Femily Decision Making - Marketing Consumer Behavior

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The Family and Its Social Class Standing

CHAPTER

TEN

Learning Objectives

To Understand the Changing Nature of U.S. Families, Including Their Composition and Spending Patterns.

To Understand the Socialization Process and Other Roles of the Family.

To Understand the Dynamics of Husband-Wife Decision Making, as Well as the Influence of Children in Family Consumption Decision Making.

To Understand How Traditional and Nontraditional Family Life Cycles Impact Consumer Behavior.

To Understand What Social Class Is and How It Relates to Consumer Behavior.

To Understand the Various Measures of Social Class and Their Role in Consumer Behavior.

To Appreciate the Distinctive Profiles of Specific Social Class Groupings.

Chapter Ten Slide

Here is an outline of the topics for Chapter Ten.

Learning Objectives (continued)

To Appreciate the Distinctive Profiles of Specific Social Class Groupings.

To Understand the “Ups and Downs” of Social Class Mobility.

To Understand the Relationship Between Social Class and Geodemographic Clusters.

To Understand the Affluent Consumer.

To Understand the Middle-Class Consumer.

To Understand the Working Class and Other Nonaffulent Consumers.

To Understand the Nature and Influence of the “Techno-Class.”

To Understand How Social Class Is Used in Consumer Research Studies.

Chapter Ten Slide

Here is an outline of the topics for Chapter Ten.

The Changing U.S. Family

Types of families
Nuclear
Extended
Single-parent
Changes in household spending patterns

Chapter Ten Slide

There are many different types of families. The nuclear family is two parents and at least one child. If the household has at least one grandparent, it is called an extended family. In addition, there is an increasing number of single-parent households. There are changes that have an effect on spending patterns. With more women working, many households have double income. In addition, families are shopping for time-saving products and services since they have less time at home.

Evidence of the Dynamic Nature of U.S. Households - Figure 10-2

Chapter Ten Slide

This figure shows how U.S. households are changing over time. In this chart, we clearly see the decrease in married couples with children and an increase in women and men living alone.

Consumer Socialization

The process by which children acquire the skills, knowledge, and attitudes necessary to function as consumers.

Chapter Ten Slide

Parents teach their children basic values and modes of behavior. These include moral and religious principles, as well as everyday skills such as manners and speech, grooming, and interpersonal skills. Do parents teach children consumption skills? Absolutely, they learn about spending versus savings, how to shop, and how to make purchase decisions. Children today are exposed to marketing messages at a very young age, especially through television advertising and the Internet.

A Simple Model of the
Socialization Process - Figure 10.4

Chapter Ten Slide

Here we see a simple model of the socialization process that focuses on young children. It is interesting to note that the arrows run both ways from the child to their families and their friends. When you were a child, didn’t you help out a family member with working a television remote or told someone the right thing to say or do in a given situation?

Other Functions of the Family

Economic well-being
Emotional support
Suitable family lifestyles

Chapter Ten Slide

In addition to socialization , the family provides other functions. The family provides economic security to its members, emotional support, and a way to share common goals and experiences.

Family Decision Making

Dynamics of Husband-Wife
Decision Making
Husband-Dominated
Wife-Dominated
Expanding Role of Children In Family Decision Making
Choosing restaurants and items in supermarkets
Teen Internet mavens
Pester power

Chapter Ten Slide

Husbands and wives often need to make decisions together. The way they balance their influence will differ as to whether it is joint, single, or dominated by one member. The balance between the husband and wife will differ from culture to culture. Furthermore, kids are very involved in family decision making. We are seeing an increase in this as kids are given more responsibility and are exposed to more media. Because kids are online so much, they are constantly finding information on products that they will share with the family. And kids don’t give up easily; when they want something they will ask many times. We say kids have pester power because they don’t give up and ask so many times.

