CONSUMER BEHAVIOR (18MBAMM301)

Unit 5:

External Influences on Consumer Behavior

Social Class: Social Class Basics, What is Social Class? (Social class & Social status, the
dynamics of status consumption, Features of Social Class, Five Social-Class Categories in
India.
Culture: Basics, Meaning, Characteristics, Factors affecting culture, Role of customs, values
and beliefs in Consumer Behaviour. Subculture: Meaning, Subculture division and
consumption pattern in India, Types of subcultures. Cross Culture - Cross-cultural consumer
analysis – Cross-cultural marketing strategy: Cross-cultural marketing problems in India,
Strategies to overcome cross-cultural problems.
Groups : Meaning and Nature of Groups, Types Family: The changing structure of family,
Family decision making and consumption related roles, Dynamics of husband-wife decision
making, The family life cycle & marketing strategy, Traditional family life cycle &
marketing implications, Reference Groups: Understanding the power & benefits of reference
groups, Factors that affect reference group influence, Types of reference group, Reference
Group Appeals.
5.1 SOCIAL CLASS : SOCIAL CLASS BASICS.
Social class is defined as the division of members of a society into hierarchy of distinct
status classes, so that members of each class have relatively the same status & members of
all other classes have either more or less status

Although social class can be thought as a continuum- a range of social positions on which
each member of society can be placed. Researchers have preferred to divide the continuum
into small number of specific social classes or strata. Within this framework the concept of
social class is used to assign individuals or families to social class category

5.2 SOCIAL CLASS AND SOCIAL STATUS.

Social class is measured in terms of status. A person belonging to a particular class is
said to hold status similar to members of that class. So, social class is defined in terms of the
amount of status the members of a particular class relatively have, in comparison with
members of other social classes. Broadly speaking, the stratification into varied social classes
is done on the bases on three factors, viz., wealth (economic assets) power (ability to exert
influence over others) and prestige (recognition received). However, marketing academicians
and researchers, as well as consumer researchers, define status in terms of demographical
variables like income, occupation and education; in fact, the three are interrelated and thus,
used in conjunction to each other. While understanding buying patterns and consumption
behaviour, it is necessary to understand the dynamics of social class. These are discussed as
follows:

1) Hierarchical Structure: Social class is hierarchical in nature. The social-class categories

are ranked in a hierarchy that ranges from low to high. Based on education, occupation and
income, the society is divided into various ranks, such that people in a particular rank are
similar to others in the same rank and different across various ranks. So, members of a
particular social class view themselves as:

i) Having a status similar to others in their own class.

ii) Having a status high or low than members of the higher or lower class. Based on the social
class, they view themselves equal to other in the same social class), inferior to others (from
higher social class). and superior to others (from lower social class). The hierarchical
structure holds following relevance for a marketer:
a) Marketers can use this as a basis to segment the market; the various strata provide a basis
for market segmentation.

b) When people are "other-directed" or susceptible to social influence, they would buy such
product and services and/or brands that people from their respective social classes purchase.
This is because they look for social approval. So they would purchase certain products and
service offerings and/or brands because they are used and favoured by members of their own
class.

c) People are class conscious and relate brands to their social class; thus, they would buy
brands which they feel relate to their "class”, and would avoid brands that they relate to
“lower class” products. There are social class influences on the actual consumption of
products.

d) The higher social class or the upper social class also acts as reference groups, for people in
the lower class, The latter aspire to emulate the former and desire buying products and brands
which the former buy.

2) Similarity of People within a Social Class: People within a social class are similar to
each other. This similarity is not only witnessed in terms of their education, occupation and
income, but also their thinking, values, norms, attitudes, lifestyle and behavioural patterns.
There is similarity among members within each social class and dissimilarity with between
social classes.
5.3 DYNAMICS OF STATUS CONSUMPTION
A consumer may seek to purchase or to consume goods and services for the status they
confer, regardless of that consumer's objective income or social class level. It is inaccurate to
view the consumption of status products as only a habit of the very wealthy. According to
Belk, “Even third world consumers are often attracted to and indulge in aspects of
conspicuous consumption before they have secured, adequate food, clothing, and shelter”.
Mason argues that significant levels of status consumption exist in all communities in the
world where the utility of products is measured by the social advantage their purchase offers.
That is, independently of social class membership, consumers vary in the extent to which
they seek to buy and to consume products that are seen to confer status on the user in the eyes
of society.

According to economic theory, a consumer will buy a product when the intrinsic utility of the
actual product exceeds the price of the product, however, this does not take into account the
value the consumer puts on mere ownership, or the status a certain product will give them.
Basically, the behaviour of the individual consumer is influenced by much more than utility
maximisation. To evaluate a product and its utility; consumers will consider the price of the
product, the quality of the product, how the product works, what the product represents, and
many other factors that are almost impossible to measure. The consumer will also observe the
consumption of his peers before making a purchasing decision. Additionally, he will need a
reason that validates his purchase to the public, as well as to himself. Of course, all of these
steps only come in to play after the consumer has been made aware of the product, usually
through some form of advertisement, which has the initial affect on the consumer's opinion of
the product in question.
5.4 FEATURES OF SOCIAL CLASS
 Multidimensional

 Hierarchical

 Restrict Behaviour

 Homogeneous

 Dynamics

1) Multidimensional: Social classes are multidimensional, being based on numerous

components. They are not equivalent to, or determined solely by, occupation or income or
any one criterion; however, they may be indicated by, or be related to, one or more of these
measures. It is important for the marketer to realise that some of these variables are more
reliable proxies” (substitutes) than other.

