MPANDE, D

UNIT 7 1
SOCIAL AND CULTURAL ENVIRONMENT
7.0. Introduction

If we define social business environment, we will say it comprises of the total sum of the culture
in a society that encompasses customs, beliefs, behaviors and practices. This is just an artificial
construct and it can be contrasted with the natural environment we are living in. So it means
every society has a construct of its own social environment based on cultural community norms
and society and also on the perception as well as psychological effects on consumer behavior in
the business environment.

7.1 Social customs, rituals and practices

Let us get the ball rolling by starting with cultural factors. Human behavior largely results from
learning certain things and individuals basically grow up learning values, preferences,
perceptions and behavioral patterns due to socialization that occurs within the family and outside.
Through this, we develop values that determine and of course drive our behavioral patterns to a
large extent. These values include things like achievement, efficiency, success, progress, material
comfort, practicality, individualism, freedom, humanitarianism, youthfulness and practicality.
These values are then influenced by subcultures such as groups of nationality, religion, racial and
geography, all of them exhibiting degrees of difference in cultural preferences, ethnic taste,
taboos, lifestyle and attitudes.

Further our subcultures are subsequently influenced by social stratification or social class, which
then acts as a determinant of behavior. A series of variables such as occupation, income, education
determine social class. People from the same social class are quite similar and different from
those from different social classes, but people can also move from one social class to the next over
time due to circumstances. Cultural factors further consist of:

Culture, Sub culture and Social class.

7.1.1 Culture

The most fundamental determinant of a persons' needs and want is Culture. Every child as they
grow acquires values, perception preferences and behaviors from family, schools etc however
culture is what influences the pattern of consumption and how the child, now a grown up, makes
decisions.

In business it is important for you to consider social factors like culture because marketers need
to explore the cultural forces and use them to formulate marketing strategies that are appropriate
for each separate cultural category in order to increase sales of their products. You should also
be aware that cultures evolve and do not stay the same and these changes gradually become part
of society. The groups considered under culture tend to be relatively large and at least in theory,
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culture is shared by few people. Cultures are passed from one group to another particularly from
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one generation to the next through learning and as such is both subjective and arbitrary. Culture
has the ability to undergo change however this change is slow due to the fact that culture is
deeply ingrained into the behavior of people. Thus, looking at it from the view point of the social
environment we can all agree that instead of trying to change culture, it is much more easier to
work within it.

7.1.2 Sub-Culture

Each culture always contains minor cultures known as sub-cultures and these provide more
specific identification and socialization of their members. Sub-culture are a set of beliefs that are
shared by a subgroup of the main culture and include nationalities, religions, racial groups and
geographic regions. A lot of sub-Cultures make up important market segments and all marketers
who desire to be successful must design products and programs that are tailored to needs of that
culture.

7.2. Lifestyle patterns and social classes

Lifestyle patterns as well as social classes have a lot of influence on consumer behavior. The
classification of socio-economic groups is called Socio-Economic Classification (SEC) and Social
class is basically a permanent and ordered division of society in which members have similar
value, interest, behavior and thus lifestyle. Social class is determined by multiple factors such as
income, occupation, education, authority, power, property, ownership, life styles, consumption,
and pattern. Our society has three different social classes namely upper class, middle class and
lower class and these social classes have different buying behavior. The Upper class consumers
want high-class goods so that they can maintain their status in the society and the Middle class
purchase carefully while collecting information and comparing different producers of the same
product. The lower class on the other hand mainly buy on impulse. Managers are thus required
to study carefully and understand the relationship between these social classes and their patterns
of consumption so that they can take appropriate measures to accommodate all the people of
those social classes to whom the products are meant to be sold.

7.3. Demographic issues

Demography is the study of a human population and it is based on factors such as age, race, and
sex. Demographics are used by governments, NGOs, corporations as well as other businesses to
learn about population characteristics for several purposes. Some of these purposes include policy
development, community knowledge assessment and economic market research. For example,
National Pension Scheme Authority (NAPSA) can use demographics to obtain knowledge on the
number of people that are nearing retirement age and how much they should be paid. In a similar
fashion, we can use demographics are as a business marketing tool to assess the best way to
approach customers as well as assess their behavior. Segmenting a population through
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demographics allows businesses to determine the potential market size. Demographics also help
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determine whether the products and services from a company are being targeted to that
company's most important and preferred consumers. Market segments also help to identify
certain age groups that have a certain buying pattern and characteristics.