The Family Life Cycle

Traditional Family Life Cycle
Stage I: Bachelorhood
Stage II: Honeymooners
Stage III: Parenthood
Stage IV: Postparenthood
Stage V: Dissolution
Modifications - the Nontraditional FLC

Chapter Ten Slide

Marketers have long used the family life cycle, also known as FLC. It gives us an idea of the stages that many families pass throughout their life. The fact is that this traditional life cycle is only passed through by a certain percent of families, so many modifications have been made and a nontraditional family life cycle has been created.

In terms of the traditional FLC, we see the 5 stages. Stage I, Bachelorhood, includes single men and women who have moved out of their parents’ home and are living on their own. The next stage, the Honeymooners, occurs immediately after marriage before the arrival of the first child. They often have start-up expenses as they establish a new home. Stage III, parenthood, occurs with the arrival of the first child. In this stage, people’s financial status often changes. Stage IV, postparenthood occurs when the children have left home. This is also called the empty-nest stage and is a time when couples have more time to themselves. The final stage, dissolution, occurs with the death of one spouse. Many in this stage will remarry or begin to live a more economical lifestyle.

This web link takes you to Fidelity, a very well know financial services company. You can see that they have products that are targeted to all stages of the family life cycle.

Nontraditional FLC Family Stages

Chapter Ten Slide

Alternative FLC Stage	Definition/Commentary
Childless couples	Increasingly acceptable with more career-oriented married women and delayed marriages
Couples who marry later in life	Likely to have fewer or no children
Couples with first child in late 30’s or later	Likely to have fewer children. Want the best and live quality lifestyle
Single parents I	High divorce rate - about 50% lead to this
Single parents II	Child out of wedlock
Single parents III	Single person who adopts
Extended family	Adult children return home. Divorced adult returns home. Elderly move in with children. Newlyweds live with in-laws.

As you can see from this table, there are many more types of family households than described in the traditional life cycle. In addition to the ones here, there are many nonfamily households not described in the traditional family life cycle.

Social Class

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.

Chapter Ten Slide

Here is a definition of social class. A description of the classes and their names will be provided in the following slide.

Social Class Measure and Distribution
Table 10.8

Chapter Ten Slide

These are the major social class categories and the percent of U.S. households they represent. As you can see, the upper is a relatively small percent of the overall population. In this chart, we see the hierarchal nature of social classes where they range from low to high.

Social Class Measurement

Subjective Measures
individuals are asked to estimate their own social-class positions
Objective Measures
individuals answer specific socioeconomic questions and then are categorized according to answers

Chapter Ten Slide

Researchers measure social class either by subjective or objective measures. In the subjective, people estimate their own class whereas in the objective measures, researchers use common objective measures, which are seen on the following slide.

Objective Measures

Chapter Ten Slide

For the single-variable indexes, occupation is commonly used. Education is often used in combination with occupation or alone. A college degree is often a deciding factor in evaluating one’s social class. Income is frequently used, although not all researchers agree on it. Because two individuals will spend that income in different ways, they have different values that reflect lifestyles of different social classes.

Because single variables are often too narrow for indexing social class, many researchers will use composite variables. The Index of Status Characteristics takes occupation, source of income, house type and quality of neighborhood into account. The Socioeconomic Status Score, which is from the U.S. Bureau of the Census, combines occupation, family income, and education level.

Discussion Questions

What are the advantages to a marketer using the objective method to measure social class?
When would the subjective or reputational method be preferred?

Chapter Ten Slide

Think about how people you know might report their social class – would it work to have them categorize themselves?

Geodemographic Clusters

A composite segmentation strategy that uses both geographic variables (zip codes, neighborhoods) and demographic variables (e.g., income, occupation) to identify target markets.

Chapter Ten Slide

Social class can be measured by linking data on where consumers live and their demographic information. This gives marketers a look at what consumers might purchase with their income.

The Affluent Consumer

Growing number of households can be classified as “mass affluent” with incomes of at least $75,000
Some researchers are defining affluent to include lifestyle and psychographic factors in addition to income

Chapter Ten Slide

Affluent households are an especially attractive target to marketers because they have a large share of discretional income.

What Is the Middle Class?

