CONSUMERS AND
SUBCULTURES
What are some demographics
 Age
 education
 occupation
 social class
 Ethnic group
 gender
 family size and composition
 distribution of population
So What Are demographics?
 Objective
 Quantifiable
 Characteristics
of a population
 Important
variables for
market
segmentation
And why are they important?
Different segments have different consumption patterns
What does money mean to you?
Security
Comfort
being able to help one's children,
freedom
pleasure
success or failure
social acceptability
love
happiness
Money means different things to different segments
Our ideas about money affect our consumption behaviour
What does the demand for
goods and services depend on?
 the ability to buy
 the willingness to buy
To Spend or Not to Spend
Consumers’ willingness to buy?
a measure of consumers’ opinions on the financial
position of their own household and the economy as a
whole
and to what extent they think it is a good time to buy
large expensive items such as a TV or a computer.
Demand for necessities remains stable over time
The underlying data are taken from the consumer
confidence survey.
The Conference Board's Consumer Confidence Survey
 a monthly report based on a representative sample of 2,000
Canadian (5,0000 US) households across the country.
measures the level of confidence individual households have in the
performance of the economy.
Households are asked five questions
(1) a rating of business conditions in the household’s area,
(2) a rating of business conditions in six months,
(3) job availability in the area,
(4) job availability in six months, and
(5) family income in six months.
An index is constructed for each response and then a composite
index is fashioned based on the responses.
Industries that rely on the Survey for forecasting include
manufacturers, retailers, banks, and government agencies
Base year 1985=100
Present situation Index – current economic and job situation
Expectations index – 6 month economy, job prospects, income
Buy Index – is now a good time to buy big ticket items
The Conference Board
Consumer Confidence
Index, declined in the third
quarter of 2005.
Why?
Implications?
What should retailers do to lure consumers in
the face of declining confidence?
Consumption growth displays a positive relation to the
willingness to buy.
The index of willingness to buy is a clear predictor for the future
development of consumer spending.
Confidence and willingness to buy varies by market segment and is
usually higher among younger than older consumers
And among higher
income consumers
than lower,
college graduates
over high school
graduates
 whites or other
ethnic groups
 men or women
Willingness to buy is also affected by product and method of
purchase
Willingness to buy by telephone
Social Class
What is Social Class?
 relatively permanent strata in a society that are
distinct subcultures
What are the typical factors that differentiate the social classes?
–
–
–
–
–
–
–
–
–
–
Occupation
Education attained
Behavioral standards – taste culture
Source of Income
Level of Income; wealth
Dwelling area
Power
Religious Affiliation; Associations
lifestyles, buying patterns, motivations and values
possessions
Classes in Canada
Upper Class
• Upper-upper class
– About 1%, “old
money”
• Lower-upper
– 2-4%, nouveau riche,
.com millionaires.
– Sir Kenneth
Thompson Canada’s
richest man ($19.6+
billion 2006) (9th in
the world)
1923-2006
Classes in Canada: Middle Class
• 40 – 50% of population
• Considerable racial and ethnic
diversity
– Upper-middle: upper
managerial or professional
fields ($100k +)
– middle-middle class. ($50$100,000)
– Lower-middle: middle
management, white-collar and
highly skilled blue-collar. (<
$50,000)
Classes in Canada: Working
Class
• 1/3 of the population.
• Lower incomes than
middle-class.
• No accumulated
wealth.
• Less personal
satisfaction in jobs.
Classes in Canada: Lower Class
• 20% of population
• Social assistance and
working poor
• Revolving door of
poverty
• Seasonal, part-time
workers, minimum
wage earners.
The Importance of Class
What sort of things does social class affect
 Lifestyles and Interests
 Tastes
 Language
 Self Image
 Values
 Political orientation
 Access to such resources as education, health care,
housing and consumer goods.
 How long you will live & how healthy you will be
I.e. Consumption behaviour
who spends how much and on what
 Dress: white collar vs. blue collar
 Form of recreation: upper-class people are
expected to play golf rather than shoot pool down at
the pool hall - but they can do it at home.
