MKTG 310 Exam 2 Chapter 7 - Group Influences on Consumer Behavior

Brand communities - Rituals and Traditions

"For the past 7 years, we have sponsored a fall trip. [W]e always go the first weekend in October. [W]e . . . get on the Blue Ridge Parkway [which was] made for MGs, you know—high mountain roads, curves, and hills. We spend Friday and Saturday night in the mountains and then come back. The 1st year we had seven or eight people, last year we had 23 cars."

Reference group influence can take three forms:

1. informational 2. normative 3. identification

Consumption subculture (sneaker heads)

A distinctive subgroup of society that self-selects on the basis of a shared committment to a particular product class, brand, or consumption activity. These groups have: 1. an identifiable, hierarchial social structure 2. a set of shared beliefs or values 3. unique jargon, rituals, and modes of symbolic expression. Thus, they are reference groups for their members as well as those who aspire to join or avoid them.

e-fluentials

E-fluentials represent about 10 percent of the adult online community, but their influence is extensive as they communicate news, information, and experiences to a vast array of people both online and offline. E-fluentials actively use the Internet to gather and disseminate information through numerous online avenues including social media. Their number one factor in opening unsolicited e-mails is brand familiarity. Clearly a trusted brand and solid online presence are critical to targeting e-fluentials.

adopter categories

Innovators: The first 2.5 percent to adopt an innovation. Early adopters: The next 13.5 percent to adopt. Early majority: The next 34 percent to adopt. Late majority: The next 34 percent to adopt. Laggards: The final 16 percent to adopt.

multistep flow of communication

Involves opinion leaders for a particular product area who actively seek relevant information from the mass media as well as other sources. These opinion leaders process this information and transmit their interpretations of it to some members of their groups. These group members also receive information from the mass media as well as from group members who are not opinion leaders.

Aspiration reference groups

Non membership groups with a positive attraction that also exert a strong influence. Individuals frequently purchase products thought to be used by a desired group in order to achieve actual or symbolic membership in the group.

Likelihood of seeking an opinion leader

Product/purchase involvement: High Product knowledge: High = moderate likelihood Product/purchase involvement: Low Product knowledge: High = low likelihood Product/purchase involvement: High Product knowledge: Low = high likelihood Product/purchase involvement: Low Product knowledge: Low = moderate likelihood

enduring involvement

The most salient characteristic of opinion leaders is greater long-term involvement with the product category than the non-opinion leaders in the group. Leads to enhanced knowledge about and experience with the product category or activity. This knowledge and experience make opinion leadership possible. Thus, an individual tends to be an opinion leader only for a specific product or activity clusters

Asch phenomenon

The power of groups was initially demonstrated in a classic series of studies. Eight subjects are shown four straight lines on a board—three unequal lines are grouped close together, and another appears some distance from them. The subjects are asked to determine which one of the three unequal lines is closest to the length of the fourth line shown some distance away. The subjects are to announce their judgments publicly. Seven of the subjects are working for the experimenter, and they announce incorrect matches. The order of announcement is arranged so that the naive subject responds last. The naive subject almost always agrees with the incorrect judgment of the others

Community

characterized by consciousness of kind, shared rituals and traditions, and a sense of moral responsibility.

Brand-related events / brand fests

gatherings of owners and others for the purposes of interacting with one another in the context of learning about and using the brand.

Influentials

heavy users of print media, such as newspapers and magazines, as well as the Internet and are more likely than the general population to engage in WOM recommendations about products, services, brands, and even what new websites to visit.

adoption process

individual consumers presumably go through a series of distinct steps or stages known as the adoption process when purchasing an innovation. Stages in adoption process: Awareness -> Interest -> Evaluation -> Trial -> Adoption Stages in extended decision making: Problem recognition -> Info search -> Alternative evaluation -> purchase -> post purchase evaluation

Laggards

locally oriented and engage in limited social interaction. They tend to be relatively dogmatic and oriented toward the past. Laggards adopt innovations only with reluctance.

Late majority

members are skeptical about innovations. They often adopt more in response to social pressures or a decreased availability of the previous product than because of a positive evaluation of the innovation. They tend to be older and have less social status and mobility than those who adopt earlier.

Primary groups

strength of social tie refers to the closeness and intimacy of the group linkages. Primary groups such as family and friends involve strong ties and frequent interaction. Primary groups often sield considerable influence.

Secondary groups

such as professional and neighborhood associations, involve weaker ties and less-frequent interaction.

