Consumer Behavior and Marketing Psychology

Learning Objective 8.1: Factors Influencing the Shopping Experience

The consumer's shopping experience is influenced by factors across three phases: pre-purchase, purchase, and post-purchase.

Pre-Purchase Experience

• Utilitarian versus Hedonic Shopping Orientation:

• Utilitarian: Shopping for functional or tangible needs, focused on efficiency.

• Hedonic: Shopping for pleasure, intangible benefits, and entertainment.

• Hedonic Shopping Motives:

• Gratification Seeking: Shopping for stress relief or as a treat.

- Idea Shopping: Staying updated on trends and new products.

• Adventure Seeking: Seeking excitement and a sense of being in another world.

• Social Shopping: Enjoying shopping with friends and family.

• Role Play: Imagining how a gift will be received.

• Value Shopping: The thrill of finding sales and bargains.

Purchase Experience

• Store Atmospherics:

The conscious design of a space to evoke certain effects on buyers. This includes:

• Colors: Different colors can evoke different moods (e.g., red can cause tension, blue can calm).

• Scents: Odors can influence behavior (e.g., a casino using certain scents to increase slot machine usage).

- Sounds: Music tempo and type can affect behavior (e.g., slow music can lead to more drinking, fast music to more eating).

• Sensory Cues: All sensory inputs contribute to the atmosphere.

• Retail Theming:

Creating imaginative environments to transport shoppers. Types include:

• Landscape Themes: Associating with nature, animals, or the body (e.g., Bass Pro Shops).

• Marketscape Themes: Recreating manufactured places (e.g., The Venetian in Las Vegas).

- Cyberspace Themes: Using imagery of information and communication technology (e.g., eBay).

- Mindscape Themes: Drawing on abstract ideas, introspection, and fantasy (e.g., a spa with spiritual overtones).

• In-Store Decision Making:

- Unplanned Buying: Recognizing a new need or being reminded of a need while in the store, often due to time pressure or store layout.

- Impulse Buying: A sudden, irresistible urge to buy. Impulse items are often placed near checkouts.

- Point of Purchase (pop) Stimuli: Elaborate product displays, demonstrations, coupon dispensers, or free samples designed to influence decisions at the moment of purchase.

- Salespeople: Play a lead role in the exchange process, contributing to identity negotiation and influencing the customer's experience. Their effectiveness depends on factors like age, appearance, knowledge, and interaction style.

- Customer Journey: The series of steps a customer takes before, during, and after a shopping experience. Marketers use "Gemba" (going to the actual place where consumers use the product/service) to understand customer pain points.

- Design Thinking: A process to make interactions seamless, starting with empathy for the customer. It involves empathizing, defining, ideating, prototyping, and testing.

Post-Purchase Experience

• Expectancy Disconfirmation Model:

Consumer satisfaction is determined by the gap between pre-purchase expectations and actual product/service performance.

• If performance greater than expectations, satisfaction is high.

• If performance less than expectations, satisfaction is low.

- Dissonance: Cognitive dissonance can occur after a purchase, where consumers may seek to justify their decision by increasing their evaluation of the chosen product to reduce the discomfort of potentially making a bad choice.

Learning Objective 8.2: Virtualization of Shopping and Digital Assets

The increasing virtualization of shopping leads to a greater reliance on digital assets.

- E-Commerce and the Digital World:

• From Bricks to Clicks: A significant shift towards online shopping.

• Shopping Apps and In-Store Tech: Mobile apps offer navigation, sales information, and reward points. Beacons can send real-time offers to smartphones. Augmented Reality (A.R) and Virtual Reality (V.R) provide immersive shopping experiences.

- Digital Currencies: The rise of digital wallets, near-field communication (N.F.C) technology, and cryptocurrencies like Bitcoin, which use blockchain technology for secure transactions.

- Online Commerce: Key aspects for successful e-commerce include detailed product information, seamless add-to-cart functionality, high-quality imagery, single-page checkout, and the ability to mix and match products visually.

• Liquid Consumption:

A consumption pattern characterized by:

- Ephemeral: Valuing products only in certain contexts or for limited times.

- Access-based: Accessing products rather than owning them outright (e.g., renting, streaming).

- Dematerialized: Products that use fewer or no materials to deliver functionality (e.g., digital goods, cloud services).

- Virtual Assets and N.F.T's: Non-Fungible Tokens (N.F.T's) represent ownership of unique digital assets stored on a blockchain.

Learning Objective 8.3: The Sharing Economy

The growth of the sharing economy fundamentally changes how consumers think about using and owning goods.

• Sharing Economy (Collaborative Consumption): A model where individuals rent or borrow what they need rather than buying it. This is facilitated by online platforms and P.2.P (peer-to-peer) commerce.

- Impact on Ownership: Consumers increasingly prioritize temporary use and access over outright ownership.

• Examples:

• Transportation: Zipcar, oo-ber, Lyft.

• Accommodation: Airbnb.

- Goods Rental: SnapGoods.

• Financial Services: Lending Club.

• Drivers of the Sharing Economy:

• Lower transaction costs due to technology.

• Ease of online payments and trust-building through social networks.

• Desire to monetize underutilized assets.

• Shifting consumer attitudes towards ownership and sustainability.

• Secondary Market (Recommerce):

I'm growing market for used goods (e.g., thrift stores, online marketplaces) offers economic and environmental benefits.

• Thrifting: Replacing some new purchases with used items.

• Swishing: Organizing parties to exchange goods.

Learning Objective 8.4: Climate Change and Consumer Behavior

The climate crisis necessitates a reevaluation of buying, using, and disposing habits to minimize environmental impact.

• Product Disposal:

How consumers get rid of products is as crucial as how they acquire them.

- Identity and Possessions: Consumers form attachments to possessions, and disposal can be symbolic of discarding a part of the self.

• Recycling: Reusing materials to reduce waste.

- Lateral Cycling: Exchanging owned items for items owned by others.

- The Crisis of Food Waste: Significant waste occurs at the consumer level due to purchasing habits, consumption patterns (e.g., desire for variety, overcooking), and disposition practices.

- Environmental Footprint: Consumer decisions contribute to landfills, pollution, and greenhouse gas emissions.

- Sustainable Consumption: Growing awareness of environmental issues drives demand for recycled products and participation in recommerce models.

- Underground Economy: Includes informal markets like flea markets and P.2.P sales of used goods, which are significant economic components.

Learning Objective 8.5: Maladaptive Consumer Behaviors

Certain consumer behaviors can become maladaptive, leading to negative consequences.

- Maladaptive Consumption: Includes substance-related addictions (alcohol, tobacco, opioids) and behavioral problems (gambling, overeating, compulsive shopping, tech/social media addiction, hoarding). These behaviors are harmful physically, mentally, economically, and socially.

• Addictive and Compulsive Behavior:

• Compulsive Shopping: Repetitive, excessive shopping to cope with negative emotions, often characterized by a lack of control, short-lived gratification, and subsequent regret.

• Gambling: Excessive gambling can lead to debt, relationship problems, and financial ruin. Online gambling presents unique challenges due to anonymity and accessibility.

• Hoarding: The acquisition and inability to dispose of possessions, leading to significant distress and functional impairment.

• Tech and Social Media Addiction:

• Internet Addiction: Compulsive overuse of digital experiences.

- Dark Design: User interfaces intentionally designed to be habit-forming and manipulative (e.g., slot machine effect, "likes" as rewards, wavy dots).

- Dopamine Reward Loop: Tech design often exploits the brain's reward system, leading to addictive usage patterns.

Identity and the Self The Self and Self-Concept

The self-concept refers to the beliefs a person holds about their own attributes and how they evaluate themselves on these qualities. It's a complex and malleable structure, with some elements being stable and others changing over time.

Identities

Each element that contributes to our self-concept is an identity. An identity is a category label with which a consumer self-associates, and which is amenable to a clear picture of what a person in that category looks like, thinks, feels, and does. Examples include stable identities (e.g., mother, African American) and more temporary ones (e.g., fan of a singer, college student).

Self-Esteem

Self-esteem is the positivity of a person's self-concept.

- Low self-esteem: Individuals expect to perform poorly, avoid embarrassment, failure, or rejection. They might prefer portion-controlled items if they feel they lack self-control.

• High self-esteem: Individuals tend to feel more confident and may spend more on themselves. They are also more likely to desire brands that others envy.