 Residential location: upper-class people do not
ordinarily live in slums
 Material Possessions: Kind of car: Rolex watch,
how many bathrooms a house has
How Much Money Will Be Spent
How Money Will Be Spent
Vuitton
Credit Card
Holder $96.00
Celine
Boogie Bag
$990
Where it will be spent
Singapore Airlines (SIA)
offers a first and
business-class only flight
to the United States in
2005. A first for Asia, SIA
became the second major
airline in the world to go
all-business class: about
a year ago, Swiss
PrivatAir started 'no
coach' flights between
Dusseldorf and Newark,
on behalf of Lufthansa.
How Do the Lower and Upper Classes Differ in Their
Consumption Tastes?
Lower classes
generally focus on
more immediate
and more
utilitarian needs
Upper classes
are often likely to
approach
consumption from
a more aesthetic
perspective
Ads targeted to
particular social classes
Marketing Implications
Your company, XYZ corp., manufactures inexpensive
furniture and has targeted the less well off. In an
effort to upgrade your image the company has
decided to target higher-class consumers. What will
the marketing implications be on the following.
 Product design, choices and development
 Distribution
 Price
 Advertising and other
marketing communications
What are Status Symbols?
Conspicuously consumed goods which are used to provide
evidence of wealth
Why do some people feel the need for status symbols?
 motivation for the purchase and display of products is not to
enjoy them but rather to let others know that we can afford them
 Anonymity exacerbates the need for uniqueness. If most people
are unknown in public, status cannot be conveyed by reputation
The Sony VGN-A190 Vaio laptop computer
“Take a look at this status symbol”
“Wow you're going to attract attention opening this in public…”
•17" Widescreen LCD display, 512MB SDRAM expandable to 2GB, 400MHz
FSB, 80GB Hard Drive, 4x DVD Writer - up to DVD-R $2400 US
Status Symbols
Examples
Parody Display
When consumers deliberately
mock a trend by carefully
selecting products and
consumption patterns that
are not the current fashion
or style.
Paper Denim Retro Torn
Jeans $140.00
Fraudulent
Symbolism
When too many others use
or possess a status
symbol such that it loses
much of its former power
Sumptuary Laws
 King Henry VIII, (1509 to 1547),
introduced an elaborate set of regulations
governing how everyone was to dress
down to the smallest detail.
 The color, style and fabric content of a
person's clothing signaled that person's
rank in society.
None shall wear . . .any lace
of gold or silver, lace mixed
with gold or silver, silk,
spurs, swords, rapiers,
daggers, buckles, or studs
with gold, silver or gilt. . .
except . . .Baron's Sons, all
above that rank, Gentlemen
attending the Queen,
Knights and Captains.
The main purpose of the legislation was
to mark class distinctions clearly and to
prevent any person from assuming the
appearance of a superior class.
 People who lived in England during the
16th century knew at a glance where
everyone stood in the social pecking
order.
 Even after sumptuary laws stopped being enforced, it was easy to
tell the social status of a person by the quality and amount of fabric
or the amount of labour-intensive lace and embroidery.
Nowadays there are a lot more dimensions of the individual that
people seek to express through consumer goods besides social status
e.g.
religious affiliation
Political leanings
educational level
ecological awareness
Sports interests
Gender
They all seek expression through consumer good, not the least of all
clothing.
SUBCULTURES
What is a Subculture?
A distinct cultural group that exists as an identifiable
segment within a larger, more complex society/culture
How do you distinguish one group from another?
 beliefs
 Values
 Customs
 Lifestyles and interests
 norms
 Language
 Insignias
 Consumption patterns
Every consumer belongs to many subcultures
What are some Types of Subcultures
in Canada
Ethnic
Age
Religious
Regional
Which region has the highest
bubble gum sales?
Canadian consumers cannot be
viewed as a single block of customers
with consistent purchasing patterns
What is an Ethnic Subculture?