Diffusion process

the manner in which innovations spread throughout a market. The term spread refers to purchase behavior in which the product is purchased with some degree of regularity.The market can range from virtually the entire society (for a new soft drink, perhaps) to the students at a particular high school (for an automated fast-food and snack outlet).

Factors Affecting the Spread of Innovations

1. Type of group. Some groups are more accepting of change than others. In general, young, affluent, and highly educated groups accept change, including new products, readily. Thus, the target market for the innovation is an important determinant of the rate of diffusion. 2. Type of decision. The type of decision refers to an individual versus a group decision. The fewer the individuals involved in the purchase decision, the more rapidly an inno- vation will spread. 3. Marketing effort. The rate of diffusion is heavily influenced by the extent of market- ing effort involved. Thus, the rate of diffusion is not completely beyond the control of the firm. 4. Fulfillment of felt need. The more manifest or obvious the need that the innovation satisfies, the faster the diffusion. Rogaine, a cure for some types of hair loss, gained rapid trial among those uncomfortable with thin hair or baldness. 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. Both the performance and the cost of the product are included in relative advantage. The digital audio tape (DAT) had neither advantage compared with CDs and DVDs and thus never took off. 7. Complexity. The more difficult the innovation is to understand and use, the slower the diffusion. The key to this dimension is ease of use, not complexity of product. Specialized blogging software is making an otherwise complex task easy and fun.70 8. Observability. The more easily consumers can observe the positive effects of adopting an innovation, the more rapid its diffusion will be. Cell phones are relatively visible. Laser eye surgery, while less visible, may be a frequent topic of conversation. On the other hand, new headache remedies are less obvious and generally less likely to be discussed. 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. The diffusion of products like laser eye surgery has been hampered by the difficulty of trying out the product in a realistic manner. This is much less of a problem with low-cost items such as headache remedies, or such items as camera phones, which can be borrowed or tried at a retail outlet. 10. Perceived risk. The more risk associated with trying an innovation, the slower the diffusion. Risk can be financial, physical, or social. Perceived risk is a function of three dimensions: (1) the probability that the innovation will not perform as desired; (2) the consequences of its not performing as desired; and (3) the ability (and cost) to reverse any negative consequences. Thus, many consumers may feel a need for the benefits offered by laser eye surgery and view the probability of its working successfully as being quite high. However, they perceive the consequences of failure as being extreme and irreversible and therefore do not adopt this innovation.

Reference group

A group whose presumed perspectives or values are being used by an individual as the basis for his or her current behavior. Thus, a reference group is simply a group that an individual uses as a guide for behavior in a specific situation. Most of us belong to a number of different groups and perhaps would like to belong to several others. When we are actively involved with a particular group, it generally func- tions as a reference group. As the situation changes, we may base our behavior on an entirely different group, which then becomes our reference group. We may belong to many groups simultaneously, but we generally use only one group as our primary point of refer- ence in any given situation. Reference group examples: immediate family is a reference group influencing behavior at Thanksgiving Day dinner celebration Ex 2: Reference group would be consumer behavior classmates. this reference group influences behavior at "after the final exam" celebration.

Identification influence/value-expressive influence

Also called value-expressive influence, occurs when individuals have internalized the group's values and norms. These then guide the individuals' behaviors without any thought of reference group sanctions or rewards. The individual has accepted the group's values as his or her own. The individual behaves in a manner consistent with the group's values because his or her values and the group's values are the same. Example situations: Over time, Tim notices that successful executives dress conservatively Tim sees an ad showing "smart young people on the way up" using an iPad Many of Tim's friends regularly consume health foods Then his behavioral responses: Tim believes that a conservative image is appropriate for executives and develops a conservative wardrobe Tim begins to use an iPad Tim decides that health foods are good for you and begins to consume them regularly.

Brand communities - Moral Responsibility

An MG owner and enthusiast indicates a sense of dedication to help other MG owners even to the point of letting a stranger (who eventually became a friend) stay at his home for free for several nights while waiting on repair parts. "I love it because anyone who has an MG is immediately accepted. . . . I'd help anyone who has an interest in British cars."

Dissociative reference groups

Groups with negative desirability. Can influence behavior just as those with positive desirability.

Informational influence (runners on track team)

Occurs when an individual uses the behaviors and opinions of reference group members as potentially useful bits of information. This influence is based on either the similarity of the group's members to the individual or the expertise of the influencing group member. Thus, a person may notice that runners on the track team use a specific brand of nutrition bar. He or she may then decide to try that brand because these healthy and active runners use it. Use by the track team members thus provides information about the brand.