2) Hierarchical: Social classes have a vertical order to them, ranging from high status exist
as a position on the social scale. Individuals may be placed within a class on this hierarchy,
based on status criteria.

3) Restrict Behaviour: Interaction between the classes is limited because most of us are
more comfortable and find reinforcement with those "like us” in terms of values and
behaviour patterns. Consequently, members of the same social class tend to associate with
each other and not to any large extent will members from another social class because they
share similar educational backgrounds, Occupations, or lifestyles. The factor of limited
interaction impedes interpersonal communication between different classes about advertising,
products, and other marketing elements.

4) Homogeneous: Social classes may be viewed as homogeneous divisions of society in

which people within a Class nave similar attitudes, activities, interests, and other behaviour
patterns. For the marketer this means that groups of people are exposed to similar media,
purchase similar products and services, and shop in stores. This homogeneity allows the
marketer in many cases to effectively segment the market by social class and to develop
appealing marketing mixes.

5) Dynamic: Social stratification systems in which people have some opportunity for upward
or downward movement are known as open systems. People in closed systems have inherited
or ascribed status; that is, they are born into one social level and are unable to leave it. Thus,
the difference between a systems based on earned or achieved status versus one based on
inherited status is significant with regard to social mobility.

5.5 SOCIAL CLASS CATEGORIES

Identification of members within each social class is influenced most heavily by education
and occupation, including income, as a measure of work success. But it is also affected by
family recreational habits and social acceptance by a particular class. Thus, social class is
composite of many personal and social attributes rather than a single characteristic such as
income or education. Traditionally, social class positioning has been measured in terms of
socio-economic factors, namely, type and source of income (inheritance or salary),
occupational status, and level of education, value of housing and quality of neighboured.
Socio-economic factors appeal to marketers because the information is easily collected as
part of any questionnaire. It is thus possible to prepare profiles of the potential target markets.
The number of categories of social class varies. They are ordered in a manner that begins
with some type of elite upper class and ends with a lower class. A variety of different
classification schemes has been developed, to rank the social classes. A frequently used
scheme is the well known Warner's Index of Status Characteristics (ISC). Warner's Index
uses four variables as indicators of social class. They are occupation, income, house and
dwelling area.

Warner categorised the members in a society into six classes as follows:

1) Upper-upper class,

2) Lower-upper class,

3) Upper-middle class,

4) Lower-middle class,

5) Upper-lower class, and

6) Lower-lower class.

The percentage of population accounted for in each social class appears to fluctuate but is
concentrated in the middle and lower classes. The concept of mass marketing can, e.g., be
applied to the middle classes but not to the affluent upper-upper. The upper-upper is,
however, a desirable target market for speciality goods marketing by firms. Such goods can
appeal to the cultivated tastes of a very small number of affluent consumers. In addition, four
target groups have been identified by marketers for their use. These include a broad upper
class, a white collar middle class, an affluent working class and poorer lower class. The social
classes are described for marketing purposes, in terms of the social groups from which they
are drawn in society.

On the basis of demographic factors, these are as follows:

1) Upper-Upper Class: This is the wealthy, aristocratic, landed class. It acts as a reference
group for rest of the social classes. Since its size is very small, it is not a major number
segment; but it provides scope for niche marketing

2) Lower-Upper Class: Here we find novel rich consisting of those who have attained
success and earned wealth. Successful professionals like doctors, lawyers, first generation
successful entrepreneurs belong here. These provide market for specialised luxury goods.

3) Upper-Middle Class: This class consists of the moderately successful. It consists of the
professionally educated managers, intellectual elite and successful professionals, doctors,
lawyers, and professors, owners of medium-sized businesses and managerial executives, and
also younger men and women who are expected to reach these occupational status levels.
Housing is important to this class, and also the appearance of products in general.

4) Lower-Middle Class: It is represented by the common man, and the highly paid
individual worker. It includes the small business owners and non-managerial workers.
Persons in this class tend to have high school educations and some college education, but do
not reach high levels in their organisations.

5) Working Class: This is the largest of the social classes, and is composed of skilled and
semi-skilled workers. They are blue (Khaki) collar workers but have sufficient money for
consumer products, and along with the middle classes, they represent the market for mass
consumer goods. Within each of these social classes, there are both, under-privileged and
over-privileged members depending on whether their incomes are above, or below, the
average for the class. For many products, the groups of interest to the marketer are the middle
and working classes, by far the largest segment of the market.
5.6 SOCIAL CLASSES CATEGORIES IN INDIA
India, known today for its 300 million strong middle class, had only two distinct classes at the
time of independence - the upper class and the lower class. The last few decades, however,
have witnessed huge growth in a new distinct class - the Indian middle class. This Indian
middle class now has three distinct classes in it - Upper-middle (approx. 40 million), middle-
middle (approx. 110 million), and lower-middle (approx. 100 million).

The Indian middle class constituted less than 10% of its total population in 1985. Although
the last decade has seen a spurt in the numbers, it is still below 20% of the population. Two
factors are said to be responsible for this spurt in numbers in the Indian middle class – rising
literacy especially among women, and their increasing participation in the workforce.

