REFERENCE GROUPS

Person or group that serves as a point of comparison (or reference) for an individual in forming general or specific values, attitudes or specific guide for behaviour

Comparative reference groups- Benchmark for specific attitudes

Normative reference groups- Influence general or broadly defined values or

behaviour i.e. immediate family

Types of reference groups- Contactual- Aspirational- Disclaimant- Avoidance

Factors that affect reference group influence- Information and experience- Credibility, attractiveness, power- Conspicuousness of product- Reference groups and consumer conformity- Selected consumer-related reference groups- Celebrities and other reference group appeals

SOCIALIZATION OF FAMILY MEMBERS

Imparting to children and other family members the basic values and modes of behaviour consistent with cultures

Manners, goals, values and other qualities imparted through instruction and observation

Consumer socialization- Process where people acquire skills, knowledge,

attitudes and preferences relevant to their own functioning and participation in the marketplace

Child consumer socialization- Family is instrumental in teaching children the

fundamental aspects of purchasing and consumption

Child consumer socialization (`cont’d..)- Parent types in socialization process

Authoritarian parents Neglecting parents Democratic parents Permissive parents

- Family types in socialization process Tactical families Easygoing families Autocratic families Malleable families

Adult consumer socialization- Transition process from childhood to adolescence- Intergenerational consumer behavior as a cross

between generations i.e. parents to children and vice versa

Young Person

Other Family Members

Friends

Influence morebasic values/behaviour

•Moral/Religious principles•Interpersonal Skills•Dress/Grooming standards•Manners and speech•Educational motivation•Occupational/career goals•Consumer behaviour norms

Influence more expressiveattitudes/behaviour

•Style•Fashion•Fads•`In/Out’• Acceptable consumer behaviour

Pre-adolescent Adolescent Teens Older

A simple model of the socialization process

THE FAMILY LIFE CYCLE (FLC)

Concept based on progression of stages which majorities of families pass through in life

FLC is a strategic tool of marketers to segment families into a series of stages spanning the life course of a family unit and thereby understand their purchase and consumption behaviour

Traditional family life cycle- Singles- Marriage- Family growth- Family contraction

Spending patterns vary by type of household depending on the age of household members, marital status and number of children at home

Spending patterns change during each stage of the FLC

Stage 1: Young Singles

Young single men and women who have established households apart from their parents

Have own income Most likely have sufficient disposable income Engaged and soon-to-be-married couples are the

target for many products and services i.e. bridal services)

Stage 2: Young Marrieds

Start immediately after marriage vows and continues until the birth of the first child

High combined disposable income that permits a pleasure-seeking lifestyle

Have considerable start-up expenses in establishing new home i.e. appliances, furniture)

Stable environment

Stage 3: Parenthood

Young married stage moved to a close Referred to full-nest stage Can be divided into pre-school, primary, high school

and tertiary phases Child-rearing and educational responsibilities

gradually increase then decrease as children become self-supporting

Stage 4: Post-parenthood

Empty nest stage Traumatic or liberating rebirth Financial freedom The opportunity to pursue new freedom i.e. travel

more frequently

Stage 5: Dissolution

Dissolution of basic family unit with death of one spouse

Dissolved family experience distinct changes in consumption behaviour

More economical lifestyle

FAMILY DECISION MAKING

Marketers examine attitudes and behaviour of whom they believe would be the major decision maker

Marketers also examine the person most likely to be primary used of the product or service

FAMILY DECISION MAKING

How family members interact and divide rolesEight roles in the family decision-making

process:- Influencers- Gatekeepers- Deciders- Buyers- Preparers- Users - Maintainers- Disposers

FAMILY DECISION MAKING

Roles vary from family to familyWestern families encourage individuality and

individual decision makingThe larger the family the greater

concentration of purchases

HUSBAND/WIFE DECISION MAKING

Family consumption decisions are husband-dominated/wife-dominated/joint decisions (equal or syncratic) or individual (autonomic)

Three-step decision model:1. Search for information2. Shortlist3. Final decision

HUSBAND/WIFE DECISION MAKING

Influencing spouses and resolving conflict through six influence strategies:

1. Expert2. Legitimacy3. Bargaining4. Reward5. Emotional6. Impression

CHILDREN

Children attempt to influence their parents to make a purchase (to yield)

Children attempt to influence their parents in- Purchases of special interest to them- Purchases of remote interest

Children and television - Children with greater media exposure tend to recall

more advertising slogans- Youngsters are influenced by actions of adults on

television- Older children recognize symbolism on television

Latchkey kids - Children home alone for part of school day when

parents are at work- Exposed to more television- This group are more self-sufficient in use of various

household appliances

Teenagers and post teens- Ability to spend rather than save

University students- consume wide range of goods and services i.e.

personal clothing, petrol etc and are more opinionated