The Actual Self, Ideal Self, and Avoidance Self

• Actual Self: A realistic appraisal of the qualities a person possesses.

- Ideal Self: A person's conception of how they would like to be.

- Avoidance Self: The type of person a consumer does not want to be.

Consumers choose products that align with their actual self, help them reach their ideal self, or help them distance themselves from their avoidance self.

The Self and Others

Our sense of self is heavily influenced by how we perceive others see us and how we compare ourselves to others.

Impression Management

Impression management is the process by which individuals work to "manage" what others think of them, strategically choosing products and behaviors to present themselves in a favorable light.

The Looking-Glass Self

The looking-glass self is the sociological concept that our desire to define ourselves operates by imagining others' reactions and projecting their impressions of us. We ask ourselves "Who am I in this situation?" and "Who do others think I am?" and often pattern our behavior based on these perceived expectations, creating a self-fulfilling prophecy.

Social Comparison

Social comparison is the tendency to evaluate oneself by comparing to others, particularly those depicted in idealized images (e.g., in advertising). This can lead to feelings of envy or inadequacy (fomo - fear of missing out).

Self-Construal

Self-construal describes how individuals perceive themselves in relation to others:

- Independent self-construal: Common in Western cultures, focusing on unique personal traits and attributes, de-emphasizing others. Driven by independence and differentiation.

- Interdependent self-construal: Common in Eastern cultures, defining identity largely by relationships with others. Focuses on aspects of the self shared with a subset of others.

Self-Consciousness

Self-consciousness refers to the awareness of one's self, particularly how one is perceived by others.

Public self-consciousness: A heightened concern about one's public image and the social appropriateness of products and activities. Consumers high in this tend to be more interested in clothing and cosmetics.

• Self-monitors: Individuals who are highly attuned to how they present themselves and whose product choices are influenced by how they believe others will perceive them.

The Malleable Self and Role Identities

The Malleable Self

We are not a single, static self. We can be different people in different social situations and roles.

Role Identities

Role identities are the components of the self that correspond to different social roles (e.g., student, friend, employee). Marketers can activate specific role identities by placing products and messages in relevant contexts.

Symbolic Interactionism

The perspective of symbolic interactionism posits that our relationships with others and our interpretation of symbols in our environment shape our sense of self. Possessions play a key role in this process, helping us evaluate ourselves and determine "who we are."

Creating Our Self as We Consume

Our consumption choices are deeply intertwined with our sense of self.

Self-Image Congruence Models

These models suggest that we choose products whose attributes match our self-image. When products align with our self-concept, it enhances our feelings about ourselves.

Self-Signaling

Self-signaling is the process where consumers use their choices to send a message to themselves that their actions align with how they want to think about themselves. Brands are powerful tools for self-signaling, communicating aspects of identity.

The Extended Self

The extended self includes external objects that we consider part of ourselves. It exists on four levels:

1. Individual level: Personal possessions like jewelry, cars, and clothing.

2. Family level: The residence and its furnishings, seen as a symbolic body for the family.

3. Community level: Neighborhood or town of origin, fostering a sense of belonging.

4. Group level: Attachments to larger social groups, landmarks, or monuments.

New Ways to Express Identity

Consumers are finding increasingly diverse ways to express their identities through consumption.

Compensatory Consumption

Compensatory consumption occurs when consumers respond to threats to their self-esteem by consuming products that are linked to that threatened aspect of their self-concept. This is particularly relevant when forming a new social identity.

Symbolic Self-Completion Theory

This theory suggests that individuals with an incomplete self-definition complete their identity by acquiring and displaying symbols associated with that role.

Anti-Consumption

Anti-consumption is the deliberate avoidance or reduction of material consumption to affirm identity through nonmaterial aspects of life or to reject certain brands or practices.

Embodied Cognition

Embodied cognition proposes that states of the body modify states of the mind. Our actions and what we buy can shape our thoughts. This includes:

• Power posing: Adopting confident body language can influence assertiveness.

• Enclothed cognition: The symbolic meaning of clothing can change behavior.

Our Digital Selves

Our digital selves represent our identity in online environments (social media, virtual worlds). Consumers often strategically present an ideal digital self. Virtual makeover technologies and digital clothing for avatars are emerging ways to express identity online.

Gender and Consumer Behavior

Gender identity is shaped by a complex interplay of sociocultural factors.

Gender Socialization and Gender Roles

• Gender roles: Societal expectations about how men and women should act, dress, or speak.

• Gender socialization: The process by which individuals learn these gender roles, often

influenced by media and products.

• Patriarchal masculinity: A viewpoint advocating male superiority and authority.

Gender Differences in Consumer Behavior

These differences stem from sociocultural and biological factors.

- Agentic orientation: Emphasizes instrumentality, independence, and achievement. Often associated with traditional male socialization.

- Communal orientation: Values inclusiveness, interdependence, and the well-being of others. Often associated with traditional female socialization.

Sex-Typed, Androgynous, and Gender-Bending Products

• Sex-typed products: Products marketed with stereotypical masculine or feminine attributes.

- Androgynous products: Neither specifically masculine nor feminine, may possess traits of both.

• Gender-bending products: Traditionally sex-typed items adapted for the opposite gender.

Toward Greater Gender Fluidity

Societal definitions of gender are evolving, with increasing recognition of gender fluidity and the L.G.B.T.Q plus community. Marketers need to be aware of and respectful of these changing identities.

The Body and Identity

Our physical appearance and how we feel about our bodies are significant components of our identity.

Body Image

Body image is a consumer's subjective evaluation of their physical self. This evaluation can be distorted and may not align with objective reality.

Ideals of Beauty

An ideal of beauty is a specific model or exemplar of appearance valued by a culture. These ideals influence physical features, clothing styles, and body types.

Marketing's Role in Shaping Beauty Ideals

Advertising and media play a significant role in determining and perpetuating cultural ideals of beauty. This can lead to dissatisfaction and lower self-esteem if consumers feel they don't measure up.

Body Modification and Decoration

People adorn or alter their bodies for various reasons:

• Separating group members from nonmembers.

• Placing the individual within a social organization or gender category.

• Enhancing sex-role identification.

• Indicating desired social conduct or high status.

• Providing a sense of security.

Examples include tattoos, cosmetic surgery, piercings, and even implants.

The Mechanized Body and The Quantified Self

• Mechanized body: The increasing integration of technology with the human body (wearable computing, implants). This blurs the line between human and machine, creating cyborg-like existences.

Quantified self: The trend of tracking and measuring various aspects of one's body and behaviors (steps, calories, sleep) using technology, often for self-improvement and social comparison.

Body Positivity and Challenges

While movements like "body positivity" aim to promote acceptance of diverse body types, challenges remain. Marketing can contribute to both negative body image (through idealized portrayals) and positive self-esteem (through inclusive representations). The industry faces the challenge of balancing diverse body types with health considerations.

Personality, Values, and Lifestyles

Personality

Personality refers to a person's unique psychological makeup, encompassing consistent patterns in their behavioral, cognitive, and emotional responses to their environment. While genetics plays a role, behavior is also shaped by inherited personality traits and situational factors. Personality generally stabilizes by adulthood, around age 30.

Freudian Theory of Personality

Sigmund Freud proposed that personality is a result of the interplay between three systems:

- Id: The primitive, instinctual part of the mind driven by the pleasure principle, seeking immediate gratification of desires (e.g., hunger, aggression) without regard for consequences. It is selfish and illogical.

• Superego: The moral conscience, which internalizes societal rules and values taught by parents. It works to prevent the id from seeking selfish gratification.

- Ego: The rational part that mediates between the id and the superego, operating on the reality principle. It finds realistic and acceptable ways to satisfy desires, acting as a referee between temptation and virtue. These conflicts often occur unconsciously.

Freud's work is relevant to marketing as it highlights the potential importance of unconscious motives in consumer purchases and suggests that consumers may not always be able to articulate their true motivations. The ego's use of product symbolism to compromise between the id and superego is also a key concept.

Neo-Freudian Theories and Archetypes

- Carl Jung: A follower of Freud, Jung developed analytical psychology. He proposed the concept of a collective unconscious, a shared storehouse of memories inherited from ancestors. This collective unconscious contains archetypes, which are universally recognized ideas and behavior patterns appearing in myths, stories, and dreams (e.g., the hero, the mother, the wise old man, the shadow). These archetypes can influence consumer perceptions of brands.

