Consumer Behaviour - Assignment

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This chapter opens with the story of Zachary. Zachary leads a secret life. During the week he is a stock analyst, but on the weekends, he’s out on the road with his Harley-Davidson. Zachary’s group of biker friends is an important part of his identity and this membership influences many buying decisions. The biker group is a reference group. A reference group is an actual or imaginary individual or group conceived of as having significant relevance upon an individual’s evaluations, aspirations, or behavior.

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Social identity theory argues that each of us has several “selves” that relate to groups. Minimal group paradigm, researchers show that even when they arbitrarily assign subjects to one group or another, people favor those who wind up in the same group.

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Social power exists when the one person admires the qualities of another and tries to copy the referent’s behavior. It’s important to marketers because consumers voluntarily modify what they do and buy to identify with the referent. Information power exists when someone knows something others would like to know. Legitimate power is granted through true authority in a situation. For instance, police officers have legitimate power. Expert power accrues to a person who is an expert in a particular field. Due to their expertise, others will be influenced by them. Reward power refers to the influence held by a person who has the ability to offer a reward. Coercive power is the opposite of reward power. It is held by someone who has the ability to punish.

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Membership reference groups are people we know like our families, friendship groups, and colleagues. Because we tend to compare ourselves with similar others, many promotional strategies include ordinary people. Seeing the consumption activities of others acts as a form of social influence. Aspirational reference groups are people we admire. They may be successful businesspeople, athletes, or performers.

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Reference groups can affect our decisions both positively and negatively. Sometimes we deliberately do the opposite if we want to distance ourselves from avoidance groups. Antibrand communities are those that coalesce around a brand but they are united by a disdain for the brand. Many brands have been targeted by antibrand communities including Dunkin’ Donuts, Rachael Ray, and Starbucks.

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People in larger groups have fewer constraints on behavior. Deindividuation occurs when our individual identities are submerged in the group. In other words, we don’t stay out alone so we may behave differently. At a costume party, we may act wilder than we would in our everyday lives. The change in our shopping behavior in groups is the reason some brands use home shopping parties. Why do we tend to conform to the pressure of groups? The primary culprits are listed in the slide. Culture pressure refers to how different cultures encourage conformity to a greater or lesser extent. For instance, the Japanese society emphasizes collective well-being and group loyalty over individuals’ needs. Individuals may believe that the group will apply sanctions to punish nonconforming behaviors. This is the fear captured in the factor, fear of defiance. According to the principle of least interest, the person who is least committed to staying in a relationship has the most power because that party doesn’t care as much if the other person rejects him. As groups gain in power, compliance increases. The trait, susceptibility to interpersonal influence, refers to an individual’s need to have others think highly of him or her.

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Brandfests are held by many companies like Mini and Harley-Davidson. The festivals enable consumers to interact with others who share a similar brand passion.

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In brand communities, experienced members coach newer members. As this process occurs, the community creates added value for being a part of the community. Figure 11.1 illustrates how value is created and socialized throughout the community. Can you apply this process to a community of which you are a part?

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Buzz building is creating “buzz” around some idea, product, or promotion. Serial reproduction is examining how content mutates

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This objective deals specifically with organizational decision-making as one of the types of collective decision-making covered in the chapter.

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This figure illustrates how information changes as it is transmitted. The farther from the original source, the more difference exists in the information transmitted. Sometimes this transmission effect creates misinformation about products – especially online.

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Two-step flow model of influence. It proposes that a small group of influencers disseminates information because they can modify the opinions of a large number of other people. Consumers communicate the information vigorously to one another and they also participate in a two-way dialogue with the opinion leader as part of an influence network. These conversations create information cascades that occur when a piece of information triggers a sequence of interactions (much like an avalanche).

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Everyone knows people who are knowledgeable about products and whose advice others take seriously. Opinion leaders are valuable sources of information because they possess social power. They may have expertise but one source of influence is their similarity to the person being influenced. Homophily refers to the degree to which a pair of individuals is similar in terms of education, social status, and beliefs. The original framework describing opinion leadership is known as the two step flow model of influence. It proposes that a small number of influencers disseminate information because they can modify the opinions of a large number of other people. Research has shown that this might not be the case. Instead, influentials share the information with those who are easily influenced and then those people continue to talk among themselves, resulting in information cascades. The influence of these opinion leaders is more widespread online. Forrester calls these people Mass Connectors and they are responsible for about 80% of brand mentions online.

