MKTG 4120 Chapter 7

How does a group differ from a reference market?

- A group is defined as two or more individuals who share a set of norms, values, or beliefs and have certain implicitly or explicitly defined relationships to one another such that their behaviors are interdependent - A reference market is a group whose presumed perspectives or values are being used by an individual as the basis for his or her current behavior

What five factors determine the strength of reference group influence in a situation?

- Group influence is strongest when the use of product or brand is visible to the group. - Reference group influence is higher the less of a necessity an item is. - In general, the more commitment an individual feels to a group, the more the individual will conform to the group norms. - The more relevant a particular activity is to the group's functioning, the stronger the pressure to conform to the group norms concerning that activity. - The individual's confidence in the purchase situation.

Describe the factors that affect the diffusion rate for an innovation. How can these factors be utilized in developing marketing strategy?

1. Type of group - some groups are more accepting of change than others 2. Type of decision - refers to an individual versus a group decision 3. Marketing effort - the rate of diffusion is heavily influenced by the extent of marketing effort involved 4. Fulfillment of felt need - the more manifest or obvious the need that the innovation satisfies 5. Compatibility - the more the purchase and use of the innovation are consistent with the individual's and group's values or beliefs, the more rapid the diffusion. 6. Relative advantage - the better the innovation is perceived to meet the relevant need compared with existing methods, the more rapid the diffusion. 7. Complexity - the more difficult the innovation is to understand and use, the slower the diffusion. 8. Observability - The more easily consumers can observe the positive effects of adopting an innovation, the more rapid its diffusion will be. 9. Trial-ability - the easier it is to have a low-cost or low-risk trial of the innovation, the more rapid is its diffusion. 10. Perceived risk - the more risk associated with trying an innovation, the slower the diffusion.

What is a brand community? What are the characteristics of such a group?

A brand community is a non geographically bound community, based on a structured set of social relationships among owners of a brand and the psychological relationship they have with the brand itself, the product in use, and the firm. The characteristics of such a group are consciousness of kind, shared rituals and traditions, and a sense of moral responsibility.

What is a consumption-based group or a consumption subculture? How can marketers develop strategy based on consumption subcultures?

A consumption subculture is a distinctive subgroup of society that self-selects on the basis of a shared commitment to a particular product class, brand, or consumption activity. Marketers can develop strategy by attempting to use the most respected members of a consumption subculture as a means for identifying trends and influencing consumers in the mass market.

What is a dissociative reference group? In what way can dissociative reference groups influence consumer behavior?

A dissociative reference group are groups with negative desirability. They can influence behavior just as do those with positive desirability. Ex: teenagers tend to avoid clothing styles associated with older consumers

What is an aspiration reference group? How can an aspiration reference group influence behavior?

An aspiration reference group is a nonmembership group with a positive attraction. It can influence behavior because individuals frequently purchase products thought to be used by a desired group in order to achieve actual or symbolic membership in the group.

What is an innovation? Who determines whether a given product is an innovation?

An innovation is an idea, practice, or product perceived to be new by the relevant individual or group. Perceptions of the potential market determine whether a given product is an innovation.

What is an online social network site? What are the guidelines for marketers operating in online communities and social networking sites?

An online social network site is a web-based service that allows individuals to - construct a public or semipublic profile within a bounded system - articulate list of other users with whom they share a connection - view and traverse their list of connections and those made by others within the system The guidelines are - to be transparent - to be part of the community - to take advantage of the unique capabilities of each venue

What is an opinion leader? How does an opinion leader relate to the multistep flow of communication?

An opinion leader is known in their circle as the "go-to person" for specific types of information. These individuals actively filter, interpret, or provide product and brand-relevant information to their family, friends and colleagues. An opinion leader relates to the multistep flow of communication by processing information from the mass media and other sources, and transmits their interpretations of it to some members of their groups.

What is a blog?

Blogs are personalized journals where people and organizations can keep a running dialogue.

What is buzz? How can marketers create it?

Buzz can be defined as the exponential expansion of WOM. It happens when "word spreads like wildfire" with no or limited mass media advertising supporting it. Marketers create buzz by providing opinion leaders advance information and product samples, having celebrities use the product, placing the product in movies, sponsoring "in" events tied to the product, restricting supply, courting publicity, and otherwise generating excitement and mystique about the brand.

What are the various categories of innovations? How do they differ?

Continuous Innovation, dynamically continuous innovation, discontinuous innovation,

What characterizes an opinion leader?

Greater long-term involvement with the product category.

What is the Asch phenomenon and how do marketers utilize it?

Impact of groups and groups norms on individual behavior. You will follow the majority opinion even if it contradicts your beliefs. Examples on pg 229. Marketers utilize it by positioning products as appropriate for group activities.

What types of groups influence exist? Why must a marketing manager be aware of these separate types of group influence?

Informational, normative, and identification. Marketing strategies depend on the type of influence involved.

What are adopter categories? Describe each of the adopter categories.

Innovators - venturesome risk takers Early adopters - tend to be opinion leaders in local reference groups Early majority - consumers tend to be cautious about innovations Late majority - members are skeptical about innovations Laggards - are locally oriented and engage in limited social interaction

How does a market maven differ from an opinion leader?

Market mavens are some individuals who have information about many different kinds of products, places to shop, and other aspects of markets. They both initiate discussions with others about products and shopping, and respond to requests for make information.

What criteria are used by marketers to classify groups?

Membership Strength of social tie Type of contact Attraction

How can a marketer use knowledge of reference group influences to develop advertising strategies?

Showing members of a certain group using a product. Suggesting that using or not using the brand will result in having members of a group you belong to or wish to join rewarding you or punishing you. Demonstrating that the product is consistent with the group's and therefore the individual's beliefs.

What is the diffusion process? What pattern does the diffusion process appear to follow over time?

The diffusion process is the manner in which innovations spread throughout a market. The pattern that the diffusion process appears to follow over time: a period of relatively slow growth, followed by a period of rapid growth, followed by a final period of slower growth.

How can a marketer foster a brand community?

They can establish relationships with the owner and help owners establish relationships with one another. They can also use social networking, community engagement, brand use, and impression management.

Explain the role of enduring involvement in driving opinion leadership.

When opinion leaders have a greater long-term involvement with the product category than the non-opinion leaders and it leads to enhanced knowledge about and experience with the product category or activity.

How can a marketer use knowledge of adopter categories to develop marketing strategy?

pg 247

What determines the likelihood that a consumer will seek information from an opinion leader?

product knowledge and product/purchase involvement