Motivational Research

This approach borrows from Freudian ideas to understand deeper product meanings through in-depth interviews with consumers.

- Ernest Dichter: A pioneer in this field, he conducted extensive studies and influenced marketing campaigns, such as Esso's "Put a tiger in your tank" slogan, which tapped into powerful animal symbolism with vaguely sexual undertones.

- Zaltman Metaphor Elicitation Technique (zmet): A modern adaptation where consumers collect images and metaphors that represent their thoughts and feelings about a product, service, or brand, rather than literal representations. This technique aims to reveal latent feelings and motivations through analogical reasoning.

Trait Theory

This approach focuses on the quantitative measurement of personality traits, which are identifiable characteristics that define a person.

The Big Five Inventory: A widely recognized model of personality traits, consisting of five dimensions:

1. Openness to experience: The degree to which a person is open to new ways of doing things. Consumers high in this trait may engage in more creative or risky activities.

2. Conscientiousness: The level of organization and structure a person needs. Consumers high in this trait are more likely to engage in healthy behaviors.

3. Extroversion: How well a person tolerates stimulation from people. Extroverts are more likely to use social services and engage in gambling.

4. Agreeableness: The degree to which a person feels sympathy, kindness, and consideration toward others. Agreeable individuals tend to engage in more environmentally friendly behavior and donate more to charity.

5. Neuroticism (emotional instability): How well a person copes with stress. This trait is associated with problematic digital behaviors like social media and online gaming addiction.

Other Key Personality Traits Influencing Consumer Behavior

• Need for Cognition: Enjoyment of thinking; these individuals respond better to words than pictures.

• Need for Affect: Enjoyment of processing feelings; these individuals respond better to pictures and may engage in compulsive behavior.

• Need for Control: The desire to exert personal control; framing new products as enhancing control increases acceptance for those with a high need for control.

• Need for Uniqueness: The desire to be different; these individuals are often opinion leaders and responsive to scarcity appeals.

- Susceptibility to Interpersonal Influence: The likelihood that others will influence behavior; these individuals prefer products with social benefits.

• Willingness to Spend Money: Differentiates spendthrifts (lower savings, higher debt, more hedonic purchases) from tightwads (pain of paying).

• Risk Aversion: Preference for certain over risky options.

• Impulsiveness: Tendency towards immediate gratification.

• Need for Touch: Preference for using the sense of touch to gather information or for pleasure (autotelic touch) or information (instrumental touch).

• Need for Perfection: Driven by dichotomous (black-and-white) thinking, can lead to suboptimal decisions when tasks are difficult.

• Reactance: A predisposition to resist perceived restrictions on autonomy. High reactance individuals are resistant to persuasion.

- Frugality: Denying short-term purchasing whims in favor of resourcefully using existing possessions; driven by the pleasure of saving.

Values and Attitudes

Values are enduring beliefs about what is important or what is considered good or bad. They are learned through socialization and shape our goals and priorities, translating into consumption-specific and product-specific values. Cultures have a value system, which is a ranking of universal values.

Core Values

Core values uniquely define a culture. For example, U.S. culture is often characterized by values such as freedom, youthfulness, achievement, materialism, and optimism.

Values Related to Things: Materialism and Minimalism

- Materialism: The importance attached to worldly possessions. Materialists value possessions for status and appearance, linking more of their identity to products. This often develops through socialization and can be reinforced by media (cultivation theory).

- Minimalism: A lifestyle emphasizing simplicity and getting rid of unneeded possessions. This is a counter-trend to materialism.

• Fresh Start Mindset: The belief that people can restart or reset aspects of their lives.

- Tiny House Movement: A lifestyle trend reflecting minimalism and a desire for simplicity.

Values Related to Money

Consumer behavior is shaped by attitudes toward money, including:

- Spending versus Saving Orientation: Individuals have different tendencies to spend or save. Tightwads experience pain from paying, while frugal individuals derive pleasure from saving.

- Lifestyle-Based Depletion: The feeling of being unable to keep up with responsibilities, leading to stress and reduced self-control in purchasing decisions.

Values Related to Time

Time is a valuable resource, and our perception and use of it influence consumption.

• Time Poverty: The feeling of not having enough time.

- Timestyles: An individual's priorities determine how they allocate time, leading to different approaches like workaholism or leisure focus.

• Psychological Time: Our subjective experience of time, influenced by our priorities and needs.

• Deceleration: A desire for slowness and savoring moments, seen in movements like Slow Food.

Understanding Values

• Rokeach Value Survey: Differentiates between terminal values (desired end states, for example, a world of beauty) and instrumental values (actions to achieve terminal values).

• Means-End Chain Model: Links product attributes to terminal values, suggesting consumers choose products (means) to achieve desired end states. Laddering is a technique to uncover these links.

• Syndicated Surveys: Large-scale surveys (e.g., vals 2) that track changes in values and attitudes over time and across demographics.

Lifestyles and Consumer Identity

Lifestyle refers to a pattern of consumption reflecting how a person chooses to spend time and money. It plays a key role in defining consumer identity and is informed by values and tastes.

Lifestyle Marketing Perspective

This perspective recognizes that people group themselves based on their preferred activities, leisure time use, and spending habits. A key aspect is focusing on people using products in desirable social settings.

Psychographics

Psychographics go beyond demographics to understand why consumers make certain decisions by examining psychological, sociological, and anthropological factors.

• Demographics: Describe who buys (age, income, gender).

• Psychographics: Describe why they buy (motivations, lifestyle, values).

Performing a Psychographic Analysis

• Lifestyle Profile: Differentiates users from non-users of a product.

Product-Specific Profile: Details consumers within a target group based on product-relevant dimensions.

• General Lifestyle Segmentation: Groups a large sample based on overall preferences.

• Product-Specific Segmentation: Tailors questions to a specific product category.

Personas

Buyer personas are semi-fictional representations of ideal customers, created using market research and data. They help marketers understand consumer motivations, concerns, and decision-making criteria.

A.I.O's (Activities, Interests, and Opinions)

A common psychographic variable used to segment consumers. Marketers assess how people spend their time, what they find interesting, and their views on themselves and the world.

Uses of Psychographic Studies

• Define target markets.

• Create new market views.

Position products effectively.

• Communicate product attributes.

• Develop product strategy.

• Market social and political issues.

Values and Lifestyles System (vals 2)

A well-known system that segments consumers into groups based on their resources (income, education, etcetera) and self-orientation (ideals, achievement, self-expression).

• High Resources: Innovators, Thinkers, Achievers, Experiencers.

• Low Resources: Believers, Strivers, Makers, Strugglers.

The Role of Brands in Our Lives

Brands become meaningful to consumers by being integrated into their personalities, values, and lifestyles.

Brand Personality

A brand personality is the set of traits people attribute to a product as if it were a person. These traits can include:

• Old-fashioned, wholesome, traditional

• Surprising, lively, "with it"

Serious, intelligent, efficient

• Glamorous, romantic, sexy

• Rugged, outdoorsy, tough, athletic

Brand names, design, packaging, and advertising all contribute to forming a brand's personality.

Meaning Transfer

Consumers absorb meanings from brands through a meaning transfer process. Brands gather cultural meaning from various sources (advertising, fashion, society), and consumers then adopt these meanings when they use the brands.

Brand Resonance

Brand resonance occurs when a brand forms a strong, lasting bond with a consumer. This happens when a brand truly speaks to an aspect of a consumer's life or culture. Types of resonance include:

• Interdependency (habits, rituals)

• Intimacy (insider knowledge)

• Personal Co-creation (consumer-created stories)

Emotional Vibrancy (strong emotions)

• Cultural Bedrock (links to core values)

• Currency Value (defines a trend)

• Role Resonance (emblematic of a social role)

• Category Resonance (benchmark for the category)

Archetypes in Branding

Advertisers often use archetypes (from Jungian psychology) to create vivid brand personalities. Examples include the "old wise man," "earth mother," or "hero." The BrandAsset® Archetypes model categorizes these.

Spokescharacters

Companies use spokescharacters (e.g., Chester Cheetah, the Michelin Man) to humanize brands and build trust. These characters can be anthropomorphized and given human-like qualities.

Congruence Between Consumer and Brand

Consumers tend to prefer brands whose personalities match their own (self-congruity). Arrogant brands, for example, may appeal to narcissistic consumers.