The upper class comprises just 1% of the Indian population and comprises former royal
families, industrialists, and top executives. On the other side, the country's lower class
generally comprises artisans, farmers, ordinary labourers, etc.

A survey by AC Nielson and ORG-MARG on attitudes to life among youth, categorised

Indian youth, into the following types:

1) Balancing Lot: Typically upper and upper-middle class males and females, who believe in
self-expression and freedom, but value family.

2) Money Maniacs: Generally middle and lower-middle class males, who believe that
money is the only way to success.

3) Desi Youth: Mostly middle and lower-middle class males and females, who have strong
value systems at home, and thus are apprehensive of western culture and values.

4) Cool Guys: Males and females belonging to the affluent class, who have completely
adopted western culture and brands.

5) Repressed Souls: Mostly middle and lower-middle class females are youngsters with
tense relationships with parents and are frustrated with life due to parental restrictions.
5.7 CULTURE : MEANING AND DEFINITION.
Culture is everything that is socially learned and shared by the members of a society. Culture
consists of material and nonmaterial components. Nonmaterial culture includes the words
people use; the ideas, customs, and beliefs they share; and the habits they pursue.

In a sense, culture is a society's personality. For this reason, it is not easy to define its
boundaries.

Culture is the sum total of learned beliefs, values, and customs that serve to direct the
consumer behaviour of members of a particular society, Beliefs consist of the very large
number of mental or verbal statements (i.e., "I believe ...") that reflect a person's particular
knowledge and assessment of something (another person, a store, a product, a brand).

Values also are beliefs. Values differ from other beliefs, however, because they meet the
following criteria:

1) They are relatively few in number;

2) They serve as a guide for culturally appropriate behaviour;

3) They are enduring or difficult to change;

4) They are not tied to specific objects or situations; and

5) They are widely accepted by the members of a society. Customs

are overt modes of behaviour that constitute culturally approved or acceptable ways of
behaving in specific situations. Customs consist of everyday or routine behaviour. Thus,
while beliefs and values are guides for behaviour, customs are usual and acceptable ways of
behaving.

Culture may be defined as the cumulative deposit of knowledge, experience, beliefs, values,
attitudes, meanings, hierarchies, religion, notions of time, roles, spatial relations, concepts of
the universe, and material objects and possessions acquired by a group of people in the course
of generations through individual and group striving. Culture consists of patterns, explicit and
implicit, of and for behaviour acquired and transmitted by symbols, constituting the
distinctive achievement of human groups, including their embodiments in artifacts; the
essential core of culture consists of traditional ideas and especially their attached values,
culture systems may, on the one hand, be considered as products of action, on the other hand,
as conditioning influences upon further action.
5.8 CHARACTERISTICS OF CULTURE .
1. Culture is Invented

2. Culture is Socially Shared

3. Culture is Learned

4. Culture is Gratifying and Persistent

5. Cultures are Similar but Different

6. Culture is Organised and Integrated

7. Culture is Adaptive

8. Culture is Prescriptive

1) Culture is Invented: Culture does not simply "exist” somewhere waiting to be discovered.
People invent their culture. This invention consists of three interdependent systems or
elements. i) An ideological system, or mental component, that consists of the ideas, beliefs,
values, and ways of reasoning that human beings learn to accept in defining what is desirable
and undesirable.

ii). A technological system that consists of the skills, crafts, and arts that enable humans to
produce tots material goods derived from the natural environment; and

iii) An organisational system (such as the family system and social class) that makes it
possible for humans to coordinate their behaviour effectively with the actions of others.

2) Culture is Learned: Culture is not innate or instinctive, but is learned beginning early in
life and is charged with a good deal of emotion. The great strength of this cultural stamp
handed down from one generation to another is such that at an early age, children are firmly
imbued with their culture's ways of acting, thinking, and feeling. This obviously has
important implications for the behaviour of consumers, because these preconditions of that
behaviour are moulded by their culture from birth.

3) Culture is Socially Shared: Culture is a group phenomenon, shared by human beings living
in organised societies and kept relatively uniform by social pressure. The group that is
involved in this sharing may range from a whole society to a smaller unit such as a family.

4) Cultures are Similar But Different: All cultures exhibit certain similarities. For example,
each of the following elements is found in all societies: athletic sports, bodily adornment, a
calendar, cooking, courtship, dancing, education, family, gestures, government, housing,
language, law, music, religious ritual, and numerous other items. There is, however, great
variation from society to society in the nature of each of these elements, which may result in
important consumer-behaviour differences around the world.

5) Culture is Gratifying and Persistent: Culture satisfies basic biological needs as well as
learned needs. It consists of habits that will be maintained and reinforced as long as those
who practice them are gratified. Because of this gratification, cultural elements are handed
down from generation to generation. Thus, people are comfortable doing things in the
customary way.

6) Culture is Adaptive: Inspite of resistance to change, cultures are gradually and

continuously changing. Some societies are quite static, with a very slow rate of change, while
others are more dynamic, with very rapid changes taking place.