The “middle” 50 percent of household incomes - households earning between $25,000 and $85,000
The emerging Chinese middle class
Moving up to more “near luxuries”

Chapter Ten Slide

It is not easy to define the middle class, but we can categorize them most easily by their incomes. We see that in certain countries, especially China, there is a growing middle class who are driven by a desire for social status and will purchase status symbols. As luxury products become more affordable, middle-class consumers will be drawn to purchasing them.

The Working Class?

Households earning $40,000 or less control more than 30 percent of the total income in the U.S.
These consumers tend to be more brand loyal than wealthier consumers.

Chapter Ten Slide

The working class is a sizable part of the U.S. population. Many companies target this group with affordable options in food, clothing, and entertainment. To get an estimate of the size of different social groups based on income, this web link will bring you to U.S. Census data.

Consumer Behavior and
Social Class

Clothing, Fashion, and Shopping
The Pursuit of Leisure
Saving, Spending, and Credit
Social Class and Communication

Chapter Ten Slide

Social class is important to keep in mind for marketers. Consumers of different social classes purchase clothes and spend their leisure time with different activities. In addition, different social classes tend to view savings vs. spending differently and will view different television shows and visit different websites.

Influence of Culture on Consumer Behavior

CHAPTER

ELEVEN

Learning Objectives

To Understand What Culture Is and How It Impacts Consumer Behaviors.

To Understand How Culture Acts as an “Invisible Hand” That Guides Consumption-Related Attitudes, Values, and Behavior.

To Understand How Culture Sets Standards for What Satisfies Consumers’ Needs.

To Understand How Culture Is Learned and Expressed in Language, Symbols, and Rituals

To Understand How Consumers Are Always Adapting to Culture-Related Experiences.

To Understand How the Impact of Culture on Consumer Behavior Is Measured.

To Understand How Core Cultural Values Impact American Consumers.

To Understand How the American Culture Became a “Shopping Culture.”

Chapter Eleven Slide

Here is an outline of the topics for Chapter Eleven.

Culture

The sum total of learned beliefs, values, and customs that serve to regulate the consumer behavior of members of a particular society.

Chapter Eleven Slide

To understand culture, just think of the difference between two societies. How do they think, believe, and act differently? Even though many believe culture is becoming less distinct from country to country, I am sure you can identify differences in values and behaviors.

Culture Satisfies Needs

Food and Clothing
Needs vs. Luxury

Chapter Eleven Slide

What kinds of needs does culture help satisfy? It helps us decide where to eat, when to eat, and what to eat. It helps us know which products we simply must have, like a cell phone, and what products are a luxury, like a private plane.

Culture Is Learned

Enculturation and acculturation
Language and symbols
Ritual
Sharing of culture

Enculturation
The learning of one’s own culture
Acculturation
The learning of a new or foreign culture

Issues

Chapter Eleven Slide

We learn about our own culture from the time we are small children. Through both informal and formal learning, we learn how to behave and the difference between right and wrong. The learning of our own culture usually happens slowly over time. Quite often, when someone moves, they must learn a new culture. This process of acculturation can be very difficult and will differ based on age, interest in the culture, and desire to become part of the new society. This web link gives you information on doing business in Japan and some cultural issues, including etiquette and manners.

Culture Is Learned

Enculturation and acculturation
Language and symbols
Ritual
Sharing of culture

Issues

Without a common language ,shared meaning could not exist
Marketers must choose appropriate symbols in advertising
Marketers can use “known” symbols for associations

Chapter Eleven Slide

There is a strong symbolic nature to human language. We use symbols to communicate with each other and marketers will use symbols to communicate to their customers.

Culture Is Learned

Enculturation and acculturation
Language and symbols
Ritual
Sharing of culture

Issues

A ritual is a type of symbolic activity consisting of a series of steps
Rituals extend over the human life cycle
Marketers realize that rituals often involve products (artifacts)

Chapter Eleven Slide

You can probably think of many rituals in which you have been involved – birthday parties, weddings, graduations, or religious rites of passage. Many of these rituals involved artifacts, objects that are important to the day. Some rituals might even be informal, like poker night. Are there certain artifacts that students absolutely must have? Food, perhaps, music or objects.

