Chapter 4

Consumer Behaviour
BAMK 2102

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 Chapter 4

Topics covered

1. Meaning of Culture
2. Subculture and types of subculture
3. Group and Reference group
4. Factors affecting reference group influence
5. Types of reference groups

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INTRODUCTION

Culture is the characteristics of a particular group of people, defined by everything from

language, religion, cuisine, social habits, music and arts. 

1. Culture has a potent influence on all consumer behavior.

2. Individuals are brought up to follow the beliefs, values, and customs of their society and to
avoid behavior that is judged “unacceptable” or considered taboo.
a) In addition to segmenting in terms of cultural factors, marketers also segment overall
societies into smaller subgroups (subcultures) that consist of people who are similar in
terms of their ethnic origin, their customs, and/or the ways they behave.
b) These subcultures provide important marketing opportunities for astute marketing
strategists.
3. The sub-cultural divisions discussed are based on a variety of sociocultural and demographic
variables, such as nationality, religion, geographic locality, race, age, sex, even working
status.

WHAT IS SUBCULTURE?

1. Members of specific subcultures possess beliefs, values, and customs that set them apart
from other members of the same society.
2. Subculture is defined as being a distinct cultural group that exists as an identifiable segment
within a larger, more complex society.
3. A cultural profile of a society or nation is a composite of two elements:
a) The unique beliefs, values, and customs subscribed to by its members.
b) The central or core cultural themes shared by the majority of the population, regardless
of specific sub-cultural memberships.
4. Each subculture has its own unique traits.
5. Sub-cultural analysis enables the marketing manager to focus on sizable and natural market
segments.
a) When carrying out such analyses, the marketer must determine whether the beliefs,
values, and customs shared by members of a specific subgroup make them desirable
candidates for special marketing attention.

NATIONALITY SUBCULTURES

1. For many people, nationality is an important sub-cultural reference that guides what they
value and what they buy.
2. Many people still retain a pride and identification with the language and customs of their
ancestors.
This identification can manifest itself in consumption behavior.
3. When it comes to consumer behavior, ancestral pride is manifested most strongly in the
consumption of ethnic foods, in travel to their “homeland,” and in the purchase of numerous
cultural artifacts.

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RELIGIOUS SUBCULTURES

1. Consumer behavior is commonly directly affected by religion in terms of products that are
symbolically and ritualistically associated with the celebration of various religious holidays.
2. Religious requirements or practices sometimes take on an expanded meaning beyond their
original purpose.
3. Targeting specific religious groups with specially designed marketing programs can be very
profitable.

GEOGRAPHIC AND REGIONAL SUBCULTURES

1. There are regional differences in consumption behavior, especially when it comes to food
and drink.
Regional differences also include brand preferences.
2. Consumer research studies document regional differences in consumption patterns.
This distinction helps redefine local markets in terms of specific urban lifestyle.

RACIAL SUBCULTURES

The major racial subcultures in the United States are Caucasian, African American, Asian
American, and American Indian.
The majority of research has focused on the difference between African American and Caucasian
consumers and only recently turned to Asian Americans.

AGE SUBCULTURES

Four age subculture segments have been singled out for discussion (Generation Y, Generation
X, baby boomers, and seniors) because their distinctive lifestyles qualify them for consideration
as sub-cultural groups.
The Generation Y Market

This age cohort (a cohort is a group of individuals born over a relatively short and continuous
period of time) includes the approximately 71 million Americans born between the years 1977
and 1994 (i.e., the children of the baby boomers).
a. This cohort is also known as the “millennium generation.”
b. This group is often described as being pragmatic, savvy, socially and environmentally
aware, and open to new experiences.

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The Generation X Market

1. This group consists of approximately 46 million 23- to 37-year-olds who spend about $125
billion yearly.
2. They do not like labels, are cynical, and do not want to be singled out and marketed to.
3. They are in no rush to marry, start a family, or work excessive hours to earn high salaries.
a. Job satisfaction is typically much more important than salary.
b. It is more important to enjoy life and to have a lifestyle that provides freedom and
flexibility.

Baby-Boomers

1. This segment was born between 1946 and 1964, aged mid-30s to mid-50s.
2. They represent 40 percent of the adult population and comprise 50 percent of all people in
professional and managerial occupations and more than one-half of those with at least a
college degree.
Older Consumer

1. America is aging; the number of elderly consumers is growing twice as fast as the overall
U. S. population.
2. People over age 50 comprise fully one-third of the adult U.S. market.
3. Some people think of older consumers as:
a. The annual discretionary income of this group amounts to half of all the nation’s
discretionary income.
b. This group controls 70 percent of the nation’s wealth, which now amounts to about $70
trillion.

Reference Groups and Family Influences

WHAT IS A GROUP?

1. A group is two or more people who interact to accomplish either individual or mutual goals.
a. This broad definition covers everything from intimate groups to formal work groups.
b. Included in this definition, too, is a kind of “one-sided grouping” in which an individual
consumer observes the appearance or actions of others who unknowingly serve as
consumption-related role models.
2. Sometimes groups are classified by membership status.
A group to which a person either belongs or would qualify for membership is called a
membership group.
3. There are also groups in which an individual is not likely to receive membership, despite
acting like a member by adopting the group’s values, attitudes, and behavior—this is
considered to be symbolic groups.

