FAMILY /GROUP INFLUENCES
AND SEGMENTATION
• Family influences
• Group influences
• Segmentation
– Methods
– Tradeoffs
– Segmentation in direct
marketing
MKTG 371
Family/Group Influences/Segmentation
1
Perner
FAMILY INFLUENCES
• Types of Households
– Family
• Traditional
– Nuclear
– Extended
• Blended
– Traditional non-family
• Usually temporary (e.g., college and pre-marriage
roommates)
– Non-traditional
• Non-married heterosexual
• Gay/lesbian
MKTG 371
Family/Group Influences/Segmentation
2
Perner
The Family Life Cycle
• Individuals and
couples typically
move through stages
• Today’s world is
complicated
MKTG 371
Family/Group Influences/Segmentation
3
Perner
Potential Family Life Cycle
Stages
YOUNG
SINGLE
YOUNG
COUPLE
EMPTY NEST
I/II
FULL NEST
I/II/III
SINGLE
PARENT
OLDER
SINGLE
BLENDED
MKTG 371
Family/Group Influences/Segmentation
4
Perner
Economic/Marketing Implications of
Household Cycles
• Income tends to increase
with time
• But children/ obligations
add cost
• Divorce
– increases costs
– may change income
distribution marriage
MKTG 371
Family/Group Influences/Segmentation
• Product demand due
to
– singles with low
expenses
– new couples
– divorced families
– children
– empty nesters -->
more income
5
Perner
Household Decision Making
• Strategies of
Influence
• Roles/influence
– Information
gatherers/holders
– Influencers
– Decision makers
– Purchasers
– Users
• Values--desired end
states
MKTG 371
Family/Group Influences/Segmentation
– Constructive
• Bargaining
• Reasoning (sincere)
– Manipulative
• Impression management
• Authority
• Emotion
– Borderline
• Information gathering
6
Perner
Definition
• Group: two or more
individuals who share a
set of norms, values, or
beliefs and have certain
implicitly or explicitly
defined relationships to
one another such that
their behaviors are
interdependent.
MKTG 371
Family/Group Influences/Segmentation
7
Perner
Definition
You must own at least
three encyclopedias to
belong to our group!
MKTG 371
Family/Group Influences/Segmentation
• Reference group: a
group whose
presumed
perspectives or
values are being used
by an individual as
the basis for his or
her current behavior.
8
Perner
Reference Groups
• Types of
reference groups:
• Degree of
importance:
– aspirational
(“Mean Joe
Greene”)
– associative
(colleagues)
– dissociative
(“Cadillac--It’s not
your father’s car!”)
– primary
– secondary
MKTG 371
Family/Group Influences/Segmentation
9
Perner
Types of Reference Group
Influence
• Informational
• Normative
• Identification
MKTG 371
Family/Group Influences/Segmentation
How can you
be a cool person
if you are not
on the ‘Net?
10
Perner
Communication About Products
• Word-of-Mouth
– product info
– rumors
• Communicators
– Opinion Leaders (considered
experts)
– Market Mavens--status from
knowledge
– “Purchase-Pals”
MKTG 371
Family/Group Influences/Segmentation
11
Perner
SEGMENTATION
•
•
•
•
Bases for segmentation
Determining which segments exist
Choosing segments to serve
Serving chosen segments
– positioning
– promotion
– product features
• Segmentation in direct marketing
MKTG 371
Family/Group Influences/Segmentation
12
Perner
Requirements for Segment
Viability
• Group identity (similarity
within, differences between,
segments)
• Systematic behaviors
• Marketing mix
efficiency potential
MKTG 371
Family/Group Influences/Segmentation
13
Perner
Three “Levels” of Segmentation
• Personal characteristics
– lifestyle
– personality
• Benefits sought
– attributes
– results
• Behavior
– approach to purchase
– variety seeking/loyalty
MKTG 371
Family/Group Influences/Segmentation
Note: Some of these
approaches overlap.
It is not essential to be
dogmatic in distinguishing.
14
Perner
Level 1:
Personal Characteristics
• Demographics
– age, sex, ethnic group
– geographic region
– education, occupation, social
class
• Media exposure
• Lifestyle/Psychographics
MKTG 371
Family/Group Influences/Segmentation
15
Perner
Lifestyles and
Psychographics: Examples
• VALS, VALS2
• Residence based
(e.g., PRIZM)
MKTG 371
Family/Group Influences/Segmentation
16
Perner
VALS2 Segments
• The Needy
• Inner-Directed Goal
Consumption
– Survivors
– Sustainers
• Outer-Directed Goal
Orientation
–
–
–
–
– Experiential
– Socially Conscious
– Integrated
Belongers
Emulators
Achievers
I Am Me
MKTG 371
Family/Group Influences/Segmentation
17
Perner
VALS Japan
•
•
•
•
•
Exploration
Self-expression
Achievement
Tradition
Realists
MKTG 371
Family/Group Influences/Segmentation
18
Perner
The PRIZM System
• 60 consumer measures
within zip code area
• 36,000 zip code areas
• Statistical methods used
to find areas containing
relatively consumers --->
60 segments
MKTG 371
Family/Group Influences/Segmentation
19
Perner
Level 2
Benefits Sought
• Based on
– differences in arbitrary
tastes (e.g., cola vs. noncola drink)
– ideal point
– tradeoffs (e.g., taste vs.
calories)
– usage situation (e.g.,
coffee for camping
(instant) vs. higher quality
for home brewing)
MKTG 371
Family/Group Influences/Segmentation
A consumer in
search of benefits.
20
Perner
Level 3
Behavior
• Attitude
• Extent of usage
• Shopping approach
–
–
–
–
price elasticity
deal-proneness
brand loyalty
sources of influence on brand choice:
• advertising
• sales person
• store assortment
MKTG 371
Family/Group Influences/Segmentation
What do you mean
you won’t give me
a discount? Then I’ll
go to the competitors!
21
Perner
Means of Segmentation in
Direct Marketing
•
•
•
•
•
Income
Past purchases
Ethnic surnames
Credit history
Hobbies/interests
(magazine
subscription lists)
MKTG 371
Family/Group Influences/Segmentation
22
Perner
Sources of Info for Direct
Marketing Segmentation
• Phone books--often contain
both names and addresses;
yellow pages
• State registrations (vehicle,
driver’s licenses)
• Past purchases (from
company or outside)
• Professional and school
directories
• Magazine subscription lists
• Credit rating bureaus
MKTG 371
Family/Group Influences/Segmentation
23
Perner
Advanced Segmentation Techniques
in Direct Marketing
• “Merge-Purge”
– merge: add lists together; add
purchased lists to own customer list
– purge: sort of duplicates
• special software allows for
standardization of addresses
(“phonetic” matching possible)
MKTG 371
Family/Group Influences/Segmentation
24
Perner
Sources of List Value
• Recency
• Frequency of
purchase
• Value of past
purchases
• Geography (zip
code as surrogate
for lifestyle)
• Gender
identifiability
MKTG 371
Family/Group Influences/Segmentation
25
Perner