Consumer Behavior Exam #3

Marketing Implications of the drivers of values

**Consumption Patterns:** Consumers' purchases, usage, and disposal of products align with their values. For example, sustainability-minded consumers have influenced companies like Unilever and Procter & Gamble to focus on waste reduction and resource conservation. **Market Segmentation:** Marketers use value segmentation to cater to consumer groups with specific values. This approach helps in understanding consumer preferences, as seen with companies like Faber-Castell and The Body Shop targeting segments based on values like quality, creativity, and environmental consciousness. **New Product Ideas:** Consumers' values significantly impact their response to new products. Successful products often align with key consumer values, but balancing conflicting values can be challenging, as seen in Campbell Soup Company's product adjustments. **Ad Development Strategy:** Ads that resonate with target consumers' values are more effective. Companies like Harley-Davidson use crowdsourcing to align their ads with consumer values and avoid cultural conflicts. **Ethical Considerations:** Consumer judgments of marketing practices are influenced by their values. Marketing strategies conflicting with values like fairness and ethics can lead to consumer backlash, boycotts, or complaints, as evidenced by reactions to certain products and ads.

How to Assess Values

**Market Segmentation by Values:** Understanding consumers' values, which are often abstract and hard to verbalize, is crucial for market segmentation. Marketers use both direct and indirect methods to assess these values, including analyzing cultural artifacts like advertisements and product names. **Inferring Values from Cultural Artifacts:** Cultural artifacts like ads, product names, and media content reflect societal values and can reveal cross-cultural differences. However, interpreting these artifacts can be challenging and may not clearly distinguish if culture reflects or creates values. **Means-End Chain Analysis:** This technique links product attributes to consumer values. By understanding the associations between product attributes, benefits, and values, marketers can better position products and develop effective advertising strategies. **Value Questionnaires:** Questionnaires, such as the Rokeach Value Survey, assess consumer values directly. These tools help identify important values for specific consumer groups, track value stability over time, and understand behavior influences.

Five main factors altering structure of a household:

1. Delayed marriage (people remaining single for longer bc a desire for freedom and noncommital attitude and career priority, postponement of financial commitments) and cohabitation (living with two members of opposite sex but not married) 2. Dual Career Households (higher discretionary spending, who value time-saving) and realize more men are becoming stay at home dads so more ads are tailored for them 3. Divorce (causes disposition of old items, new consumption patterns forming of a new household) 4. Smaller Households: equals a higher discretionary spend per person and more spent on each child 5. Same-sex households (allows for a targeted advertisement)

Agreeableness

A big-five personality trait Agreeableness is the tendency to appreciate and actively seek social harmony. It captures the extent to which one is more helpful, respectful of authority, and forgiving versus more competitive, argumentative, and self-focused. People with a high level of agreeableness tend to express compassion and politeness.

Conscientiousness

A big-five personality trait Conscientiousness is the tendency to be achievement oriented (proactive) and self-disciplined (inhibited). It captures the extent to which one is ambitious, organized, orderly versus more spontaneous, easily distracted, and flexible. People with a high level of conscientiousness tend to express industriousness and orderliness.

Extraversion

A big-five personality trait is the tendency to appreciate and actively seek engagement with the external world. It captures the extent to which one is more enthusiastic, sociable, assertive, action oriented versus more reserved, quiet, and on their own. People with a high level of extraversion tend to express enthusiasm and assertiveness.

Openness

A big-five personality trait is the tendency to appreciate and actively seek new experiences for their own sake. It captures the extent to which one is more intellectually curious, creative, sensitive to beauty and art versus more pragmatic, conventional, and down to earth. People with a high level of openness tend to express intellect and desire for experience.

Neuroticism

A big-five personality trait is the tendency to experience negative emotions such as anxiety, as well as mood changes. It captures the extent to which one is more anxious, insecure, sentimental versus more calm, confident, and resilient. People with a high level of neuroticism tend to express emotional volatility and withdrawal.

subjective social status (SSS)

A consumer's perceived relative social standing in society. It is consumer's self-identification in a particular social class.

socioeconomic status (SES)

A consumer's relative status in society as measured by, for instance, income, educational level, occupational level, and area of residence.

