals, marketers should consider the consumption circumstances and the family structure before deciding on specific communication or advertising methods to attract their segment.

What is a Family? 

 A family is a group of two or more persons related by blood, marriage, or adoption who reside together. The nuclear family is the immediate group of father, mother, and child(ren) living together. The extended family is the nuclear family, plus other relatives, such as grandparents, uncles and aunts, cousins, and parents-in-law. The family into which one is born is called the family of orienta tion, whereas the one established by marriage is the family of procreation. 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.

What is a Household? 

 The term household is used to describe all person, both related and unrelated, who occupy a housing unit. There are significant differences between the terms household and family even though they are sometimes used interchangeably. It is impor tant to distinguish between these terms when examining data. 

 The term household is becoming a more important unit of analysis for marketers because of the rapid growth in nontradi tional families and non-family households. Among non-family households, the great majority consist of people living alone. The remaining non-family households include those consisting of elderly people living with non-family members. For example, persons of Opposite Sex Sharing Living Quarters, friends living together, and same sex couples. 

Structural Variables Affecting Families and Households 

 Structural variables include the age of the head of household or family, marital status, presence of children, and employment status. For example, consumer analysts have enormous interest in whether families have children and how many they have. Children increase family demand for clothing, food, furniture, homes, medical care, and education, while they decrease demand for many discretionary items, including travel, higher-riced restaurants, and adult clothing. 

 Other structural changes affect the types of products that are manufactured. For example, in Japan, high-tech companies have formed a consortium to standardize technology that has been developed to monitor and manage households. 

Sociological Variables Affecting Families and Households 

 Marketers can understand family and household decisions better by examining the sociological dimensions of how families make consumer decisions. Three sociological variables that help explain how family’s function includes cohesion, adaptability, and communication. 

  ➢ Cohesion is the emotional bonding between family members. It measures how close to each other family members feel on an emotional level. Cohesion reflects a sense of connectedness to or separateness from other family members.   

➢ Adaptability measures the ability of a family to change its power structure, role relationships, and relationship rules in response to situational and developmental stress. The degree of adaptability shows how well a family can meet the challenges presented by changing situations.   

➢ Communication is a facilitating dimension, critical to movement on the other two dimensions. Positive communication skills (such as empathy, reflective listening, and supportive comments) enable family members to share their changing needs as they relate to cohesion and adaptability. Negative communication skills (such as double messages, double binds, criticism) minimize the ability to share feelings, thereby restricting movement in the dimensions of cohesion and adaptability. Understanding whether family members are satisfied with family purchase requires communication within the family.

 To determine how the family makes its purchase decisions and how the family affects the future purchase behavior of its members, it is useful to understand the functions provided and the roles played by family members to fulfill their consumption needs. 

Functions of The Family 

 Four basic functions provided by the family are particularly relevant to a discussion of consumer behavior. These include

  (1) Economic wellbeing, 

(2) Emotional support, 

(3) Suitable family lifestyles, and 

(4) Familymember socialization. 

(1) Economic Well-Being 

 Providing financial means to its dependents is unquestionably a basic family function. How the family divides its responsibilities for providing economic well-being has changed considerably. The traditional roles of husband as economic provider and wife as homemaker and child rearer are still valid. The economic role of children has changed. Today, even if some teenage children work, they rarely assist the family financially. Their parents are still expected to provide for their needs. But some of them get enough pocket-money to decide their consumption of discretionary items.

(2) Emotional Support 

 The provision of emotional nourishment (including love, affection, and intimacy) to its members is an important basic function of the contemporary family. In fulfilling this function, the family provides support and encouragement and assists its members in coping with personal or social problems. To make it easier for working parents to show their love affection and support for their children, greeting-card companies have been marketing cards especially for parent to give to their children. For instance, in most communities, many educational and psychological centers are available that are designed to assist parents who want to help their children improve their learning and communication skills, or generally, better adjust to their environments. 

(3) Suitable Family Lifestyles 

 Another important family function in terms of consumer behavior is the establishment of a suitable lifestyle for the family. Family lifestyle commitments, including the allocation of time, greatly influence consumption patterns. For example, the increase in the number of married women working outside the home has reduced the time they have available for household chores, and has created a market for convenience products and fast-food restaurants. Also, with both parents working, an increased emphasis is placed on the notion of “quality time”, rather than the “quantity of time” spent with children and other family members. Realizing the scarcity of quality family time, Hotels feature a variety of weekend packages targeted to couples and their children. 

(4) Socialization of Children and Other Family Members 

 The socialization of family members, especially young children, is a central family function. In large part, this process consists of imparting to children the basic value and modes of behavior consistent with the culture. These generally include moral and religious principles, interpersonal skills, dress and grooming standard, appropriate manners and speech, and the selection of suitable educational and occupational or career goals. Socialization skills (manners, goals, values, and other qualities) are imparted to a child directly through instruction and indirectly through observation of the behavior of parents and older siblings. Marketers often target parents looking for assistance in the task of socializing preadolescent children.

Family Life Cycles Families pass through a series of stages that change them over time. This process historically has been called the family life cycle (FLC). The concept may need to be changed to house hold life cycle (HLC) or consumer life cycle (CLC) in the future to reflect changes in society. However, we will use the term FLC to show how the life cycle affects consumer behavior. 

Family Life Cycle Characteristics 

 The traditional FLC describes family patterns as consumers marry, have children, leave home, lose a spouse, and retire. These stages are described in Table along with consumer behaviors associated with each stage. But consumers don’t necessarily have to pass through all these stages-thy can skip multiple stages

Young Singles 

 Young singles may live alone, with their nuclear families, or with friends, or they may co-habitate with partners in this stage. Although earnings tend to be relatively low, these consumers usually don’t have many financial obligations and don’t feel the need to save for their futures or retirement. Many of them find themselves spending as much as they make on cars, furnishings for first residences away from home, fashions, recreation, alcoholic beverages, food away from home, vacations, and other products. 

Newly Married Couples 

 Newly married couples without children are usually better off financially than they were when they were single, since they often have two incomes available to spend on one household. These families tend to spend a substantial amount of their incomes on cars, clothing, vacations, and other leisure activities. They also have the highest purchase rate and highest average purchases of durable good (particularly furniture and appliances) and appear to be more susceptible to advertising. 

Full Nest I 

 With the arrival of the first child, parents begin to change their roles in the family, and decide if one parent will stay to care for the child or if they will both work and buy daycare services. In this stage, families are likely to move into their first home; purchases furniture and furnishings for the child; and purchase new items such as baby food, toys, sleds, and skates. These requirements reduce families’ ability to save, and the husband and wife are often dissatisfied with their financial position. 

Full Nest II 

 In this stage, the youngest child has reached school age, the employed spouse’s income has improved. Consequently, the family’s financial position usually improves, but the family finds itself consuming more and in larger quantities. Consumption patterns continue to be heavily influenced by the children, since the family tends to buy largesized packages of food and cleaning suppliers, bicycles, music lessons, clothing, sports equipment, and a computer. 

Full Nest III 

 As the family grows older and parents enter their min-40s, their financial position usually continues to improve because the primary wage earner’s income rises, the second wage earner is receiving a higher salary, and the children earn from occasional and part-time employment. The family typically replaces some worn pieces of furniture, buys some luxury appliances, and spends money on education. Families also spend more on computers in this stage, buying additional PCs for their older children. Depending on where children go to college and how many are seeking higher education, the financial position of the family may be tighter than other instances. 

