The Influence of Groups on Consumer Behavior

1. Chapter 12 Group Influence Group Influence

2. The meaning of groups • Two or more individuals who • Share a set of norms, values or beliefs • Have certain role relationships • Experience interdependent behavior • A social system in which members • Have regular contact • Act cooperatively • Share common goals

3. Importance of groups • Play an important role in consumer socialization • The process by which we acquire the skills, knowledge and attitudes necessary to function as consumers • As consumers we learn to think and behave according to society’s expectations as modeled by the groups we interact with

4. Types of social groups • Primary groups: small and intimate groups we come together with frequently and face-to-face • Secondary groups: less intimacy and personal interaction • Key difference is the extent of influence over one’s attitudes, beliefs, behavior, etc.

5. Formal groups: organized, hierarchical groups where structure is defined, roles delineated, etc. • Informal groups: often emerge from formal groups, but may also emerge between neighbors, friends, etc.

6. Roles • Patterns of behavior expected of individuals within a given social context • May develop in one of three ways • Formal role definitions prescribed by the group • Informal rules of the group • History of prior experiences

7. Roles influence consumption behavior • A role-related product cluster is a set of goods necessary to play a given role

8. Status • The relative position of a person in a group’s social spectrum • Consumers often purchase goods and services appropriate to their status within a group

9. Reference groups • Any person or group that serves as a point of comparison (reference) for an individual in forming either general or specific values, attitudes, or a specific guide for behavior • Reference groups are groups that serve as frames of reference for individuals in their purchase or consumption decisions

10. Types of reference groups • Normative: groups that influence general or broadly defined values or behavior • Comparative: groups that benchmark specific or narrowly defined attitudes or behaviors • Indirect: individuals or groups with whom a person does not have direct contact, such as movie stars, sports heroes, celebrities, political leaders, etc.

11. Membership reference groups • Aspirational reference groups • Dissociative reference groups

12. Factors that affect reference group influence • Degree of influence a reference group exerts on a consumer’s actions depend on several factors: • Nature and extent of consumer’s information and experience • Credibility, attractiveness, and power of the group • Conspicuousness of the product

13. 1. Consumer’s information and experience • Greater the consumer’s access to information about or experience with a product, the less likely it is that he or she will be influenced by the advice or examples of others

14. 2. Credibility, power and attractiveness of the reference group • Direct relationship between these factors and the influence the group wields • Consumers are more likely to be persuaded by those whom they consider trustworthy and knowledgeable—i.e., high credibility

15. Consumers who are concerned with the power that a group can exert over them might choose products or services that conform to the norms of that person or group • Consumers who are concerned with the acceptance or approval of others they like or identify with are likely to adopt their product, brand, or other behavioral characteristics

16. 3. Conspicuousness of the product • A purchase that will stand out and be noticed is more likely to be made with the reaction of a reference group in mind • Particularly true for luxury and status-revealing purchases

17. Implications for marketing • Marketers who employ reference group influence must understand that consumers have multiple reference groups • Different groups may influence consumer purchases in different areas • Marketers must first identify the types of groups that consumers are likely to refer to when making a purchase • Then they are in a position to select appropriate influencers to deliver the marketing message

18. Selected consumer-related reference groups • There is a large and diverse range of groups that have the potential to influence consumer behavior; we will look at four: • Friendship groups • Shopping groups • Work groups • Consumer action groups

19. 1. Friendship groups • Generally considered informal groups • Next to family, considered the most likely to influence individual’s purchase decision • Seeking and maintaining friendships is a basic drive of most people • Opinions and preferences of friends are an important influence in determining the products and brands a consumer selects • Marketers recognize this and often depict friendship situations in their ads, especially for products such as clothing, snack foods and alcoholic beverages

20. 2. Shopping groups • Two or more people who shop together • A range of reasons • Social--to share time together • Risk reduction--to have a second opinion • Informational--others in the group may know more about certain products

21. 3. Work groups • The workplace actually creates two different types of group: formal and informal • Formal work groups involve individuals who work together as a team and thus there is an opportunity for influencing each other’s consumption-related activities • Informal work groups are people who have become friends through their work, though they may not work as a team

22. 4. Consumer action groups • Today there are many groups whose purpose is to provide information and assistance to consumers • Several different types • Public vs. private • Single-issue vs. broad-based • Temporary vs. permanent

23. Reference group appeals • Four very common and effective reference group appeals used by advertisers include • Celebrity appeals • Expert appeals • Common-man appeals • Executive appeals

24. 1. Celebrity appeals • Celebrities represent an idealization of life that most people imagine they would love to live • Four ways in which celebrities are used to promote products • Testimonial: based on personal usage, a celebrity attests to the quality of the product • Endorsement: celebrity lends name and appears on behalf of a product (may not be an expert) • Actor: celebrity presents a product through his or her character • Spokesperson: celebrity represents the brand or company over an extended period of time

25. Celebrity appeals work only if the person is perceived as credible • The more products a celebrity is associated with, the more credibility erodes

26. 2. Expert appeals • A person who, because of his or her occupation, training or experience is in a unique position to help consumers evaluate a product or service

27. 3. The common man appeal • Uses the experiences of satisfied customers • Consumers can easily identify with them • Especially effective in public health announcements • Commercials that show individuals or families solving problems by using the advertised product are called slice-of-life commercials because they focus on real issues that consumers can identify with

28. 4. The executive spokesperson • Became popular in last 20 years as CEO’s became better known to the public • As with celebrities, success depends on public perception of the spokesperson’s credibility