 Possess common cultural and/or genetic ties which are
identified both by its members and by others as a
distinguishable category -- a sense of collective identity.
 Ethnicity implies common customs, values, and attitudes within
a group of people who are bound by a common cultural
identification.
 Because values reflect a standard or criterion that people use in
the guidance of behaviour, they act as a norm for ethnic
consumer behaviour and an influence on many consumption
motives.
 Ethnic identity is a significant component of a consumer’s self
concept
What makes Ethnic Subcultures
Different?
Food preferences
are close to a
people’s centre of
their self definition
or identity
Why has Ethnic marketing become more important to
marketers who wish to maintain or increase market share?
Ethnic groups in Canada are growing more than 7
times faster than the general population
Advertising Canada estimated that in 2001 African and
Asian populations in Canada represented in excess of
$300 billion in purchasing power.
Ethnicity plays an important role in how brands are
perceived and purchase decisions made, i.e. Each ethnic
group has its own buying habits
Some ethnic groups spend significantly more than the
market average for certain types of goods and services.
e.g., the Chinese are likely to spend more on leather
goods, furniture, appliances and electronic equipment.
Italians are likely to favor clothing, food items, cleaning
products and personal services,
the Portuguese tend to purchase more appliances, baby
food, cigarettes and sport services,
South Asian consumers spend more on furniture,
utensils, home decoration and children's clothing.
companies should target homogeneous components of a
heterogeneous market rather than the market as whole
Immigration in Canada
 Canada has one of the world’s most liberal immigration policies
and is considered a multicultural or pluralistic society (as opposed
to melting pot)
 Canada is becoming increasingly culturally diverse as a result of
the changing patterns of immigration since the 1960s.
 A shift from
European to nonEuropean countries
as the sources of
immigrants to
Canada is leading to
a more ethnically
varied population
New immigrants tend to cluster together
geographically which makes them easy to reach.
Concentrated in major Canadian cities
Bring with them customs, traditions, values, etc.
New immigrants are likely to be Asian
Population reporting at least one Ethnic Origin other than British,
French or Canadian, 1986, 1991 and 1996 Censuses
37%
42%
58%
63%
1986 Census
1991 Census
44%
Legend
British, French or Canadian Origins
Other Ethnic Origins
56%
1996 Census
Who are they and where are they?
Vancouver
Edmonton
Calgary
Saskatoon
Winnipeg
Toronto
Ottawa-Hull
Quebec
Halifax
35
4.5
5.7
0.5
1.31
43.8
3.2
5.79
0.1
0.3
East Indian
23.3
4.3
5.2
0.3
1.89
56.6
2.9
5.3
0.1
0.4
Filipino
21.1
5.1
6
0.5
10.7
48
1.9
6.5
0
0.2
Japanese
44.2
3.7
7.7
0.3
2.94
32.9
3.1
4.21
0.3
0.8
Korean
33.7
3.4
4.6
0.2
1.2
49.9
1.9
4.42
0.2
0.5
Pakistani
8.72
2.7
5.3
0.4
0.86
66.1
3.5
12.1
0.1
0.4
Punjabi
30.4
4.3
4.9
0.1
1.32
52.1
1.5
5.27
0
-
Sri Lankan
3.44
0.7
0.9
0.1
0.73
76.8
2.8
14.4
-
0.2
Thailand
2.55
0.3
0.4
0
0.18
86.7
2.2
7.64
-
0
Vietnamese
18
7.1
9.1
0.6
2.76
35.6
5.2
20.2
0.8
0.6
Other Asian*
14.4
2.5
3.4
0.4
1.66
40.8
4
32.1
0.4
0.3
Total Asian
26.3
4.2
5.4
0.4
2.6
48.6
3
8.97
0.2
0.3
Chinese
2001
Montreal
Asian Canadians
Asian Canadians are the Fastest Growing Minority
Group in Canada
Small, Diverse, Growing
Above Average Income
($2000/yr more)
Native Language Print Media
Education Oriented
.