Married, No Kids 

 Couples who marry and do not have children are likely to have more disposable income to spend on charities, travel, and entertainment than others in their age range. Not only do they have fewer expenses, these couples are more likely to be dual-wage earners, making it easier for them to retire earlier if they save appropriately. 

Older Singles 

 Single, age 40 or older, may be single again (ending married status because of divorce or death of a spouse), or never married (because they prefer to live independently or because they co-habitate with partners), either group of which may or may not have children living in the household. This group now has more available income to spend on travel and leisure but feels the pressure to save for the future, since there is no second income on which to rely as they get older. 

Empty Nest I 

 At this stage, the family is most satisfied with its financial position. The children have left home and are financially independent allowing the family to save more. In this stage discretionary income is spent on what the couple wants rather than on what the children need. Therefore, they spend on home improvements, luxury items, vacations, sports utility vehicles, food away from home, travel, and product for their grand children. 

Empty Nest II 

 But this time, the income earners have retired, usually resulting in a reduction in income and disposable income. Expenditures become health oriented, centering on such items as medical appliances and health, and medicines. But many of these families continue to be active and in good health, allowing them to spend time traveling, exercising, and volunteering. Many continue working part time to supple ment their retirement and keep them socially involved. 

Solitary Survivor 

 Solitary survivors be either employed or not employed. If the surviving spouse has worked outside the home in the past, he or she usually continues employment or goes back to work to live on earned income (rather than saving) and remain socially active. Expenditures for clothing and food usually decline in this stage, with income spent on health care, sickness care, travel entertainment, and services.. Those who are not employed are often on fixed incomes and may move in with friends to share housing expenses and companionship, and some may choose to re marry. 

Retired Solitary Survivor 

 Retired solitary survivors follow the same general consumption patterns as solitary survivors; however, their income may not be as high. Depending on how much they have been able to save throughout their lifetimes, they can afford to buy a wide range of products. These individuals have special needs for attention, affection, and security based on their lifestyle choices. 

 Marketers use the descriptions of these FLC stages when analyzing marketing and communication strategies for products and services, but they often add additional information about consumer markets to analyze their needs, identify niches, and develop consumer-specific marketing strategies. 

Family Decision-Making

 Families use products even though individuals usually buy them. Determining what products should be bought, which retail outlet to use, how and when products are used, and who should buy them is a complicated process involving a variety or roles and actors. 

Role Behavior 

 Families and other groups exhibit what sociologist Talcott Parsons called instrumental and expressive role behaviors. 

  ➢ Instrumental roles, also known as functional or economic roles, involve financial, performance, and other functions performed by group members.   

➢ Expressive roles involve supporting other family members in the decision-making process and expressing the family’s aesthetic or emotional needs, including upholding family norms. 

Individual Roles in Family Purchases 

 Family consumption decisions involve at least five definable roles, which may be assumed by spouses, children, or other members of a house hold. Both multiple roles and multiple actors are normal. Marketers need to communicate with consumers assuming each of these roles, remembering that different family members will assume different roles depending on the situation and product. Children, for example, are users of cereals, toys, clothing, and many other products but may not be the buyers. One or both of the parents may be the decider and the buyer, although the children may be important as influencers and users.

Family Roles for a family to function as a cohesive unit, roles or tasks-such as doing the laundry, preparing meals, setting the dinner table, taking out the garbage, walking the dog must be carried out by one or more family members. In our dynamic society, etc. family-related roles are constantly changing. 

Key Family Consumption Roles 

 The roles played by the different family members will vary from product to product. While shopping in the market, a housewife comes across a new variety of juice that she buys for the family. Her decision topurchase does not directly involve the influence of other family members. She is the deci der, buyer; but she may or may not be the preparer and is not the only user. In case of products such as television, car, music systems, furniture or any other product which is likely to be used by some or all the family members, the purchase decision is likely to be joint or group decision. 

 There are eight distinct roles in the family decision-making process. A look at these roles provides further insight into how family members act in their various consumption-related roles: 

1. Influencers: Those family members who provide information and advice and thus influence the purchase. The housewife tells her family about the new eatery that has opened in the neighborhood and her favorable description about it influences her husband and teenaged children. 

2. Gatekeepers: Those family members who control the flow of information about a product/service thus influencing the decisions of other family members. The teenage son, who wants a racing bicycle, may withhold from his father much of the relevant information on all brands except the one that he fancies, thereby influencing his father’s decision in favour of his preferred brand. 

3. Deciders: Family members who have the power to unilaterally or jointly decide whether or not to buy a product or service. The husband and wife may jointly decide about the purchase of a new refrigerator. 

4. Buyers: Those family members who actually buy a particular product or service. A housewife may be the person who actually buys all the foodstuffs, rations and toiletries, which are consumed by all the family members. 

5. Preparers: Those family members who transform or prepare the product into the form in which it is actually consumed. The housewife may prepare the family meal using raw vegetables, lentils, spices, oil and other ingredients. 

6. Users: Those family members who use or consume a particular product or service. All family members may use the car, watch the television, and listen to the stereo music s

7. Maintainers: Family member(s) who service or repair the product so that it will provide continued satisfaction. 8. Disposers: Family member(s) who initiate or carry out the disposal or discontinuation of a particular product or service. 

Influencing Spouses and Resolving Consumer Conflicts 

 When making consumer decisions, husbands and wives commonly attempt to influence each other to arrive at what they feel to be the best outcome. Six influence strategies for resolving husband/wife consumptionrelated conflicts have been identified: 

  ➢ Expert: At attempt by a spouse to use his or her superior information about decision alternatives to influence the other spouse. (Cooking Oil)

  ➢ Legitimacy: An attempt by a spouse to influence the other spouse on the basis of position in the household.(Buying a house) 

  ➢ Bargaining: An attempt by a spouse to secure influence now that will be exchanged with the other spouse at some future date. (Jewelry) 

  ➢ Reward: An attempt by a spouse to influence the behavior of the other spouse by offering a reward.(FMCG) 

  ➢ Emotional: An attempt by spouse to use an emotion-laden reaction to influence the other spouse’s behavior.(Birth control measures) 

  ➢ Impression: Any persuasive attempts by one spouse to influence the behavior of the other.(Fixated buyer behavior)

 These influence strategies tend to be used by either husbands or wives when they find themselves in disagreement or in conflict with the other spouse regarding specific consumer decision. For instance, we all have experienced occasions on which different restaurants to visit, see different movies, or go on a different type of family vacation. These are only a few examples of the almost endless possibilities of potential family consumption conflicts that might need to be resolved. 

Children 

 As any parent knows, young children attempt to influence family decisions as soon as they possess the basic communica tion skills needed to interact with other family members (“Buy me a cookie”, “I want a Barbie doll”, “Let’s eat at McDonald’s”.). Older children are likely to participate more directly in family consumption activities. In a study of children aged 6 to 14, more than half indicated that they influenced family purchase decisions, such as choice of vacations, stereo equipment, and home computers. Other research indicates that children play relatively important roles when it comes to initiating interest in a new computer and in the actual purchase decision. 

 The parent-child relationship, as it relates to consumer behavior, can be viewed as an influence versus yield situation. Specifically, children attempt to influence their parents to make a purchase (to yield). In observing shoppers in a supermarket, it is quite evident that children attempt to influence their parents to make purchases of special interest (e.g., laundry detergents) for which they see ads on TV. 