Types of social media interaction

Providing incentives such as free products and coupons Providing information or solutions to my problems Asking for my feedback on products and services Entertaining me Finding new ways to interact with me Marketing to Principles: 1. BE TRANSPARENT 2. BE APART OF THE COMMUNITY 3. TAKE ADVANTAGE OF THE UNIQUE CAPABILITIES OF EACH VENUE.

Type of contact

Refers to whether the interaction is direct or indirect. Direct contact involves face-to-face interaction; indirect contact does not. The Internet, in particular, has increased the importance of indirect reference groups in the form of online communities, which are discussed in more detail later in the chapter.

opinion leader

Some folks are known in their circles 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. opinion leaders receive information from their followers as well as from other opinion leaders.

Market mavens

Some individuals 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 market information. market mavesn are a special type of opinion leader that can provide significant amounts of information to others across a wide array of products, including durables and nondurables, services, and store types. They provide information on product quality, sales, usual prices, product availability, store personnel characteristics, and other features of relevance to consumers. Market mavens are extensive users of media. They are also more extroverted and conscientious, which drives their tendency to share information with others. Demographically, market mavens tend to be similar to those they influence.

Normative influence/utilitarian influence (wine/fashion or mouthwash/deodorant)

Sometimes referred to as utilitarian influence, occurs when an individual fulfills group expectations to gain a direct reward or to avoid a sanction. You may purchase a particular brand of wine to win approval from a colleague. Or you may refrain from wearing the latest fashion for fear of being teased by friends or to fit in with or be accepted by them. As you might expect, normative influence is strongest when individuals have strong ties to the group and the product involved is socially conspicuous. Ads that promise social acceptance or approval if a product is used are relying on normative influence. Likewise, ads that suggest group disapproval if a product is not used, such as a mouthwash or deodorant, are based on normative influence.

two-step flow of communication

The process of one person's receiving information from the mass media or other sources and passing it on to others. The two-step flow explains some aspects of communication within groups, but it is too simplistic to account for most communication flows. What usually happens is a multistep flow of communication. Direct flow : marketing activities -> relevant marketing segment Multistep flow: marketing Activities and Other infomration -> opinion leader -> relevant marketing segment.

Brand communities - Consciousness of Kind

There are several new classes of riders fouling the wind with the misapprehension that merely owning a Harley [Davidson] will transform them into a biker. This is the same type of dangerous ignorance that suggests that giving a dog an artichoke turns him into a gourmet.

Group

Two or more individuals who share a set of norms, values, or beliefs and have certain implicity or explicity defined relationships to one another such that their behavior are independent. The membership criterion is dichotomous: either one is a member of a particular group or one is not a member of that group. Of course, some members are more secure in their membership than others are; that is, some members feel they really belong to a group, while others lack this confidence. Can be classified under 4 variables 1. Membership 2. Strength / Social Tie 3. Type of Contact 4. Attraction

Word-of-mouth (WOM) communications

WOM involves individuals sharing information with other individuals in a verbal form, including face-to-face, on the phone, and over the Internet. WOM can have a critical influence on consumer decisions and business success. It is estimated that two-thirds of all consumer product decisions are influenced by WOM. Recent research shows just how much faith consumers put in WOM versus advertising across a number of products and services. The importance of WOM is generally high, and its importance relative to advertising varies somewhat across product types. In addition, traditional mass-media advertising still plays a role, particularly at the earlier stages of the decision process, including building brand awareness. Negative experiences are powerful motivators of WOM, a factor that must be considered by marketers because negative WOM can strongly influence recipients' attitudes and behaviors. Negative experiences, which are highly emotional and memorable, motivate consumers to talk.

Online community

a community that interacts over time around a topic of interest on the Internet. These interactions can take place in various forms, including online message boards and discussion groups, blogs, as well as corporate and nonprofit websites. Research indicates that online communities exist for many participants and that there is often a sense of community online, which moves beyond mere interactions to include an affective or emotional attachment to the online group. Studies have found ongoing communications among subsets of these interest groups. In addition, the patterns of communication indicate a group structure, with the more experienced members serving as experts and leaders and the newer members seeking advice and information. These groups develop unique vocabularies, netiquette, and means for dealing with behaviors deemed inappropriate. Extent of connection can vary dramatically across members. Many members observe the group discussions without participating. Others participate but only at a limited level. Others manage and create content for the group.1

Brand community (loyal car people)