7) Culture is Organised and Integrated: A culture “hangs together”, that is, its parts fit
together. Although every culture has some inconsistent elements, it tends to form a consistent
and integrated whole

8) Culture is Prescriptive: Culture involves ideal standards or patterns of behaviour so that

members of society have a common understanding of the right and proper way to thin, feel,
and act Norms rules or guidelines specifying what behaviour are appropriate or inappropriate
in given situation.
5.9 FACTORS AFFECTING CULTURE .
Factors affecting culture are:

1) Social Factors: Social factors such as:

i) Reference Groups: A person's reference groups are all the groups that have a direct (face-
to-face) or indirect influence on their attitudes or behaviour. Groups having a direct influence
are called membership groups. Some of these are primary groups with whom the person
interacts fairly continuously and informally, such as family, friends, neighbours, and co-
workers.

Reference groups influence culture in three ways:

a) They expose an individual to new behaviours and lifestyles.

b) They influence attitudes and self-concept.

c) They create pressures for conformity that may affect product and brand choices.

People are also influenced by groups to which they do not belong. Aspirational groups are
those a person hopes to join; dissociative groups are those whose values or behaviour an
individual rejects.

ii) Family: The family is the most important consumer buying organisation in society, and
family members constitute the most influential primary reference group. Two families can be
distinguished in the buyer's life. The family of orientation consists of parents and siblings.
From parents a person acquires an orientation toward religion, politics, and economics, and a
sense of personal ambition, self-worth, and love. Even if the buyer no longer interacts very
much with his or her parents, their influence on behaviour can be significant.

iii) Roles and Status: A person participates in many groups – family, clubs, and
organisations. Groups often are an important source of information and help to define norms
for behaviour. A role consists of the activities a person is expected to perform. Each role
carries a status. People choose products that reflect and communicate their role and actual or
desired status in society. Marketers must be aware of the status-symbol potential of products
and brands.

2) Personal Factors: These include the buyer's age and stage in the lifecycle, occupation and
economic circumstances, personality and self-concept, and lifestyle and values. Because
many of these characteristics have a very direct impact on culture:
i) Age and Stage in the Lifecycle: People buy different goods and services over a lifetime.
Taste in food, clothes, furniture, and recreation is often age related. Consumption is shaped
by the family lifecycle. Trends like delayed marriages, children migrating to distant cities or
abroad for work leaving parents behind, tendency of professionals/working couple to acquire
assets such as a house or an automobile in the early stages of career (earlier these used to be
close-to-retirement acquisitions for a large majority), has resulted in different opportunities
for marketers at different stages in the consumer lifecycle.

ii) Occupation and Economic Circumstances: Occupation also influences consumption

patterns. A blue collar worker will buy work clothes, work shoes, and lunchboxes. A
company president will buy dress suits, air travel, and country club memberships.

Computer software companies, for example, design different products for brand managers,
engineers, lawyers, and physicians. Product choice is greatly affected by economic
circumstances – spendable income (level, stability, and time pattern.) savings and assets
(including the percentage that is liquid), debts, borrowing power, and attitudes toward
spending and saving. Luxury-goods makers, such as Gucci, Prada, and Burberry can be
vulnerable to an economic downturn.

iii) Personality and Self-Concept: Each person has personality characteristics that influence
culture. By personality, means a set of distinguishing human psychological traits that lead to
relatively consistent and enduring responses to environmental stimuli. It can be described in
terms of such traits as self confidence, dominance, autonomy, deference, sociability,
defensiveness, and adaptability.
5.10 ROLE OF CUSTOMS, VALUES AND BELIEFS IN

CONSUMER BEHAVIOUR .

Customs are ways of behaving under specific circumstances

A value may be defined as a desirable, an internalized criterion or standard of evaluation a

person possesses.

Beliefs are thoughts about concept, events, objects or people; or about the relationship
between these things.

ROLE OF CUSTOMS
Following are the role of customs in consumer behaviour:

1) Determines Customs and Traditions: The customs and traditions that the people of a
community follow, the festivals they celebrate, the kind of clothing they wear, the food they
eat, and most importantly, the cultural values they adhere to, bind them together.

2) Predict Consumer Buying Behaviour: Customs consist of everyday or routine

behaviour. Although beliefs and values are guides for behaviours, customs are usual and
acceptable ways of behaving, which are necessary for the marketers to know since they show
the buying behaviour.

3) Helps in Understanding Society's Culture: Customs and ethics are rooted deeply in a
society's culture which came into being thousands of years ago and evolved through the long
history. So, social customs comes from the complicated inner world of human heart and
minds, which makes it important for the marketers to consider it.

4) Understand Purchase Pattern and Occasion: Consumers purchase products based on

their customs or traditions, such as, a person will purchase a greeting card or cakes for
wishing Christmas according to the customs.

5) Predict Consumer Acceptance of Products: Customs consist of everyday or routine

behaviour. An understanding of various customs can help marketers predict consumer
acceptance of their products.

6) Influence Business Buyer Reactions: Customs can strongly influence business buyer
reactions to the marketer's behaviour and strategies.
ROLE OF VALUES

Values have a great impact on the type of buying behaviour a consumer engages in.

The roles of values in consumer behaviour are as follows:

1) Values Determine Goals: Some market choices depend on how much functional or
utilitarian value is associated with the alternatives. Values also determine the type of goals
people set for themselves. According to Solomon, “consumers buy products and services
because they think that those products or services are going to help them in reaching a certain
value-added goal”. For example, some people seek to purchase products that will make them
look younger, thinking that it is more preferable to looking old.