Nuclear family

A couple and their dependent children

Core values

A person's most enduring, strongly held, and abstract values that hold in many situations. These values are at the center of a person's value system. These highly enduring, strongly held, and abstract values apply in many situations. For example, because much of Western culture is based on the notion of freedom, that value permeates many domains of our lives. This leads to a belief in the freedom to speak, to go where we want, to dress as we please, and to live where we want.

Status Symbols

A product, service, or brand that signals one's higher social class standing to other consumers.

Rokeach Value Survey (RVS)

A questionnaire instrument that measures the instrumental and terminal values proposed by psychologist Milton Rokeach. This questionnaire asks consumers about the importance that they attach to the 19 instrumental values and 18 terminal values identified in Exhibit 14.2. This questionnaire is standardized, and everyone responds to the same set of items, a procedure that helps researchers identify the specific values that are most important to a given group of consumers, determine whether values are stable over time, which values differ between groups of consumers, and which influence behavior. There are efficient value instruments derived from the RVS that measure a smaller set of values to be used for market segmentation and positioning, such as the List of Values (LOV). Some survey projects systematically track consumer values across various life domains, including work, housing, and welfare over time, such as the European Value Survey (EVS) on consumer values in 46 European countries since 1981.

Family

A set of people who live together have a relation by marriage, birth, or adoption includes same sex couple living together long term with or without children is a type of household

Nagging or pester power

A technique children use to get their parents to perform an action more likely to be hedonistic (food or games) child friendly / related products When children are older or more individualized, they exert more power When the household is less traditional (working parents or single parents) the child is more likely to get what they want parents will align purchase behavior with whether they value self control or materialistic

Acculturation

Acculturation is the process by which individuals learn the values and behaviors of a new culture For example, immigrants arriving in the United States learn new values to acculturate to American life and transmit some of their own values back. Consumers are more likely to adopt the values of a new culture if they view that culture as attractive and as having values like their own. Acculturation also occurs faster when people in the new culture are cohesive, communicate their values clearly, and express pride in the values that they hold.

How the type of household effects nature of child's influence

Authoritarian households stress obedience. Democratic households encourage self-expression, and permissive households remove constraints and allow children to influence household decisions and make their own, autonomous decisions. Further, mothers may identify more with the daughters and unknowingly favor them, whereas fathers may do the same with sons. Also, children's influence varies at different stages of the decision process. It is greatest early in the decision-making process, in the problem recognition and information search stages, and declines significantly in the later stages.

Four typical patters in household decision making

Autonomous: In a household, autonomous decision-making happens when one member independently manages all stages of purchasing and using a product or service they alone consume. For instance, one partner might choose and buy a book to read, while the other selects and listens to music streams. Partner-dominated decisions: In this context, partner-dominated decision-making occurs when one member of a household primarily influences the purchase of a product or service used by several household members, or even exclusively by others. An example is when one partner unilaterally decides to buy a couch for the family's use. Child-dominated decisions: In this situation, children-driven decision-making happens when one or more children in a household greatly influence the choice of a product or service used by the entire family. For example, if a child decides which cereal will be eaten by some or all family members at breakfast, this illustrates children having significant sway in household decisions. Syncratic decisions: Syncratic decisions involve all household members in the decision-making process, common for important issues. There are two types: 1. **Consensual Decision-Making**: Everyone contributes equally to the decision, like a rowing team without a coxswain. 2. **Collaborative Decision-Making**: Members take on different roles based on their skills or knowledge, similar to positions in a football or baseball team. An example is collaboratively planning a summer vacation, where each member has a specific role in the decision-making.

Techniques used by children

Bargaining (making deals) Persausion Emotional appeals requests in return, caregivers use these and more including expert knowledge, legitimate power, and directive (parental authority) startegies

Conspicuous consumption

Buying and using products because of the "statement" they make about social position

Competitiveness

Competitiveness, varying among individuals, is linked to the conscientiousness trait in the Big-Five personality model and aligns with achievement and self-direction values. This trait manifests in the desire to surpass others, often through conspicuous consumption of material items like the latest gadgets. It influences behavior in both direct (e.g., sports, gambling) and indirect ways (e.g., supporting a sports team). Marketers targeting competitive consumers emphasize being first in trying or buying new products and may use subtle status cues for branding. On social media, competitiveness is reflected in the pursuit of more friends, followers, and likes, often stimulating increased consumption among those seeking to elevate their status.