Teenagers and Post teens 

 A significant number of teenagers have discretionary spending in terms of spending patterns. High school students (those in grades 7 through 12) are most interested in sports and fitness. Boys between the ages of 16 and 19 spend most of their money on movies, dating, entertainment, vehicle expenses, and clothing, while girls of that age spend most of their money on clothing, cosmetics, and fragrances. 

 Family marketing 

 Family marketing focuses on the relationships between family members based on the roles they assume, including the relationship between purchaser and family consumer and between purchaser and purchase decision maker. Family marketing identifies scenarios where some purchase might have more than one decision maker, whereas some have more than one consumer. The family marketing model, as see in Figure, represents nine cells describing various purchaser-consumer relationships. Depend ing on where in the matrix various products fall, marketers can advertise and position products differently according to their purchaser-consumer relationships. 

 The family purchase decision-making process can be complex, but answering the following questions helps identify different purchaserconsumer relationships.

1. Who’s buying for whom? 

2. Who are the principal characters?

 3. What’s the plot for the purchase? 

4. Who wants what and when? 

5. What can we assume?

The Family Marketing Model

 Although these answers may not identify all essential relationships marketers should consider, they do identify a family marketing plan, which creates a relationship between individuals and products based on the role each individual has in the influence or purchase of products. In the restaurant industry, the trend has been to focus on marketing to the family as a single unit. Admittedly, the appeal to families arose from the restaurant industry’s desire to grow sales and profits. 

Influences on the Decision Process 

 How do husbands and wives perceive their relative influence on decision making across the decision stages? And what does this mean for marketers? Joint decisions tend to be made about vacations, televisions, refrigerators, and living room furniture. Autonomic decision-making tends to be present in decisions about categories that include women’s jewelry, men’s leisure clothing, indoor paint and wallpaper, and luggage. By understanding where on this “map” the decisions to buy particular products fall, marketers can try to determine which aspects of specific product to advertise to different household members and which media will reach the influential family member. 

Influence by Decision Stage 

 Spouses exert different degrees if influence when passing through the different stages of the decision-making process. This movement from informa tion search to final decision may be minimal in the case of many low-involvement goods but more pro nounced for goods that are risky or have high involvement for the family. Movement is most pronounced for refrigerators, family autos, upholstered living room furniture, and carpets or rugs. Vacations are perhaps the most democratic of a family’s purchase decisions. Separate campaigns may be timed to coincide with specialized interests, especially for products with a long planning cycle. 

Influence of Employment 

 In the past, marketers were able to refer to the traditional role structure categories to determine which family member was most likely to purchase a specific product. Although traditional buying roles still apply, husbands in dual-income marriages may be willing to stop at the grocery store to pick up a few items, and working wives may drop the family car at the service station for an oil change. However, contemporary couples are not inclined to shift traditional joint buying responsibilities to only one spouse, but they are willing to shop jointly for major items. 

Influence of Gender

 As the gender gap narrows, husband and wife decisions are increasingly made jointly. Qualls studied family decisions concerning vacations, automo biles, children’s education, housing, insurance, and savings. Prior studies showed that decisions regarding these products were usually reported as wife or husband dominant. Qualls found overwhelmingly that joint decisions are now the norm for these products, with 80 percent of children’s education and housing decisions made jointly. Increasing resources of women and shift toward egalitarianism are producing more joint decision-making in product and service categories of perceived high risk. 

Groups, Social Class and Reference Groups

Introduction 

 With the exception of those very few people who can be classified as hermits, people tend to be involved with others on a rather constant basis. Like almost all behavior, an individual’s social relationships are often motivated by the expectation that they will help in the satisfaction of specific needs. For example, a person might become a volunteer ambulance driver to satisfy a need for community recognition. Another person might join a computer club in an effort to find compatible friends to satisfy social needs. A third person might join a health food cooperative to obtain the benefits of group buying power. These are just a few of the almost infinite number of reasons why people involve themselves with others.

What Is A Group? 

 A group may be defined as two or more people who interact to accomplish some goals. Within the broad scope of this definition are both an intimate “group” of two neighbors who informally attend a fashion show together and a larger, more formal group, such as a neighborhood.

Types of Groups 

 To simplify our discussion, we will consider four different types of group classification: primary versus secondary groups, formal versus informal groups, large versus small groups, and membership versus symbolic groups. 

1. Primary versus Secondary Groups 

 If a person interacts on a regular basis with other individuals (with members of his or her family, with neighbors, or with co-workers whose opinions are valued), then these individuals can be considered as a primary group for that person. On the other hand, if a person interacts only occasionally with such others, or does not consider their opinions to be important, then these others constitute a secondary group for that person. From this definition, it can be seen that the critical distinctions between primary and secondary groups are the frequency with which the individual interacts with them and. the importance of the groups to the individual.

2. Formal versus Informal Groups 

 Another useful way to classify groups is by the extent of their formality; that is, the extent to which the group structure, the members’ roles, and the group’s purpose are clearly defined. If a group has a highly defined structure (e.g., a formal membership list), specific roles and authority levels (a president, treasurer, and secretary), and specific goals (to support a political candidate, improve their children’s education, increase the knowledge or skills of members), then it would be classified as a formal group. 

 The local chapter of the American Red Cross, with elected officers and members who meet regularly to discuss topics of civic interest, would be classified as a formal group. 

 On the other hand, if a group is more loosely defined, if it consists, say, of four women who were in the same college sorority and who meet for dinner once a month, or three co-workers who, with their spouses, see each other frequently then it is considered an informal group.

3. Large versus Small Groups 

 It is often desirable to distinguish between groups in terms of their size or complexity. A large group might be thought of as one in which a single member is not likely to know more than a few of the group’s members personally, or be fully aware of the specific roles or activities of more than a limited number of other group members. Examples of large groups include such complex organizations as General Motors, with its numerous subordinate divisions, and the American Bar Association, with its many state, county, and city chapters. 

 In contrast, members of a small group are likely to know every member personally and to be aware of every member’s specific role or activities in the group. For example, each staff member of a college newspaper is likely to know all the other members and be aware of their duties and interests within the group. 

 In the realm of consumer behavior, we are principally concerned with the study of small groups, since such groups are more likely to influence the consumption behavior of group members. 

4. Membership versus Symbolic Groups 

 Another useful way to classify groups is by membership versus symbolic groups. A membership group is a group to which a person either belongs or would qualify for membership. For example, the group of women with whom a young homemaker plays golf weekly or with whom she hopes to play golf when an opening occurs would be considered, for her, a membership group. 

 In contrast, a group in which an individual is not likely to receive membership, despite acting like a member by adopting the group’s values, attitudes, and behavior, is considered a symbolic group. Clearly, actual membership groups offer a more direct, and thus a more compelling, influence on consumer behavior. 

 In summary, we can say that small, informal, primary membership groups are of the great interest to marketers because they exert the greatest potential influence on consumer purchase decisions. 

Consumer-Relevant Groups 

 To more fully comprehend the kind of impact that specific groups have on individuals, we will examine six basic consumer-relevant groups: the Family, Friendship groups, Formal social groups, Shopping groups, Consumer action groups and Work groups.