2) Personally or Socially Preferable: Values are shared by members of a culture and they
have major influence on the behaviour of an individual and serve as guidelines for behaviour
in different situations. Values are durable beliefs that a specific mode of conduct or end-state
of existence is personally or socially preferable to an opposite mode of conduct or end-state
existence.

3) Social Image: Purchasing decisions may be affected by social value; consumers buy
products that carry an image that is consistent with the norms and values of their friends or
convey a social image they want to communicate.

4) Curiosity, Experiences or General Knowledge: People purchase products or services

that satisfy their curiosity, provide new experiences or enhance their general knowledge,, in
other words, they choose products based on their epistemic value.

5) Situation and Circumstances: Some buying decisions are dependent on the situation and
the circumstances faced by the consumer in that specific situation. A person who is driven by
conditional value may adapt his or her plan or typical pattern of choice because of the
situational circumstances.

6) Guide Attitudes and Behaviour: Core values that guide attitudes and behaviour are huge
determinants in consumer behaviour. Core values go much deeper than mere behaviour or
attitudes of people because at a basic level they determine people's choices and desires over
the long-term.
ROLE OF BELIEFS

Roles of beliefs in consumer behaviour are as follows:

1) Products Supporting Beliefs: People generally want to buy products that support or
reinforce their own beliefs and agendas. For example, a person who believes in the
importance of local economy may be more likely to buy products which advertise their local
manufacturing or roots.

2) Beliefs Shape the Consumer's Perception: Beliefs shape the consumer's perception of
the product. These factors may be difficult to change because they stem from the individual's
personality and lifestyle.

3) Blocking Information Conflicting Beliefs: Consumers often block information that

conflicts with their beliefs and attitudes. They tend to selectively retain information or even
distort the information to make it consistent with their previous perception of the product.

4) Marketing Strategies Revolving Around Beliefs: Many marketing strategies revolve

around understanding the beliefs of certain demographics and tailoring advertisements to suit
specific groups.

5) Beliefs Make-Up Product and Brand Images: Marketers are interested in the beliefs that
people formulate about specific products and services, because these beliefs make-up product
and brand images that affect buying behaviour. If some of the beliefs are wrong and prevent
purchase, the marketer will want to launch a campaign to correct them.
5.11 SUB CULTURE : MEANING.
Sub Culture is defined as broad groups of consumers within a society’s culture having
similar values which distinguish them from the rest of the society. A subculture is a group of
people with a culture which differentiates them from the larger culture which they belong.

5.12 SUB CULTURE DIVISION AND CONSUPTION PATTERN IN

INDIA.
Sub-cultures exist within a given dominant culture. Culture is viewed as consisting of basic
patterns of behaviour that exist within a society at national level. Within this broad culture,
one can easily distinguish relatively more homogeneous and fairly large groups that follow
the dominant cultural values but also have other quite distinct beliefs, values, customs and
traditions that set them apart from the larger cultural mainstream. These represent the sub-
cultures that may be based on religion, region, ethnic groups, language, age, gender, and
many other differences, In India, sub-cultures are often differentiated when someone is
described as a South Indian, Punjabi, Kashmiri, Gujrati, Bengali, etc. However, the diversity
of sub-cultures in India is simply mind-boggling. These sub-cultures show significant
preference for a particular types of diet, clothing, ceremonies, etc.

Out of several sub-cultures in India, only some are important from the marketers' point of
view for formulating separate marketing programmes. Much depends on the relevance of a
product category to a particular subculture. For example, cosmetics are popular among ladies,
not matter to which sub-culture they belong. Similarly, jeans and T-shirts are very popular
among urban and semi-urban teenagers irrespective of whether they are Hindus, Muslims,
Sikhs, or Christians.

Sub-culture categories are:

1) Religion: Based on different faiths, beliefs, and religion, like Muslims, Sikhs, Christians,
Hindus, Buddhists, etc.

2) Sex: All societies have assigned different traits and roles for males and females, like
breadwinners for males and homemakers for females, etc.

3) Occupation: Farmer, teacher, businessman.

4) Social Class: Upper, middle, lower.

5) Geographic and Religious Sub-Culture: For example, South Indians, North Indians, North-
East Indians.
The members of religious sub-cultures make purchases that are influenced by their religious
identity, particularly products that are symbolically and ritualistically associated with the
celebration of religious holidays, festivals weddings, birth or death in the family, etc. For
example, the bride in a Hindu family is dressed in a traditional crimson sari; the bridegroom
wears a shervani, chooridar and dons a pagri. Consumption of meat, beef, pork and alcohol is
also determined by one's religion. Sikh religion does not permit use of tobacco products and
shaving of hair.

McDonald's had a policy of adopting uniformity across global markets. After facing
problems, it has now adopted products appropriate for particular cultures. When McDonald's
entered India, it had to make the most dramatic changes. Eighty per cent of the Indian
population is Hindu and they do not eat beef, so there is no Big Mac (which contains beef). In
its place, there is Big Maharaja, which contains mutton. Many Hindus and almost all Jains are
strictly vegetarian and for this segment McDonald's offers Vegetable Burgers.

Distinct regional sub-cultures arise due to climatic conditions, the natural environment and
available resources, language and significant social and cultural events. Such groups can be
identified as having distinct and homogeneous needs, tastes, lifestyle and values.