Lifestyle Brands and Constellations

- Lifestyle Brands: Brands that are associated with a particular lifestyle (e.g., Ralph Lauren, Lululemon).

• Consumption Constellation: A set of products and services that consumers associate with a specific lifestyle and use to define and communicate social roles (e.g., "hipsters" with beards, vinyl records, craft coffee).

- Product Complementarity: Occurs when the symbolic meanings of different products relate to one another, reinforcing a particular lifestyle. Marketers may use co-branding strategies to leverage these relationships.

Authenticity and Brand Storytelling

• Authenticity: Consumers, especially younger ones, increasingly value trustworthiness and genuineness in brands. This is often conveyed through heritage, sincerity, and commitment to quality.

• Brand Storytelling: Using narratives to bring brands to life. This includes the brand's backstory (behind-the-scenes history) and brand biography (origins and founders' stories), which can resonate with consumers by highlighting underdog narratives and struggles. A brand's transmedia world refers to the various platforms where consumers can engage with the brand's story.

Social and Cultural Identity

The Dynamics of Social Identity

- Social Identity: This refers to the unique identity-relevant behaviors, attitudes, and beliefs associated with the groups from which we derive our sense of self. These identities shape how we think, feel, and act.

• Facets of Social Identity:

Our social identity is multifaceted and includes components such as:

• Family

• Ethnicity/Race

• Age Groups

• Generations

• Places (subcultures based on location)

• Religion/Politics

• Subculture: A group whose members share significant beliefs and common preferences.

• Dynamics of Identity:

- Autonomy versus Affiliation: Our social identity is shaped by the tension between our desire for independence (autonomy) and our need to belong to groups (affiliation).

- Emotion Profile: Each social identity is linked to an emotion profile that, when activated, can influence our emotions and decisions.

- Context Activates Identity: Facets of our identity are not always equally prominent. Situations can activate latent identities. For example, being the only person of a certain race in a room can activate one's racial identity.

• Salient Identity Cues: These are noticeable cues (e.g., in advertising) that can activate specific identity mindsets. Social identity priming can make certain identities more salient. Some individuals respond more strongly to symbols that activate their identities (e.g., the flag and patriotism).

• Threats to Social Identity:

People respond to threats to their social identity based on their self-construal (independent versus interdependent).

- Independent Self-Construal: Under threat, these individuals may distance themselves from the threatened identity to restore self-worth.

- Interdependent Self-Construal: Under threat, these individuals may strengthen their group affiliation.

• Identity Styles:

- Convergent Thinking: Consumers prefer products and choices that closely match their identity.

- Divergent Thinking: Consumers prefer choices that make them feel different or unique.

• Intersectionality: This describes how competing identities (e.g., race, gender, class) combine

to create unique experiences, particularly regarding privilege and oppression.

• Ingroup Bias: A bias towards things or brands that connect us to our "home" or ingroup.

- Social Dominance Orientation: The extent to which a person desires their ingroup to be superior to and exercise power over outgroups.

- Identity Synergy: When a brand connects with multiple social identities of a consumer, it creates a stronger connection, leading to greater relevance, meaning, and trust. This is more likely when a company values and supports consumers' social identities and shares similar values.

The Family

- Family Identity: The collective sense of "who we are" as a unit, shaped by shared beliefs, rituals, and consumption practices.

• Consumption Practices: Activities involving consuming products that play a role in structuring and defining the family unit.

• Evolving Household Structures:

Traditional notions of family are outdated. Modern family structures are diverse and include:

• Extended Family: Three generations living together (grandparents, aunts, uncles, cousins).

- Nuclear Family: Mother, father, and one or more children.

- Cohabitating Couples: Living together without being married.

• Voluntarily Childless: Couples choosing not to have children.

• "Boomerang Kids": Adult children who return to live with their parents.

• "Sandwich Generation": Middle-aged adults supporting both aging parents and their own children.

- dinks (Double Income, No Kids): Often well-educated couples with higher discretionary income.

- The Family Life Cycle (F.L.C): Describes how family income, structure, and needs change over time, influencing spending and lifestyle decisions. Key factors include:

1. Ages of household members.

2. Presence or absence of children.

3. Ages of children, if present.

• Parenting Styles:

Based on emotional warmth and behavioral restrictiveness:

- Authoritative: Warm and restrictive; effective communication, balanced rules and autonomy.

• Neglecting: Permissive and hostile; little guidance, strained communication.

• Indulgent: Warm and permissive; lenient, accepting, non-punitive.

• Authoritarian: Restrictive and hostile; controlling, adult-supremacist views.

• Parenting and Consumer Behavior:

- Parental Yielding: The process where a child's product request influences a parental decision.

• Children directly influence a significant amount of family purchases.

- Teen consumers' autonomy motivations increase, and affiliation often shifts from family to peer groups.

- The Extended Family (Pets): Pets often play an important identity role, are treated as family members, and drive significant spending in the pet industry.

Age and Generations

• Age-Related Life Events: Events tied to age shape identity and guide consumption.

• Teenagers:

- A massive global market with significant spending power.

• Constantly seek cues for behavior and appearance from peers and advertising.

- Experience conflicts: autonomy versus belonging, rebellion versus conformity, idealism versus pragmatism, narcissism versus intimacy.

• Tweens (Ages 8 to 14): Exhibit characteristics of both childhood and adolescence.

• Consumers Aging Gracefully (Retirement and Beyond):

- Older adults (65+) control a significant portion of discretionary income and wealth.

• Mature Market: Older adults (ages 65+).

- Consumer Identity Renaissance: The redefinition process people undergo upon retirement, leading to either revitalization of previous identities (revived) or pursuit of new life projects (emergent).

• Age Cohorts:

People of similar ages who have similar experiences. Key cohorts include:

Baby Boomers (1946 to 1964): Postwar context, idealism, revolutionary, materialistic.

• Generation X (1965 to 1985): Political transition, capitalism, individualistic, status-oriented.

• Generation Y (Millennials, 1986 to 2002): Globalization, internet emergence, globalist experience-oriented.

• Generation Z (2003-early 2010s): Social networks, digital natives, realistic, uniqueness-oriented, ethical.

• Generation Alpha (Early 2010s Present): Digital natives, emerging characteristics.

• Characteristics of Major Age Cohorts (Summary):

Baby Boomers: Postwar context, idealism, materialism, status consumption.

• Gen X: Political transition, individualistic, brands and cars, luxury goods.

• Gen Y (Millennials): Globalization, internet, experience-focused (festivals, travel).

• Gen Z: Social networks, digital natives, community-oriented, ethical consumption.

Ethnicity and Race

• Ethnic Identification: The degree of emotional attachment to one's ethnic group.

• Acculturation:

- The process of adapting to a new culture. Different levels of identification with microculture (heritage culture) and macroculture (mainstream society) exist:

• Multiculturalism: High identification with both micro and macro cultures.

• Alienation: Low identification with both.

• Cultural Fusion: Partial identification with both.

- Assimilation: High identification with macroculture, low with microculture.

• Self-Segregation: High identification with microculture, low with macroculture.

- Ethnic and Racial Diversity in the U.S.: Increasingly diverse population, with significant growth in Hispanic and Asian populations. Multiracial identification is also increasing.

- Hispanic Americans: A large and growing consumer market with significant purchasing power. Family is often central, but structures are evolving.

- African Americans: Face racial stigma in the marketplace. Often seek "cool" products, prefer in-store shopping, and find advertising informative.

- Asian Americans: A fast-growing and diverse group with multiple origins and languages. Some segments are highly affluent and active online shoppers.

- Ethnic and Racial Symbols: Symbols carry cultural connections. Marketers have historically used ethnic/racial symbolism, but negative stereotypes have largely disappeared due to the civil rights movement and increased minority power.

Religious and Political Beliefs

• Religious Identity:

• Religious consumers celebrate traditions and holidays through consumption.

• Religious dietary requirements (e.g., Halal, Kosher) create specific market demands.

- Brands can be perceived as "infidels" if they conflict with religious values (e.g., modesty, halal-haram principles, perceived tyranny).

- Halal Foods: Permissible under Islamic law; growing market appeal.

- Modest Fashion: A significant global industry catering to religious and personal preferences for less revealing clothing.

• Political Identity:

• Political orientation significantly influences consumption choices.