The Family

 An individual’s family is the most important group to influence his or her consumer decisions. The family’s importance in this regard is due to the frequency of contact that the individual has with other family members and that the family has a greater extent of influence on the establishment of a wide range of values, attitudes, and behavior. 

Friendship Groups

 Friendship groups are informal groups because they are, usually unstructured and lack specific authority levels. In terms of relative influence, after an individual’s family, it is friends who are most likely to influence the individual’s purchase decisions. 

 Seeking and maintaining friendships is a basic drive of most people. Friends fulfill a wide range of needs: they provide companionship, security, and opportunities to discuss problems that an individual may be reluctant to discuss with members of his or her own family. Friendships are also a sign of maturity and independence, for they represent a breaking away from the family and the forming of social ties with the outside world. Consumers are more likely to seek information from those friends they feel have values or outlooks similar to their own.

Formal Social Groups

 In contrast to the relative intimacy of friendship groups, formal social groups are more remote and serve a different function for the individual. A person joins a formal social group to fulfill such specific goals as making new friends, meeting “important” people (e.g., for career advancement), or promoting a specific cause. Because members of a formal social group often consume certain products together, such groups are of interest to marketers. For example, the membership list of a men’s club would be of interest to local men, Insurance agents, automobile agents, tax accountants.

 Membership in a formal social group may influence a consumer’s behavior in several ways. For example, members of such groups have frequent opportunity to informally discuss products, services, or stores. 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 be called a shopping group. Such groups are often offshoots of family or friendship groups. People like to shop with others who they feel have more experience with or knowledge about a desired product or service. Shopping with others also provides an element of social fun to an often boring but necessary task. In addition, it reduces the risk that a purchase decision will be socially unacceptable. 

 Relatively few marketing or consumer behavior studies have examined the nature of shopping groups. However, one study of the instore behavior of shoppers revealed some differences between group and individual shopping. The research found that shopping parties of at least three persons deviated more from their original purchase plans (they bought either more or less than originally planned) than did either single shoppers or two-party groups. The study also found that shopping groups tended to cover more territory in the store than individuals shopping alone, and thus had more opportunity to see and examine merchandise and to make unplanned purchases. 

 A special type of shopping group is the in-home shopping group, which typically consists of a group of women who gather together in the home of a friend, to attend a “party” devoted to the marketing of a specific line of products. The in-home party approach provides marketers with an opportunity to demonstrate the features of their products simultaneously to a group of potential customers. The undecided guests often overcome a reluctance to buy when they see their friends make positive purchase decisions. Furthermore, some of the guests may feel obliged to buy because they are guests in the home of the sponsoring hostess. 

Consumer Action Groups 

 A particular kind of consumer group-a consumer action group- has emerged in response to the consumerist movement. This type of consumer group has become increasingly visible since the 1960s and has been able to influence product design and marketing practices of both manufacturers and retailers.

 Consumer action groups can be divided into two broad categories: those that organize to correct a specific consumer abuse and then disband, and those that organize to address broader, more pervasive, problem areas and operate over an extended or indefinite period of time. A group of tenants who band together to dramatize their dissatisfaction with the 

quality of service provided by their landlord, or a group of irate community members who unite to block the entrance of a fast-food outlet into their middle-class neighborhood, are examples of temporary, cause-specific consumer action groups. 

Work Groups

 The sheer amount of time that people spend at their jobs, frequently more than thirty-five hours per week, provides ample opportunity for work groups to serve as a major influence on the consumption behavior of members. 

 Both the formal work group and the informal friendship/work group have the potential for influencing consumer behavior. The formal work group consists of those individuals who work together as a team. Their direct and sustained work relationship offers substantial opportunity for one or more members to influence the consumer-related attitudes and activities of other team members. Members of informal work groups may influence the consumption behavior of other members during coffee or lunch breaks or after-hours meetings.

Social Class

 Social class is more of a continuum, i.e., a range of social positions, on which each member of society can be place. But, social researchers have divided this continuum into a small number of specific classes. Thus, we go by this framework, social class is used to assign individuals or families to a social-class category.

 Social class can be 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 the members of all other classes have either more or less status.’

Characteristics of Social Classes

The main characteristics of social class

1. Persons within a given social class tend to behave more alike 

2. Social class is hierarchical

3. Social class is not measured by a single variable but is measured as a weighted function of one’s occupation, income, wealth, education, status, prestige, etc.

 4. Social class is continuous rather than concrete, with individuals able to move into a higher social class or drop into a lower class.

Impact of social class

  ➢ Provides a sense of identity  

➢ Imposes a set of ‘normative’ behavior  

➢ Classes share values, possessions, customs and activities

  ➢ Marketing response to customers of different economic means

  ➢ Marketing to the low-income consumer  

➢ Some marketers ambivalent as not perceived as long-term customers constitutes a substantial group  

➢ Target with value-oriented strategies

Reference Groups 

 Reference groups are groups that serve as a frame of reference for individuals in their purchase decisions. This basic concept provides a valuable perspective for understanding the impact of other people on an individual’s consumption beliefs, attitudes, and behavior. It also provides some insight into methods that groups can be used to effect desired changes in consumer behavior. 

What is a Reference Group? 

 A reference group is any person or group that serves as a point of comparison (or reference) for an individual in the formation of either general or specific values, attitudes, or behavior. The usefulness of this concept is enhanced by the fact that it places no restrictions on group size or membership, nor does it require that consumers identify with a tangible group (i.e., the group can be symbolic: prosperous business people, rock stars, and sports heroes). 

 Reference groups that influence general values or behavior are called normative reference groups. An example of a child’s normative reference group is the immediate family, which is likely to play an important role in molding the child’s general consumer values and behavior (e.g., which foods to select for good nutrition, appropriate ways to dress for specific occasions, how and where to shop, what constitutes “good” value). 

 Reference groups that serve as benchmarks for specific or narrowly defined attitudes or behavior are called comparative reference groups. A comparative reference group might be a neighboring family whose lifestyle appears to be admirable and worthy of imitation (the way they maintain their home, their choice of home furnishings and cars, the number and types of vacations they take). 

 Both normative and comparative reference groups are important. Normative reference groups influence the development of a basic code of behavior; comparative reference groups influence the expression of specific consumer attitudes and behavior. It is likely that the specific influences of comparative reference groups are to some measure dependent upon the basic values and behavior patterns established early in a person’s development by normative reference groups. 

Broadening the Reference Group Concept 

Like many other concepts borrowed from the behavioral sciences, the meaning of reference group has changed over the years. As originally employed, 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 has gradually broadened to include either direct and indirect individual or group influences. Indirect reference groups consist 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. Referents that a person might use in evaluating his or her own general or specific attitudes or behavior vary from an individual to several family members to a broader kinship, from a voluntary association to a social class, a profession, an ethnic group, a community, or even a nation. 

Types of Reference Groups 

 Reference groups can be classified in terms of a person’s membership or degree of involvement with the group and in terms of the positive or negative influences they have on his or her values, attitudes, and behavior. Four types of reference groups that emerge from a cross-classification of these factors: 

1. A contractual group is a group 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 has a positive influence on an individual’s attitudes or behavior. 

2. An aspirational group is 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 serves as a positive influence on that person’s attitudes or behavior. 

3. A disclaimant group is a group in which a person holds membership or has face-to-face contact but disapproves of the group’s values, attitudes, and behavior. Thus the person tends to adopt attitudes and behavior that are in opposition to the norms of the group. 

