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These core values still hold for a majority of Americans today. A person’s values are key

determinants of what is important and not important, what actions to take or not to take,

and how one behaves in social situations.

People typically form values through interaction with family, friends, and other influencers

such as teachers, religious leaders, and politicians. The changing environment can also play

a key role in shaping one’s values.

Values influence our buying habits. Today’s consumers are demanding, inquisitive, and

discriminating. No longer willing to tolerate products that break down, they are insisting on

high-quality goods that save time, energy, and often calories. U.S. consumers rank the

characteristics of product quality as (1) reliability, (2) durability, (3) easy maintenance, (4)

ease of use, (5) a trusted brand name, and (6) a low price. Shoppers are also concerned

about nutrition and want to know what’s in their food, and many have environmental

concerns.

The Natural Marketing Institute has marked some burgeoning trends that are apparently

becoming American values. Some of them are:

Getting off the grid: Consumers are pursuing ways to become more self-sufficient,

including householdgenerated energy, water conservation and purification, and

private gardens.

Meaningful green: Green initiatives must be distinctive, memorable, and measurable

to have an impact on environmental, social, and economic dimensions.

EcoTechMed: New economic realities are motivating many to take greater steps toward

proactive health care rather than sick care and to take greater responsibility for their

own health and wellness.

Source: Partial list of trends projected by the Natural Marketing Institute, “Healthy, Green,

Simple—Trends to Watch in the Next Ten Years,” Quirk’s Marketing Research Review, May

2010, 6.

© Roz Woodward/PhotoDisc/Jupiterimages

4-2b: The Growth of Component Lifestyles

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People in the United States today are piecing together component lifestyles. A lifestyle is a

mode of living; it is the way people decide to live their lives. With component lifestyles,

people are choosing products and services that meet diverse needs and interests rather than

conforming to traditional stereotypes.

component lifestyles

the practice of choosing goods and services that meet one’s diverse needs and

interests rather than conforming to a single, traditional lifestyle

In the past, a person’s profession—for instance, banker—defined his or her lifestyle. Today,

a person can be a banker and also a gourmet, fitness enthusiast, dedicated single parent,

and Internet guru. Each of these lifestyles is associated with different goods and services

and represents a target audience. Component lifestyles increase the complexity of

consumers’ buying habits. Each consumer’s unique lifestyle can require a different

marketing mix.

4-2c: How Social Media Have Changed the Way People and Businesses Communicate

Social media are Web-based and mobile technologies that allow the creation and exchange

of user-generated content. Social media encompass a wide variety of content formats

including text, video, photos, audio, PDF files, and PowerPoint. These media allow for one-

to-one, one-to-many, and many-to-many (going viral) communications. Social media

participants can create content, comment on content, or simply observe.

By the beginning of 2012, one minute out of every five spent on the Internet worldwide was

dedicated to social networking. This statistic is based upon data from 1.2 billion people

around the globe, or 82 percent of the world’s Internet population. Facebook, YouTube, and

Twitter are the most-used social networking sites worldwide, and Facebook, by far, is the

world’s most popular with 92 percent of all social networking site users signing in. Fifteen

percent of Facebook users update their own status, 22 percent comment on another’s post

or status, 20 percent comment on another user’s photos, 26 percent “like” another user’s

content, and 10 percent send another user a private message.

Are social networking site users more socially connected? Looking at how much total

support, emotional support, companionship, and instrumental aid adults receive, the

average American scores 75 out of 100 on a scale of total support, 75 out of 100 on emotional

support (such as receiving advice), 76 out of 100 in companionship (such as having people to

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spend time with), and 75 out of 100 in instrumental aid (such as having someone to help if

they are sick in bed).

Internet users in general score three points higher in companionship and four points higher

in instrumental support. A Facebook user who uses the site multiple

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times per day tends to score an additional five points higher in total support, emotional

support, and companionship than Internet users of similar demographic characteristics.

At one time, Myspace had far more customers than Facebook. What enabled Facebook to

grow so rapidly? The company has a different design philosophy than the rest of Silicon

Valley. Instead of obsessing about making tasks like posting a photo easier or making the

interface more beautiful, Facebook is getting its product out of the way. Most designers in

the computer industry have focused on helping humans interact with machines. But

Facebook is about human-to-human interaction. “We don’t want people to remember their

interactions with Facebook,” says director of design Kate Aronowitz. “We want them to

remember their interactions with their friends and family.” Chris Cox, director of product,

calls this “social design.” “It’s more like designing a plaza or a restaurant,” he explains. “The

best building is one where the people inside get it and work together and are connected.

That connectivity is created by how everything is arranged.”