For example, South Indians prefer to drink coffee, while most North Indians use tea. Dog
meat is considered a delicacy in certain North-Eastern parts of India, which may shock
consumers in other parts of the country. Given such clear difference in consumption patterns,
marketers have realised that India is in no way a single market for at least some product
categories.

Geography can significantly influence the type of food people consume and the dresses they
wear. Conservative Brahmin families in India are generally vegetarian. However. Kashmiri
Brahmins are basically non-vegetarian. Woollens and other warm clothes are worn by North
Indians during winters but because of geographic conditions, South Indians have no need for
warm clothes. While North Indians consume more wheat, south Indians prefer a variety of
rice dishes. Traditionally. Tamilians prefer to wear a white shirt and dhoti or lungi and
women are very fond of wearing bright coloured silk saris.

Teenagers are known to be self-conscious and in search of self-identity. Most teenagers view
themselves as kind, trustworthy, likable, funny, affectionate, intelligent, creative and active.
Occasionally, their behaviour is rebellious against authority, tradition and what they consider
as old-fashioned values. This influences their behaviour as consumers, particularly in urban
and semi-urban areas in India. They need to be accepted for support and nurturing. Most
teenagers prefer to wear modern casual dresses, sports shoes of known brands, want to own
autos that project a macho image, listen to pop music and watch MTV. They spend family
money and often influence family purchases.

For many products, friends are the most significant influence. This is known as 'peer
pressure'. Nevertheless parents are still an important factor affecting many buying decisions.
The brand and store preferences of this cultural sub-group tend to be enduring. This market is
particularly attractive to marketers because preferences and tastes formed during these years
can significantly influence purchases throughout their life. To influence them as consumers,
marketers need to use appropriate language, music, images and media especially in places
where these young people hang out' (frequent) such as shopping malls, discotheques, pubs,
fast food parlours, etc.

Many products are typically associated with males for females. For example, one hardly
comes across any ads showing men using products traditionally associated with women or
performing tasks such as changing diapers of kids. In India, shaving products, cigarettes,
trousers, ties, motorcycles, etc., are products for males; bangles, bracelets, lipstick, sari, bindi
and mehndi, etc., are ladies products. However, many products now are losing their
traditional gender typing such as financial services, cars, mobile phones, computer games,
equipment, etc., that are now designed keeping women's preference in mind.

In developed and most developing countries, marketers are increasingly interested in

targeting working women because they constitute a sufficiently large and growing market.
They have a different set of needs compared to women who do not work outside their homes.
Working women shop less frequently, spend less time shopping and are more brand and store
loyal. They are more likely to shopping after office hours in the evening. After examining
advertising response to financial services, Lynn J. Jaffe has reported that the use of a
“modern” positioning strategy, i.e., a focus on career and family, prove more effective with
women than a more traditional positioning strategy of focusing on “nurturing and family”.

In recent times, a number of advertisers have realised the importance of communicating

appropriately with working women and mothers.
5.13 TYPES OF SUB CULTURE.
1. Nationality Sub culture

2. Religious Sub culture

3. Geographic and Regional Subculture

4. Racial Sub culture

5. Age sub culture

6. Sex as a sub culture

Nationality sub-culture:

Within a particular country there are sizeable proportions that have originated from or have the roots
in other countries. Like in, India there also has Anglo Indians, Parsees, Moguls, indo-Chinese,
Sinhalese etc. These people show a markedly different behaviour in purchasing of ethnic foods,
cultural artefacts, travelling to their homeland etc

Religious sub-culture:

In any given country there are always people belonging to different faiths beliefs & religions like
Hindus, Muslims, Christians, Buddhists etc. And again there are various sub-divisions or sects like
Sikhism, Jainism, within Hindus, catholic & protestants within Christians, Shies & Sunnis within
Muslims etc. Some people may consider them as separate religious on their own merit. Even within
the same culture these sub-divisions show different purchasing behavior

Geographic & regional sub-culture: the Indian sub continent has diverse languages, climates, tastes,
& preferences based on biographical region. Almost all states have different languages, eating habits,
traditional costumes etc. Even climatic conditions vary significantly from one region to another in
India. While Rajasthan is known for its desert climate, Jammu & Kashmir is known for its snowball.
Marketers thus target geographical regions on basis on the basis of these variables for example;
Google has introduced search engines services in Hindi, Bengali, Marathi, telugu, & tamil in India

In India there are distinct sub-cultures of:

North Indians

Racial sub-culture: a culture can be provided on basis of race like:

In USA they can be Caucasians, African, American, Asian, American, & American Indians
In India they can be Parsees, Pathans, pahadis, jaths, kashmirs, Chinese, Aryans, Dravidians,
adibasis, Sinhalese etc

Age sub-culture: age is a major basis of sub-culture. There are different ways the people of different
age groups behave in listening music, reading magazines, eating foods, wearing dresses, watching
TV & cinemas etc. Consumer research has identified four lucrative age sub-cultures in India-
technology babies, impatient aspirers, balance seekers & arrived veterans
5.14 CROSS CULTURE – CROSS CULTURAL CONSUMER
ANALYSIS.
Cross cultural consumer analysis: is defined as effort to determine to what extent the consumers of
two or more nations are similar or different. Such analysis can provide marketers with an
understanding of the psychological, social, cultural characteristics of foreign consumers they wish to
target so that they can design effective marketing strategies for each of specific national markets
involved

CROSS CULTURAL CONSUMER ANALYSIS.