4. An avoidance group is a group in which a person does not hold membership and does not have face-to-face contact and disapproves of the group’s values, attitudes, and behavior. Thus the person tends to adopt attitudes and behavior that are in opposition to those of the group.

 Consider Ron a senior majoring in advertising at the state university in the southwestern United States. The school’s Advertising Club, of which he is vice-president, serves as one of Ron’s contractual groups. Ron believes that continuing his education to obtain an MBA will enhance his career opportunities. It is clear that individuals who hold the MBA degree serve as an aspirational group for him. Still further, although he enjoys his position as a reporter on the university’s newspaper, the recent editorials (endorsed by most of the staff) urging students to adopt a more conservative political philosophy run counter to his own views. Thus the newspaper staff is currently a disclaimant group. Finally, Ron personally knows a number of students who have quit college during their final year; these former students serve as an avoidance group. 

Factors that Affect Reference Groups Influence 

 The degree of influence that a reference group exerts on an individual’s behavior usually depends on the nature of the individual and the product and on specific social factors. This section discusses how and why some of these factors operate to influence consumer behavior. 

1. Information and Experience 

 An individual who has firsthand experience with a product or service, or can easily obtain full information about it, is less likely to be influenced by the advice or example of others. On the other hand, a person who has little or no firsthand experience with a product or service, and does not expect to have access to objective information about it (e.g., a person who believes that relevant, advertising may be misleading or deceptive), is more likely to seek out the advice or example of others. Research on imitative behavior provides some interesting insights on how insufficient experience or information concerning a product makes consumers more susceptible to the influence either positive or negative, of others. For example, if a medical school student wants to impress his new girl-friend, he may take her to a restaurant that he knows from experience to be good or to one that has been highly recommended by the local newspaper’s Dining-Out Guide. If he has neither personal experience nor information he regards as valid, he may seek the advice of friends or imitate the behavior of others by taking her to a restaurant he knows is frequented by physicians whom he admires. 

2. Credibility, Attractiveness, and Power of the Reference Group 

 A reference group, which is perceived as credible, attractive, or powerful can induce consumer attitude and behavior change. For example, when consumers are concerned with obtaining accurate information about the performance or quality of a product or service, they are likely to be persuaded by those they consider to be trustworthy and knowledgeable. That is, they are more likely to be persuaded by sources with high credibility. When consumers are primarily concerned with the acceptance or approval of others they like, with whom they identify, or who offer them status or other benefits, they are likely to adopt their product, brand, or other behavioral characteristics. 

 When consumers are primarily concerned with the power that a person or group can exert over them, they might choose products or services that confirm to the norms of that person or group in order to avoid ridicule or punishment. However, unlike other reference groups that consumers follow either because they are credible or because they are attractive, power groups are not likely to cause attitude change. Individuals may conform to the behavior of a powerful person or group but are not likely to experience a change in their own attitudes. 

 Different reference groups may influence the beliefs, attitudes, and behavior of an individual at different points in time or under different circum- stances. For example, the dress habits of a young female attorney may vary, depending on her place and role. She may conform to the dress code of her office by wearing conservative business suits by day and drastically alter her mode of dress after work by wearing more conspicuous, flamboyant styles.

3. Conspicuousness of the Product 

 The potential influence of a reference group varies according to how visually or verbally conspicuous a product is to others. A visually conspicuous product is one that can be seen and identified by others, and that will stand out and be noticed (e.g., a luxury item or novelty product). Even if a product is not visually conspicuous, it may be verbally conspicuous it may be highly interesting or it may be easily described to others. Products that are especially conspicuous and status-revealing (a new automobile, fashion clothing, home furniture) are most likely to be purchased with an eye to the reactions of relevant others. Products that are less conspicuous (canned fruits, laundry soaps) are less likely to be purchased with a reference group in mind.

 The success of a brand of status running shoes like Reebok is aided by the fact that it is relatively easy to spot a person wearing them-given the distinctive flag symbol on the side of each shoe. 

4. Reference Group Impact on Product and Brand Choice 

 In some cases, and for some products, reference groups may influence both a person’s product category and brand (or type) choices. Such products are called pro- duct-plus, brand-plus items. In other cases, reference groups influence only the product category decision. Such products are called product-plus, brand-minus items. In still other cases, reference groups influence the brand (or type) decision. These products are called product-minus, brand-Plus items. Finally, in some cases, reference groups influence neither the product category nor the brand decision; these products are called product-minus, brand-minus items. The idea of classifying products and brands into four groups in terms of the suitability of a reference group appeal was first suggested in the mid-1950s, along with an initial classification of a small number of product categories. 

5. Reference Groups and Consumer Conformity 

 Marketers are particularly interested in the ability of reference groups to change consumer attitudes and behavior (i.e., to encourage conformity). To be capable of such influence, a reference group must: 

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; 

4. Legitimize an individual’s decision to use the same products as the group. 

 The ability of reference groups to influence consumer conformity is demonstrated by the results of a classic experiment designed to compare the effects.

Benefits of the Reference Group Appeal

 Reference group appeals have two principal benefits for the advertiser: they increase brand awareness and they serve to reduce perceived risk.

1. 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 than is possible with many other types of promotional campaigns. This is particularly true of the celebrity form of reference group appeal, where the personality employed is generally well known to the relevant target segment.

 Celebrities tend to draw attention to the product through their own popularity. 

 This gives the advertiser a competitive advantage in gaining audience attention, particularly on television where there are so many brief and similar commercial announcements.

2. Reduced Perceived Risk

  The use of one or more reference group appeals 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: Following are examples of how reference group appeals serve to lower the consumer’s perceived risk.

a.  Celebrity: Consumers who admire a particular celebrity often have the following reactions to the celebrity’s endorsement or testimonial. For e.g. “She wouldn’t do a commercial for that product if she didn’t believe it was really good.” 

b.  Expert. When consumers are concerned about the technical aspects of a product, they welcome the comments of an acknowledged or apparent expert. For e.g. “If he says it works, then it really must work.” 

c.  Common Man. When consumers are worried about how a product will affect them personally, they are likely to be influenced by a common man endorsement or testimonial. For eg. “People just like me are using that product,”

Cultural and Environmental Influences on Consumer Behavior

Introduction 

 Everybody in this world is a consumer. Every day of our life we are buying and consuming an incredible variety of goods and services. However, we all have different tastes, likes and dislikes and adopt different behavior patterns while making purchase decisions. Many factors affect how we, as individuals and as societies, live, buy, and consume. External influences such as culture, ethnicity, and social class influence how individual consumers buy and use products, and help explain how groups of consumers behave. The study of culture encompasses all aspects of a society such as its religion, knowl edge, language, laws, customs, traditions, music, art, technology, work patterns, products, etc. Culture is an extremely critical and all pervasive influence in our life. 

CULTURE - Meaning

 For the purpose of studying consumer behavior, culture can be defined as the sum total of learned beliefs, values and customs that serve to guide and direct the consumer behavior of all members of that society. Howard and Sheth have defined culture as “A selective, manmade way of responding to experience, a set of behavioral pattern”. Thus, culture consists of traditional ideas and in particular the values, which are attached to these ideas. It includes knowledge, belief, art, morale, law, customs and all other habits acquired by man as a member of society. An accepted concept about culture is that includes a set of learned beliefs, values, attitudes, habits and forms of behavior that are shared by a society and are transmitted from generation to generation within that society. 

