1. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–1 Chapter 13 Household Structure and Consumption Behaviour Nature of Australian households Stages in the household life cycle Households also undertake purchase-related decision making The link between household and consumer socialisation Trends relating to household consumption

2. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–2 Types of Households Household designates a variety of distinct social groups Family household – two or more related persons, who live and eat in private residential accommodation Non-family household – householders who either live alone or with others to whom they are not related

3. 13–3 Influence of Household Consumption on Marketing Strategy

4. 13–4 Changes in Household Structure (the average size of household and family units)

5. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–5 Household Life Cycle Young (under 35) – Single I – young married – full nest I – single parent I Middle-aged (35–64) – Single II – delayed full nest II – full nest II – single parent II – empty nest I Older (over 64) – single III – empty nest II

6. 13–6 Stages in the Household Life Cycle

7. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–7 Young Single Stage Two subgroups – Living at home – Independent

8. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–8 Young Married: No Children Stage High level of disposable income Often DINKs

9. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–9 Full Nest I: Young Married with Children Stage One partner stops working About 61% keep dual income

10. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–10 Single Parent I: Young Solo Parent Stage One in four marriages end in divorce A high proportion of divorced males remarry (64.2% of males in 1988 compared to 26.1% of females) Latest figures: http://www.abs.gov.au/Ausstats/abs%40.nsf/94713 ad445ff1425ca25682000192af2/c500a32ee2774a8 cca25699f0005d61b!OpenDocument

11. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–11 Middle-Aged Single II Stage Small group of the population High disposable income Travel often

12. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–12 Delayed Full Nest I: Older Married with Young Children Stage Many have delayed having children until their thirties They have a high income and have acquired more capital and possessions They outspend all groups on childcare, mortgage repayments, home and garden maintenance, and household furnishings High non-child spending e.g. food, alcohol, entertainment and savings

13. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–13 Full Nest II: Middle-Aged Married, with Children at Home Stage Older children Heavy consumer of lessons and clothing Need larger homes

14. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–14 Single Parent II: Middle-Aged Single with Children at Home Stage Financially burdened group Older children take on significant household responsibilities Typically female – (5 times male number)

15. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–15 Empty Nest I: Middle-Aged Married with No Children Stage Typically dual income Time poor, cash rich Spend on dining out, holidays, services

16. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–16 Empty Nest II: Older Married Couple Stage Either still working or fully retired Financial situation in decline

17. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–17 Older Single III Stage Typically female Growing segment as baby boomers age

18. 13–18 A Product Targeted at the Older Single Market

19. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–19 Household Life Cycle and Social Class A useful segmentation is household life cycle and social class People from different social classes have similar problems but seek varying solutions

20. 13–20 Household Life Cycle/Social Stratification Matrix

21. 13–21 Targeting Communications at ‘Influencers’ and ‘Information Gatherers’

22. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–22 Household Decision Making Five distinct roles: 1. Information gatherer 2. Influencer 3. Decision maker 4. Purchaser 5. User

23. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–23 Determinants of Household Purchases Different members at different stages Different attributes are considered by each member Involvement is often removed – e.g. Clothes for children, BBQ for Dad Who is doing the ‘purchasing’ – Product category – Likely conflicts – Resolution etc.

24. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–24 Household Decision Making (cont.) Individual’s role within the household – Information gatherer – Influencer – Decision maker – Purchaser – User Cultural and social changes

25. 13–25 Family-Member Influence at Various Stages of the Decision-Making Process

26. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–26 Conflict Resolution Approaches used to resolve purchase conflicts: 1. Bargaining 2. Impression management 3. Use of authority 4. Reasoning 5. Playing on emotions 6. Additional information

27. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–27 Consumer Socialisation Young people acquiring skills, knowledge and attitudes relevant to their functioning as consumers in the marketplace Consumer socialisation and advertising – advertising standards Role of the household in socialisation

28. 13–28 Managerial Framework for Evaluating the Household Decision-Making Process

29. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–29 Household Trends Over the Next 25 Years Single households to double Average household size down* – 2.6 (1996) – 2.2 (2021) Families without children more than ‘with children’ by 2016 One-parent families up by 30% to 66%

30. 13–30 The Importance of the Family Pet: Ownership in 1998

31. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–31 Computers and Video Games in Households Large number of household have Internet access Opinion of being ‘online’ and video games is now more favourably accepted by experts

32. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–32 Households and the Purchase of Services High use of services Food – eating-out more frequent – fast food frequently purchased

33. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–33 Implications… As marketers you will need to consider… – will these trends continue? – what will be the ramifications for the product/service market under your management? – When is the ‘household’ the decision-maker … as opposed to ‘individuals’

34. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–34 Summary Household is the basic consuming unit Family households pass on cultural and social-class values and behaviour patterns Family household—2 or more related persons living together Non-family households—2 or more unrelated persons HLC is classified into stages—relatively predictable HLC variables—age, marital status (household head) presence of children Household decision making—who buys,who decides, and who uses products purchased and used by and for the household

35. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–35 Summary (cont.) Marketing managers must take into account each household decision process for each product category Role specialisation Trends—services, role of pets, etc. Consumer socialisation—how children become socialised, learn how to be consumers – Purchasing skills, e.g. shopping, budgeting – Indirect skills, e.g. symbols of quality, prestige – Families assist by teaching, providing role models, etc.

36. Copyright  2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins 13–36 Next Lecture… Chapter 14: Group Influence and Communication