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SOCIAL CLASS
RAVI (61) SAHIL (66) DHAVAL

Social Class
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Social class a status hierarchy by which groups and individuals are classified on the basis of esteem (regard, respect) and prestige (reputation, influence derived from achievements). American Marketing Association

The division of members of a society into a hierarchy of distinct status classes, so that members of each class have either higher or lower status than members of other classes.

What is social class ?

Socialist Ideology for Social Class

Karl Marx: 1818-1883 Assertion that there were two great classes the owners of the means of production (capitalists) and the workers the only thing that the workers owned was their ability to work, what Marx called labor power. Because owners (capitalists) paid wages to workers and could for the most part determine that wage, owners had power over workers. "in countries where modern civilization has become fully developed, a new class of petty capitalist has been formed. An industrial army of workmen, under the command of a capitalist, requires, like a real army, officers (managers) and sergeants (foremen, over-lookers) who, while the work is being done, command in the name of the capitalist"

What is social class ?

Max Weber: 1864 1920 Max Weber formulated a three-component theory of stratification, that saw political power as an interplay between "class", "status" and "group power". Weber believed that class position was determined by a person's skills and education, rather than by their relationship to the means of production.

Class: A person's economic position in a society. Weber noted how managers of corporations or industries control firms they do not own. Status: A person's prestige, social honor, or popularity in a society. Weber noted that political power was not rooted in capital value solely, but also in one's individual status. Poets or saints, for example, can possess immense influence on society with often little economic worth. Power: A person's ability to get their way despite the resistance of others. For example, individuals a member of Parliament, may

What is social class ?

Modern Definition of social class

Schiffman & Kanuk The division of members of a society into a hierarchy of distinct status classes, so that members of each class have either higher or lower status than members of other classes.

Grant, J. Andrew Social class (or simply "class") is a set of concepts in the social sciences and political theory centered on models of social stratification in which people are grouped into a set of hierarchical social categories.
American Heritage Dictionary 4th A set, collection, group and configuration containing members regarded as having certain attributes or traits in common: a kind of category.

Meaning of social class


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Social class can be viewed as a range of position in a society . Social class define the ranking of people in a society in to a hierarchy of distinct status class; Upper, Middle, Lower, so that the member of class have relatively the same status based on their power & prestige. Upper Class Structure of Social Class
Upper Class Middle Class Lower Class Middle Class Lower Class

What determines social class?


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Occupation
Personal Performance

Class consciousness
Income Level

Interactions
Possessions

Heritage
Educational attainment Level of Influence

Value orientations

Nature of Social class


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Social classes exhibit status Net equivalent but related. Status =Rank in social system perceived by other members of society= Function of social class and personal characteristics E.g. Scientist High rank social system but in a prestigious capacity other in small R&D late. His professional contribution to society determines his status. Factors that determines status are , Authority over other Power ( political , Economic , Military) Property, Income, Consumption Pattern, Lifestyle, Occupation, Education, Public Service, Ancestry, Associations and Connections.

Symbols of status ( Mark of Distinction) Things consumer buys become symbols ( Status Symbolization) because of scarcity and social desirability. Conspicuous Consumption (Buying things we dont need). Shunning prestige items frivolity and a lavish display of wealth. Stealth wealth Quieter buy of quality item that dont scream money , glamour and glitz. Financial wealth dictates status. Possessions are substitute indicator of status. Marketers cater to consumers looking for something to give them an edge (Real or imagined) over their peers. Need for prestige is universal (Admired , Praised , envied and acknowledged) Relatively expensive , high quality, limited supply products purchased by a respected and admired group of people. Blurring of Symbolism Luxury goods market supported by middle class upscale tastes. Pseudo affluent purchase upscale indulgences. Genuine affluent have many of the Common mans

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Blurring of Symbolism (Conti.)


Truly rich view luxury goods as Toys. Designer labels mass marketing result in less than clear distinctions between social classes.

2.

Social classes are Multidimensional Based on numerous components like occupation and income. Some of these variable are more reliable substitutes

Eg Colgate Palmolive used neighborhood to drop 10 Million samples of their detergent (Based on one criteria You are where you live)

3.

Social classes are Hierarchical Vertical order from high to low.

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4.

Social classes restrict behaviour

Assiciation with same social class because of sharing of similar education , occupation , income level ,lifestyle.

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Social classes are Homogeneous

People in one class have similar attitudes , activities, interests and other behavior patterns. Exposed to similar media shop in similar stores.

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Social classes are Dynamic

Open systems (Move up or down) Closed systems ( inherited / ascribed status eg. Rural India)

What is Social Status?


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Relative ranking of members of each social class in terms of specific status factors. Family income, occupational status and educational attainment. Social class and status are not equivalent concepts.

