A Simple
Model of
Consumer
Decision
Making
10 - 1
Reference
Group
A group that serves as
a point of comparison
(or reference) for an
individual in the
formation of either
general or specific
values, attitudes, or
behavior.
10 - 2
Indirect
Reference
Groups
Individuals or groups
with whom a person
identifies but does not
have direct face-to-face
contact, such as movie
stars, sports heroes,
political leaders, or TV
personalities.
10 - 3
Teens are
very
influenced
by indirect
reference
groups.
weblink
10 - 4
Major Consumer Reference
Groups
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A Reference Group Must ...
• Inform or make the individual aware of a
specific product or brand
• Provide the individual with the opportunity to
compare his or her own thinking with the
attitudes and behavior of the group
• Influence the individual to adopt attitudes and
behavior that are consistent with the norms of
the group
• Legitimize the decision to use the same
products as the group
10 - 6
Brand Communities
• Harley-Davidson Owner Groups
• Amul advertisement likers in Social
Networking sites
• Apple product users’ groups
Copyright 2007 by Prentice Hall
10 - 7
Influence of Family
10 - 8
Households
Family Households:
Married couple,
Nuclear family,
Extended family
Households
Nonfamily Households:
Unmarried couples,
Friends/ Roommates,
Boarders
10 - 9
Evidence of the Dynamic Nature of U.S.
Households (Refer Page 316 – text book for Indian scenario)
10 - 10
Consumer
Socialization
The process by which
children acquire the
skills, knowledge and
attitudes necessary to
function as consumers.
10 - 11
A Simple Model of the
Socialization Process
10 - 12
Family Decision-Making Process – Aspect 1
ROLE
Influencers
Gatekeepers
Deciders
Buyers
Preparers
Users
DESCRIPTION
Family member(s) who provide information to other members about a
product or service
Family member(s) who control the flow of information about a
product or service into the family
Family member(s) with the power to determine unilaterally or jointly
whether to shop for, purchase, use, consume, or dispose of a specific
product or service
Family member(s) who make the actual purchase of a particular
product or service
Family member(s) who transform the product into a form suitable for
consumption by other family members
Family member(s) who use or consume a particular product or service
Maintainers
Family member(s) who service or repair the product so that it will
provide continued satisfaction.
Disposers
Family member(s) who initiate or carry out the disposal or
discontinuation of a particular product or service
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Family Decision-Making Process – Aspects 2
• Husband-Dominated
• Wife-Dominated
• Joint
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The Family Life Cycle
• Traditional Family Life Cycle
– Stage I: Bachelorhood
– Stage II: Honeymooners
– Stage III: Parenthood
– Stage IV: Post-parenthood (Empty nest stage)
– Stage V: Dissolution
• Modifications - the Nontraditional FLC
10 - 15
Influence of Social Class
10 - 16
Social Class
The division of
members of a society
into a hierarchy of
distinct status classes,
so that members of
each class have
relatively the same
status and members of
other classes have
either higher or lower
status
10 - 17
Social Class Measurement
• Subjective Measures
– individuals are asked to estimate their own
social-class positions
• Objective Measures
– individuals answer specific socio-economic
questions and then are categorized
according to answers
Copyright 2007 by Prentice Hall
10 - 18
Objective Measures
• Single-variable
indexes
–
–
–
–
Occupation
Education
Income
Other Variables
Copyright 2007 by Prentice Hall
• Composite-variable
indexes
– Index of Status
Characteristics
– Socioeconomic
Status Score
10 - 19
Socioeconomic
Status Score
(SES)
Copyright 2007 by Prentice Hall
A multivariable social
class measure used by
the United States
Bureau of the Census
that combines
occupational status,
family income, and
educational attainment
into a single measure of
social class standing.
10 - 20
Geodemographic
Clusters
Copyright 2007 by Prentice Hall
A composite
segmentation
strategy that uses
both geographic
variables (zip codes,
neighborhoods) and
demographic
variables (e.g.,
income, occupation)
to identify target
markets.
10 - 21
PRIZM
(Potential
Rating Index
by Zip
Market)
Copyright 2007 by Prentice Hall
A composite index of
geographic and
socioeconomic factors
expressed in
residential zip code
neighborhoods from
which
geodemographic
consumer segments
are formed.
10 - 22
Explore the
Prizm Product
at Clarita’s
Web site.
weblink
Copyright 2007 by Prentice Hall
10 - 23
Consumer Behavior and
Social Class
• Clothing, Fashion, Accessories and
Shopping
• The Pursuit of Luxury, Leisure
• Saving, Spending, and Credit
• Social Class and Media / Communication
10 - 24
Influence of Culture
10 - 25
Culture
The sum total of learned
beliefs, values and
customs that serve to
regulate the consumer
behavior of members of
a particular society.
