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Consumer Behavior Marketing Final

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Terms

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Extended family?
Consists of three generations living together and often includes grandparents, aunts, uncles, and cousins.
Nuclear Family?
A mother and a father and one or more children
Family Household?
Contains at least two people who are related by blood or marriage (as defined by Census Bureau)
POSSLQ?
Persons of Opposite Sex Sharing Living Quarters
Voluntary childless?
Women of childbearing age who choose to have no children
Who’s Living at Home?
Boomerang Kids: Children between the ages of 18 and 34 that return home to live with their parents.
Animals Are People Too!
Animals Are People Too!
Family Life Cycle (FLC)?
Concept that combines trends in income and family composition with the changes in demands placed upon this income to segment households.
FLC Models?
Focuses on longitudinal changes in priorities which are valuable in predicting demand for specific product categories over time.
Four variables in FLC models?
(1) Age
(2) Marital Status
(3) Absence or Presence of Children
(4) Ages of Children
What are the lifestlye effects on buying?
Young bachelors and newlyweds are most likely to exercise, go to bars/concerts/movies
Early 20s: apparel, electronics, gas
Families with young children: health foods
Single parents/older children: junk foods
Newlyweds: appliances (e.g., toaster ovens)
Older couples/bachelors: home maintenance services
Consensual Purchase Decision?
Members agree on desired purchase
Accommodative Purchase Decision?
Members have different preferences or priorities and cannot agree on a purchase
Factors determining the degree of family decision conflict?
Interpersonal need
Product involvement and utility
Responsibility
Power
Autonomic Decision?
When one family member chooses a product
Syncratic Decision?
When the family jointly makes a decision
What Four Factors Determine the Degree to Which Decisions will be Made Jointly by One or the Other Spouse?
Sex-role stereotypes
Spousal resources
Experience
Socioeconomic Status
Kin-Network System?
Ties among family members, both immediate and extended.
Parental Yielding?
Occurs when a parental decision maker is influenced by a child’s request and “surrenders.”
Status Symbols?
Products that serve as markers of social class
Woman’s Work?
More people participating in the labor force
Mothers with children are the fastest growing segment of working people
Disposable Income?
Personal income available after taxes and all other employer withholdings, which can be used for spending, investing or saving.
Discretionary Income?
The portion of disposable income remaining after essential living costs are paid.
Behavioral Economics (a.k.a. economic psychology)?
Concerned with the “human side” of economic decisions
Consumer Confidence?
Consumers’ beliefs about what the future holds
Overall savings rate influenced by?
(1) Individual consumers’ pessimism or optimism about their personal circumstances
(2) World events
(3) Cultural differences in attitudes toward saving
Dominance-submission hierarchy?
Each individual in the hierarchy is submissive to those higher in the hierarchy and is dominant to those below them in the hierarchy
Social Class Affects Access to Resources?
Marx believed that position in society was determined by one’s relationship to the means of production.
Weber believed that rankings of people depended on prestige (status groups), power (party) and wealth (class)
Social class?
The overall rank of people in a society
Homogamy?
Tendency to marry into a similar social class
Social Stratification?
Creation of artificial divisions in a society
Achieved status?
Status earned through hard work or diligent study
Ascribed status?
Status one is born with
Occupational Prestige?
The “worth” of people based on what they do for a living
The Relationship Between Income and Social Class?
Social class is a better predictor of purchases that have symbolic aspects but low to moderate price
Income is a better predictor of major expenditures that do not have status or symbolic aspects
Social class and income are both needed to predict purchases of expensive, symbolic products
Working class?
More focused on immediate needs than long-term goals
Depend more heavily on relatives for emotional support
Orient themselves toward community rather than the world
More likely to be conservative and family oriented
Affluenza?
Many well-off consumers seem to be stressed or unhappy despite their wealth
SES score =
(Income) + (Education) + (Occupation) / 3
(SES) is?
Census Bureau Index of Socioeconomic Status
What are the problems with using Social Class as a Explainer or Predictor of Purchase Behavior?
1. There is no definitive way to measure SC

