1. Group Influence and Family Decision Making

2. Group and Situational Influence A group is two or more individuals who share a set of norms, have role relationships, and experience interdependent behaviors. Groups influence the socialization process--i.e., they influence what we learn and how we behave.

3. Classification of Groups Content or function –Membership group –Symbolic group Degree of personal involvement –Primary –Secondary Degree of organization –Formal –Informal

4. Reference Groups A group to which a consumer looks for guidance for values and behavior. Serves as a frame of reference for individuals in their purchase or consumption decisions. Broad categories of reference groups: –Normative –Comparative

5. How Do Reference Groups Influence Consumers? Social power theory Information and experience Product conspicuousness and exclusivity

6. Social Power Theory Groups have potential power over members through 5 different types of social powers. Three processes that impact the likelihood that social power will influence an individual member: –Compliance –Internalization –Identification

7. Social Powers Legitimate Expert Referent Coercive Reward

8. Information and Experience Members of reference groups share experiences and information about products. –Family, friends –Expert power

9. Product Conspicuousness and Exclusivity How much a reference group influences depends on two characteristics of a product: –Conspicuousness How visible the product is to people Public vs. private –Exclusivity How exclusively the product is owned Necessity vs. luxury

10. “Private necessities” Reference group influence: Weak for product ownership and weak for brand choice. Examples: Mattress Floor lamp refrigerator “Public Luxuries” Reference group influence: Strong for product ownership and strong for brand choice. Examples: Golf clubs Sail boat Snowboard “Private luxuries” Reference group influence: Strong for product ownership but weak for brand choice. Examples: Theater sound system Pool table Trash compactor “Public necessities” Reference group influence: Weak for product ownership But strong for brand choice. Examples: Car Computer Clothes Low exclusivityHigh exclusivity Low visibility High visibility

11. Reference Group Appeals Appeals that consumers identify with in some way: –Admiration –Aspiration –Empathy –Recognition

12. Types of Appeals Celebrity appeals –Testimonial –Endorsement –Actor –Spokesperson

13. Appeals, continued... Expert appeals “Common man” appeals Executive spokesperson appeals Trade or spokes-characters

14. Benefits of Reference Group Appeals Increase brand awareness Decrease perceived risk

15. Family A family is the most important reference group. What is a family? Family vs. household

16. Functions of the Family Economic function Emotional support Establish lifestyle Socialization

17. Consumer Socialization The process by which children acquire skills, knowledge, and attitudes necessary to function as consumers. Primary socialization agent –Parents Secondary socialization agent –Peers –Media

18. Family Decision Roles Related to sex –Instrumental vs. expressive –Traditional vs. egalitarian Related to purchase and consumption –Influencer –Gatekeeper –Decider –Buyer –User

19. Family Decision Making Models Husband-wife decisions –Wife dominant –Husband dominant –Autonomic –Syncratic (joint) Classification based on degree of role specialization and relative influence.

21. Models, continued... Purchase decision strategies –Consensual decisions Goal consensus Requires problem solving strategy or rule strategy –Accommodative decisions Conflicting goals Requires conflict resolution, persuasion strategies, bargaining strategies

22. Models, continued... Husband-wife influence strategies –Expert influence –Legitimate influence –Bargaining –Reward/referent influence –Emotional influence –Impression management Partners use a combination of strategies

23. Influence Strategy Mixes

24. Involvement of Children in Family Decision Making Children are significant market segment: –As influencers of family purchases –As individual consumers Primary influence on family purchases: –Personal involvement –Initiation stage of purchase process –Sub-decisions

25. Children…. Direct vs. indirect influence Influence strategies

26. Family Life Cycle (FLC) A classification scheme based on the assumption that families pass through an orderly progression of stages, each having unique characteristics, financial situations, and purchasing patterns. A useful tool for predicting certain household purchases.

27. FLC, continued FLC models –Base categorization on either husband’s or wife’s age and on age of youngest child in family. –Spending patterns generally follow an inverted U pattern over the life cycle.

28. Traditional FLC Stage 1--Bachelorhood Stage 2--Honeymooners Stage 3--Parenthood –Full nest I-III Stage 4--Postparenthood –Empty nest I-II Stage 5--Dissolution

29. Updated FLC Address societal changes –Never married –Divorce –Childless couples –Single parents –Delayed marriage –Delayed children