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Chapter 13
Group and PersonalInfluences
Types of Influence
Transmissionof Influence
Personal and Group Influences
on Individuals
Individual Lifestyles, Behaviors, Purchases,
and Consumption
Low Degree of Influence
High Degree of InfluencePersonal and Group Influence on
Individuals
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Group and Personal Influences on IndividualsReference group: any person orgroup of people that significantlyinfluences an individual’s behavior
May be individuals (celebrities,athletes, or political leaders) orgroups of individuals with similarities(musical groups or sports teams)
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Types of Reference Groups
Primary: a social aggregation that issufficiently intimate to permit andfacilitate unrestricted face-to-faceinteraction (ex: family)
Secondary: groups in which face-to-face interaction occurs, but it is moresporadic, less comprehensive, andless influential in shaping thoughtand behavior (ex: professionalassociations or communityorganizations)
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Types of Reference Groups
Formal: groups characterized by adefined structure (often written) and aknown list of members andrequirements for membership
Informal: have less structure thanformal groups and are likely to bebased on friendship or interests
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Types of Reference Groups
Membership: when individuals arerecognized as members of a group,they have achieved formal acceptancestatus in the group
Aspirational: groups that exhibit adesire to adopt the norms, values, andbehaviors of others with whom theindividuals aspire to associate
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Types of Reference Groups
Dissociative: groups from which anindividual tries to avoid association
Virtual: groups that are based on setsof social relations among peoplerather than face-to-face relationships
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Types of Influence
Personal and Group Influences
on Individuals
Personal and Group Influence on Individuals
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Types of Group InfluenceNormative: when individuals alter theirbehaviors or beliefs to meet theexpectations of a group
Value-expressive: when a need forpsychological association with a groupcauses acceptance of its norms,values, attitudes, or behaviors
Informational: when people havedifficulty assessing product or brandcharacteristics by their own contacts orobservations
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Types of Influence
Transmissionof Influence
Personal and Group Influences
on Individuals
Personal and Group Influence on Individuals
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Types of Influence
Transmissionof Influence
Personal and Group Influences
on Individuals
Individual Lifestyles, Behaviors, Purchases,
and Consumption
Low Degree of Influence
High Degree of Influence
Personal and Group Influence on Individuals
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How Reference Groups Influence Individuals
Socialization: permits an individual toknow what behavior is likely to resultin stability both for the individual andfor the group
Manual may tell people how to dressin the workplace
Informal groups may tell them what isacceptable and the norm in thatparticular environment
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How Reference Groups Influence Individuals
Self-concept: people protect andmodify their self-concept in theirinteractions with group members
People can maintain self-concept byconforming to learned roles
Testimonial advertising is effectivewhen the self projected in the ad isconsistent with the idealized self ofthe target consumer
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How Reference Groups Influence Individuals
Social comparison: individuals oftenassess themselves by comparingthemselves to others
Consumers often use referencegroups as benchmarks to measuretheir own behaviors, opinions,abilities, and possessions
Advertising or television can besources of social comparison
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How Reference Groups Influence Individuals
Conformity: a change in beliefs oractions based on real or perceivedgroup pressures
Compliance: when an individualconforms to the wishes of the groupwithout accepting all its beliefs orbehaviors
Acceptance: when an individual actuallychanges his or her beliefs and values tothose of the group
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How Reference Groups Influence Individuals
Factors affecting how likely people are to conform to group norms:
Cohesiveness of group
Size of group
Group’s expertise on topic
Person’s desire to belong
Individual’s need for social acceptance
Public versus private use of product
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PRIVATE LUXURIES
Influence: Strong product & weak brand
(icemaker)
PRIVATE NECESSITIES
Influence: Weak product & weak brand
(mattress, refrigerator)
PUBLIC LUXURIES
Influence: Strong product & strong brand
(golf clubs, skis, boat)
PUBLIC NECESSITIES
Influence: Weak product & strong brand
(watch, autos, suits)
Strong Reference Group Influences
Weak Reference Group Influences
PRODUCT
Source: William O. Bearden and Michael J. Etzel, “Reference Group Influences on Product and Brand Purchase Decisions,” Journal of Consumer Research, 9 (September 1982), 1985.