10 - 26
A Theoretical Model of Cultures’
Influence on Behavior
10 - 27
Culture Is Learned
Issues
• Enculturation and
acculturation
• Language and
symbols
• Ritual
• Sharing of culture
• Enculturation
– The learning of one’s
own culture
• Acculturation
– The learning of a new
or foreign culture
10 - 28
The Measurement of Culture
• Content Analysis
• Consumer Fieldwork
• Value Measurement Instruments
10 - 29
Content
Analysis
A method for
systematically
analyzing the content of
verbal and/or pictorial
communication. The
method is frequently
used to determine
prevailing social values
of a society.
10 - 30
Field
Observation
A cultural measurement
technique that takes
place within a natural
environment that
focuses on observing
behavior (sometimes
without the subjects’
awareness).
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Characteristics of Field
Observation
• Takes place within a natural environment
• Performed sometimes without the
subject’s awareness
• Focuses on observation of behavior
10 - 32
ParticipantObservers
Researchers who
participate in the
environment that they
are studying without
notifying those who
are being observed.
10 - 33
Value Measurement Survey
Instruments
• Rokeach Value Survey (RVS)
– A self-administered inventory consisting of
eighteen “terminal” values (i.e., personal goals)
and eighteen “instrumental” values (i.e., ways of
reaching personal goals)
• List of Values (LOV)
– A value measurement instrument that asks
consumers to identify their two most important
values from a nine-value list that is based on the
terminal values of the Rokeach Value Survey
• Values and Lifestyles (VALS)
– A value measurement based on Values, Attitudes
and Lifestyles
10 - 34
Table 12.5
Excerpt from the Rokeach Value Survey
TERMINAL VALUES
INSTRMENTAL VALUES
A comfortable life
Ambitious
An exciting life
Broad-minded
A world at peace
Capable
Equality
Cheerful
Freedom
Clean
Happiness
Courageous
National security
Forgiving
Pleasure
Helpful
Salvation
Honest
Social recognition
Imaginative
True friendship
Independent
Wisdom
Intellectual
10 - 35
Page 231: HSBC’s “Different
Values” campaign
10 - 36
Subculture
Copyright 2007 by Prentice Hall
A distinct cultural group
that exists as an
identifiable segment
within a larger, more
complex society.
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Relationship Between Culture
and Subculture
10 - 38
An ad showing
many racial
subcultures
10 - 39
This ad for
Vibe Vixen
magazine
targets the
African
American
Urban
subculture.
10 - 40
Issues in Studying Hispanic
American Subcultures
• Hispanic Consumer Behavior
– Stronger preference for well-established
brands
– Prefer to shop at smaller stores
– Some are shifting food shopping to nonethnic American-style supermarkets
– Youths are more fashion conscious than
non-Hispanic peers
10 - 41
Regional Subcultures
• Many regional differences exist in
consumption behavior
– Westerners have a mug of black coffee
– Easterners have a cup of coffee with milk
and sugar
– White bread is preferred in the South and
Midwest
– Rye and whole wheat are preferred on the
East and West coasts
10 - 42
Major Age Subcultures
Generation X
Market
Generation Y
Market
Seniors
Market
Baby Boomer
Market
Copyright 2007 by Prentice Hall
10 - 43
Generation
Y
Born between 1980
and 1999; also called
echo boomers and
millennium
generation.
10 - 44
Three Subsegments of Gen Y
• Gen Y Adults
• Gen Y Teens
• Gen Y Tweens
10 - 45
Generation X
Copyright 2007 by Prentice Hall
Born between 1965
and 1979; post baby
boomer segment (also
referred to as Xers or
busters).
10 - 46
Baby
Boomers
Individuals born
between 1946
and 1964
(approximately 40
percent of the
adult population).
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Baby Boomers
• The largest age category alive today
• Frequently make important consumer
purchase decisions
• Include a small subsegment of
trendsetting consumers (yuppies) who
influence consumer tastes of other age
segments
10 - 48
Seniors
Generally older
consumers. Consist
of subcultures,
including the 65-plus
market and the
“elderly consumers”
market.
10 - 49
Gender as a Subculture
• Gender Roles and Consumer Behavior
– Masculine vs Feminine Traits
• The Working Woman
– Segmentation Issues
– Shopping Patterns
10 - 50
Cross-Cultures and
Consumer Behaviour
10 - 51
The Imperative to Be
Multinational
• Acquiring Exposure to Other Cultures
• Country-of-origin Effects
Copyright 2007 by Prentice Hall
10 - 52
The World’s Most Valuable
Brands
1. Coca-Cola
2. Microsoft
3. IBM
4. GE
5. Intel
6. Disney
7. McDonald’s
8. Nokia
9. Toyota
10.Marlboro
10 - 53
Most of these
brands offer
different Web
sites for each
country.
weblink
10 - 54
Swiss Watches
10 - 55
Can’t Beat the Engineering
The “American” Twist
10 - 56
Cross-Cultural
Consumer
Analysis
The effort to
determine to what
extent the
consumers of two
or more nations are
similar or different.