Culture is learned through the following three ways: 

1. Formal learning: Parents and elders teach children the proper way to behave. For instance, you have been taught that you need to study to be successful and happy in life. This learning may influence your response both as a student and individual towards education. 

2. Informal learning: We learn by imitating the behavior of our parents, friends, or by watching TV and film actors in action 3. Technical learning: Instructions are given about the specific method by which certain things to done such as painting, dancing, singing etc. 

Characteristics of Culture 

  ➢ Culture is learned.   

➢ Culture regulates society–norms, standards of behavior, rewards and punishments.   

➢ Culture makes life more efficient  

 ➢ All members follow same norms.   

➢ Culture is adaptive.   

➢ Culture is environmental.   

➢ Multiple cultures are nested hierarchically.

 Culture also determines what is acceptable with product advertising. Culture determines what people wear, eat, reside and travel. Cultural values in India are good health, education, respect for age and seniority. But in our culture today, time scarcity is a growing problem, which implies a change in meals. Some changes in our culture:

1. Convenience: As more and more women are joining the work force there is an increasing demand for products that help lighten and relieve the daily household chores, and make life more convenient. This is reflected in the soaring sale of washing machines, microwaves, pressure cookers, mixer-grinders, food processors, frozen food etc. 

2. Education: People in our society today wish to acquire relevant education and skills that would help improve their career prospects. This is evident from the fact that so many professional, career oriented educational centers are coming up, and still they cannot seem to meet the demand. As a specific instance count the number of institutions offering courses and training in computers that has opened in your city. 

3. Physical appearance: Today, physical fitness, good health and smart appearance are on premium today. Slimming centers and beauty parlours are mushrooming in all major cities of the country. Cosmetics for both women and men are being sold in increasing numbers. Even exclusive shops are retailing designer clothes. 

4. Materialism: There is a very definite shift in the people’s cultural value from spiritualism towards materialism. We are spending more money than ever before on acquiring products such as airconditioners, cars CD players etc, which adds to our physical comfort as well as status.

Types of Culture 

  ➢ National culture  

 ➢ The culture prevalent in a nation, common to everyone  

 

➢ Popular culture   

➢ The culture of the masses with norms of mass appeal  

 ➢ Subculture   

➢ The culture of a group within the larger society 

 ➢ Group identification based on nationality of origin, race, region, age, religion, gender, etc.  

 ➢ Corporate culture   

➢ The company’s values, rituals, customs, myths and heroes 

Hoffstede’s Five Dimensions of Culture 

 Culture has a profound impact on the way consumers perceive themselves, products they buy and use, purchasing processes, and the organisations from which they purchase. Marketers, however, are giving more attention to understanding macro cultures and how they affect consumer behavior. Hoffstede found five dimensions of culture that are common among sixty six countries. These dimensions serve as a foundation for character izing, comparing and contrasting specific national cultures, and they are helpful in identifying environmentally sensitive segments of the market. 

1.  Individualism versus collectivism (Pursuit of self or group interest) Individualism describes the relationship between an individual and fellow individuals

 

2. Power distance ( Social inequality and submission to authority) Power distance reflects the degree to which a society accepts inequality in power at different levels in organisations and institutions. It can affect preferences for centralization of authority, acceptance of differential rewards, and the ways people of unequal status work together. 

Individualism versus Collectivism

3. Uncertainty avoidance (Tolerance/avoidance of ambiguity) Uncertainty avoidance concerns the different ways in which societies react to the uncertainties and ambiguities inherent in life. Some societies need well-defined rules or rituals to guide behavior, whereas others are tolerant of deviant ideas and behavior.

4. Masculinity/femininity (Segregation of male and female roles in society) This factor determines the extent to which societies hold values traditionally regarded as predominantly masculine or feminine. For instance, assertiveness, respect for achievement, and 

the acquisition of money and material possessions are identified with masculinity; and nurturing, concern for the environment and championing the underdog are associated with a culture’s feminity. 

5.    Abstract versus associative thinking Creation of value in products based on cause/effect logic or association among events without a logical link 

Cultural Influences 

Culture is that complex whole which includes knowledge, belief, art, law, morals, customs and any other capabilities and habits acquired by humans as members of society. Culture influences the pattern of living, of consumption, of decision-making by individuals. Culture is acquired and it can be acquired from the family, from the region or from all that has been around us while we were growing up and learning the ways of the world. Culture forms a boundary within which an individual thinks and acts. When one thinks and acts beyond these boundaries, he is adopting a cross-cultural behavior and there are cross-cultural influences as well. The nature of cultural influences is such that we are seldom aware of them. One feels, behaves, and thinks like the other members of the same culture. It is all pervasive and is present everywhere. Material culture influences technology and how it brings cultural changes like use of telephones, mobile phones, clothing styles and fashions, gives the marketers a chance to improve the product, packing, etc. to meet the needs of the customers.

 Norms are the boundaries that culture sets on the behavior. Norms are derived from cultural values, which are widely told beliefs that specify what is desirable and what is not. Most individuals obey norms because it is natural to obey them. Culture outlines many business norms, family norms, behavior norms, etc. How we greet people, how close one should stand to others while conducting business, the dress we wear and any other patterns of behavior. 

 Culture keeps changing slowly over time; and is not static. Changes take place due to rapid technologies. In case of emergency, war, or natural calamities, marketers and managers must understand the existing culture as well as the changing culture and culture of the country where the goods are to be marketed. Major companies have adapted themselves to international culture and are accepted globally. 

 Coca Cola is sold all over the world. Procter & Gamble and other companies give cross-cultural training to their employees. By making cross-cultural mistakes, many companies have difficulty in pushing their products for example, 

(i) Coca Cola had to withdraw its 2 liters’ bottle from Spain, because it did not fit in the local refrigerator; 

(ii) Many countries are very traditional and do not like women displayed on the products. This acts as a detriment to business in those countries.

Variation in Cultural Values

 There are three broad forms of cultural values as shown in the following figure.

Values Orientation influencing Behavior

I. Other Oriented Values

 This shows the relationship between individuals and the society. The relationship influences marketing practices. If the society values collective activity, decisions will be taken in a group. It gives rise to following questions which affect consumer behavior. 

 Individual/ collective: Whether individual initiation has more value than collective activity?  Romantic orientation: This depicts whether the communication is more effective which emphasizes courtship or otherwise. In many countries a romantic theme is more successful.  Adult/ child theme: Is family life concentrated round children or adults? What role do children play in decision-making? 

 Masculine/ Feminine: Whether the society is male dominant or women dominant or balanced.  Competitive/ Cooperation: Whether competition leads to success. This is achieved by forming alliances with others.  Youth/ age: Are prestige roles assigned to younger or older members of the society. American society is youth oriented and Korean is age oriented. Decisions are taken by mature people

II. Environment Oriented Values

 Cleanliness: If a culture lays too much stress on cleanliness. There is scope for the sale of beauty creams, soaps, deodorants, insecticides, washing powder, vacuum cleaner, etc. In western countries, a lot of emphasis is placed on this aspect and perfumes and deodorants are widely used. 

 Performance/ status: A status oriented society cares for higher standards of living, and chooses quality goods and established brand names and high prices items. This is true for the United States, Japan, Singapore, Malaysia, Indonesia, Thailand and most Arabic countries. 