Reference Group Influence on Product and Brand Purchase Decisions
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Normative Influence in Marketing Strategy
Normative compliance is declining in itsimpact as many consumers put individualneeds ahead of group needs
Extended families have less face-to-facecontact and people are more sociallyisolated than in the past
Television and mass media expand people’shorizons beyond social circles
Some consumers want to expressindividuality more than group affiliation
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Celebrity and Other Reference Group Appeals in Advertising
Testimonials: celebrities tout productsbased on personal usage
Endorsements: celebrities lend theirname or likeness to a product withoutnecessarily being an expert in thearea
Spokesperson: someone whorepresents a brand or company for anextended period of time
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Linda Evans, atelevision starfamous for her roleas CrystalKarrington onDynasty (DenverClan), touts a facialtoning mask.
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Pierce Brosnan endorses Omega watches, as does his film character James Bond.
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Celebrity and Other Reference Group Appeals in Advertising
Expert appeal: appeal from a personpossessing unique information orskills that can help consumers makebetter purchase decisions than othertypes of spokespersons
Common-man appeal: testimonialsfrom “regular” consumers with whommost consumers can relate
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Transmission of Influence Through Dyadic Exchanges
Person-to-person exchange in whichan individual receives personalcommunication from someone aboutbehaviors or opinions) and thenreceives feedback on their ownbehaviors
Dyadic exchange requires theexchange of resources (commentsand opinions)
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Dyadic Exchanges
Word-of-mouth Communication
Opinion Leadership
Service Encounters
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Word-of-mouth Communication
Word-of-mouth communication:informal transmission of ideas,comments, opinions, and informationbetween two people, neither one ofwhich is a marketer
The receiver gains information aboutbehaviors and choices
The sender increases its confidence inits product or behavior choice bypersuading others to do the same
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-potential reciprocity of exchange
-increased attention and status
-increased number of individuals with similar behaviors-increased cohesion within group
-satisfaction of verbal expression
-feeling of power and prestige of influencing others’ behaviors
-enhanced position within a grou-decreased doubt about one’s own behavior
-more information about options
-more reliable/credible information
-less time spent on search-enhanced relationship with another individual
-decrease risk of new behavior -increase confidence in choice
-decrease cognitive dissonance
-increase likelihood of acceptance by a desired group or individual
Functional BenefitsHedonic Benefits
Benefits of Word-of-Mouth
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Opinion Leadership
Opinion leadership: the sender ofinformation is often considered anopinion leader--a person whoinfluences the decisions of others
Opinion leaders might be experts inone area but not in others
The greater the perceived knowledgeof a category, the more likely thatperson’s opinions are to influenceothers’ decisions
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Opinion LeadershipPersonal influence in the form of opinion leadership is likely to occur when:
An individual has limited knowledge
A person cannot evaluate options
The consumer does not trust advertisingor other sources of information
Other information sources have lowcredibility with the consumer
The individual has a high need for socialapproval
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Opinion Leadership
Strong social ties exist between senderand receiver
The product is complex
The product is difficult to test againstobjective criterion
The product is highly visible to others
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Opinion Leadership
Market mavens: individuals who serveas information sources about themarketplace because of theirawareness of new products and othermarketplace activities
Surrogate consumers (shoppers): anindividual who acts as an agent toguide, direct, and or conduct activitiesin the marketplace
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Service Encounters
Service encounters: occurs whenthere is personal communicationbetween a consumer and a marketer
May be a consumption experiencewithin a store--the various trans-actions and services that occur duringa purchase
May be an experience with a specificservice a consumer purchases
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Service Encounters
Service providers must understandthe needs of different customers andmatching the appropriate salesassociate or sales approach to aparticular type of customer
Which customers need a lot ofattention and which ones prefer to beleft alone
Salesperson fosters a relationshipbetween buyer and seller
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Transmitting Personal InfluencesTrickle-down: alleges that lowerclasses often emulate the behaviortheir higher-class counterparts