HOW FIRMS USE SOCIAL MEDIA

There are many categories and types of social media that will be discussed in Chapter 16.

You will learn how businesses are using these tools to engage and retain customers, acquire

new customers, and understand the marketplace. There are several examples of how

Facebook has been used successfully by businesses:

Target ran a Valentine’s Day promotion called “Super Love Sender” that allowed people

to send personalized valentines and to vote on (and track) the charity to which Target

would donate $1 million.

Corona put the faces of its Facebook fans onto a Times Square billboard, generating 1.5

million impressions per day and feeding into 200,000 more “likes” for the brand.

L’Oréal’s Salon Facebook Program provided a kit to local salons that the salons then

used on their own Facebook pages. More than 6,000 salons now improve their own

Facebook pages with L’Oréal-supplied elements such as how-to videos, an appointment

booking engine, information on products, and a Facebook advertising credit. Was

L’Oréal’s Facebook program “worth it”? Since it has reached 1.7 million clients, it

appears that it was.

Bacardi created a promotion on Facebook called “Like It Live, Like It Together.” In a six-

week period, Bacardi fans “liked” randomly featured items on the brand’s Facebook

page (for example, one promotion asked people to “like” a pizza truck or a taco truck).

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The promotion gained Bacardi more than 145,000 fans in the United States and boosted

its YouTube channel views by 67 percent.

None of these companies settled for simple “likes” for the company or brand. Instead, each

found a creative way to engage customers and potential customers.

4-3: DEMOGRAPHIC FACTORS

Another uncontrollable variable in the external environment—also extremely important to

marketing managers—is demography, the study of people’s vital statistics, such as age, race

and ethnicity, and location. Demographics are significant because the basis for any market

is people. Demographic characteristics are strongly related to consumer buyer behavior in

the marketplace.

demography

the study of people’s vital statistics, such as age, race and ethnicity, and location

4-3a: Population

People are directly or indirectly the basis of all markets, making population the most basic

statistic in marketing. The world’s population hit 7 billion in 2012. China has the largest

population with 1.3 billion persons; India is second with 1.2 billion. The latest Census

(2010) puts the U.S. population at 308 million. The country grew

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by 27 million from 2000 to 2010. But growth was unevenly distributed. Metropolitan areas,

defined as the collection of small cities and suburbs that surround an urban core with at

least 50,000 people, accounted for most of the gain, growing 10.8 percent over the decade to

257.7 million people.

Rural areas, meanwhile, grew just 4.5 percent to 51 million. Many regions—from the Great

Plains to the Mississippi delta to rural New England—saw population declines. About 46

percent of rural counties lost population in the decade, including almost 60 percent of rural

counties that aren’t adjacent to a metro area.

Population is a broad statistic that is particularly useful when broken into smaller

increments. Age groups present opportunities to focus on a section of the population and

offer opportunities for marketers. These groups are called tweens, teens, Generation Y,

Generation X, and baby boomers. You will find that each cohort group has its own needs,

values, and consumption patterns.

4-3b: Tweens

America’s tweens (ages eight to twelve) are a population of more than 20 million. With

attitudes, access to information, sophistication well beyond their years, and purchasing

power to match, these young consumers spend over $200 billion annually. Tweens directly

spend about $50 billion per year, and the remainder is spent by parents and family

members for them. For example, the average family budget for back-to-school clothes is

$225.

With such spending power, many markets are striving to attract this age group. One of the

fastest-growing tween markets is home décor. Both boys and girls want their rooms to be

more than just rooms, and retailers such as Pottery Barn, Pier 1 Imports, and other home

goods retailers sell bedding, furniture, and wall art designed specifically for tweens. By

introducing tweens to home furnishings at a younger age, these firms hope to keep their

business as they change their fashion sense and need to furnish dorms or apartments for

college.

4-3c: Teens

There are approximately 25 million teens in the United States. They spend approximately

seventy-two hours per week tuned in electronically. This includes television, Internet,

music, video games, and cell phones. About 93 percent of U.S. teens are on the Internet, 75

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percent own a cell phone, and 66 percent say they text. Seventy-three percent of teens in the

United States are into social networking, and 50 million teens worldwide post their profiles

on Facebook. Only 14 percent of American teens blog, but about half post comments on

blogs. Only 8 percent of teens use Twitter.

Atkins is targeting Gen Y’s active lifestyles and adventurous spirit with ads like this one.

For teens, shopping has become a social sport whether online or at the mall, though most

teens prefer to shop in stores instead of online. The average teen spends about forty-five

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dollars per week (25 percent report working part time, and 70 percent work odd jobs).

Thirty-one percent of teen spending goes toward clothing, shoes, and accessories, and the

biggest purchase influence comes from friends.

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