Factors Important in Determining Status


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Authority over others Ownership of Property Consumption Patterns & Lifestyle Public Service Association Power Income Occupation Education Ancestry

India's top status symbols


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1.

2.
3. 4. 5. 6.

Education degree Car Home location Cell phone Children school / College Credit card

Social comparison theory


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Individuals normally compare their own material

Possessions with those owned by others in order to


Determine their relative social standings.

Consumers purchasing power Consumers possessions

In making such a comparison, an individual consumer use


Downward comparison (bolster his/her self-esteem) Upward comparison (create inferiority)

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Marketing practitioners most often use three socioeconomic variables on a daily basis to measure socialclass

Family income Occupational status Educational attainment

Social class is hierarchical and a natural form of segmentation


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Social-class categories usually are ranked in a hierarchy, ranging from low to high status. Social-class membership serves consumers as a frame of reference for the development of their attitudes and behaviours. The various social-class strata provide a natural basis for market segmentation for many products and services.

HOW IS IT IMPORTANT TO UNDERSTAND SOCIAL CLASS IN CONSUMER BEHAVIOUR STUDY?


Social class is a crucial external factor which influence consumers behaviour; It is because:

Affects access to resources

Affects tastes and lifestyles

Individuals can move up or down the social class hierarchy Frame of Universal reference Pecking for Order consumer behaviour Reflects a persons relative social status

natural form of market segmentati on

Classification of social class


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Social class is hierarchical and a form of segmentation Social class categories


a. b. c. d. e. f.

g.

Two category social class ( blue white collar; L,U; L,M) Three category (blue, grey, white collar ; L-M-U) Four category (L,L-M,U-M,U) Five category (L,L-M,M,U-M,U) Six category (L-L,U-L,L-M,U-M,L-U,U-U) Seven Category (RL-L, a lower group of people but not lowest, working class, M,U-M,L-U,U-U) Nine category (L-L,M-L,U-L,L-M,M-M,U-M,L-U,M-U,U-U)

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Unique behaviours
Situation:

entertainment e.g. Opera subscription

Shared behaviours

Situation: entertainment e.g. Football match

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Social class in America


Upper Americans
U-U L-U U-M Middle Americans M Working

Social class in India


U
U-M M-M L-M L

Lower Americans
U-L L-L

Indian Social class


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INDIAN CONSUMER MARKET A CHANGE FROM PYRAMID TO SPARKLING DIAMOND Extreme rural poverty has declined from 94% in 1985 to 61% in 2005 and is projected to drop to 26% by 2025.

Affluent class, defined as earning above Rs 10,00,000 a year will increase from 0.2% of the population at present to 2% of the population by 2025. Affluent classs share of national private consumption will increase from 7% at present to 20% in 2025.

Economic predictions
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India's social class is moving from a pyramid to a diamond . There is a large middle class population now. India's growing at an average annual rate of 7.6% for the past five years and it is expected to grow at a faster rate.

Income based classification


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Higher Income Upper Middle Income Middle Income Lower Middle Income Lower Income

The new urban Indian consumer pyramid


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SEC D,E SEC A&B

SEC C

Tier 2 ( The aspiring class) Tier 1(Consuming class)

Tier 3 ( The under privileged)

Indian consumer classification


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Consumers are divided into three major types based on size of wallet, occupation, education and sort of town/city they live

1. Consumers(largest value consumer base)

HHI- above 35,000 per month Professionals, Businessmen, owning major consumer durables, at par with the developed world's consumers Their needs. Lifestyle, aspiration would give answer to
Who to market Consumer profiling What to market- Needs and benefits How to market _ Media and distribution

Indian consumer classification


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2. Climbers (Largest volume consumer base


HHI- 15,000-35,000 per month Graduates, blue collar worker, small business traders, own two consumer durable. Focused on children's education

3. Aspirants( Largest growth driving consumer base)


HHI- 8000/- to 14,000/- per month rural/first generation migratory urban workers Poor employed, aspirations for children

SEC's in Total Urban Population


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SEC's in Total Urban Population


No. of families (mn) 9.10

Urban Sec Class SEC-A

SEC-B
SEC-C SEC-D SEC-E

12.61
16.58 18.05 21.08

Average monthly household incomes of Urban SEC's


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Urban SEC Class

SEC A

SEC B

SEC C

SEC D SEC E

All urban households

Av.Monthly HHI Av.per capita MHI

18,549

10,911

6,776 5,112

4,219

9,113

4,678

2,679

1,636 1,235

1,018

2,251

Social-Class Profiles
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THE UPPER-UPPER CLASS--COUNTRY CLUB


Small

number of well-established families Belong to best country clubs and sponsor major charity events Serve as trustees for local colleges and hospitals Prominent physicians and lawyers May be heads of major financial institutions, owners of major long-established firms Accustomed to wealth, so do not spend money conspicuously