 In performance oriented societies, where rewards and prestige is based on an individual’s performance, less importance is given to brand names. Products which function equally well and may not be big brand names are used. Germans do not give the same amount of emphasis to brand names. The marketers adopt strategies accordingly. 

 Tradition/ change: Traditional oriented societies stick to the old product and resist innovation or new techniques. In traditional societies, there is less scope for new products, and old traditional products are in greater demand. In some societies which are upwardly mobile, consumers are looking for modern methods, new products, new models and new techniques. 

 Risk taking/ security: An individual who is in a secure position and takes a risk can be either considered venturesome or foolhardy. This depends on the culture of the society. For developing new entrepreneurs risk taking is a must. It leads to new product development, new advertising themes and new channels of distribution. Security oriented societies have little chances of development and innovation. 

 Problem solving/fatalist: A society can be optimistic and have a problem solving attitude or, be inactive and depend on fate. This has marketing implications on the registering of complaints when consumers are dissatisfied with the purchase of the products. Advertising plays an important part and gives guidance to the consumer, and removes these doubts to a great extent.  

Nature: There are differences in attitude over nature and its preservation. Consumers stress on packing materials that are recyclable and environment friendly. Some countries give great importance to stop environmental pollution and to recycling of products.  Companies like P&G, Colgate-Palmolive captured a great extent of the market by offering products which are less harmful to the environment. They also use ingredients in the products which are not harmful in any way. 

III. Self-Oriented Values

 Active/passive: Whether a physically active approach to life is valued more highly than a less active orientation. An active approach leads to taking action all the time and not doing anything. In many countries, women are also taking an active part in all activities. This makes the society a highly active one, where everybody is involved in work. 

 Material/ non-material: In many societies money is given more importance, and a lot of emphasis is on being material minded. While in many societies things like comfort, leisure and relationships get precedence over being materialistic. Materialism can be of two types. 

  ➢ Instrumental materialism: which is the acquisition of things to enable one to do something or achieve something. Cars are used for transportation. People like to possess things of material value which would help them to bring efficiency.  

➢ Terminal materialism: is the requisition of materialism for the sake of owing it rather than for use-Art is acquired for owing it. Cultural differences play art important role in this type of materialism. Instrumental materialism is common in the United States of America, where as Japanese advertisements are mostly dominating terminal materialism. 

 Hard work/leisure: This has marketing implications on labor saving products and instant foods. Some societies value hard work and consider it as a fuller life. Others adopt labor saving devices and instant foods to have more leisure time at their disposal.  Postponed gratification/ immediate gratification: Should one save for the rainy day or live for the day? Sacrifice the present for the future, or live only for the day? Some countries like The Netherlands and Germany consider buying against credit cards as living beyond one’s means, whereas credit cards are very popular in America and other countries having a different cultural orientation, some prefer cash to debt. Some societies save for tomorrow; others enjoy the present and spend lavishly.  

Sexual gratification/Abstinence: Some traditional societies curb their desires, food, drinks or sex, beyond a certain requirement. Muslim cultures are very conservative, and do not want their women to be seen in public or be exposed, so the Polaroid camera which gives instant photographs can be purchased and pictures can be taken by the family members without their women being exposed to the developers in a photo lab.  Humor/ serious: Should we take life lightly and laugh it off on certain issues or, take everything seriously? This is an- other aspect of culture. Advertising, personnel selling techniques and promotion may revolve around these themes and the way the appeal for a product is to be made in various cultures.

 

Subcultures and Consumer Behavior

 Culture can be divided into subcultures. A subculture is an identifiable distinct, cultural group, which, while following the dominant cultural values of the overall society also has its own belief, values and customs that set them apart from other members of the same society. 

Sub-culture categories are: 

  ➢ Nationality: Indian, Sri Lanka, Pakistan  

 ➢ Religion: Hinduism, Islam   

➢ Race: Asian, black, white   

➢ Age: young, middle aged, elderly 

  ➢ Sex: Male, Female  

 ➢ Occupation: Farmer, teacher, business  

 ➢ Social class: upper, middle, lower   

➢ Geographic regions: South India, North-eastern India 

1. Regional, Ethnic, and Religious Influences on Consumer Behavior 

 The three major aspects of culture that have important effects on consumer behavior are regional, ethnic, and religious differences. Firstly, consumption patterns may differ in various regions of India and the world, and marketing strategy can sometimes be tailored specifically to these regions. 

 Secondly, our country has a number of different ethnic groups, and population trends will dramatically alter the demographic profile of the country in the next 50 years. In spite of its diversity, marketing strategies can be developed for this group. 

 Finally, religious beliefs and values can influence consumer. Many marketers are now becoming multicultural in their marketing activities by trying to appeal to a variety of cultures at the same time. Although the diversity of the Indian melting pot may be unique, there are many important ethnic groups in other areas of the world. 

2. Age, Gender, and Household Influences on Consumer Behavior 

 Among the four major age groups, Teens, who need to establish an identity, are the consumers of tomorrow and have an increasing influence on family decisions. The somewhat disillusioned Generation X consists of smart and cynical consumers who can easily see through obvious marketing attempts. Baby boomers grew up in a very dynamic and fastchanging world, and this has affected their values for individualism and freedom. The 50 and older segment can be divided into two groups-the young again and the gray market. Neither group likes to be thought of as old. The affect of gender differences on consumer behavior is examined next. Sex roles are changing. Women are becoming more professional and independent, and men are becoming more sensitive and caring. Also, men and women can differ in terms of traits, information processing, decision styles, and consumption patterns. 

 Gender is consistent throughout lifetime, influencing customer values and preferences. Gender shows different consumption patterns and perceptions of consumption situations. E.g. the wedding ceremony.

 Households play a key role in consumer behavior. The proportion of non-traditional households has increased due to factors such as 

(1) later marriages, 

(2) Cohabitation, 

(3) Dual-career families, 

(4) Increased divorce, and 

(5) Fewer children. 

 Households also exert an important influence on acquisition and consumption patterns. First, household members can play different roles in the decision process (gatekeeper, influencer, decider, buyer, and user). Second, husbands and wives vary in their influence in the decision process, depending on the situation-husband-dominant, wife-dominant, autonomic, or syncretic.

3. Psychographics:

Values, Personality, and Lifestyles 

 The roles of psychographics in affecting the consumer behavior are detailed below.

 Values are enduring beliefs about things that are important. They are learned through the processes of socialization and acculturation. Our values exist in an organized value system, with some values being viewed as more important than others. Some are regarded as terminal values and reflect desired end states that guide behavior across many different situations. Instrumental values are those needed to achieve these desired end states. Domain-specific values are those that are relevant within a given sphere of activity. Western cultures tend to place a relatively high value on material goods, youth, the home, family and children, work and play, health, hedonism, and technology. Marketers use tools like value segmentation to identify con sumer groups with common values.  Personality consists of the distinctive patterns of behaviors, tendencies, qualities, and personal dispositions that make people different from one another. Approaches to the study of personality include 

1. The psychoanalytic approach, which sees personality arising from unconscious internal struggles within the mind at key stages of development; 

2. Trait theories, which attempt to identify a set of personality characteristics that describe and differentiate individuals, such as introversion, extroversion, and stability; 

3. Phenomenological approaches, which propose that personality is shaped by an individual’s interpretation of life events 

4. Social-psychological theories, which focus on how individuals act in social situations (e.g., compliant, detached, or aggressive); and 

5. Behavioral approaches, which view an individual’s personality in terms of past rewards and punishments. 

 Marketers also measure lifestyles, which are patterns of behavior (or activities, interests, and opinions). These lifestyles can provide some additional insight into consumers’ consumption patterns. Finally, some marketing researchers use Psychographic techniques that involve all of these factors to predict consumer behavior. One of the most well known Psychographic tools is the Values and Lifestyle Survey (VALS).