Discussion Questions

What are some rituals (religious, educational, social) that you have experienced?
What artifacts or products were part of that ritual?
How did marketers influence the choice of these artifacts?

Chapter Eleven Slide

No doubt, growing up you were involved in some rituals – high school graduation, rite of passage rituals, births, or deaths.

Selected Rituals and Associated Artifacts - Table 11.2

Chapter Eleven Slide

SELECTED RITUALS	TYPICAL ARTIFACTS
Wedding	White gown (something old, something new, something borrowed, something blue)
Birth of child	U.S. Savings Bond, silver baby spoon
Birthday	Card, present, cake with candles
50th Wedding anniversary	Catered party, card and gift, display of photos of the couple’s life together
Graduation	Pen, U.S. Savings Bond, card, wristwatch
Valentine’s Day	Candy, card, flowers
New Year’s Eve	Champagne, party, fancy dress

Table 11.2 presents some rituals and artifacts. These might be some of the same rituals you identified in the previous discussion question.

Culture Is Learned

Enculturation and acculturation
Language and symbols
Ritual
Sharing of Culture

Issues

To be a cultural characteristic, a belief, value, or practice must be shared by a significant portion of the society
Culture is transferred through family, schools, houses of worship, and media

Chapter Eleven Slide

A culture can not just exist within one person. There must be a large group which is involved, a significant portion of society. We will discuss subcultures in the next chapter, which are smaller subcultural groups that exist within larger cultures.

Culture is Dynamic

Evolves because it fills needs
Certain factors change culture
Technology
Population shifts
Resource shortages
Wars
Changing values
Customs from other countries

Chapter Eleven Slide

It is important for marketers to realize that culture is changing. The products that fulfill needs, what is cool and in style, are constantly changing. Large cultural shifts may occur due to events that affect society. Certain cultures would like to change. For example, this is a link to changing the drinking culture at colleges.

The Measurement of Culture

Content Analysis
Consumer Fieldwork
Value Measurement Instruments

Chapter Eleven Slide

Measurement techniques are used to track values and social trends for government and business. Each one will be looked at individually on the following slides.

Content Analysis

A method for systematically analyzing the content of verbal and/or pictorial communication. The method is frequently used to determine prevailing social values of a society.

Chapter Eleven Slide

Researchers can look at magazines, websites, television commercials, and even blogs to see what changes might be occurring and what values are important.

Consumer Fieldwork

Field Observation
Natural setting
Subject unaware
Focus on observation of behavior
Participant Observation

Chapter Eleven Slide

With consumer fieldwork, researchers observe behavior. This can be done in the field or by actively involving participants to observe their own behavior and beliefs.

American Core Values

Chapter Eleven Slide

These eleven values can be considered the “building blocks” of American culture. Take a minute to think about each one. There is probably a good chance that you can picture an advertisement that appeals to each of these values. Most of these values are clearly stated and should be easily understandable. The ones that might need some description are progress and external conformity. Progress relates to the fact that people and the society can improve themselves. It is closely tied to the related values of achievement, success, efficiency, and practicality. External conformity relates to the fact that although consumers like freedom of choice and individualism, they all accept the reality of conformity.

Scale to Measure Attitude
Toward Helping Others

Chapter Eleven Slide

This is a scale that is used to measure people’s attitudes toward helping others. There is a related scale that measures their attitudes toward charitable organizations, which is also given in the textbook.

Toward a Shopping Culture

Is shopping what we do to create value in our lives?
The younger generation is shopping more
This has an effect on credit card debt

Chapter Eleven Slide

The “shop till you drop” mentality has propelled shopping to an American pastime. People of all ages view shopping as more than a necessity but a hobby, interest, and important part of their lives. In some cases, shopping becomes an addiction. This web link takes you to WebMD which discusses this addiction.

Subcultures and Consumer Behavior

CHAPTER

TWELVE

Learning Objectives

To Understand What Subculture Is, and Its Relationship to Culture.