•College Graduation Rate is Twice That of Whites
tend to be more brand and price conscious
Tend to be early adapters of new technology
Reaching the Asian Canadian Consumer
Problems Encountered by Canadian Marketers
Translating Advertising Messages Into Asian Media
Overlooked Complex Differences Among Asian Subcultures
Lack of Media Available to Reach Asian Canadians
Been Insensitive to Cultural Practices
A British ad for Tennent’s beer
marketed to the East Asian
community
Summary of 2003 UK Study on Ethnic Marketing
A strong status-orientation and conspicuous consumption combine
to make brands disproportionately more important to ethnic groups
compared with the mainstream.
Many major purchases are subject to strong family-based decision
making.
Advertising is perceived rationally and consciously as performing
a functional selling role.
There is demand for culturally-relevant marketing - more focused
targeting, sympathetic to the culture
Local newspapers/radio are consumed as part of strong
community orientation.
Minority ethnic communities are as internally diverse as they are
distinct from mainstream culture.
Some advertising fails to connect
Non-literal
communications
are least likely to
connect,
particularly with
Asians
How many Asian
Canadians get the
joke?
What is this
ad saying?
Who gets it?
Who doesn’t
“Yes, Yes, Yes
A totally organic
experience”
Ethnic marketing is an important aspect of lifestyle marketing,
a strategy that tailors a company’s products and services
towards the customer’s lifestyles.
Ethnic marketing can be effective in the Canadian
multicultural environment, because:
The ethnic market is a profitable market;
Ethnic markets tend to have high purchasing power;
Ethnic markets are big markets;
The ethnic market is a concentrated market;
The ethnic market is a growing market.
Marketing Implications of Subculture
1. Minority ethnic groups represent a significant opportunity for
brands and should be targeted separately
2. What language does your key ethnic demographic prefer that
you use in communications with them?
3. What media do they read, listen to or watch?
4.
Does the product or service
support their culture
requirements?
5. Distribution-geographic concentration of many ethnic
subcultures means that marketers can reach them more easily;
also in some cases certain groups prefer to shop in certain stores
6. One must take into account, religious dictates, gender roles,
values, spending patterns, and symbols
Why build multilingual web sites?
• Your customers do not always want to do
business with you in English.
• Customers are four times more likely to
buy if sold to in their native language.
• China = 85% favor Web sites in Chinese
over those in English.
• Japan = 92% prefer Japanese Web site over
those in English.
CanadianChinese
auto Web
site
To appeal to overseas Chinese, certain branches of TD
Waterhouse keep fish tanks (A symbol of prosperity), stocked
with 8 Goldfish (an auspicious number)
 The company also honors requests to avoid the number 4 in
accounts (it sounds like the word “death” in Mandarin and
Cantonese)
 Of utmost
importance is to
involve members of
the ethnic group in
marketing efforts
aimed at that group
– and not just
review material for
gaffs
Telco Example
Ethnic groups spend more on telecom than the general
population.
Ethnic groups are the fastest growing segment of the
population
In 2002, ethnic consumers spent nearly $50 billion on telecom
services.
An Insight survey of ethnic consumers overwhelmingly
identified “customer service” as their number one criterion for
selecting a Telco.
 Chinese consumer's tend to regard wireless devices as
personal security systems.
 Asians are known to be early adapters of new technology
 Asians are also known to have above average income.
Assuming you are the marketing manager for Bell
Mobility, how would you market to this group?
Bell Mobility targets Canada's population of Chinese through
advertising in Chinese in Chinese dailies,
And by a dedicated dealer network with customer service
reps fluent in Mandarin and Cantonese.
targeted advertising speaks to Chinese consumer's tendency
to regard wireless devises as personal security systems.
Using minority ethnic characters is a double-edged sword
 Use of minority ethnic actors tends to polarize the
community between those who see the individual
representation as positive and those that see it as tokenistic
or stereotypical.
 Viewers evaluate
the ads not only on
the basis of
personal relevance
but also on the
basis of "what does
this say about us?"
to the rest of
society.