Cross Cultural Consumer Behavior Cross cultural marketing: Objectives and Policies 

 Cross-cultural marketing is defined as “the effort to determine to what extent the consumers of two or more nations are similar or different. This will facilitate marketers to understand the psychological, social and cultural aspects of foreign consumers they wish to target, so as to design effective marketing strategies for each of the specific national markets involved.” 

Problems in Cross Cultural marketing 

1. Problems related to product selection: The marketer going for cross cultural marketing has to select the customers/ market not on the basis of the superficial similarities of age or income, but by using the real motivating factors that prompt them to accept or reject products. 

2. Problems related to promotion/marketing communication: e.g. Ariel in the middle east and also Pepsi 3. Problems related to pricing: the marketer has to adjust his pricing policies according to the local economic conditions and customs. 4. Problems related to selection of distribution channels: in Japan, P & G used this to sell soap 

Cross-Cultural Consumer Analysis 

 To determine whether and how to enter a foreign market, we need to conduct some form of cross-cultural consumer analysis. 

 Cross-cultural consumer analysis can be defined as the effort to determine to what extent the consumers of two or more nations are similar or different. Such analysis can provide marketers with an understanding of the psychological, social, and cultural characteristics of the foreign consumers they wish to target, so that they can design effective marketing strategies for the specific national markets involved. 

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. Alternative Multinational Strategies 

 Some of us may argue as markets are becoming more and more similar, standardized marketing strategies are becoming more and more feasible. But, some more would argue back that differences between consumers of various nations are far too great to permit a standardized marketing strategy. Whether to use shared needs and values as a segmentation strategy or to use national borders as a segmentation strategy? Shared needs and values would mean to appeal to consumers in different countries in terms of their common needs, values, and goals. Using national borders as a segmentation strategy would mean to use relatively different local or specific market ing strategies for members of distinctive cultures or countries.

Alternative Global Marketing Strategies 

1. Favoring a World Brand: A lot of companies have created world brand products that are manufactured, packaged, and positioned in exactly the same way regardless of the country in which they are sold. For instance, Sony sells its Walkman in this fashion. 

2. Adaptive Global Marketing: In contrast to the above, some other organizations imbibe a strategy that adapts their advertising messages to the specific values of particular cultures. A very good example here would be that of McDonald’s, which tries to localize its advertising to consumers in each of the cross-cultural markets in which it operates.

Cultural Variations & Non-Verbal Communication

 In a culture we have many variations in non-verbal communications. Each culture assigns a meaning to non-verbal signs utilized by it. There are some variables in non-verbal communication. These are: 

(a) Use of time

 (b) Use of space 

(c) Friendship 

(d) Agreements

 (e) Things

 (f) Symbols 

(g) Etiquette

Time

 Time is a resource which is distributed equally amongst everybody. Every person has the same amount of time at his disposal. What view individuals and societies take of time makes them different. Some can be classified under monochromic culture and others in polychromic culture.

The meaning of time may be different in different cultures. Some people take time in making decisions according to the importance of decisions. Some insist on coming to the point directly in business transactions and are well prepared. Some keep appointments by the minute; others make people wait for a long time.

 

Space 

 Space may be related to prestige rather than the need. The higher the office, the bigger the office space and so on. Americans have the offices of executives on the top floor and tend to separate the office of subordinates. Japanese have their discount stores on the upper floor. Some cultures and individuals maintain a fair distance while transacting, others co-mingle easily. Americans maintain a fair distance while interacting with associates. Arabs stand very close to each other. 

Friendship 

 Friendship plays an important role in business transactions. Good personal relationship and feelings matter most in a long term agreement. Social contacts developed by parties gain priority over technical specifications. Americans make friends easily, and drop them easily as well, because of both social and geographical mobility. Some cultures like Indian or Latin Americans have lasting relationships that endure for a long time and so does the business. Personal ties, personal trust leads to cooperation and a lot of transaction can take place between parties. Some want to transact business only with those whom they get along and, making money is secondary. 

Agreements 

 All business when transacted is done under some agreements. These agreements may be written or just on an understanding between the two parties. Most people enter into an agreement, but friendship and kinship are also given a lot of importance. Verbal commitments are also binding in some cultures, where signing a contract is just a mere formality. 

Things  

Different cultures attach different meaning to things. Things include products as well as gifts given in certain business and social situations. An appropriate product in the form of a gift is to be carefully chosen. The gifts can be big or small. They can be given openly or presented privately. This depends on the practices followed in that particular country. Some want to make a show of the gift, by giving it in front of others. Others are secretive about it. 

Symbols and Colours 

Different countries attach different meanings to symbols, numbers and colours. Symbols can be flowers, triangles, pictures and animals, etc. Some numbers are considered lucky, and others not so lucky, or even unlucky, like 13, 4, etc. Colors have different interpretations. Pink is associated with a female, and blue with the male in the US, whereas it is just the opposite in Holland. 

A list of colors and their interpretations is given below:

 White: Symbol of mourning or death in the Far East, happiness, purity and peace in the United States.  

Purple: Associated with death in many Latin American countries.  Blue: Symbolizes feminity in Holland and masculinity in the United States, Sweden, India, etc.  

Red: Color for brides and children in India. Sign of masculinity in the UK and France, negative in Nigeria, Germany and positive in Denmark, Rumania and Argentina.  

Yellow: Sign of death in Mexico, infidelity in France, celebrations in many countries including India.  White lilies: Suggestion of death in England. 

Symbol of Numbers 

 7: Lucky in India, USA, Morocco, Nicaragua and Czechoslovakia.

13: Unlucky in many countries including India. 

 4: Symbol of death in Japan. Packing in 4s is avoided. 

 Triangle: Negative in Hong Kong and Taiwan, positive in Columbia.  Owl: Wisdom in the United States, bad luck in India.

  Deer: Speed, grace in the United States; Homosexuality in Brazil. 

Etiquette

 These are accepted norms of behavior. Some behavior may be rude or abusive in one culture and quite acceptable in other cultures, e.g. sitting with legs crossed or sitting in a manner that shows the sole of a shoe. In Japan it is considered impolite to say no directly to a business offer. They put it differently, by saying it is very difficult, which means no. The exchange of business cards in Japan is essential, and indicates the level of your status in your business. 

 Similarly, there are many different habits and ways of doing things socially that affect the making of advertisement. Eating with the fork in the right hand and the left hand kept under the table is quite common in America, whereas, in European culture, the fork should be in the left hand and the right hand holding the knife or spoon. 

 These non-verbal communications in different countries or different languages have a direct bearing on the marketing activity and must be taken care of. As people recognize verbal languages, they act accordingly. In a similar manner, non-verbal communication must also be recognized and understood so that there is less misinterpretation. The advertisement of the communication we want to give should be appropriate and match with the culture of the country.