To Understand Nationality as a Subcultural Influence on Consumer Behavior.

To Understand Religious Affiliation as a Subcultural Influence on Consumer Behavior.

To Understand Geographic and Regional Residences as Subcultural Influences on Consumer Behavior.

Chapter Twelve Slide

Here is an outline of the topics for Chapter Twelve.

Learning Objectives (continued)

To Understand Racial Identity as a Subcultural Influence on Consumer Behavior.

To Understand Age as a Subcultural Influence on Consumer Behavior.

To Understand Gender as a Subcultural Influence on Consumer Behavior.

To Understand How Multiple Subcultural Memberships Jointly Influence Consumer Behavior.

Chapter Twelve Slide

Here is an outline of the topics for Chapter Twelve.

Subculture

A distinct cultural group that exists as an identifiable segment within a larger, more complex society.

Chapter Twelve Slide

A subculture has beliefs, values, and customers that set them apart from the other members of the same society.

Discussion Questions

Would you categorize yourself as belonging to any subcultures?
How does it affect your consumer purchases?

Chapter Twelve Slide

Perhaps you belong to religious or ethnic subcultures. Do these affect your grocery decisions, for instance?

Nationality Subculture - Hispanic

Stronger preference for well-established brands
Prefer to shop at smaller stores
Some are shifting food shopping to non-ethnic American-style supermarkets
Youths are more fashion conscious than non-Hispanic peers

Chapter Twelve Slide

Nationality is an important variable for defining subculture in the U.S. since census data shows that more than 1 in 10 Americans is foreign born. The Hispanic subculture is growing in the United States. Some consider it a single group but there are actually several subgroups in the United States. These subgroups can be seen on the following slide. The Hispanic culture does show some differences from the American culture in general. They like brands and see them as more prestigious. They tend to be very fashion conscious. They tend not to be impulsive buyers and prefer to shop at smaller stores; this may be in part because they prefer fresh to frozen or prepared foods.

Nationality Subculture – Hispanic
U.S. Hispanic Population by Place of Origin
Figure 12.3

Chapter Twelve Slide

Here we can see the breakdown between the Hispanic subculture and their country of origin. The web link on this page brings you to a website that focuses on Hispanic businesses. Why would a subculture need this type of website? Does this site seem effective in communicating and helping the Hispanic business owner?

Religious Subcultures

200+ organized religious groups in the U.S.
Primary organized faiths include:
Protestant denominations
Roman Catholicism
Islam
Judaism
Consumer behavior symbolically and ritualistically associated with the celebration of religious holidays.

Chapter Twelve Slide

Religion is an important subculture when we think about rituals that are performed by subcultures. Think of all the symbolic shopping that is done in preparation and for Christmas day.

Major Racial Subcultures
African American

The African American Consumer
13 percent of the U.S. population
Purchasing power estimated at $845 billion

Chapter Twelve Slide

Although representing only 13 percent of the U.S. population, the African American population is very important to marketers due to their increasing purchasing power and their interest in certain products. For instance, the African American teen spends more on many products compared to same-aged Anglo-white or Hispanic teens. These products include martial arts, basketball, iced tea drinks, body powder, and breath fresheners.

Major Racial Subcultures
African American

Prefer leading brands over private-label brands
Brand loyal
Higher than average trips to grocery store and higher spending
Spend more then other segments on telephone services

Chapter Twelve Slide

Some other interesting consumption patterns include a preference for brand names and more frequent trips for grocery shopping. Hair care and telephone services are two other products that tend to be bought more than other segments.

Major Racial Subcultures
Asian American

Fastest growing racial segment
Diverse group including 6 major ethnicities:
Chinese, Filipino, Indian, Vietnamese, Korean, and Japanese
95% live in metropolitan areas and business ownership is high

Chapter Twelve Slide

The Asian market is a challenge for marketers because it is so diverse and there are so many languages spoken. It is hard to determine whether to run an ad to this target in their native language or in English.