Influence is transmitted vertically throughsocial classes, as higher classes expresswealth through conspicuous consumption,and lower classes copy their behavior
Today, trends are transmitted throughmass media and classes do not havedirect contact
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Transmitting Personal InfluencesTwo-step Flow
Opinion Leader
Opinion Seekers
Mass Media
Information and InfluenceInformation
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Transmitting Personal InfluencesMultistep Flow
Gatekeepers
Opinion Seekers
Mass Media Opinion
Leader
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WOM and Opinion Leaders in Advertising and Marketing Strategy
Advertising can provide information toconsumers about products they mightseek from other sources and whichmay be discussed in WOM
Advertising can create WOM amongconsumers and peer groups
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As more consumersare concerned abouttheir health, this adprovides them withvaluable informationabout the benefits ofsoy protein, whichmay be passed onwith WOM.
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Internet-basedfirms seek tocreate WOM withtheir ads, ashotjobs.com doeswith this ad writtenfor Hillary Clinton.
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The Advertising-WOM Relationship
For some firms, WOM is a substitutefor advertising
Advertising could be targeted toopinion leaders, although it is difficultto identify this segment unless theybelong to an identifiable group
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Victoria’s Secret builtmuch of its brandawareness with WOMgenerated by itscatalog, models, andpromotions
The Advertising-WOM Relationship
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The Advertising-WOM Relationship
Firms may stimulate WOM by givingaway or loaning products to opinionleaders to use or display
Organizations may hire opinion leadersto influence consumers (camera storesmay hire professional photographers towork in their stores)
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The Advertising-WOM Relationship
Firms can create opinion leaders byproviding incentives for new customersto attract others to the store
Companies can activate searchthrough advertising that encouragesconsumers to “ask a person whoknows” or “tell a friend”
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Managing Negative WOM
Monitoring the content of WOM--whatconsumers are saying about theproduct or company
Monitoring rumors which do not alwaysappear in customer complaint reports
Creating a strategy to respond torumors and negative WOM
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Diffusion of InnovationsInnovation: any idea or productperceived by the potential adopter tobe new
Marketers often use the word “new”to symbolize an innovation
Innovations may also be usage-based--using an existing product in anew way
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Pringlesintroduced a fat-free potato chipusing the new fatsubstitute Olean.
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Types of Innovations
• Continuous innovation
• Dynamically continuous innovation
• Discontinuous innovation
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Continuous Innovation
The modification of an existingproduct rather than the establishmentof a new product or product category
Modification may be in the taste,appearance, performance, orreliability of the product
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Crayola introduceda new crayon whichis washable and canbe removed from avariety of surfaces.
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Dynamically Continuous Innovation
May involve the creation of either anew product or a significant alterationof an existing one
Does not generally alter establishedpurchase or usage patterns
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The Kodak Advantixsystem allowsconsumers to takepictures as they havein the past; however,they have threepicture formats tochoose from andthey must usedifferent film.
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Discontinuous Innovation
Involves the introduction of an entirelynew product that significantly altersconsumers’ behavior patterns andlifestyles
Examples include television,automobiles, and computers
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Evaluating Innovation
Relative Advantage
Compatibility
Complexity
Trialability
Observability
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Relative AdvantageThe degree to which consumers mayperceive the innovation to offersubstantially greater benefits thanthe product currently used
Relative advantages are often featuredin communication pieces, advertising,and packaging of products once in themarketplace
Advantages over old technology becometouted product features
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CompatibilityThe degree to which a new product isconsistent with an individual’s existingpractices, values, needs, and pastexperiences of the potential adopter
How does the innovation blend withproducts consumers might own?Will it replace other products or will itbecome a part of an existing system?How does the innovation fit currentpurchase or consumption behaviors?
