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Consumer Behavior - Course Notes

Consumer Behavior Notes

Chapter 11 – Social Influences

  • Shift from Micro to Macro View: Understanding how larger social contexts influence individual consumer behavior.
  • Social Pressures: Influences can come from:
    • Society at large
    • Family and friends
    • Media platforms
    • Marketers themselves

Consumer Socialization

  • Definition: The process through which individuals learn to become consumers.
  • Influential Factors:
    • Family dynamics, including parental guidance and peer influences.
    • Learning about the value of money, decision-making regarding purchases, consumer behavior norms, and the distinction between saving and spending.

Parental Influence

  • Parents instill norms regarding acceptable products and behaviors concerning consumption.
    • Tendency for children to subconsciously emulate parental purchasing behavior through a phenomenon known as parental heuristic.
    • U.S. children typically learn consumerist behaviors at a younger age compared to other nations.

Normative vs. Informational Influence

  • Normative Influence: Driven by social norms that dictate acceptable behavior.
    • Conformity: The inclination to align behavior with that of peers.
    • Brand Choice Congruence: Consumers prefer brands that are positively perceived within their social circles.
  • Informational Influence: External entities provide data that shapes consumer decisions.

Valence Influence

  • Definition: The consumer's assessment of information as either positive or negative.
  • Word-of-Mouth (WOM): Information shared among consumers:
    • Consumers often spread negative experiences more frequently than positive ones, contributing to a higher influence.
    • Marketers must take negative WOM seriously, as it can significantly affect brand perception.
    • The relevance of WOM is amplified on social media platforms.
    • Factors that enhance virality include: Novelty, Curiosity, and Emotion.

Reacting to WOM

  • Marketers should proactively manage WOM through strategic communication strategies, whether paid or unpaid, including public relations efforts.

Marketers Spending on Social Influence

  • Increase in annual budgets allocated to social media influencers rather than traditional celebrity endorsements.

Social Influence - Definitions

  • Reference Group: A group with which a consumer identifies or compares themselves.
    • Associative Group: Groups to which an individual belongs.
    • Dissociative Group: Groups an individual chooses not to affiliate with.
    • Aspirational Group: Groups that individuals aspire to join but do not currently belong to.
  • Opinion Leader: Individuals who influence a reference group through the provision of information and opinions.
  • Compliance: The action of agreeing to requests, differing from normative influence which lacks explicit direction.
  • Reactance: An oppositional behavior to directives, e.g., a hard sell approach that may result in consumer resistance.

Case Study: Dunkin Donuts

  • Exploration of marketing strategies involving nano-influencers (less than 10K followers) who possess high credibility despite limited reach.

Social Influence - Case Study: Fisker Auto

  • Notable instance of consumer reaction via social media when a popular tech reviewer rejected a car model, impacting the brand severely. Demonstrates the importance of brand reputation management in the face of negative reviews.

Consumer Diversity

  • Disclaimer: General stereotypes may or may not apply to individuals.
  • Stereotypes: Often oversimplified societal images that can influence consumer behavior.
  • APC Diversity: Represents Age (biological), Period (historical), and Cohort (groups within the same age range) leading to similar behavioral patterns.
    • Understanding generational influences is critical for marketers.

Generational Overviews

  • Silent Generation (Age 80-95): Value hard work and saving due to experiences during the Great Depression and WWII.
  • Baby Boomers (Age 60-80): Focused on results and individual achievements; have accumulated significant wealth.
  • Gen X (Age 45-60): Skeptical of institutions and place importance on financial security; highest spending power.
  • Millennials (Age 30-45): Tech-savvy, emphasize experiences over possessions, prioritize social responsibility.
  • Gen Z (Age 15-30): Digital natives who are entrepreneurial and have heightened concerns about social equity and environmental issues.
  • Gen Alpha (Age <15): Anticipated to be globally aware, tech-savvy, and possibly entrepreneurial due to diverse influences.

Comparison of Generational Consumer Behavior

  • Marketers must understand psychographic differences across generations, as consumer behavior is continually evolving.

Gender & Consumer Behavior

  • Recognizes that purchasing habits differ significantly by gender:
    • Women engage more in high-effort decision-making.
    • Higher brand loyalty seen in men, while women may exhibit individual loyalty.