Region of Residence for Selected Subcultural Groups – Figure 12.7

Chapter Twelve Slide

Major Age Subcultures

Chapter Twelve Slide

You have probably heard these terms before. Marketers and other researchers divide the population into groups depending on the year they were born. There are many differences between these age subcultures, which will be explored in the following slides.

Generation Y

According to sources, born 1977-1994 OR 1982-2000
Three groups
Gen Y Adults – 19-28
Gen Y Teens – 13-18
Gen Y Tweens 8-12
Twixters – 21-29 and live with parents

Chapter Twelve Slide

Gen Y has shifted from TV viewing to the Internet and are less likely to read newspapers. They are the largest users of text messaging and spend a lot of time with online social networks.

Generation X

Born between 1965 and 1979
Also referred to as Xers, busters, or slackers
Do not like labels, are cynical, and do not want to be marketed to

Chapter Twelve Slide

Gen X is careful to work at jobs they like, regardless of salary. The tend to work to live rather than the baby boomers who lived to work. Although they are not designer focused, they do tend to purchase brand names such as Sony.

Baby Boomers

Born between 1946 – 1964
More than 40 percent of the adult population
Motivated consumers
Not anxious to retire and handle it as:
Opportunity for a new start
A continuation of preretirement life
Unwelcome disruption
Transition to old age

Chapter Twelve Slide

The baby boomers have a lot of purchasing power due to their size and their propensity to purchase for themselves, others, and their homes. They are mixed on their views of retirement and will therefore purchase in different ways during these golden years.

Older Consumers

Roughly 65 years and older
Growing segment due to better medical care, declining birthrate and the aging of the large baby boomer segment
Three segments by age
The Young-Old (65-74)
The Old (75-84)
The Old-Old (85 and older)

Chapter Twelve Slide

The older consumer is an important and growing segment. People are living longer and are healthier and more active at an older age. Many people tend to clump seniors together when, in fact, there are several segments within this group. The young-old tend to travel and purchase at a very high rate.

Older Consumers

Segmentation can also be done on motivations and quality-of-life orientation
Cyberseniors

Chapter Twelve Slide

Some research has shown that perceived or cognitive age might be a better way to segment people. Those who feel and act younger will purchase consumer products that are generally consumed by a somewhat younger group. This web link is to AARP, the American Association of Retired People and one of the largest and most powerful associations in the country.

How Seniors Use the Internet
Figure 12.9

Chapter Twelve Slide

Older consumers are very active online and are more connected than you might think at first. This graph shows the most common reasons that seniors use the internet and the online activities in which they engage.

Discussion Questions

How might the three senior segments differ in their consumption of food products?
How might a marketer of a food product market differently to the three subgroups?

Chapter Twelve Slide

To answer this question, visualize a grocery store and the variety of food categories. Where might you find the three groups of seniors? What about dining out? What are their interests?

Issues in Understanding Gender as a Subculture

Sex Roles and Consumer Behavior
Masculine vs. Feminine Traits
Consumer Products and Sex Roles
Women as depicted in Media

Chapter Twelve Slide

Gender plays an important role in some marketing issues. Men and women react differently toward print ads and have very different shopping motives. As such, some consumer products are much more focused to one sex versus the other. It is only in the past few years that men have increased their purchases of consumer care products, including moisturizers and hair care products.

Many women are concerned with the way they are depicted in media and would like to see more of the “real” women that advertisers like Dove have begun to use. Follow this web link to the Campaign for Real Beauty by Dove to learn more about the campaign.

Working Women

Segments of ALL women
Stay-at-home
Plan-to-work
Just-a-job working
Career-oriented working

Chapter Twelve Slide

Working women are important consumers and comprise about 60 percent of American women. They can be broken into many segments based on “why” they work and their occupational category. Think of women you know who work. Which ones are focused on their career versus working just to pay the bills? How might this affect their purchasing behavior?

Subcultural Interaction

Marketers should strive to understand how multiple subcultural memberships jointly influence consumers behavior

Chapter Twelve Slide

It is important for marketers to realize that an individual can belong to several of the subcultures presented in these slides and must consider how these influences will work together.