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THE LOWER-UPPER CLASS--NEW WEALTH


Not

quite accepted by the upper crust of society new money business executive users of their new wealth

Represent

Successful

Conspicuous

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THE UPPER-MIDDLE CLASS--ACHIEVING PROFESSIONALS


Have

neither family status nor unusual wealth Career oriented Young, successful professionals, corporate managers, and business owners Most are college graduates, many with advanced degrees Active in professional, community, and social activities Have a keen interest in obtaining the better things in life Their homes serve as symbols of their achievements Consumption is often conspicuous Very child oriented

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THE LOWER-MIDDLE CLASS--FAITHFUL FOLLOWERS


Primary

non-managerial white-collar workers and highly paid blue-collar workers Want to achieve respectability and be accepted as good citizens Want their children to be well behaved Tend to be churchgoers and are often involved in churchsponsored activities Prefer a neat and clean appearance and tend to avoid faddish or highly-styled clothing Constitute a major market for do-it-yourself products

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THE UPPER-LOWER CLASS--SECURITY-MINDED MAJORITY


The

largest social-class segment Solidly blue-collar Strive for security View work as a means to buy enjoyment Want children to behave properly High wage earners in this group may spend impulsively Interested in items that enhance leisure time (e.g., TV sets) Husbands typically have a strong macho self-image Males are sports fans, heavy smokers, beer drinkers

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THE LOWER-LOWER CLASS--ROCK BOTTOM


Poorly

educated, unskilled laborers

Often

out of work are often poorly treated

Children

Tend

to live a day-to-day existence

Social Class Measurement


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Subjective Measures: individuals are asked to estimate their own social-class positions Reputational Measures: informants make judgments concerning the social-class membership of others within the community Objective Measures: individuals answer specific socioeconomic questions and then are categorized according to answers

Subjective Measurement of Social class

The individual places himself/herself in a class category, regardless of whether the researcher thinks they belong in that class category. Reflection of ones product usage and preferences Problem is to categorized themselves as middle class

Subjective Measurement of Social class


Think of this ladder as representing where people stand in India. At the top of the ladder are the people who are the best off those who have the most money, the most education and the most respected jobs. At the bottom are the people who are the worst off who have the least money, the least education, and the least respected jobs or no jobs. The higher up you are on this ladder, the closer you are to the people at the very top; the lower you are the closer you are to the people at the very bottom. If you consider your current situation and compare it with all other people in India, where would you place

Reputational Measurement of Social class

Think of this ladder as representing where people stand in their communities. At the top of the ladder are people who have the highest standing in their community. At the bottom are people who have the lowest standing in their community. If you consider your current situation and compare it with all other people in your community, where would you place yourself on this ladder?

Objective Measures
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Single-variable indexes

Occupation (Revital for sales people)(Economic times for business corporate executives and professionals ) Education (public defender & private lawyer)(mode of information search) (Laptops) Income (skiing, bowling, golf) (economic boom Mach 3 razor, Huggies supreme diapers) Other Variables (quality of neighborhood) (Chapins social status scale items in living room)

Composite-variable index

Index of status characteristics (ISC) Socioeconomic status score (SES)

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Index of Status Characteristics (ISC)

Developed by Warner

A weighted measure of the following socioeconomic variables like Occupation, source of income (not the amount), house type, dwelling area (quality of neighbourhood)

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Socioeconomic Status Score (SES)

Developed by The United States Bureau of the Census

A multivariable social class measure used by the United States Bureau of the Census that combines occupational status, family income, and educational attainment into a single measure of social class standing. Occupation, family income, occupational attainment

Social Mobility
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It occurs whenever people move across the social class boundaries, perhaps in their own life time or through generations, or from one occupational level to another Horizontal Mobility:

Movement from one position to another roughly equivalent in social status. ( same designation but organization changed)

Vertical Mobility:

Downward Mobility: movement from one position to another position that is lower in social status ( loss in share market) (parents and son) Upward Mobility: movement from one position to another position that is higher in social status (rajnikant)

Upward mobility
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Upward mobility

Upward Shift

A good example can be the Maruti 800 Ad camp. Of Rs 2599 which appeals to all the two wheelers and the lower middle class people , who are looking for an upward mobility in Status moving from a scooter to a Car

Geo-demographic Clusters
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A composite segmentation strategy that uses both geographic variables (zip codes, neighborhoods) and demographic variables (e.g., income, occupation) to identify target markets. Once settled in, people naturally emulate their neighbors, adopt similar social values, tastes and expectations and, most important of all, share similar patterns of consumer behavior toward products, services, media and promotions. It's the old "birds of a feather flock together" phenomenon LIFESTYLES, PRIZM, CLUSTER PLUS and Compusearch's new PSYTE system