• Liberals versus Conservatives:

- Differ in core values, views on government, social change, taxes, healthcare, etcetera

- Liberals: Value equality, progress, social justice; favor active government.

- Conservatives: Value tradition, stability, personal responsibility; favor limited government.

- Personality traits, information processing styles, and cultural outlooks also differ between political leanings.

Place-Based Subcultures

- Geodemography: Combines geographic, demographic, and sociological data to understand consumer patterns based on where people live.

• Cosmopolitanism: A mindset valuing new experiences beyond one's local environment.

- "Birds of a Feather Flock Together": The principle that people with similar interests and tastes tend to live near each other. Marketers use this to identify and target specific geographic clusters.

- Nielsen's prizm System: A popular geodemographic tool that classifies U.S. zip codes into categories based on lifestyle and socioeconomic factors, enabling targeted marketing.

- Place-Based Subcultures: Geographical areas can foster distinct subcultures with unique consumption patterns and identities (e.g., "American Nations" concept).

Consumer Behavior and Marketing Psychology: Chapter 12

Learning Objectives

- 12.1 Describe the role of reference groups and social norms in influencing consumer behavior.

- 12.2 Describe how social influences flow through word-of-mouth communication and how they're especially powerful when they come from opinion leaders.

- 12.3 Explain how, whether in a family or a corporation, members of a group unit play different roles and have different amounts of influence when making collective decisions.

- 12.4 Explain how consumers are social beings that form groups, tribes, and communities around consumption practices and brands.

Sources of Group Influences

- Humans are social animals, and our desire to fit in or identify with desirable individuals/groups motivates many consumption behaviors.

- Social Identity Theory: Each individual has multiple "selves" related to the groups they belong to, leading to a sense of "we" rather than just "I."

- Minimal Group Paradigm: Even arbitrary group assignments can lead to favoritism and a sense of connection within the assigned group.

- Incidental Food Consumption (I.F.C): People who share meals tend to cooperate and trust each other more than those who don't.

Reference Groups

- A reference group is an actual or imaginary individual or group that significantly influences an individual's evaluations, aspirations, or behavior.

- Perceived Typicality: The effectiveness of an influencer depends on how well they align with the typical image of the brand's consumers.

• Types of Reference Groups:

- Associative Reference Group: People we know and who strongly influence our behavior (e.g., family, friends).

- Aspirational Reference Group: People we admire but don't know personally and would like to emulate (e.g., successful businesspeople, athletes).

- Dissociative Reference Group: People or groups we want to distance ourselves from, often acting opposite to them (e.g., rival groups, groups with undesired values).

Social Norms: How Groups Change Our Behavior

• Norms: Informal rules that govern behavior within a society or group.

- Descriptive Norms: What people actually do (e.g., "Everyone checks their phones during lectures").

- Prescriptive Norms: What people believe they should do (e.g., "Students are expected to keep their phones away during class").

- Norms guide behavior by providing a sense of what is acceptable or expected.

• "We" messages are generally more effective than "you" messages when communicating

norms.

• Associative Norms: Beliefs about the norms of a group to which we belong.

• Dissociative Norms: Beliefs about the norms of groups we do not want to associate with.

Conformity: Going Along to Get Along

• Conformity: A change in beliefs or actions due to real or imagined group pressure.

- The Red Sneakers Effect: Nonconforming actions that can lead to more positive impressions, often inferring higher status or competence.

- Social Default: Unconsciously imitating the choices of others, especially when lacking strong preferences or time to decide.

- Social Loafing: Reduced effort in a group task because individual contributions are less noticeable.

Word of Mouth (W.O.M) Communication

- Word of Mouth (W.O.M) / Word of Mouse: Product information transmitted from individual to individual.

- W.O.M is generally more influential than traditional marketing messages, especially for unfamiliar product categories.

- Viral Marketing: Motivating visitors to forward online content to friends to build buzz around a product or service.

• Buzz Building: Creating an aura of excitement around a product.

- Reverberating Echoverse: Brand communications forming feedback loops between corporate communications, media, and user-generated content.

- Negative Word of Mouth: Consumers weigh negative W.O.M more heavily than positive comments.

- Serial Reproduction: The process through which information changes as it is passed from person to person (e.g., Bartlett's study).

- Negativity Spiral: Negative messages inspiring others to add to the conversation, potentially leading to social media firestorms.

Information Flows in Social Networks

• Sociometric Methods: Techniques used to trace communication patterns and map interactions among group members.

• Social Graph:

A diagram showing the interconnections within a network.

• Nodes: Members of the network.

- Ties: Connections between nodes.

• Flows: Exchanges of resources, information, or influence between nodes.

• Media Multiplexity: Communication occurring across multiple platforms.

- Tie Strength: The nature of the bond between people (strong primary ties versus weak secondary ties). Weak ties can be important for bridging different social networks.

- Information Cascades: A sequence of interactions triggered by a piece of information, where people's choices are influenced by the choices of others.

- Two-Step Flow Model of Influence: Information flows from mass media to a small group of influencers, who then disseminate it to a larger population. Newer frameworks emphasize interaction among easily influenced individuals.

Opinion Leaders and Social Media Influencers

- Opinion Leaders: Individuals who can frequently influence others' attitudes or behaviors regarding specific product categories.

• Sources of Opinion Leader Social Power:

• Expert Power: Possess technical competence and knowledge.

• Knowledge Power: Screen, evaluate, and synthesize product information.

- Referent Power: Wield influence because they are admired and similar to the consumer in values/beliefs (homophily).

• Legitimate Power: Influence derived from social standing or authority.

• Information Power: Control access to desired information.

• Reward Power: Provide positive reinforcement.

• Coercive Power: Influence through intimidation (rarely used by marketers).

• Homophily: The degree to which individuals are similar in terms of education, social status, and beliefs.

• Opinion leaders often absorb risk by being early adopters.

- Monomorphic versus Polymorphic Opinion Leaders: Monomorphic are experts in a limited field; polymorphic are experts in several fields (though usually concentrated in a broad domain).

• Social Media Influencers:

Individuals who collaborate with brands to promote products, categorized by follower count:

• Mega-influencers: greater than 1 million followers (celebrities).

• Macro-influencers: 100,000 - 1 million followers (viral content creators).

• Micro-influencers: 1,000 - 100,000 followers (neesh focus).

- Nano-influencers: less than 1,000 followers (local influence).

• Influencer Marketing: Strategy leveraging influential individuals to reach targeted audiences.

• Megaphone Effect: The ability of online platforms to give a huge audience to individuals.

- Dispreferred Marker Effect: Softening negative feedback with phrases like "I'll be honest..." can make the speaker more likable and credible.

- Surrogate Consumers: Hired intermediaries who provide input into purchase decisions (e.g., interior decorators, stockbrokers).

• Product Curators: Assemble merchandise and often provide recommendations.

Collective Decision Making

- Collective Decision-Making Process: Involves two or more people who may have different levels of investment, tastes, or priorities.

• Key Roles in Collective Decisions:

- Initiator: Identifies the need or brings up the idea.

• Gatekeeper: Controls information flow and conducts research.

• Influencer: Tries to sway the decision's outcome.

• Buyer: Makes the actual purchase.

- User: Consumes the product or service.

• Factors Influencing Group Decisions: Interpersonal need, product involvement/utility, responsibility, and power dynamics.

• The Intimate Corporation (Households):

• Synoptic Ideal: Joint decision-making with defined roles and rational choices.

• Muddling Through: Reaching decisions through compromise and conflict avoidance.

- Oppositional Brand Choice: Deliberately choosing brands a partner dislikes.

• Collective Decision Making in Organizations:

• Organizational Buyers: Purchase goods/services on behalf of companies.

• Business-to-Business (B.2.B) Marketing: Focuses on organizational needs.

- Key Differences from Consumer Buying: Involves more people, precise specifications, potentially riskier decisions, substantial dollar volume, emphasis on personal selling, and rare impulse buying.

• Factors Influencing Organizational Buyers: Supplier expectations, organizational climate, and buyer's self-assessment.

• Buyclass Theory of Purchasing:

• Straight Rebuy: Habitual, automatic decisions.

- Modified Rebuy: Repurchasing with minor modifications, limited decision-making.

- New Task: Extensive problem-solving, significant risk, involves a buying center.

• Buying Center: The group of people involved in organizational decision-making.

- Customer Relationship Management (C.R.M): Systems used to improve customer retention and integrate company operations.