Similarities & Differences Among People:

The Growing Global Middle Class

Acculturation Is Needed Marketing Viewpoint

Applying Research Techniques:

5.14 CROSS CULTURAL MARKETING STRATEGY

Basic areas for cross cultural marketing

 Language and Meaning

 Differences in market segmentation opportunities

 Differences in the criteria for evaluating products and services.

 Differences in the economic and cultural social condition and family structure

5.15 CROSS CULTURAL MARKETING PROBLEMS IN INDIA

1. Product Problems

2. Pricing Problems

3. Promotion problems

4. Place – Dilmah Distribution in the global market

In most cases the gamble for marketers in international marketing is not in knowing whether the
product , the promotional appeal, the pricing, or the retail channels that are effective in one country
will work in other countries & trying to determine what specific changes should be made to ensure
acceptance in each foreign market. The following examples of some international marketing
blunders illustrate that failure to adapt marketing strategy to the target markets distinctive cultural
traits can lead to costly mistakes.

Product problems: international marketers frequently neglect to modify their products to meet local
customs & tastes

Japanese marketer selling food products in India, is hard to learn way that how Indian consumers
respond, depend on their need for product. International marketer has to learn the latent needs of
consumers in India. To avoid such problems marketers must ascertain in advance whether the
physical characteristics of products will be acceptable to Indian consumer

Promotional problems: international marketers have faced various problems in communicating with
widely different customer groups. Product names & promotional phrases can also cause considerable
problems for international marketers. International marketer has to take care of whether it is ethical
as per values of Indian consumers or not. These firms must be aware of the differences in doing
business in other countries

Pricing & distribution problems: International marketers must adjust their pricing & distribution
policies to meet local economic conditions & customs. For example, in many developing countries
like India, small sized product packages often are necessity. Even in developed nations, important
differences do exist. For example, supermarkets are very popular in India, but in France which is just
across the border consumers prefer smaller & more intimate stores for grocery shopping

5.16 STRATEGIES TO OVERCOME CROSS CULTURAL PROBLEMS.

 Country of origin effects

 Consumer Ethnocentrism

 Targeting consumers across cultures

 Global versus local brands

 Favouring a world brand

 Making global brands different

 Assessing multinational reactions to brand extensions

 Adapting Global marketing.

5.17 GROUPS : MEANING

A group is a set of two or more individuals who are jointly characterized by a network of
relevant communications, a shared sense of collective identity and one or more shared
dispositions with associated normative strength.

5.18 NATURE OF GROUPS.

 Two or more persons

 Collective identity

 Interaction

 Shared goal interest .

5.19 TYPES OF FAMILY

 Married Couple

 Nuclear Family

 Extended Family

5.20 CHANGING STRUCTURE OF FAMILY

 Passing of joint family systems

 Changes in Authority structure

 Changes in marital practices

 Domestic tension and violence

5.21 FAMILY DECISION MAKING AND CONSUMPTION RELATED

ROLES
Family decision making is the process by which decisions that indirectly or directly involve two or
more family members are made. Decision making by a group as a family differs in many ways from
decisions made by an individual. Consider the purchase of breakfast cereal that children & perhaps
the adults will consume.

Although many marketers recognize the family as the basic consumer decision making unit they
most frequently examine the attitudes & behavior of the one family member whom they believe to be
the major decision maker. In some cases they also examine the attitudes & behavior of the person
most likely to be the primary user of product or service

Most important may family purchases are inherently emotional & affect the relationships between
the family members. The decision to buy a child a requested toy or new school clothes is more than
simply an acquisition. It is a symbol of commitment to the child. The decision to take family to
restaurant for meal or to purchase a new television has emotional meaning to other family members.
Disagreements about how to spend money are a major cause of marital discord. The processes
families use to make purchase decisions & the outcomes of those processes have important effects on
the well- being of individual family members & family itself. Thus while family decision making has
some things in common with organizational decision making it is not the same

Marketers are not only interested in the family lifecycle they also want to know how a family
actually decides what to buy & what not to buy i e the family decision making process. Researchers
have identified four major phases in the family purchase process- problem or need recognition
information search & evaluation of alternatives, final decision regarding the purchase & post
purchase behavior. Family members perform various roles in decision making.

5.22 DYNAMICS OF HUSBAND WIFE DECISION MAKING

Husbands & wives play different roles in making decisions & the nature of their influence depends
on the offering & the couple’s relationship. In examining husband wife influence a landmark study
conducted in Belgium identified four major decision categories

Husband Dominant decision: a husband dominant decision is made primarily by the male head of
household (for example, the purchase of lawn mowers & hardware)

Wife dominant decision: A wife dominant decision is made primarily by the female head of
households (for example, children’s clothing, women’s clothing, groceries, & toiletries).