PRIZM (Potential Rating Index by Zip Market)


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A composite index of geographic and socioeconomic factors expressed in residential zip code neighborhoods from which geo-demographic consumer segments are formed. Education, income, occupation, family life cycle, ethnicity, housing and urbanization with consumer behavior 62 segments further collapsed into 15 groups (s1 to R3) Nielsen PRIZM is a set of geo-demographic segments for the United States, developed by Claritas Inc., which was then acquired by The Nielsen Company. It was a widely used customer segmentation system for marketing in the United States in the 1990s and

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PRIZM NE (New Evolution) is an update to the original PRIZM model that featured 62 segments. The PRIZM system categorizes U.S. consumers into 14 distinct groups and 66 demographically and behaviourally distinct types, or "segments," to help marketers discern those consumers likes, dislikes, lifestyles and purchase behaviours.

The affluent consumer


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Especially attractive target to marketers Have extra income to buy upscale products (household items) Growing number of households can be classified as mass affluent with income of at least $75000 Some researcher are defining affluent to include lifestyle and psychographic factors in addition to income Have different medial habits than the general population No longer rely on volume to increase profit.

Mediamark Research, Inc. Affluent Market-Segmentation


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Upper deck ( top 10% households in teams of income)


Well-feathered Nests ( at least 1 high income earner with children) No Strings Attached ( at least 1 high income earner with no children) Nannys In Charge ( more than 1 earner but not high and have children) Two Careers (more than 1 earner but not high and no children) The Good Life (high degree of affluent with no person employed)

Rural Affluent Segments


Suburban Transplants (who moved to rural but still have high paying urban job) Equity-rich Suburban Expatriates (who sale home at high price in urban area and live in rural area) City Folks with Country Homes (who enjoy vacation in rural areas like mountain and costal) Wealthy Landowners (wealthy farmers others who comfortable living off)

What is Middle Class?


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The middle 50% of household incomes - households earning between $25,000 and $85,000 Households made up of college-educated adults who use computers, and are involved in childrens education Lower-middle to middle-middle based on income, education, and occupation (this view does NOT include upper-middle which is considered affluent) Near luxury model and down price make them buy upscale items Slowly disappearing towards upward and downwards in USA but increasing in Asia so companies moving to Asia

What is Working Class and other non affluent class?


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Households earning $34,000 or less control more than 30% of the total income in the U.S.
More brand loyal because they cant afforded mistakes Food is a particularly important purchase

The Techno class


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Having competency with technology Those without are referred to as technologically under classed Seek for earliest exposure to computers Parents are seeking computer exposure for their children No longer want to left out and being embarrassed by admitting dont know computers

Consumer Behavior Application for Social Class


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Clothing, Fashion, and Shopping

The Pursuit of Leisure

Saving, Spending, and Credit

Social Class and Communication

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Clothing, Fashion, and Shopping


Like to wear as per social class that suits them Lower middle class wear cloth with well known logos Upper class preferred more delectated looks Like to purchase from those stores which are relevant to their social class Big Bazaar has divided India into three segments: India one: Consuming class which includes upper middle and lower middle class (14% of India's population). India two: Serving class which includes people like drivers, household helps, office peons, liftmen, washermen, etc. (55% of India's population) and India three: Struggling class (remaining 31% of India's population). While Big Bazaar is targeted at the population across India one and India two segments, Aadhaar Wholesale(joint venture between The Future Group & Godrej Agrovet Ltd) is aimed at reaching the population in India three segment.

The Pursuit of Leisure


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Upper class like to attained theater and concerts Lower class tend to be avid tv watcher Middle class spend more on experience that brings family together

Saving, Spending, and Credit


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Upper class is more confidence and future oriented, they invest in insurance, stock and real estate Use credit card as substitute of case Lower class not future oriented and when they do save primarily interest are safety and security Use credit card as buy now and pay later

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Social Class and Communication

Diff. social classes are diff. in their media habits and how they transmit and receive communication. middle class have a broader or more general view of world while lower class tend to have narrow or personal view Also regional differences in terminology is there; Dabeli is known as roti in kuchha Higher class tend to watch current events and drama on tv while lower class watch quiz shows and comedies Upper class have more exposure to magazines than lower

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http://www.pbs.org/peoplelikeus/games/chintz. html

Group Activity
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Assume you are a travel agent selling vacation packages to different social classes. Discuss and create a plan for:

Vacation packages to offer (destination, accommodations, food, etc.) Advertising media selection and appeals used Communication style used in Ads Payment polices

Do this for (a) upper class, (b) middle class, and (c) lower class. Discuss if YOUR product is better suited for upper, middle, or working class and why. Write down your ideas and be prepared to share with the class.