Home as a value

Consumers are increasingly valuing their homes, focusing on making them attractive and comfortable. In the U.S., 66% own their homes, viewing them as safe havens in a complex and exhausting world, and as hubs for connecting with others. Homes serve as "command central" for coordinating activities and pooling resources. Additionally, over three-quarters of U.S. homes have high-speed broadband, supporting the use of various technologies like TVs, game devices, computers, and smartphones. The emphasis on the home as a personal sanctuary is also evident in the offerings of home furnishing companies like IKEA.

Technology attraction as a value

Consumers globally are increasingly attracted to technology, with some developing a strong affinity or "technophilia". A significant portion of the population in countries like the U.S. and Japan view devices like smartphones, tablets, and smartwatches as essential to their lives. Approximately 86% of adults worldwide own a smartphone, and 89% in the U.S. engage in online banking. However, rapid technological advancements can be overwhelming for consumers, leading to efforts in making technology more accessible and user-friendly, such as through face recognition and voice-controlled appliances. Despite these advancements, there are concerns about the negative aspects of technology, like constant surveillance and the potential for AI to replace jobs, prompting some people to adopt a minimalistic lifestyle with less technology reliance.

need for cognition

Consumers with a high need for cognition enjoy deep thinking about products and their features, aligning with traits of openness and self-direction such as being broadminded and logical. They prefer products with a learning aspect and detailed, technical advertisements. In contrast, those with a low need for cognition prefer taking mental shortcuts, relying more on emotions, and respond better to simpler, visually appealing ads. This trait varies independently of education level and significantly influences consumer preferences and responses to marketing strategies.

Need for Uniqueness

Consumers with a high need for uniqueness seek distinctiveness through their choices in goods and services. This need encompasses three dimensions: creative choice counter-conformity (socially distinctive yet approved choices), unpopular choice counter-conformity (choices that defy norms despite potential disapproval), and avoidance of similarity (eschewing common items for uniqueness). Linked to the openness trait and self-direction values like independence and imagination, these consumers often make unconventional choices, preferring niche or local brands over global ones, seeking unique fashion trends, handcrafted items, and personalized products to maintain their individuality.

means-end chain analysis

Describes how attributes of products and services ("means") link to the values of consumers ("ends"). It tries to get at the associations that consumers have between the attributes of products and brands and their deeper personal values. In step 1, a researcher finds out which attributes of products or services consumers perceive, say that one beer is light in calories, and another is not. In step 2, the researcher asks which attribute level a consumer prefers, for instance, the beer that is light or heavy in calories. In step 3, the researcher asks "why" the consumer prefers this, for instance, "I prefer the light beer because it prevents weight gain" and then "why" this is important, for instance, because it "helps me remain healthy," and "why" this is important, for instance, because it "makes me feel good about myself." This entire process is called a means-end chain because the product attribute provides the means to a desired end state or terminal value (in this case, self-esteem). a particular product attribute can be associated with very different benefits and values. Thus, the attribute "fewer calories" of light beer leads to the benefits "prevent weight gain" and "refreshing," and these eventually lead to the two terminal values "self-esteem" and "belonging." Second, the same value may be associated with very different products and attributes. Thus, the attribute "fewer calories" of light beer and the attribute "comes in a boiling bag" of rice may both appeal to the terminal value of belonging.

Work and Leisure Balance as a value

Different cultures have varying values regarding work and leisure. In the U.S., people are working longer hours, often even during vacations, due to increased productivity demands and decreased real income. This trend is reflected in a European study, showing varied importance placed on work over leisure in different countries. As a result, people increasingly value their free time as much as money, leading to the growth of services like online grocery delivery, which offers convenience and time-saving. Additionally, there's a rising trend in slow consumption for leisure, with more people seeking remote vacations and specific-interest themed cruises to fully detach from work.

