• A group is defined as a set of people who interact to achieve certain individual

or mutual goals.
 ROLE OF REFERENCE GROUP
• A reference group in the consumer behavior context is referred to as a group to which an
individual belongs. Reference group provide the benchmarks and the contrast needed for
comparision and evaluation of group related behavior. They act as a frame of reference to which
people always refer so as to evaluate their achievements , roles, performance, aspirations and
ambitions.
• Reference group that influence broadly defined behavior are called normative reference group,
e.g. Own family members. Reference groups that serve as benchmark for narrowly defined
attitudes are called comparative reference groups, e.G. Friends, neighours. While the family
members imbibe a basic code of behavior from their upbringing, the latter influence the
expression of specific consumer behavior
 INFORMATION AND EXPERIENCE

• A reference group is used as an information source in the different stages of the decision making
process.
• This type of influence is based either on the similarity of buyer’s desires and preferences with
those of the group members or on the recognition of the quality of the recommendations of the
group.
 CONSUMPTION RELATED REFERENCE GROUP

• Groups can be classified depending on many criteria , such as the affiliation and the type of
contact(frequent/occasional) or depending on attraction(positive/negative).
• Primary groups
• The primary groups are formed by the persons that we meet most often: friends, close colleagues,
family. A primary group has a sufficiently high possibility of face to face contact , and the subject’s
participation is characterized by cohesion and reciprocity which determine similar behavior and
beliefs within the group. The primary group is usually coherent and lasting , since it consists of
persons that think in a similar manner and have the same interests.
• Secondary group
• A secondary group is formed by persons that meet occasionally and have certain common
interests. Such a group can have influence on common activities.
• Aspirational reference
• The aspirational groups are the ones to which the subject wants to belong. For example, celebrities
are very powerful in influencing the behavior of their fans since the subjects will adopt the
celebritie’s choice in the hope of their affiliation as members. The marketers frequently use them to
endorse a certain product to penetrate into the youth or rural market in india.
• Official groups
• The best example of official groups are colleagues and members of an association or club. The
sheer amount of time that people spend at their jobs, provide ample opportunity for work groups
to serve as a major influence on the consumption of products and services by those members.
Though the marketers at first seem to have more success in influencing the formal groups,
experience shows that the official groups are generally having higher degree of influence because
they share part of the daily routine.
• Implicit groups
• The implicit groups are the ones whose affiliation is not formally defined , but they belong to the
same age, gender or educational background. They are sometimes also called brand communities
such implicit group members often become admirers of certain brands and events.
• Virtual groups or communities
• A virtual group is a community of persons that interact online on various themes of common interest
or specific activities. These groups, though mostly anonymous, are passing through a phase of
explosive growth and they often share their opinions on diverse subjects. – From entertainment ,
grooming to careers.
• Consumer action forums
• A particular type of consumer group , called consumer action forum, has emerged in response to
the consumerist movement. This group is dedicated to providing consumers with assistance in their
effort to make the right purchase decisions in a healthy and responsible manner and generally
add to the overall quality of their lives.
 EFFECT OF REFERENCE GROUP ON CONSUMER
DECISION MAKING
• The family group
• The family group consist of parents , brothers, sisters and close relatives. When the consumer is not in a
proper state of mind to recognize the problem he is facing , the family is the first reference group to point
out the problem and also help him in finding solutions. For example, if a student is getting tired by using
public transport system on his way to college , then most probably his mother/father will be the first one to
suggest the solution to buy a motorcycle.

• Friends
• Friends impact a lot of marketing decisions for people in various stages of life . they provide companionship ,
opportunities , share good moments , share problems. Friends play a major role in decision making for
publicly consumed products and become an easy source of information. In the case of low involvement of a
product like beverages, the decisions and suggestions of a friends make a lot of impact on brand choice.
That is why the advertisements of these products show the happy times being spent with friends , which tend
to make people cherish their happy memories.
• Formal groups
• Formal groups include individuals working together in a team and people who meet each other in
a formal set-up. Individuals spend many hours together in a formal set-up with each other due to
their employment requirements. Generally, peer groups have considerable influence on individual
members.An example would be an employee who is considering buying a new car. The first thing
he considers would be his family requirements. The second would be the price factor and whether
it is within his “range”. The next factor that comes to his mind is that he should be at a level more
than his peers. Thus, a formal set-up acts as a comparative reference group.
• Expert groups
• A person who is an expert in his own field will act as a perfect reference group for the product in
his expertise. People tend to take the opinion of the expert in a high involvement product. It need
not be a durable good like refrigerator, but can also be a fast moving consumer goods like
shampoo, depending on the importance of the usage of the product. The effect of experts is
naturally more in highly technical and innovative products
 COMMON MAN AS A REFERENCE GROUP
• Today a trend that is catching up is the leveraging of a common man’s image. He is ideal and we
as citizens try to emulate him. The common man’s image is experimented because the image of the
person is more important than the performance. The audience have to like him. When a person is
called for an ad, it is because of how he is perceived by customers, and not because of his recent
performance.
• Sunil babu, badhiya hai ! wonderful ad that had everyone speaking a phrase, “badhiya hai”.
Simple ad , wonderful memory! The asian paints ad tells a funny tale, adds drama and dust to the
story and emerges as a communication coup. If ever there was a brand that has remained etched
in the memory of the indian consumer, it is asian paints. For years, “gattu” hogged the limelight
and was the face of the brand , until replaced by the raunchy “sunil babu” in 2002, which again
proved to be an instant hit with asian paints patrons. Badhiya hai! Ad tries to communicate about
one of the reference group, that is the neighours who we try to emulate and influences our decision
making , especially problem recognition part of the decision making process.
 EXAMPLES OF ENDORSEMENT BY CELEBRITIES

• Endorsement by celebrities has been used by some of the top brands in the world like nike and
pepsi.
• In india too, HUL has used film stars to endorse their beauty soap lux since the fifties. Vimal, thums
up. Gwalior and dinesh suitings are some of the other brands that used star appeal in the early
days of mass advertising.
• Celebrities generally include movie stars, entertainers, sports personalities, tv icons and others.
Celebrities have an enormous influence in india.
• Celebrity endorsements have several advantages,key among them being building credibility,
fostering trust and drawing attention.
 • Example
• Kuch meetha ho jaye
• Amitabh bachhan known as big B , is shown as a chocolate grocer operating his shop close to a
college. “ Kuch meetha ho jaye” is what he is continuously uttering to signify that the dairy milk
chocolate is for all the people having sweet teeth. In short, it is an alternative to any sweets
available in the market. Therefore , it means one can have dairy milk chocolate instead of laddus
or barfis to make the mouth sweet( muh meetha ho jaye) . if a mega star like AB can have
chocolate in his sixties why can’t others ? thus the ad was meant to increase the customer base and
also to encash the rapport that AB enjoys with the consumers.
• Coke ads by amir khan
• Wonderful little concepts with superb acting by the ace actor himself . got the thanda culture up
and running for a coke . “ thanda matlab coca cola” & “ sar uthake pio” seems to be the magic
chant for coke.
• Shah rukh khan for tag heuer
• Katrina for nakshatra jewellery- “very indian, very de beers. The
brightest circle of light”
• Aishwarya rai
• Wah taj
• Ustad zakir hussain’s association with taj mahal tea ,the premium
brand from HUL
• Toofani dhamaka
• Live every moment- airtel