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. Jeep, along with its owner-enthusiasts, has created a brand community, as described at the beginning of this chapter, as have Harley-Davidson, Saab, Ford Bronco, and MG (a British sports car) As the Jeep example suggests, brand communities create value through sets of activities or "practices" that create brand engagement. Four categories of activities and an example of each relating to the Mini Cooper brand are shown in Table 7-1. From the firm's perspective, building a brand community involves establishing relationships with the owner and helping owners establish relationships with each other. Social Networking—Creating, enhancing, and sustaining ties among members by welcoming, empathizing, and governing. • Empathizing—Lending emotional or other support to members • Example (relating to members' "birthing" rituals for their Mini's): Good job Birdman! I'm like you. I watched cameras, checked tracking. . . . You'll treasure having these for your "scrap book" or should I say Minibirds's "baby book"? Jack [the car] was not on a WW ship so there were a lot less options for catching glimpses of the journey. Hang in there. Minibird is almost home! Community Engagement—Reinforce members' escalating engagement with community by documenting, badging, milestoning, and staking. • Milestoning—Noting significant events in brand ownership and consumption • Example (relating to length of relationship with Mini): The odometer hit 100k miles and I loved my Mini more than ever. Brand Use—Improving or enhancing the use of the focal brand by customizing, grooming, and commoditizing. • Grooming—Caring for the brand • Example (relating to washing the Mini appropriately): I try to wash at least once a week with a quick detail spray during the middle of the week to keep my Zaino shining. Newt [thread initiator] prepare yourself for an onslaught of posts suggesting that you should keep your car away from those car washes. Impression Management—Creating positive view of brand community to nonmembers by evangelizing and justifying. • Evangelizing—Sharing about the brand and inspiring others to use the brand • Example (relating to the safety of the Mini): In another MINI forum that I used to visit a lot, there were a few people who had major accidents in their MINIs and I was shocked at just how tough and safe these little cars are. [T]hey weigh more than most small cars and are amazingly rigid and protective from what I've seen.

Online social network site

a web-based service that allows individuals to: (1) construct a public or semi public profile within a bounded system (2) articulate a list of other users with whom they share a connection (3) view and traverse their list of connections and those made by others within the system. Online social network sites take many forms, including friendship (Facebook and MySpace), media sharing (Flickr and YouTube), events (NASCAR Hookup), corporate or brand (Toyota Friend), and micro- blogging (Twitter).

Innovation

an idea, practice, or product perceived to be new by the relevant individual or group. Whether or not a given product is an innovation is determined by the perceptions of the potential market, not by an objective measure of technological change. The manner by which a new product is accepted or spreads through a market is basically a group phenomenon. For example, computer tablets such as Apple's iPad are more of an innovation than is a new fat-free snack. The changes required in one's behavior, including attitudes and beliefs, or lifestyle if a person adopts the new product or service determine the degree of innovation, not the technical or functional changes in the product.

Early majority

consumers tend to be cautious about innovations. They adopt sooner than most of their social group but also after the innovation has proved successful with others. They are socially active but seldom leaders. They tend to be somewhat older, less well educated, and less socially mobile than the early adopters. The early majority relies heavily on interpersonal sources of information.

guerrilla marketing

marketing with a limited budget using nonconventional communications strategies. Guerrilla marketing is about making an "intense connection with individuals and speeding up the natural word-of-mouth process. Examples: Sony Ericsson hired attractive actors to pose as tourists in various metro areas. They would then hand their cell phone/digital camera to locals and ask them to take a picture in an attempt to get the camera in their hands and get them talking about it.

Early adopters

tend to be opinion leaders in local reference groups. They are successful, well educated, and somewhat younger than their peers. They are willing to take a calculated risk on an innovation but are concerned with failure. Early adopters also use commercial, professional, and interpersonal information sources, and they provide information to others.

Buzz

the exponential expansion of WOM. It happens when "word spreads like wildfire" with no or limited mass media advertising supporting it. Buzz drove demand for Hard Candy nail polish, as described earlier. It also made massive successes of Pokémon, Beanie Babies, the original Blair Witch Project, the Harry Potter books, and Toy Story. 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. Buzz is generally not supported by large advertising budgets, but it is often created by marketing activities. In fact, creating buzz is a key aspect of guerrilla marketing.

innovators

venturesome risk takers. They are capable of absorbing the financial and social costs of adopting an unsuccessful product. They are cosmopolitan in outlook and use other innovators rather than local peers as a reference group. They tend to be younger, better educated, and more socially mobile than their peers. Innovators make extensive use of commercial media, sales personnel, and professional sources in learning of new products.