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UNDERSTANDING THE POWER OF REFERENCE GROUPS

1. A reference group is any person or group that serves as a point of comparison (or reference)
for an individual in forming either general or specific values, attitudes, or a specific guide for
behavior.
a. They help us understand the impact of other people on an individual’s consumption
beliefs, attitudes, and behavior.
b. It helps marketers choose their methodology to affect desired changes in consumer
behavior.
2. From a marketing perspective, reference groups are groups that serve as frames of reference
for individuals in their purchase or consumption decisions.
3. Reference groups that influence general or broadly defined values or behavior are called
normative reference groups.
4. Reference groups that serve as benchmarks for specific or narrowly defined attitudes or
behavior are called comparative reference groups.
a) A comparative reference group might be a neighboring family whose lifestyle appears
to be admirable and worthy of imitation.
5. Normative reference groups influence the development of a basic code of behavior.
6. Comparative reference groups influence the expression of specific consumer attitudes and
behavior.

Factors That Affect Reference Group Influence

 Information and Experience

1. An individual who has firsthand experience with a product or service, or can easily obtain
full information about it, is less likely to be influenced by the advice or example of others.

A person who has little or no experience with a product or service and does not expect to
have access to objective information about it (e.g., a person who believes that relevant
advertising may be misleading or deceptive) is more likely to seek out the advice or example
of others.

 Credibility, Attractiveness, and Power of the Reference Group

1. A reference group that is perceived as credible, attractive, or powerful can induce consumer
attitude and behavior change.
2. When primarily concerned with the acceptance or approval of others they like, with whom
they identify, or who offer them status or other benefits, consumers are likely to adopt their
product, brand, or other behavioral characteristics.
3. When consumers are primarily concerned with the power that a person or group can exert
over them, they might choose products or services that conform to the norms of that person
or group in order to avoid ridicule or punishment.

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4. Unlike other reference groups, however, power groups are not as likely to cause attitude
change.
a) Individuals may conform to the behavior of a powerful person or group but are not as
likely to experience a change in their own attitudes.
5. Different reference groups may influence the beliefs, attitudes, and behavior of an individual
at different points in time or under different circumstances.

SELECTED CONSUMER-RELATED REFERENCE GROUPS

Five specific reference groups are considered because they give us a kind of cross-section of
the types of groups that influence consumers’ attitudes and behavior. They are:

a. Friendship groups.
b. Shopping groups.
c. Work groups.
d. Virtual groups or communities.
e. Consumer-action groups.

Friendship Groups

1. Friendship groups are classified as informal groups because they are usually unstructured
and lack specific authority levels.
2. Seeking and maintaining friendships is a basic drive of most people.
3. The opinions and preferences of friends are an important influence in determining the
products or brands a consumer ultimately selects.
Shopping Groups

Two or more people who shop together can be called a shopping group.
a) The motivations range from primarily social to reducing risk.
b) A special form of a shopping group is the in-home shopping party.
i) Early purchasers tend to create a bandwagon effect.
ii) Undecided guests often overcome a reluctance to buy when they see their friends
make positive purchase decisions.
iii) Furthermore, some of the guests may feel obliged to buy because they are in the
home of the sponsoring host or hostess.

Work Groups

1. Both the formal work group and the informal friendship/work group have potential for
influencing consumer behavior.
2. The formal work group consists of individuals who work together as part of a team and, thus,
have the opportunity to influence each other’s consumption-related attitudes and actions.
3. Members of informal work groups may influence the consumption behavior of other
members during coffee or lunch breaks or after-hours meetings.

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4. Recognizing that work groups influence consumers’ brand choices and that most women now
work outside the home, firms are redirecting their sales efforts to the workplace rather than
the home.
Virtual Groups or Communities

1. Thanks to computers and the Internet, we are witnessing the beginnings of a new type of
group—virtual groups or communities.
2. While fifty years ago the definition of a community stressed the notion of geographic
proximity and face-to-face relationships, today’s communities are much more broadly
defined as sets of “social relations among people.”
These communities provide their members with access to an extensive amount of information
and/or fellowship and social interaction covering an extremely wide range of topics and
issues.
3. The anonymity of the Internet gives its users the freedom to express whatever views they
wish, and to also benefit from savoring the views of others.
Because of this anonymity, Internet users can say things to others that they would not say in
face-to-face interactions.
4. Communicating over the Internet permits people to explore the boundaries of their
personalities.
Consumer-Action Groups

1. A consumer-action group—has emerged in response to the consumerist movement.

They can be divided into two broad categories.
i) Those that organize to correct a specific consumer abuse and then disband.
ii) And, those that organize to address broader, more pervasive, problem areas and
operate over an extended or indefinite period of time.

2. The overriding objective of many consumer-action groups is to bring sufficient pressure to

bear on selected members of the business community to make them correct perceived
consumer abuses.