Group Influences on Consumer Behavior CHAPTER SEVEN Group Influences on Consumer Behavior McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

Variety of Reference Groups

Group Classification Criteria Three Criteria: Membership Either/Or Degree of Commitment Attraction Dissociative Reference Groups Aspiration Reference Groups Type of Contact Primary Groups Secondary Groups

Types of Groups Uncategorized Membership Attraction Contact Frequent Purchasers (parents) Frequent (primary associative) Limited (secondary associative) (primary dissociative) (secondary dissociative) Desired (aspiration) Avoided (dissociative) Positive (associative) Negative Yes (membership) No (nonmembership)

Consumption Subcultures They are a distinctive subgroup of society that self-selects on the basis of a shared commitment to a particular product class, brand, or consumption activity. Consumption Subculture Characteristics: Identifiable, hierarchical social structure Set of shared beliefs or values Unique jargon, rituals, and modes of symbolic expression

Consumer Insight 7-1 Can meaningful communities exist on the Internet? What are the implications for society of the emergence of Internet-based communities? What are the ethics of marketers monitoring Internet interest groups for product and advertising insights? What are the ethics of marketers participating in Internet interest groups without revealing their identity or purpose?

Brand Communities A nongeographically bound community, based on a structured set of social relationships among owners of a brand and the psychological relationship they have with the brand itself, the product use, and the firm. Nature of Brand Communities: Consciousness of Kind Rituals and Traditions Moral Responsibility

The Nature of Reference Group Influence Informational: when an individual uses behavior and opinions of reference group members as potentially useful bits of information Normative: when an individual fulfills group expectations to gain a direct reward or to avoid a sanction Identification: when individuals have internalized the group’s values and norms

Situations and Influence

Consumption Situations and Influence

Determinants of Reference Group Influence

Discussion Question (#30) Using college students as the market segment, describe the most relevant reference group(s) and indicate the probable degree of influence for each of the following decisions: a. Brand of mouthwash b. Purchase of a Segway c. Novel to Read d. Becoming a vegetarian e. Choice of movie

Discussion Question (#31) How important are reference groups to the purchase of these products? Would their influence also affect the brand or model? Would their influence be informational, normative, or identification? a. Sports drinks b. DVD players c. Dentists d. An Internet connection e. Segway HT f. Volunteering with a nonprofit organization

Discussion Question (#32) What reference groups would be relevant to the decision to purchase the product or activity (based on students on your campus)? a. Sports drinks b. DVD players c. Dentists d. An Internet connection e. Segway HT f. Volunteering with a nonprofit organization

Group Communication Means of communication Word of Mouth Free Experience Based Varies by Product Category Negativity Bias Opinion Leadership Filter of Information Enduring Product Knowledge More Innovative Have a More Defined Role in Multistep Flow

Mass Communication Information Flows

Likelihood of Seeking an Opinion Leader

Opinion Leadership and Opinion Seeking Scales

Categories of Innovations Degree of innovation Behavioral change required Small Modest Large Examples Norplant contraceptive Becoming Vegetarian Segway Human Transport Digital camera Personal navigator Internet shopping DVD Players Light snacks Microbrew beer Discontinuous Dynamically continuous Continuous The McGraw-Hill Companies, Inc., 1998

Adoption Process & Extended Decision Making

Diffusion Rate of an Innovation over Time

Factors Affecting the Spread of Innovations High observability Rapid diffusion Low risk Low complexity Large relative advantage High compatibility Strong felt need Extensive marketing effort Individual adoption decision Change-prone target market Easy trial

Recent Diffusion Curves

Adoptions of an Innovation over Time

Early Purchasers of Computers and VCRs

Enhancing Marketing Strategy