External influences:

 Course tutor: Dr surabhi

External determinants of a consumer’s behaviour

 External or Socio cultural influences are those which are imposed on

an individual consumer by other individuals . The influence could be
direct or indirect way, emerging from a formal or informal
relationships.

 Types of influences are:

 Group influence
 Family Influence
 Reference groups
 Opinion leaders
 Social class
 Culture
 Subculture.
Groups
 Two or more people who interact to accomplish either
individual or mutual goals are called groups. Groups may
be classified as

 Formal & Informal groups

 Primary & Secondary groups

 Groups are formed for

 Informational purpose
 Utilitarian &
 Value expressive
 Family and its consumption roles

 Family is defined as two or more individuals related by blood marriage

or adoption who reside together.

 Influence of family manifests in following ways

1. Socialization

2. Family life cycle stage

3. Consumption roles in the family

1. Consumer Socialization
 Consumer Socialization is the process by which an individual learns to
consume and live within a society. It occurs in two stages:

 Stage of orientation: It is childhood stage where parents imbibe

most of our values, attitudes and beliefs necessary to function as
consumers. At this stage socialization takes place by co shopping or
observation

 Stage of procreation: is an adulthood stage where an individual

plays the role of creating a family and so redefine their
consumption patterns. At this stage socialization occurs by
interacting with people , looking at ads or following reference
groups.
 2. Family life cycles

 The marketers can study the consumer’s choice of products and level of consumption by
gauging his/her family life cycle (FLC) stages of its consumer which could be any of
these:

 Bachelorhood : single income , spend more on rent, basic furnishings , travel &
entertainment and clothing

 Married : double income , indulgent in purchasing basic comforts like appliances and
home decors

 Parenthood : would like to spend more on rearing of children, becomes a conscious

buyer, looks at value for money, spends mostly on food and education

 Post parenthood : children married off, liabilities over and once again indulgent, this time
buying things for personal use eg. New models of Cars, mobiles, other gadgets

 Dissolution stage : Death of a spouse/ separation . Very economical, purchase necessary

 DMU’s in family

 Decision making Units ( DMU’s ) in a family. The eight roles played by Family
members are

 Influencers
 Gatekeepers
 Deciders
 Buyers
 Preparers
 Users
 Maintainers
 Disposers

 Marketers must take note of the shifting patterns of family roles,Greater financial
independence for working women,Acceptance of household tasks by men, Role
of children in buying decisions
 Implication of family Influences for
marketers
 Marketers gets to know the target segment - Whether it is parents or
children who usually finds out first about products or brands
 It helps to determine the product positioning (ie masculine/feminine,
youthful/mature image)
 Also helps determine distribution and promotion pattern
 Decide the media mix to be shared by different DMUs eg

 Television
 Sunday newspapers
 Family films
 Reference groups
 Reference groups: Group whose values
attitudes or beliefs are used as a guide for
behavior by an individual are called
reference groups
Membership Non
membership
 Various types
Positive Contactual Aspirational
 Contactual: holds membership and is influence group group
in conformity with the rules of the
group
 Aspirational: does not hold Negative Disclaimant Avoidance
membership but like to be one influence group group
 Disclaimant: holds membership but
does not like to follow ideals of the
group
 Avoidance : does not want to get
associated to the group nor conform to
the ideals of the group
 Degree of Reference Group Influences

 Reference group effects are more in purchases that are:

 Luxuries rather than necessities
 Socially conspicuous/visible to others
PRODUCT
A study on 800 consumers revealed
Weak Reference Strong
Group Influence Reference Group
Influence

Strong Reference PUBLIC PUBLIC

Group Influence NECESSITIES eg. LUXURIES
BRAND Cars, Eg: clubs
wristwatches

Weak Reference PRIVATE PRIVATE

Group Influence NECESSITIES LUXURIES
Eg. mattresses Eg. TV games
Implications of Reference group influence for marketers

 Feeling of association/ dissociation to a group drives an individual to consume or

not to consume a product

 Membership in a group demands a certain degree of conformity that pressurizes an

individual to buy products, that others want them to have, that they think will
make others accept, approve or envy them.