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ComplexityThe degree to which an innovation isperceived as difficult to understandand use
The more complex, the more difficultit may be to be accepted
Complexity is a deterrent of tryingnew technology
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Complexity
How difficult is the innovation tounderstand?
How easy is it to explain to consumers inwritten form and oral communication?
How frustrating will it be to consumerswhen evaluating products or learning howto use new innovation?
How much time will consumers have todevote to learning how to use and care forthe product?
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TrialabilityNew products are more likely to beaccepted if experimenting or using theproduct is made easy
How easy will it be for people to try thenew product without buying it?
How can a company encourageconsumers to try a new product?
Where will consumers be able to try theinnovation and how will they receiveanswers to their questions?
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ObservabilityThe degree to which results fromusing a new product are visible tofriends and neighbors
If consumers can see others using anew product, that innovation is likelyto diffuse faster than if the productwere used privately
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The Diffusion ProcessDiffusion: the process by which aninnovation is communicated throughcertain channels over time amongthe members of a social system
Includes:
Diffusion of information andcommunication
Consumer decision process
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The Diffusion Process
Influencer
Consume r
Organi-zation
Reject
Accept
Demise of Innovation
Diffusion of Innovation
Consumer decision process
Diffusion of Information and Communication
(X number of people)
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Factors Affecting Diffusion
Communication (how consumerslearn about innovation)
Time (how long it takes for a personto move from product awareness topurchase or rejection)
Social system (the groups orsegments to which individualsbelong)
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Speed of Diffusion
Diffusion will be faster if:
Supplier is intensely competitive
Supplier’s reputation is good
Standardized technology is used
Vertical coordination amongchannel members exists
Resource commitments aresignificant
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Consumer Decision Process for Innovations
Rogers Model of Innovation Decision Process
Knowledge
Characteristics of the Decision Making Unit
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Knowledge Persuasion
Perceived Characteristics of the Innovation
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Consumer Decision Process for Innovations
Rogers Model of Innovation Decision Process
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DecisionKnowledge Persuasion
Adoption
Rejection
Continued adoption
Later adoption
Discontinuance
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Consumer Decision Process for Innovations
Rogers Model of Innovation Decision Process
Implemen-tation
DecisionKnowledge Confir-mation
Persuasion
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Consumer Decision Process for Innovations
Rogers Model of Innovation Decision Process
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Implemen-tation
DecisionKnowledge Confir-mation
Persuasion
Communication Channels
Source: Everett M. Rogers, Diffusion of Innovation, 3rd Edition (New York; The Free Press, 1983), 165.MAR20467
Consumer Decision Process for Innovations
Rogers Model of Innovation Decision Process
Consumers Likely to Buy New Products
Innovativeness: the degree to whichan individual adopts an innovationearlier than other members of a socialsystem
Cognitive innovators: have a strongpreference for new sensory experiences
Sensory innovators: have a strongpreference for new sensory experiences
Advertising can be targeted to varioustypes of innovators
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A B C D E
A= Innovators (2.5%)B= Early Adopters (13.5%)C= Early Majority (34%)D= Late Majority (34%)E= Laggards (16%)
Adopter Classes
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Managerial Perspectives on Adoption and Diffusion of Innovations
Most firms develop new products to fuellong-term growth and profitability
Consumer insight helps create productsthat consumers are likely to adopt
Intuition and information (often gainedfrom consumers through research)contribute to the formation of an insight
Insights drive the creation of a new oradaptation of an existing product
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V8 introduces newpackaging, which isshelf-stable andcomes in individualserving sizes. Itappeals to consumers’desire to drink “on-the-go.”
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Review Questions
1. List and define the types of referencegroups.
2. Briefly discuss the issue of serviceencounters.
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