Consumer Communities, Tribes, and Collectives

• Consumers are social beings who form groups around consumption practices.

• Consumer Collectives:

- Networks of social relations centered on a brand, practice, or platform.

• Brand Secret Microcollectives: Small, secretive groups with shared brand knowledge.

• Social Movements & Consumer Activism: Consumers rally around causes they care about.

• Culture of Participation: Enabled by social media, fostering interaction and content sharing.

- Brand Community: A group of consumers sharing social relationships based on product usage or interest.

• Key Characteristics of Online Communities:

• Standards of behavior.

• Member contributions (content creation).

• Degree of connectedness (cohesion).

• Network effects (quality improves with more users).

• Support Groups: Virtual communities offering support and empathy.

• Gaming Communities:

- Social games and M.M.O.R.P.G's foster strong social interactions and virtual consumption.

• Digital Virtual Consumption (D.V.C): Spending on virtual goods in online environments.

Chapter Summary

- Other people and groups, especially those with social power, significantly influence consumer decisions.

- Understanding group behavior is often more crucial for marketers than understanding individual behavior.

• Collective decision-making processes differ between families and corporations.

• Word-of-mouth communication is a primary driver of product choice.

• Opinion leaders and social media influencers hold significant sway over consumer choices.

• Social media has fundamentally changed how consumers learn about and select products.

Social Class and Status in Consumer Behavior

Objective 13 to 1: Consumption Choices as Expressions of Taste and Social Class

What is Social Class?

- Definition: A group of people with similar levels of prestige and esteem, sharing beliefs, attitudes, and values that influence their thinking and behavior.

• Characteristics of Social Class Members:

• Similar social standing in the community.

• Roughly similar occupations.

• Similar lifestyles due to income levels and common tastes.

• Tendency to socialize with one another.

• Shared ideas and values regarding how life should be lived.

- Consumption and Class: Consumption choices are similar within social class groups, thus reflecting class membership.

• Historical Perspectives:

- Karl Marx: Position in society determined by relationship to the means of production (haves versus have-nots).

• Max Weber:

Rankings are multi-dimensional:

• Class: Wealth and property.

• Status Groups: Prestige or social honor.

• Party: Power.

- Social Class and Learned Preferences: Social class influences values and preferences (food, furniture, clothing) developed from one's environment.

- Embodied Dispositions: Unconscious ways of behaving, conducting oneself, eating, and dressing appropriate to one's class. Class is perceived by both self and others (e.g., speech, manners).

• Homogamy: The tendency for people to marry individuals from a similar social class.

Social Class as a Set of Resources (Pierre Bourdieu)

- Social class is viewed as a set of resources deployed within a competitive field to attain symbolic capital (prestige, honor, attention).

• Types of Capital:

• Economic Capital: Money and wealth (financial assets, inherited or earned).

- Social Capital: Actual and potential resources within one's social network. It's about the backing of relationships and can be indicated by common names, manners, or ways of speaking (even accents can affect employment prospects).

• Cultural Capital:

Distinctive tastes, skills, and practices.

• Embodied Cultural Capital: Acquired knowledge and skills demonstrated daily (e.g., art appreciation, cultivated manners).

• Objectified Cultural Capital: Tangible cultural goods (pictures, books, artwork).

• Symbolic Capital: The combined storehouse of economic, social, and cultural capital, leading to prestige.

• Social Distinction:

Judgments of consumption tastes and lifestyles that differentiate social groups.

- Aspirational Class: Highly educated but prioritize decisions about health, parenting, education, and retirement over flashy consumption. They transfer resources (cultural, social, economic) to children in subtle ways.

Social Distinction, Taste, and Habitus

- Social Distinction: A system of social relations embedded in judgments of consumption tastes.

- Taste: A preference for specific things that acts as a status-marking force.

• Habitus:

A set of ingrained habits, preferences, and attitudes developed through life experiences, shaping consumption preferences.

- Examples: People with greater economic capital are more likely to attend the theater, while those with lower economic capital are more likely to attend a wrestling match.

• Accumulation of Cultural Capital:

People consume and collect experiences when young, incorporating them into their habitus.

- Middle-class consumers may intentionally seek novel experiences early in life for cultural capital.

- Working-class consumers may prefer stable, comforting experiences and community-building events (e.g., local sports games).

- Taste Regime: A system of norms linking aesthetics to practice, influenced by marketplace institutions (magazines, websites).

Online Capital

- Definition: The social value earned from online presence and sharing.

• Key Aspects:

• What you post and how you post it raises or lowers status online.

- Activity online can boost social capital.

- Reputation Economy: Approval and validation from others online act as a "currency," building a reputation.

• Psychic Income: The positive feeling and recognition from validated online posts.

- Online Gated Communities: Selectively accessible online spaces offering high social capital to members (e.g., early Facebook).

- Platform Decline: Popularity of online platforms can fade, leading to a drop in participation and trust (e.g., MySpace, Friendster).

Taste Cultures and Codes

• Consumption choices express taste and represent social class.

• Low Cultural Capital Consumers: Emphasize functional, utilitarian product characteristics;

prioritize quantity, size, and ostentatious display.

- High Cultural Capital Consumers: Prefer "self-actualizing" experiences that are mentally stimulating and creative.

• Connoisseur: A proxy for cultural capital ("someone who knows").

• Luxury Consumption Maturity:

Mature luxury consumers reject mass luxury brands for inconspicuous, less logo-driven products.

• Example: Moving from highly visible logos (Louis Vuitton) to more obscure brands (Visvim).

- Burning Man Festival Example: Evolved from a countercultural event to an elite gathering where wealthy tech moguls flaunt their money through elaborate "glamping" and exclusive enclaves.

How Do We Measure Social Class?

• Complexity: Social class is a state of being as much as having; it involves what we do with money and how it influences our perceptions and desires.

- External Perception: Sociologists emphasize that social class is about others' perceptions, not just self-perception.

• Proxies (Indicators):

• Education and Profession: The most useful proxies, often correlated.

• Credit Score: Increasingly used as a badge of worth.

• Sociological Measures:

Typically include:

• Highest level of education.

• Occupation.

• Annual household income and number of earners.

• Education and occupation of parents (to account for inheritance).

• Psychological Measures:

- Subjective Socioeconomic Status (S.E.S): Perceived social standing, assessed by asking individuals where they place themselves on a social ladder. This is crucial for understanding psychological functioning and behavior.

Social Stratification

- Definition: The creation of artificial divisions in society to understand the structure, size of socioeconomic groups, and prevalent consumer behaviors.

- Status Hierarchy: A structure where some members are better off (more authority, power, respect) than others.

• Occupational Prestige:

Often considered the single best indicator of social class due to its link to leisure time, resource allocation, aesthetic preferences, and political orientation. Hierarchies of occupational prestige are generally stable across time and cultures.

• Example Rankings: Top (C.E.O, physician, professor) versus Bottom (shoeshiner, ditch digger).

Social Mobility

- Definition: Movements along the social class continuum due to life events, often consumption-related.

- Max Weber's View: Social class incorporates "mobility chances" (opportunities for movement). Horizontal mobility (within class) is often easier than upward or downward mobility (between classes).

• Types of Mobility:

- Horizontal Mobility: Moving between positions of roughly equivalent social status (e.g., nurse to teacher).

- Downward Mobility: Moving down the social ladder (e.g., becoming homeless, welfare recipient).

• Upward Mobility: Moving up the social ladder.

• Factors Contributing to Upward Mobility:

• Increased Educational Attainment: The "college wage premium" (higher earnings for college graduates) continues to grow.

- Shift in Women's Roles: Women entering high-paying occupations previously dominated by men.

• Challenges to Social Mobility in the U.S: The U.S is seen as less mobile than many other developed economies; the economic advantage of an affluent father is more influential than in most Western countries.

- Global Context: Changes in consumption and market access can disrupt traditional status hierarchies and offer mobility opportunities in industrializing countries.

Key Factors Influencing Consumer Behavior Across Social Classes

- Empowerment: Lower-class consumers may feel less control over outcomes. "Potent actors" (believe they can affect their world) versus "impotent reactors" (feel at the mercy of circumstances).

• Consumer Confidence:

Expectations about the future economy and personal financial well-being influence current spending and debt.

- Optimism leads to less saving, more debt, and discretionary spending.

- Pessimism leads to more saving, less debt, and reduced spending.