 Marketers recognize the power of this influence and expend much effort in
associating a product with the appropriate reference groups by way of
 Celebrity
 Experts
 The common man
 Executive and employee spokesperson
 Trade or spokes character
Personal Influence through Opinion leaders/ Role Models

 Opinion leaders also called influentials

who exert a social influence over
participants seeking information
 Roughly one in ten, and in a group tend to
serve as a leading propagator of popular
trends, from public issues to new product
adoption to social attitudes.
 They come from diverse range of social
and economic backgrounds and is the most
effective method to reach public at large.
 He/she may be a leader in relation to
certain products
 Social class and its influence

•Social class means societal rank which is one’s position relative to another on
one or more dimensions valued by society.Determined by demographic features
Hierarchical, high degree of homogeneity in terms of activities opinion and

interests
•Social status means rank of an individual as perceived by other members in a
particular society

Socio economic
factors Social class Unique
behaviors
•Education •Upper class
•Occupation •Middle class •Preferences
•Income levels •Lower middle class • Purchases
•Ownerships •Lower class •Consumption
•Heritage

Social class results from socio-economic factors

 Social class and its influence

•Social class means societal rank which is one’s position relative to another on one
or more dimensions valued by society.Determined by demographic features.
Hierarchical, high degree of homogeneity in terms of activities opinion and

interests .
•Social status means rank of an individual as perceived by other members in a
particular society

Socio economic
factors Social class Unique
behaviors
•Education •Upper class
•Occupation •Middle class •Preferences
•Income levels •Lower middle class • Purchases
•Ownerships •Lower class •Consumption
•Heritage

Social class results from socio-economic factors

Social Mobility
 The passage of individuals from one social
class to another
 Horizontal mobility
 Downward mobility
 Upward mobility
 Differential fertility to “Cinderella fantasy”
 Marketers using social class influence

 Marketers follow the assumption that self esteem needs are universal
 Purchase of products or service is reflection of social class
 Marketers build different products/ stores personality as appropriate for certain social
classes
 Working class: sturdy, comfortable, and familiar products
 Affluent people: appearance/body image
 Diet foods/drinks

 Differentiates people in terms of their aesthetic and intellectual preferences

 Distinguishes consumption choices among social classes

 Groupings based on shared tastes in literature, art, music, leisure, and home decoration
 Status Symbols in india
A.C Neilsen study in 2004 in eight largets cities revealed that

Status symbols Score

1. Educational degree 7.29

2. Car 6.27
3. Home location 3.57
4. Cell phone 3.53
5. Child’s school 3.38
6. Credit card 3.29

Social class and income are not synonymous, social class is a better predictor
of symbolic purchases and Income is better predictor of major non-symbolic
expenditures
Difficulty in segmenting classes

 While targeting the lower class the utilitarian values are overemphasized
 While targeting the middle class the aspirational appeal is used
 While targeting the rich or noveau rich the conspicuous consumption appeal/
indulgent appeal is used desire to have a visible evidence of their ability to
afford luxury goods is exploited

 Marketers in India find it difficult to market to classes exclusively

 The concentration of classes is highly skewed cannot afford to target only single
class
 Dual consumption
 Mobility within classes
 Intergenerational variations in a class
 Geographic differences in social classes too diverse
Class structure in India
Class Structure in the U.S.
Class Structure Around the World

 Rise of Chinese middle class

 Nike’s new brand presence there

 Japan as a status- and brand-conscious society

 Single, working women spending on luxury goods

 Major retailers/brands are coming to Middle-Eastern

countries, where Arab women enjoy shopping with their
families/friends

 England’s rigid class structure still exists, but the dominance

of its aristocracy is fading
 Marketers are targeting chavs’ interest in fashion, food, and gadgets
 The Rise of Mass Class

 Income distribution
 “Affordable luxuries” within
reach of many consumers
 Rising incomes + decreasing
prices
 Marketers cater to mass class
with high-quality products