Autonomic decision: An automatic decision is equally likely to be made by husband or the wife
(example, men’s clothing, luggage, toys & games, sporting, equipment & cameras)

Syncretic decision: syncretic decision is made jointly by the husband &wife (for example,
vacations, refrigerators, TVs, living room furniture, financial planning services & the family car)

As spouses come closer to a final decision the process tends to move towards syncretic decision
making & away from the other three types, particularly for more important decisions. These role
structures are generally however the actual influence exerted depends on many factors. First spouse
will have greater influence when he or she brings higher financial resources to family & he or she
has a high level of involvement in the decision. Second demographic factors such as total family
income, occupation & education are related to the degree of husband wife influence. Combined these
factors provide a spouse with a perception of owner in decision making situation. The higher the
degree of perceived power the more likely the spouse will exert influence

5.23 THE FAMILY LIFE CYCLE AND MARKETING STRATEGY.

The FLC is a composite variable created by systematically combining such commonly used
demographic variables as marital status, size of family, age of family members & employment status
of head of household. The ages of the parents & the relative amount of disposable income usually are
inferred from the stage on family life cycle

Sociologists & consume researchers have long been attracted to the concept of family life cycle as
means of depicting what was once a rather steady & predictable series of stages through which most
families progresses. However with advent of many diverse family & lifestyle arrangements, what
was the rule has been on decline. This decline in the percentage of families that progress through a
traditional FLC seems to be caused by a host of societal factors, including divorce rate, the explosive
umber of out of wedlock births, & the 35 year decline in number of extended families that transpired
as many young families moved to advance their job & career opportunities

FLC analysis enables marketers to segment families in terms of series of stages spanning the life
course of a family unit. The FLC is a composite variable created by systematically combining such
commonly used demographic variables as marital status , size of family, age of family members &
employment status of head of household. The ages of the parents & relative amount of disposable
income usually are inferred from the stage in the family lifecycle

Understanding household buying processes help marketers:

Understand the differences in consumption patterns of different households

Develop product & promotional strategies wit recognition of the changing gender roles &
responsibilities within the household unit

Use concept of family lifecycle as basis for segmenting the market

Target products & services properly for the family roles in decision making

FLC concept is divided into two sections. The first section considers the traditional FLC schema.
This model is increasingly being challenged because it fails to account for various important family
living arrangements. To rectify these limitations the second section focuses on alternative FLC
stages, including increasingly important non- traditional family structures
5.24 TRADITIONAL FAMILY LIFE CYCLE AND MARKETING
IMPLICATIONS.
Traditional family life cycle concept indicated the types of products & services that a households or
family might be most interested in at each stage: it is also possible to trace how the FLC concept
impacts a single product or service over time

The tradition family life cycle is a progression of stages through which many families pass, starting
with bachelorhood moving on to marriage then to family growth to family contraction & ending with
dissolution of basic unit. The traditional FLC models can be synthesized into just five stages as
follows:

Bachelorhood: this is the first stage of traditional family lifecycles & consists of people who have
established a separate household. In India, though this might not be the case as a large majority still
live with their parents while they are working. The majority at this stage is employed, young single
adults but it consists of college students who live their own lives. For these people salary is more like
pocket money & thus they are big spenders on food, fashion clothing, entertainment & recreational
activities

Honeymoon: second stage of traditional family lifecycle starts with marriage. Newlyweds spend lot
of money in setting up home. House, furniture, furnishings, necessary home appliances & utensils
are some of the major expenses incurred by the newlyweds themselves or by their parents & other
relatives. They also spend a lot on dining out, entertainment & other leisure activities due to high
disposable income they have, especially if both husband & wife are working. Purchase of
automobiles & investment options are also important decisions at this stage

Parenthood: with birth of their first child families enter the parenthood stage of traditional family
lifecycle. This stage is quite long & lasts till the children become economically independent. This
stage can be further divided into-pre -school phase, elementary school phase, high school phase, &
college phase. In the pre-school phase the families usually have to spend a considerable amount on
the child’s basic products like baby food etc. & disposable income also goes down if wife gives up
her job to look after the child. The family disposable income increases as the wife again starts
working & the couple’s career progresses

Post parenthood: at this stage of traditional family lifecycle the children establish their own
households & the original couple are called empty nesters. Empty nesters are generally believed to
have increased expense on travel & medical needs. Members of a financially stable household at this
stage find an increase in their disposable income & use this time & money to indulge themselves
with their hobbies &other this time & money to indulge themselves with their hobbies & other
interests. Such couples also spend money on homes, automobiles furniture, & vacations & thus form
a good market for marketers of luxury products

Dissolution: at this stage one of couple dies & the other is left alone. The adjustment is easier if the
surviving spouse is in good health & economically stable. Companionship is of prime importance at
this stage & some choose to go in for re-marriage.

5.25 REFERENCE GROUPS : UNDERSTANDING THE POWER AND

BENEFITS OF REFERENCE GROUPS

Reference Groups are actual or imaginary institutions, individuals or groups having

significant relevance on the target individuals evaluations, aspirations, or behavior.

Powers of Reference Groups

1. Referent power

2. Information power

3. Legitimate power

4. Expert power

5. Reward power

6. Coercive power

Benefits of Reference Groups

1. Informational benefit

2. Utilitarian benefit

3. Value expressive benefits

5.26 FACTORS THAT AFFECT REFERENCE GROUPS INFLUENCE

1. Socialization process

2. Setters of roles

3. Information sources

4. Normative influences

5. Expression of self value

5.27 TYPES OF REFERENCE GROUPS

1. Friendship groups

2. Shopping groups

3. Work groups

4. Virtual groups or communities

5. Brand communities

6. Consumer action groups

7. Aspirational and Dissociative groups

5.28 REFERENCE GROUP APPEALS

1. Celebrities

2. Expert

3. Common man

4. Executive and employee spokesperson

5. Trade or spokes characters

6. Other reference group appeals