Chapter 14 Subcultures and Demographics

1. Chapter 14Subcultures and Demographics Consumer Behavior: A FrameworkJohn C. MowenMichael S. Minor

2. Subcultures vs. demographics Types of U.S. subcultures Baby boomers Changes in U.S. age composition How the elderly process information The African-American subculture The Hispanic and Asian subcultures Regional shifts in population Social class Class differences in shopping behavior Key Concepts

3. Subcultures . . . . . . a subdivision of a national culture that is based on some unifying characteristic. . . . members share similar patterns of behavior that are distinct from those of the national culture.

4. Marital Status Income Region Ethnicity Education Nationality Age Religion Gender Occupation Demographic Variables . . .. . . describe the characteristics of populations

5. Age Subcultures Consumers undergo predictable changes in values, lifestyles, and consumption patterns as they move through their life cycle.

6. Age Subcultures Four Major Age Trends Baby Boomers Generation X Generation Y Elderly

7. The Baby-Boom Generation. . . . . . are those Americans born between 1946 and 1964 and share lifestyle similarities. . . . number 77 million.

8. The Baby... Bust Boom Xers Yers 1930s 1940s 1960s 1970s 1980s

9. The Baby Boom Generation... • Roomer chinos are needed now. • Their difficulty in finding good jobs has led to RYAs and ILYAs.

10. Generation X . . . . . . is small in number, but possesses $125 billion of discretionary income • This group is known for valuing religion, formal rituals (e.g., proms) and materialism, • and has more negative attitudes toward work and getting ahead than the boomers had at their age.

11. Generation Y . . . . . . is the 72 million children of the baby boomers who first reached adulthood in the year 2000. • This group, like Xers, is more heterogeneous in racial and socioeconomic terms than the boomers.

12. The Elderly The “Graying of America” refers to the fourth major age trend • By the year 2020 Americans over 65 will outnumber teenagers two to one.

13. The Elderly... • Process information differently. • Experience motor skill declines which mean walking, writing, talking, etc. abilities deteriorate.

14. Ethnicity . . . . . . refers to a group bound together by ties of cultural homogeneity (i.e., linked by similar values, customs, dress, religion, and language).

15. U.S. Population Projections

16. African-American Subculture • Represents almost 13 percent of the U.S. population. • Income deprivation a major factor: In the 1990s, 37 % of African-American households had incomes of under $15,000.

17. The Hispanic Subculture . . . is the second-fastest-growing ethnic sub- cultural group in the United States and will become the largest ethnic minority in the U.S. by the year 2010. • Commonalities: • Language (82 % of U.S. Hispanic households speak primarily Spanish). • Religion (over 85% of Hispanics are Catholic). • Tendency to live in metropolitan areas (63%).

18. Hispanic Segmentation There are at least four distinct segments: • Mexicans (65.2 % of U.S. Hispanics) • Cubans (4.3 %) • Puerto Ricans (9.6 %) • Central and South Americans (14.3 %)

19. The Asian-American Subculture . . . is the fastest-growing ethnic subculture in the United States. • The percentage of Asian-Americans who graduated from college is nearly twice that of white Americans • Asian-American family incomes are significantly higher than the other ethnic subcultures • More than Hispanics, Asian-Americans differ in language and culture of origin

20. Comparing Anglo-, African-American and Hispanic Buying • No brand loyalty differences • No differences in coupon proneness, impulse buying, or shopping for generic products • African-Americans and Hispanics are more likely to shop for bargains

21. Representation in Advertisements • African-Americans and Hispanics are slightly under-represented. • Asians are slightly over-represented.

22. Regional Subcultures . . . . . . have distinct lifestyles resulting from variations in climate, culture, and ethnic mix of people. • Consequently, different product preferences exist.

23. Regional Subcultures . . . Population winners. . . The West (Nevada, Arizona, Idaho…) Population losers. . . The East (and North Dakota)

24. Geodemographics . . . . . . takes as a unit of analysis the neighborhood (i.e., census blocks) and obtains demographic information on consumers within the neighborhood.

25. are relatively permanent and homogeneous strata in a society that differ in their status, wealth, education, possessions, and values. Both actual and perceptual factors distinguish groups: Occupation Lifestyles Values Friendships Manner of Speaking Possessions Social Classes . . .

26. Social class better reflects purchases that symbolically represent lifestyles and values. Income better predicts major appliance purchases. Social Class and Buying Behavior

27. Social Class and Lifestyles Four generalizations can be made: • Social class influences consumer lifestyles • Social class is a predictor of resources owned • People buy products and services to demonstrate their membership in a particular social class • People also purchase goods and services to help advance their social standing

28. Other Subcultures • A growing rural population • Telecommuters, retirement living, second home. • Disabled Americans • 49 million in number. • Internet community.

29. Managerial Implications • Positioning. One method of positioning a product is to differentiate it vis-à-vis competitors by making special appeals to subgroups or subcultures. • Environmental Analysis. Managers should conduct environmental analyses in order to track lifestyle changes in subcultures. Analysis may also offer insight into emerging subcultures.

30. Implications continued • Research. Marketing research can identify the unmet needs of subcultures. • Marketing Mix. Differences between age cohorts, ethnic groups and regions and social classes have implications for differences in promotional, product, and pricing strategy. • Segmentation. Manufacturers can use age and ethnic subculture appeals as a segmentation variable.