2. All measures have a lot of error

3. Single factors are easier to measure and are often as
good at predicting behaviors.

4. Geo-demographics is much more efficient and accurate
for many applications.
Social Mobility?
The passage of individuals from one social class to another
Horizontal Mobility?
Movement from one position to another roughly equivalent in social status
Downward Mobility?
Movement from one position to another position that is lower in social status
Upward Mobility?
Movement from one position to another position that is higher in social status
Differential fertility: Middle class reproduce fewer children than lower class
Targeting the Poor?
Most marketers ignore this segment
Segmenting consumers based on their attitudes toward luxury?
(1) Luxury is functional
(2) Luxury is a reward
(3) Luxury is indulgence
The Nouveau Riches?
Consumers who have achieved extreme wealth and are relatively recent members of upper class
Status anxiety: Concern that one is being consistent with the cultural environment of being wealthy
Symbolic self-completion: Excessive flamboyant consumption to make up for insecurity
Subcultures?
Group memberships within society at large
Ethnic Subculture?
A self-perpetuating group of consumers who are held together by common cultural or genetic ties, and is identified both by its members and by others as being a distinguishable category.
High-context Culture?
Group members tend to be tightly knit, and they are likely to infer meanings that go beyond the spoken word.
De-ethnicization?
Refers to the process whereby a product formerly associated with a specific ethnic group is detached from its roots and marketed to other subcultures.
Affluence of Immigrants?
62 % of all Arab-Americans have spent some time in college, but 45 % of all Americans have;
36.6 % of Asians in the United States have a bachelor's degree or higher, but 20.3% of the general population.
The median annual household income of Arab-Americans was $39,580 based on the 1990 census ($44,696 for Asian Indians), the median household income of all Americans was $33,105.
African Americans?
12.3 percent of the U.S. population (2000 Census)
Differences between blacks and whites in consumption are very subtle
Hispanic Americans?
“Hispanic” describes people of many backgrounds
60 percent of Hispanic Americans are Mexican
Puerto Ricans are the next biggest group at 10%
Distinguishing Characteristics of the Hispanic Market?
Youth:
Median Age is 23.6 (U.S. average: 32)
Family Size:
Average household is 3.5 people (U.S. average: 2.7)
Importance of Family:
Preference to spend time with family affects consumption activities
Going to the movies is a family event
Convenience products are not as important
Chi?
An invisible energy current that is believed to bring good or bad luck
Feng Shui?
Translated literally as “the wind and the water”
Fastest growing minority group in the U.S.
Asians
The most affluent, best educated, and most likely to hold technology jobs of any ethnic subculture
Prosperous Asians tend to be very status conscious
The Impact of Religion on Consumption?
Not studied extensively in marketing (too “taboo”)
Religious affiliation has the potential to be a valuable predictor of consumer behavior
Speaking to Teens in Their Language?
Rule 1: Don’t Talk Down
Rule 2: Don’t Try to be What You’re Not. Stay True to Your Brand Image.
Rule 3: Entertain Them. Make it Interactive and Keep the Sell Short.
Rule 4: Show That You Know What They’re Going Through, but Keep it Light.
Generation Y?
Those born between 1979 and 1994
Values, Conflicts, and Desires of Gen Y?
Autonomy vs. Belonging
Rebellion vs. Conformity
Idealism vs. Pragmatism
Narcissism vs. Intimacy
Know Gen Y!!!???!?!
One-third of U.S. population
Spend $170 billion a year
First to grow up with computers in their homes, in a 500-channel TV universe
Multitaskers with cell phones, music downloads, IM on Internet
Most diverse generation ever
Most raised by single parent and/or working mother
Gen Yers value fitting in/teamwork
Reject violence, tobacco, alcohol, teen pregnancy
Trust government and parents
College students are hard to reach via conventional media?
Online advertising is very effective
Sampler boxes
Wall media
Spring break beach promotions
Baby Busters?
Generation X
Consumers born between 1965 and 1976
Marketers initially thought that Gen Xers felt alienated, cynical, and depressed but...
“Today’s Gen Xer is both value-oriented and value-oriented”
Desire stable families, save portion of income, and view home as expression of individuality
Baby Boomers?
People born between 1946 and 1965
Sheer size of this generation has made it the source of many cultural and economic changes
More active and physically fit than previous generations
Gray Market?
Seniors impact the market place
Account for more than half of all discretionary spending in the U.S.
In many product categories, seniors outspend other age groups
Understanding Seniors?
Autonomy: Leading active lives and being self-sufficient
Connectedness: Bonds with friends and family
Altruism: Giving something back to the world
Selling to Seniors: Product Adaptations:
Packages sensitive to physical limitations
Serving sizes
Selling to Seniors:Mature Marketing Messages:
Prefer ads that provide abundant information
Not amused or persuaded by imagery-oriented ads
Advertising to Seniors: Tailoring your Promotions
Business cards: is the font legible?