10 - 57
Cross-Cultural Consumer
Analysis
Issues
• Similarities and
differences among
people
• The growing global
middle class
• The global teenage
market
• Acculturation
• The greater the
similarity between
nations, the more
feasible to use relatively
similar marketing
strategies
• Marketers often speak
to the same “types” of
consumers globally
10 - 58
Comparisons of Chinese and American
Cultural Traits
Chinese Cultural Traits
• Not-individual centred
• Submissive to
authority
• Ancestor worship
• Values a person’s
duty to family and
state
American Cultural Traits
• Individual centered
• Emphasis on selfreliance
• Primary faith in
rationalism
• Values individual
personality
10 - 59
Cross-Cultural Consumer
Analysis
Issues
• Similarities and
differences among
people
• The growing global
middle class
• The global teenage
market
• Acculturation
• Growing in Asia,
South America, and
Eastern Europe
• Marketers should
focus on these
markets
10 - 60
Cross-Cultural Consumer
Analysis
Issues
• Similarities and
differences among
people
• The growing global
middle class
• The global teenage
market
• Acculturation
• There has been growth in
an affluent global teenage
and young adult market
• They appear to have
similar interests, desires,
and consumption behavior
no matter where they
live… GENERATION Y
10 - 61
The iPod has
global appeal
to the young
market.
weblink
10 - 62
Cross-Cultural Consumer
Analysis
Issues
• Similarities and
differences among
people
• The growing global
middle class
• The global teenage
market
• Acculturation
• Marketers must learn
everything that is
relevant about the
usage of their product
and product
categories in foreign
countries
10 - 63
Basic Research Issues in Cross-Cultural
Analysis
FACTORS
EXAMPLES
Differences in language and meaning
Words or concepts may not mean the same
in two different countries.
Differences in market segmentation
opportunities
The income, social class, age, and sex of
target customers may differ dramatically
in two different countries.
Differences in consumption patterns
Two countries may differ substantially in
the level of consumption or use of
products or services.
Differences in the perceived benefits of
products and services
Two nations may use or consume the same
product in very different ways.
10 - 64
FACTORS
EXAMPLES
Differences in the criteria for evaluating
products and services
The benefits sought from a service may
differ from country to country.
Differences in economic and social
conditions and family structure
The “style” of family decision making
may vary significantly from country to
country.
Differences in marketing research and
conditions
The types and quality of retail outlets and
direct-mail lists may vary greatly among
countries.
Differences in marketing research
possibilities
The availability of professional consumer
researchers may vary considerably from
country to country.
10 - 65
World
Brands
Products that are
manufactured,
packaged, and
positioned the same
way regardless of the
country in which they
are sold.
10 - 66
Are Global Brands Different?
• According to a survey – yes.
• Global brands have:
– Quality signal
– Global myth
– Social responsibility
10 - 67
Multinational Reactions to Brand
Extensions
• A global brand does not always have
success with brand extentions
• Example Coke brand extension – Coke
popcorn
– Eastern culture saw fit and accepted the
brand extension
– Western culture did not see fit
10 - 68
Adaptive Global Marketing
• Adaptation of advertising message to
specific values of particular cultures
• McDonald’s uses localization
– Example Ronald McDonald is Donald
McDonald in Japan
– Japanese menu includes corn soup and
green tea milkshakes
• Often best to combine global and local
marketing strategies
10 - 69
Alternative Multinational Strategies:
Global Versus Local
• Framework for Assessing Multinational
Strategies
– Global
– Local
– Mixed
10 - 70
Table 14.8 A Framework for Alternative
Global Marketing Strategies
PRODUCT
STRATEGY
COMMUNICATON
STRATEGY
STANDARDIZED
COMMUNICATIONS
LOCALIZED
COMMUNICATIONS
STANDARDIZED
PRODUCT
Global strategy:
Uniform Product/ Uniform
Message
Mixed Strategy:
Uniform Product/
Customized Message
LOCALIZED
PRODUCT
Mixed strategy:
Customized Product/
Uniform Message
Local Strategy:
Customized Product/
Customized Message
10 - 71
Cross-Cultural Psychographic
Segmentation
The only ultimate truth possible is that
humans are both deeply the same and
obviously different.
10 - 72
Six Global Consumer Segments –
An Example
Strivers
23%
Devouts
22%
Altruists
18%
Intimates
15%
Fun Seekers
12%
Creatives
10%
10 - 73