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People can also be influenced by a special type of opinion leader called the market maven. Researchers use a scale to identify market mavens. The scale includes items like “I like introducing new brands and products to my friends.”

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Surrogate consumers are opinion leaders we usually pay for advice. Their recommendations are very influential! Some examples include personal shoppers and interior designers.

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Companies want to use opinion leaders to spread word-of-mouth communication about their brands, but how do they find the opinion leaders? The most common technique is simply to ask individual consumers whether they consider themselves to be opinion leaders. The problem is that just because we transmit advice about products does not mean that other people take the advice. For someone to be a true opinion leader, others must follow the advice given.

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The play Six Degrees of Separation is based on the premise that everyone is connected to everyone else, at least indirectly. Sociometric methods trace communication patterns among members of a group. We can use this method to better understand referral behavior and to locate strengths and weaknesses in terms of how one’s reputation flows through a community. Network analysis focuses on communication in social systems, considers the relationships among people in a referral network, and measures the tie strength among them. Tie strength refers to the nature of the bond between people. It can range from strong primary to weak secondary. Even weak ties can be influential.

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Standards of behavior: Rules that specify what members can and can’t do on the site. Some of these rules are spelled out explicitly (e.g., if you buy an item on eBay, you agree that you have entered into a legal contract to pay for it), but many of them are unspoken. A simple example is discouragement of the practice of flaming when a POST CONTAINS ALL CAPITAL LETTERS TO EXPRESS ANGER. Member contributions: A healthy proportion of users need to contribute content. If not, the site will fail to offer fresh material and ultimately traffic will slow. Participation can be a challenge, though. Remember the 80/20 rule we discussed way back in Chapter 1? It applies to online consumption as well. The fact is that most members of an online community are lurkers. That’s kind of a creepy term, but it just means they absorb content that others post rather than contributing their own. Researchers estimate that only 1 percent of a typical community’s users regularly participate, and another nine percent do so only intermittently. The remaining 90 percent just observe what’s on the site. Although they don’t contribute content, they do offer value to advertisers that simply want to reach large numbers of people. But what happens when we want to engage consumers more actively? How can a site convert lurkers into active users? The easier it is to participate, the more likely it is that the community can generate activity among a larger proportion of visitors. In part,

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A game platform refers to the hardware systems on which the game is played. Platforms include game consoles (consoles are interactive, electronic devices used to display video games, such as Sony’s PlayStation3, Microsoft’s Xbox 360, and Nintendo’s Wii), computers (including both online games and those that require software installation on the player’s computer hard drive), and portable devices that may include smartphones or devices specifically for game play such as the Sony PSP or Nintendo DS. Mode refers to the way players experience the game world. It includes aspects such as whether a player’s activities are highly structured, whether the game is single-player or multiplayer, whether the game is played in close physical proximity to other players (or by virtual proximity), and whether the game is real-time or turn-based. Milieu describes the visual nature of the game, such as science fiction, fantasy, horror, and retro. The genre of a game refers to the method of play. Popular genres include simulation, action, and role-playing. Simulation games depict real-world situations as accurately as possible. There are several subgenres, including

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Viral marketing occurs when an organization motivates visitors to forward online content to their friends; the message quickly spreads much like a cold virus moves among residents of a dorm. However the urge to share even creates new genres of communication such as haul videos that feature a proud fashionista describing clothing items she just bought, and unboxing videos that illustrate in painstaking detail exactly how to remove electronics products from their boxes and assemble them for use (if you don’t believe it, Google these terms!). Dispreferred Marker Effect. Online posts that are really negative may make the writer look harsh and judgmental, so people sometimes soften them by couching them in dispreferred markers, including phrases such as, “I’ll be honest,” “God bless it,” or “I don’t want to be mean, but …” Sure enough, readers of these kinds of posts evaluated the writer more positively than they did posters who just laid the bad news, warts and all.

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Power users have a strong communications network that gives them the ability to affect purchase decisions for a number of other consumers, directly and indirectly. In advertising lingo, an impression refers to a view or an exposure to an advertising message. Forrester estimates that, each year, U.S. consumers generate 256 billion influence impressions as people talk about their lives with each other, telling stories and experiences that invariably include brands.96 These influence impressions are primarily delivered by—you guessed it—power users: Only 6.2 percent of social media users are responsible for about 80 percent of these brand mentions. Forrester calls these influencers mass connectors.

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