• Old Money versus New Money:

- Old Money: Inherited wealth, discreet display, emphasis on family history, public service, and philanthropy. Secure in status, trained for wealth.

- New Money (Nouveaux Riches): Recently acquired wealth, often displays it ostentatiously ("flashy"). May lack the ingrained "tastes" of old money.

• Horatio Alger Myth: The enduring idea of "rags to riches" through hard work and luck.

• Cosmopolitanism: An openness to the world and diverse experiences, not necessarily tied to wealth due to media and internet access. Cosmopolitans respond to global brands.

Objective 13 to 2: Consumption's Role in Social Class

Movements

Social Class Structures

- Societies exhibit status hierarchies where some members rank higher than others based on standing, power, or control.

• Social Stratification:

The process of creating divisions that define the structure of society, socioeconomic group sizes, and prevalent consumer behaviors.

Warner's Six Classes (Historical): Upper Upper, Lower Upper, Upper Middle, Lower Middle, Upper Lower, Lower Lower.

U.K's Seven Strata (Example):

1. Precariat (low income, high insecurity)

2. Emergent Service Workers (young, urban, poor but high social/cultural capital)

3. Traditional Working Class (older, modest income, property owners)

4. New Affluent Workers (young, socially/culturally active, moderate income)

5. Technical Middle Class (prosperous, skilled, socially/culturally disengaged)

6. Established Middle Class (largest group, high capital, "highbrow" tastes)

7. Elite (small, powerful, wealthy, highly educated, well-connected)

Social Mobility

- Definition: Movements along the social class continuum.

• Horizontal Mobility: Moving to a position of similar social status.

• Downward Mobility: Moving down the social ladder.

• Upward Mobility:

Moving up the social ladder.

• Key Drivers: Increased education and changes in women's roles.

• Challenges: Social mobility is harder in the U.S than in many other developed economies.

- Impact of Consumption: Consumption patterns can influence or reflect movements within the social class structure.

Key Factors Influencing Consumer Behavior

• Empowerment: Belief in one's ability to influence outcomes.

- Consumer Confidence: Optimism or pessimism about the future economy and personal finances.

• Old Money versus New Money: Distinct consumption patterns and values.

Objective 13 to 3: Consuming to Communicate Social Standing

Social Status and Consumption

• Social Status: One's perceived position in society, assessed through social comparison.

• Social Comparison:

Comparing oneself and one's possessions/achievements with others or with one's past self.

• Financial Deprivation: Feeling one has less money than peers, even if objectively "rich."

• Class Consciousness: Awareness of one's place in the social class system.

To Whom Do We Compare Ourselves?

- Upward Comparison: Comparing with aspirational reference groups (people perceived as higher status).

• Downward Comparison: Comparing with those less fortunate.

• "Keeping Up with the Joneses": Desire to match or exceed neighbors' living standards.

- Aspirations Gap: The difference between one's aspired standard of living and their attained standard.

- Hedonic Treadmill: Well-being tends to revert to a baseline despite changes in material conditions.

• Aspirations Failure: Unattainable goals leading to frustration.

- Subjective Socioeconomic Status (S.E.S): A person's judgment of their own status, regardless of objective reality. fomo (Fear of Missing Out) can distort these judgments based on social media.

Status Symbols

- Definition: Possessions or services that communicate wealth or prestige to others (e.g., luxury brand items, spa treatments).

• Status Seeking: A motivation to acquire products and services to signal successful "arrival."

• Impression Management: Strategically displaying products to convey a desirable image.

- Virtue Signaling: Publicly expressing sentiments to show good character or moral uprightness (e.g., displaying electric cars).

Conspicuous Consumption

- Definition (Thorstein Veblen): The desire to provide visible evidence of one's ability to afford luxury goods, often to inspire envy ("invidious distinction"). Also referred to as status signaling.

• Brand Prominence:

The degree to which status markers (e.g., logos) are visible on products.

• Quiet Signals: Subtle markers recognized by insiders (e.g., distinctive design of a bag).

• Loud Signals: Blatant displays with prominent logos.

- Power Distance Belief: Acceptance of social inequalities and status disparities. Higher power distance correlates with a greater tendency to consume status-symbol products.

• Typology of Status Signaling (Wealth versus Need for Status):

• Patrician: Wealthy, low need for status; signals to other patricians using quiet signals.

• Parvenu (Nouveau Riche): Wealthy, high need for status; signals to other haves using loud signals, dissociating from have-nots.

• Poseur: Less wealthy, high need for status; aspires to be a have, mimics parvenus.

• Proletarian: Less wealthy, low need for status; does not engage in signaling.

- Counterfeit Luxury Goods: Can dilute a brand's image, especially for those who can afford the genuine product.

Status Pivoting

- Status Threat: Worry about social status due to upward comparison.

- Status Pivoting: Signaling status and success in alternative domains to cope with status threat in one domain (e.g., career, wealth).

Status and Parody Displays

• Parody Display: A sophisticated form of conspicuous consumption involving the deliberate avoidance of status symbols to mock them (e.g., expensive "ripped" jeans, brands with blue-collar heritage).

• Challenges: Increased availability of "affordable luxuries" and shifting values (e.g., wealthy buying wine at Costco) make clear class distinctions harder.

The Meaning of "Luxury"

• Three Consumer Attitudes:

1. Luxury is Functional: Focus on lasting value, prepurchase research, logical decisions.

2. Luxury is a Reward: Used to signify achievement ("I've made it").

3. Luxury is Indulgence: Focus on lavishness, self-indulgence, and making others notice.

- Evolutionary Perspective: Luxury products signal functions in heterosexual relationships: men use them to attract mates, women use them to deter rivals.

Objective 13 to 4: Organizations Working Towards Social Justice

Social Inequality, Poverty, and Social Justice

• Income Inequality:

The uneven distribution of resources within a population.

• One Percenter: The top 1% of income earners.

- C.E.O Pay Ratio: Compares C.E.O salary to typical employee earnings (e.g., 324:1 in S&P 500 in 2021).

- Bottom of the Pyramid (bop):

Individuals living on less than $2 per day (billions worldwide).

- Market Potential: Organizations are increasingly recognizing the potential of bop markets by offering affordable, smaller-sized products, innovative distribution, and education.

• Digital Divide: Unequal access to technology based on income.

- Health Disparities: Systematic differences in health outcomes linked to socioeconomic status.

The Role of Consumption in Social Justice: Walk the Walk

• Purpose-Driven Consumers: Choose brands aligned with their values.

• Social Responsibility: Organizations have a responsibility to avoid accentuating socioeconomic disparities through marketing.

- Transformative Consumer Research: Focuses on maximizing human potential through six forms of consumption: subsistence, sound health, safety, sociality, sovereignty, and spirituality.

• Programmatic Responses for Social Justice:

- Businesses: Corporate social responsibility, improving bop access, cause-related marketing.

• Society: Grassroots community organizations, consumer movements.

- Government: Policy changes, educational efforts for upward mobility, safeguards for vulnerable populations.

- Non-profit Organizations: Funding and encouraging programs to reduce inequality.

The 4 A's Framework for Addressing Low-Income

Consumers

• Awareness: Focus on customer needs, local R&D, innovative thinking.

- Affordability: Reduce costs, shorten supply chains, localize sourcing, smaller packaging for lower price points.

- Acceptability: Iailor offerings to market needs, promote through diverse outlets, partner with N.G.O's.

- Availability: Select and support retailers, devise stocking strategies, maintain operations on minimal working capital.

Consumer Behavior and Culture

Chapter 14: Culture

14.1 How Culture is a Society's Personality

- Definition of Culture: Culture is a society's personality. It encompasses both abstract ideas (values, ethics) and material objects (automobiles, clothing, food, art, sports). It is the accumulation of shared meanings, rituals, norms, and traditions within a society.

- Culture as a Lens: Culture acts as the "lens" through which individuals perceive and interpret products and the world around them. Its influence is so profound that its effects are often taken for granted until one encounters a different culture (culture shock).

- Cultural Priorities: Culture shapes the priorities individuals attach to various activities and products, influencing which products are likely to be accepted in the marketplace. Products that resonate with a culture's current priorities have a higher chance of success.

- Ethnography: A research method where observers immerse themselves within a cultural group to gain an in-depth understanding of their behaviors, meanings, and social/cultural processes from an insider's perspective.

