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Consumer Psychology (PSY - 514)

LESSON26

CONSUMER SOCIAL CLASSES

CHAPTER 4: ENVIRONMENTAL INFLUENCES

Understanding:

Groups

· Reference Groups

· Working Class

· Non Affluent Consumers

Consumer Related Reference Groups

A group may be defined as two or more people who interact with each other to accomplish individual or mutual

goals e.g. group of two neighbors, the local cricket club, the boys' hockey team of a colony, group of friends from

college, group of cousins

Types of Groups

Mainly three types of groups may be differentiated:

1. Membership Group

A group to which either a person belongs or would qualify for membership is called a membership group. The

group of men with whom a young executive plays chess every week is his membership group

2. Symbolic Group

Group in which an individual is not likely to receive membership despite acting like member by adopting the

group's values, attitudes and behaviors is called a Symbolic Group. Professional cricket players may constitute a

symbolic group for an amateur who identifies with certain players by imitating their behavior, e.g. by buying a

certain brand of racket or wearing a certain kind if T-Shirt but he will never get the membership as a professional

player

3. Reference Group

Any group or a person 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 Group provides valuable perspective for

understanding the impact of other people on individual's consumption beliefs, values, attitudes and behavior. Also

provides insights into the methods marketers use to affect desired changes in the Consumer Behavior. Reference

groups serve as frames of reference for individuals in their purchase or consumption decisions.

Usefulness of the Concept of reference group is enhanced by the facts that it places no restriction on group size or

membership, nor does it require that consumers identify with a tangible group. The group can be symbolic e.g.

owners of successful businesses, leading corporate chief executives, music stars, cricket celebrities, etc...

Consumer Psychology (PSY - 514)

Types of Reference Groups

Two types of Reference Groups may be identified:

Normative Reference Group

Comparative Reference Group

Indirect Reference Grfoup

Normative Reference Group

Reference groups that influence general or broadly defined values or behavior are called Normative Reference

Groups. Child's normative reference group is his immediate family, which is likely to play important role in

modeling the child's general consumer values and behavior (such as which foods to select, what clothes to wear,

etc...) Normative Reference group influence the development of a basic code of behavior.

Comparative Reference Group

Reference groups that serve as benchmarks for specific narrowly defined attitudes or behavior are called

Comparative Reference Groups. Example: A neighboring family whose lifestyle appears to be admirable and

worthy of imitation (the way they maintain their home, their choice of furniture, cars, their taste in clothing).

Comparative groups influence the expression of specific consumer attitudes and behaviors. It is likely that the

specific influences of comparative reference groups to some measure depend upon the basic values and behavior

patterns established early in a person's development by normative reference groups

Indirect Reference Group

The meaning of reference groups has changed over the years. Originally reference groups were narrowly defined to

include only the groups with which a person interacted. IRC consists of those groups or individuals with whom a

person does not have direct face to face contact such as movie stars, sports heroes, political leaders, etc..

Factors Affecting Reference Group Influence

Following factors affect the influence of the Reference Groups

1. Information and Experience

First hand experience with a product or service, or can easily obtain first hand information about it, is less likely to

be influenced by the advice or influence of the others. Person who has little or no experience with a product or

service is more likely to seek out the advice or example of others

For example, a young corporate sale representative who wants to impress his client may take him to restaurant; he

knows is good or the one that is highly recommended by the local newspaper. In case of none of the above he may

seek the advice of a friend or a parent. He imitates the behavior of others by taking him to a restaurant he knows is

frequented by the business executives he admires.

Credibility, Attractiveness and Power

A reference group considered as credible, attractive and powerful may induce consumer attitude and behavior

change. Consumers who seek accurate information are likely to be persuaded by whom they consider trustworthy

or knowledgeable- that is more likely to be persuaded by sources that are credible.

Consumers Concern with Approval

Consumer Psychology (PSY - 514)

Consumers are primarily concerned with acceptance or approval of others whom they like or with whom they

identify, or those who offer them status or other benefits. T hey are likely to adopt their product, brand or other

behavioral characteristics.

Concern with Power

When consumers are primarily concerned with power that a person or group can exert over them they might

chose a product that confirm to the norms of that person or group in order to avoid punishment or ridicule

Conspicuousness of the Product

Influence of reference group on purchase decision varies with reference to how conspicuous the product is to

others

Visually Conspicuous product is the one that stands out and gets noticed e.g. a luxury item or novelty product.

Verbally Conspicuous Product may be highly interesting; it may be easily described to others

Especially Conspicuous Products are status revealing such as new automobile, laptop computer, fashion

clothing, etc...are most likely to be purchased with eye on the reaction of significant others

Privately consumed products that are less conspicuous (shaving cream or bath soap) are less likely to be purchased

with reference groups in mind. Marketers especially market leaders are interested in the ability of reference groups

to change consumer attitudes and behavior by encouraging conformity.

Targeting Conformity

To influence conformity, a reference group must accomplish the following:

· Inform or make the individual aware of a specific product or brand

· Provide individual with the opportunity to compare his/her own thinking with the attitudes and behaviors

of others

· Influence the individual to adopt the attitudes that are consistent with the norms of the group

· Legitimize the decision to use the same products as groups

New Brand Marketing

One may wish to elect a strategy that asks consumers to strike out and be different and not just follow the crowd

when making a purchase decision. In reality the non-conformity appeal can be thought of as a request to shift

one's reference (attitude or behavior) from one grouping to another reference.

Selected Consumer Reference Groups

Friendship Groups are classified as informal groups because they are unstructured and lack authority structure.

Friends are only second to one's family in influencing. Seeking and maintaining friendship is a basic need/drive for

most people. Friends provide comfort, love and companionship. Most of all they provide opportunity o discuss

things that one can't discuss with relatives or family.

The opinions and preferences of friends are important influences in determining the brands a consumer ultimately

selects

Workgroups

The importance of workgroups can be understood by the sheer amount of time that people spend at jobs.

Distinction can be made between formal and informal workgroups.

Formal Workgroups consist of individuals who work together as part of team and thus have a sustained

opportunity to influence each others opinions

Consumer Psychology (PSY - 514)

Informal Workgroups consist of individuals who have become friends as a result of working for the same firm.

Members of the informal workgroups may influence behavior during the coffee and lunch hours or after work

meetings.

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