Brochures: issues: glare w/glossy stock, contrast and font
Newsletters: more likely to be read
Print ads: font. Newspaper and magazine ads rank higher than television and radio on "reader believability". Keep it simple and avoid clutter.

Radio ads: background music can be problem, peak early AM hour senior audiences
Television ads: viewing time and show-type.

Direct mail campaigns: “The kids never write.”
Define Culture?
The accumulation of shared meanings, rituals, norms, and traditions among the members of an organization or society.
Four Dimensions of Cultural Variability?
Power Distance
Uncertainty Avoidance
Masculinity/femininity
Individualism
Collectivist Cultures?
People sub-ordinate their personal goals to those of a stable in-group
Individualist cultures?
Attach more importance to personal goals, and people are more likely to change memberships when the demands of the group become too costly.
Enacted norms?
Explicitly decided on
Crescive norms?
Embedded in a culture
Custom: A norm handed down from the past that controls basic behaviors.
More (“mor-ay”): A custom with a strong moral overtone.
Conventions: Norms regarding the conduct of everyday life.
Myth?
A story containing symbolic elements that represent the shared emotions and ideals of a culture.
The Functions and Structure of Myths
Metaphysical
Cosmological
Sociological
Psychological
Binary Opposition: Stories in which two opposing ends of some dimension are represented.
Grooming Rituals?
Sequences of behaviors that aid in the transition from the private self to the public self or back again
Steps in Consumers’ Rites of Passage?
Separation: Individual is detached from his or her original group or status
Liminality: Person is between statuses
Aggregation: Person reenters society after the rite of passage is complete
Three Stages of Gift-Giving?
Gestation: Giver is motivated by an event to procure a gift.
Presentation: The process of the gift exchange
Reformulation: The bonds between the giver and receiver are adjusted to reflect the new relationship that emerges after the exchange is complete.
Reciprocity Norm?
The feeling of obligation to return the gesture of a gift with one of equal value.
Sacred Consumption?
Involves objects and events that are “set apart” from normal activities and are treated with some degree of respect or awe.
Souvenirs, tacky or otherwise, allow consumers to tangibilize sacred (i.e., out of the ordinary) experiences accumulated as tourists.
Sacralization?
Occurs when ordinary objects, events, and even people take on sacred meaning to a culture or specific group within a culture.
Objectification: Occurs when we attribute sacred qualities to mundane items.
Collecting: The systematic acquisition of a particular object or set of objects.
Hoarding: Unsystematic collecting.
Co-optation?
Hip-hop fashions as an example when marketing systems take meanings created by members of culture, reinterpret them, and produce them for mass consumption
Characteristics of fashion/popular culture?
Reflection of fundamental societal trends
Style begins as risky by small group, then spreads as others become aware/confident
Styles as interplay between deliberate inventions and ordinary consumers who modify styles to suit needs
Cultural products travel widely
Influential media people decide which will succeed
Most styles eventually wear out
Culture Production Systems?
set of individuals and organizations responsible for creating and marketing a cultural product
Three major CPS subsystems?
Creative subsystem
Eminem
Managerial subsystem
Interscope Records
Communications subsystem
Advertising and publicity agencies
Cultural Gatekeepers?
Responsible to filtering the overflow of information and materials intended for customers
Tastemakers⬝ ?
who influence products consumers get to consider
Adopting Innovations
Adoption of innovations resembles consumer decision-making sequence
Individualistic consumers are more innovative than collective consumers
Likelihood of adopting innovations categories
Innovators and early adopters
Laggards
Late adopters (mainstream public)
Innovators...
Tend to be category-specific
Tend to favor taking risks
Higher educational/income levels
Socially active
Lead users
Early adopters...
Concern for social acceptance (expressive products)
Involved in product category and value fashion
Tend to “field-test” style changes
Three major types of innovations (amount of disruption/change they bring to our lives)?
Continuous innovation
Evolutionary rather than revolutionary
Dynamically continuous innovation
More pronounced change to existing product
Discontinuous innovation
Creates major changes in the way we live
Prerequisites for Successful Adoption?
Compatibility
Trialability
Complexity
Observability
Relative Advantage
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