- Two-Way Street: Culture influences consumer behavior, and consumer behavior (through product acceptance and consumption patterns) provides insights into a culture's dominant ideals at a particular time.

Dimensions of Culture

- Ecology: The way a system adapts to its habitat. This includes the technology used for resource acquisition and distribution, and the environmental resources themselves.

- Social Structure: The way people maintain an orderly social life. This encompasses domestic and political groups (e.g., nuclear versus extended family, government types) and the structure of social spaces and demographics.

- Ideology: The mental characteristics of a people and their relationship with their environment and social groups. This includes shared worldviews, rules (formal/informal), and a common ee-thoss (moral and aesthetic principles).

Learning Our Culture

• Enculturation: The process of learning and internalizing the values, beliefs, behaviors, and norms of one's own culture.

- Acculturation: The process of cultural exchange and learning that occurs when individuals from different cultures come into sustained contact.

Dimensions of National Culture (Hofstede's Model)

- Power Distance: The extent to which less powerful members of institutions accept and expect unequal power distribution. High power-distance cultures may show a preference for luxury brands linked to status.

- Individualism versus Collectivism: The degree to which self-image is defined by "I" (individualism) or "we" (collectivism). Collectivist cultures may be more sensitive to cultural congruence in product evaluations.

• Masculinity versus Femininity: The extent to which a society emphasizes achievement, ambition, and distinct gender roles (masculinity) versus caring, nurturing behaviors, and more fluid

gender roles (femininity).

- Uncertainty Avoidance: A society's tolerance for uncertainty and ambiguity. High uncertainty avoidance cultures prefer known systems.

- Long-Term versus Short-Term Orientation: Focus on future planning, perseverance, and thrift (long-term) versus respect for tradition, fulfilling social obligations, and a focus on the past and present (short-term).

- Indulgence versus Restraint: The extent to which a society allows relatively free gratification of basic human drives (indulgence) versus suppressing gratification through strict social norms (restraint).

14.2 How Consumption Rituals Structure Our Experiences and Convey Cultural Values

- Ritual: A set of multiple, symbolic behaviors that occur in a fixed sequence and are repeated periodically. Rituals structure consumption practices and imbue them with meaning.

- Rituals and Community: Rituals are essential for holding communities together, reinforcing broad cultural or religious values through communal activities (e.g., Super Bowl, graduations).

- Fortress Brands: Brands whose products are deeply embedded in consumers' rituals, making them difficult to replace.

• Extraordinary Beliefs:

Beliefs that are not scientifically verifiable or may contradict science, often underpinning consumption rituals. These beliefs serve four functions:

• Connecting: Allowing consumers to feel grounded to an object, place, time, or community.

• Controlling: Helping consumers reduce uncertainty in their lives.

• Enchanting: Beliefs in magical or non-scientific processes or properties.

• Explaining: Helping consumers make sense of the world.

Ritual Artifacts and Scripts

- Ritual Artifacts: Items necessary to perform rituals (e.g., wedding rice, birthday candles, diplomas).

- Ritual Script: The sequence of actions, identification of necessary artifacts, and roles of participants required to perform a ritual.

Common Rituals

• Grooming Rituals: Ceremonies that help individuals transition from their private to public self, often involving a transformation and reaffirming cultural values (e.g., beauty, youth).

• Gift-Giving Rituals:

A process involving three stages:

• Gestation: The giver procures an item to mark an event.

• Presentation: The actual exchange of the gift, with the recipient's response being evaluated.

- Reformulation: The giver and receiver redefine their relationship based on the gift exchange.

• Self-gifting is a growing phenomenon.

• Experiential gifts can strengthen relationships more than material gifts.

- Holiday Rituals: Ritualistic behaviors unique to specific occasions, often celebrating special characters or themes (e.g., Christmas, Halloween).

• Rites of Passage: Rituals marking a change in social status (e.g., birth, puberty, marriage,

14.3 How Products, Brands, and Practices are Vessels of Cultural Meanings

• Sacred versus Profane Consumption:

• Sacred Consumption: Objects and events set apart from normal activities, treated with respect or awe (e.g., religious artifacts, historical landmarks, celebrities).

• Profane Consumption: Ordinary, everyday objects and events.

• Sacralization:

The process by which ordinary objects, events, or people acquire sacred meaning. This can occur through:

• Objectification: Attributing sacred qualities to mundane items, often through contamination (association with sacred people/events).

• Collecting: The systematic acquisition of specific objects, transforming them into sacred items for the collector.

• Hoarding: A reluctance to discard used objects (distinct from collecting).

• Domains of Sacred Consumption:

• Sacred Places: Religious/mystical sites or places of national heritage (e.g., Mecca, Ground Zero).

• Sacred People: Celebrities, royalty, icons.

• Sacred Events: Major athletic competitions, religious ceremonies.

- Desacralization: When a sacred item or symbol loses its special status, often by being removed from its special place or mass-produced, becoming profane.

- Global Consumer Culture: A shared devotion to brand-name consumer goods, movie stars, celebrities, and leisure activities that unites consumers worldwide.

• Country of Origin (C.O.O): Consumers often associate products with specific countries, influencing perceptions and preferences. Ethnocentrism is the belief that one's own country's products are superior.

14.4 How Products, Ideas, and Practices Circulate Through Society via Diffusion

- Diffusion of Innovations: The process by which a new product, service, or idea spreads through a population.

- Innovation: Any product that consumers perceive as new (new product variation, manufacturing technique, delivery method, packaging, etcetera).

- Adoption Rates: The speed at which an innovation spreads can be rapid once it reaches a "tipping point" or critical mass.

Types of Adopters

• Innovators (2.5%): Trendsetters, risk-takers, interested in new ideas regardless of risks.

- Early Adopters (13.5%): Opinion leaders, influential, concerned with social acceptance, adopt early but with less risk than innovators.

- Early Majority (34%): Pragmatic, adopt before the average person, link between early and later adopters.

- Late Majority (34%): Skeptical, adopt just after the average person, high uncertainty and risk perception.

• Laggards (16%): Traditional, wary of change, adopt only when required or if they have few resources.

Gartner Hype Cycle

A model illustrating the progression of new technologies through five stages:

1. Innovation Trigger: Initial idea or technology gains attention.

2. Peak of Inflated Expectations: Hype and early successes mixed with failures.

3. Trough of Disillusionment: Interest wanes as results don't meet expectations.

4. Slope of Enlightenment: Understanding of the technology's actual benefits grows; better versions emerge.

5. Plateau of Productivity: Technology becomes widely adopted and proves its value.

Types of Innovations

- Continuous Innovation: Minor modification of an existing product; requires minimal change in consumer habits.

- Dynamically Continuous Innovation: A more pronounced change to an existing product, requiring some alteration in consumer habits (e.g., transitioning to electric cars).

- Discontinuous Innovation: Creates major changes in how people live (e.g., the airplane, the computer).

Factors Determining Innovation Diffusion

• Compatibility: The innovation aligns with consumers' lifestyles.

• Trialability: Consumers can experiment with the innovation before purchase.

• Complexity: The product is easy to understand and use.

• Observability: Innovations that are easily seen and noticed tend to spread faster.

• Relative Advantage: The product offers a clear benefit over existing alternatives.

The Diffusion of Consumption Practices

• Practices: Routinized actions, sayings, and understandings situated within social structures.

• Practice Diffusion:

The movement of practices across contexts, where they acquire new meanings and influence other practices. This involves:

• Demarcation: Setting the practice apart from its original and new contexts.

- Imitation: Others begin replicating elements of the practice.

• Acculturation: Parts of the practice integrate into the dominant culture.

• Innovation: Elements are unbundled and recombined, transforming the practice.

• Technology Acceptance Model (T.A.M): Predicts adoption based on perceived usefulness and perceived ease of use.

The Fashion System

• Includes all individuals and organizations involved in creating and transferring symbolic meanings to cultural goods. Affects clothing, music, art, architecture, and even business

practices.

- Memes: Ideas or products that enter the collective consciousness and spread rapidly through imitation, often influencing brands and culture.

Consumers as Sources of Innovations

• Crowdsourcing: Soliciting ideas for new products or campaigns from a user community.

• Value Co-creation: Involving consumers in the production, design, and use of products.

- Wisdom of Crowds: The perspective that, under the right conditions, groups are smarter than individuals, suggesting collective consumer input can predict successful products.

You have reached the end of the document.