Family and Children as a value

Different cultures prioritize family and children differently. For example, parents in Asia and Europe generally place a higher value on education than those in the U.S., with Asian middle-class families ranking it just below providing food. However, American consumers still highly value their children, evident in companies increasing paid parental leave and leaders like Facebook's Mark Zuckerberg advocating for parental leave. The U.S. market is very receptive to child-related products, similar to many other cultures. LEGO, a Danish company, has become the world's largest toy company, driven by the popularity of its products inspired by franchises like Harry Potter and Star Wars. Marketers target children with a wide range of products, including cereals, snacks, drinks, and toys. However, there are marketing limitations and guidelines in certain product categories, such as Taiwan's ban on free toys with children's fast-food meals, due to concerns about children's wellness.

Dogmatism

Dogmatism in consumers reflects their openness or resistance to change and new ideas. Dogmatic individuals, being more closed-minded, are typically resistant to new products, promotions, and advertising methods. This trait is linked to values related to security, prosocial behavior, and restrictive conformity. The degree of dogmatism influences consumer acceptance of new products, as shown in studies like one with Nigerian consumers. Additionally, personality in consumer behavior extends beyond these traits, with some consumers being "thinkers" who follow subjective norms and "doers" who act based on personal attitudes, highlighting the complexity and diversity of human personality in influencing consumer behavior.

Materialism

Domain specific value The tendency to place a high importance on acquiring and owning material goods and money. In contrast, symbolic items such as family mementos, photos, and a mother's wedding gown are more important to those low in materialism Focusing too much on material possessions and money can lead to neglecting social relationships and spending time with loved ones, potentially causing loneliness. Materialistic individuals who also value social connections and family life may face conflicts between these values, further harming their well-being. However, materialism has positive aspects too. Materialistic people often work harder to achieve and earn more, aligning with values of achievement and self-direction. Additionally, the act of searching for and purchasing goods can be enjoyable, enhancing overall well-being. Such values are transmitted between consumers and across generations by the media, the commercial environment of stores

Values

Enduring beliefs about desirable, abstract outcomes Ex: Healthy, family values, self respect, and freedom

Youth Focus as a value

Global consumer culture highly values youth, evident in widespread anti-aging products and services like wrinkle creams and cosmetic surgery. Companies like L'Oréal are responding to this trend, catering to a global market. Older consumers are increasingly striving to look younger. This youth focus is part of a broader "self-and-growth" orientation in global consumer culture, alongside values like materialism and health focus. In contrast, the "others-and-stability" category values home, family, authenticity, and the environment, emphasizing maturity and security.

The Environment as a value

Environmental protection and sustainable consumption are increasingly significant values worldwide. Consumers, particularly younger generations like Zoomers and Gen Alphas, show a growing interest in conserving natural resources, preventing pollution, and supporting eco-friendly products and activities. This shift is influencing businesses; for instance, packaged food companies are adopting sustainable packaging to meet consumer demands and regulatory requirements. Electric vehicles (EVs) like the Nissan LEAF, Toyota Prius, and Tesla's models, including their crossover vehicle Model Y, are gaining popularity due to their fuel efficiency and lower environmental impact. The rise in environmental consciousness is also boosting ecotourism and volunteer-based vacations that focus on helping endangered areas and species. However, there are challenges to pro-environmental behavior, such as financial costs, the difficulty of changing habits, and potential short-term discomfort. Additionally, the perception that environmentally friendly actions are more feminine may deter some men from engaging in these behaviors.

Ethnic Identification as a driver of Values

Ethnic subcultures within larger cultures often hold distinct values. Hispanic and Latino Americans, for instance, greatly value family and home, a sentiment shared by Black and African American, and Asian American consumers who also emphasize the importance of the extended family. These ethnic values can vary across countries. In China, consumers prefer premium brands for status and particularly for gift-giving. Ferrero has capitalized on this by positioning itself as a premium chocolate brand in China, offering boxed assortments suitable for various gift occasions.

Age as a driver of value

Generational members often share values distinct from other generations. For instance, Baby Boomers, who experienced the 1960s' political upheaval and cultural changes, typically value hedonism, morality, self-direction, and achievement. While it can be challenging to discern whether values like national security, equality, or comfort are influenced by age, the era, or birth cohort, these factors do impact consumer behavior significantly. This generational influence is a key factor in understanding differing consumer preferences and behaviors.

Culture as a driver of values

Global consumer culture varies due to different cultural experiences, leading to diverse values across countries. For example, Brazilians value true friendship, mature love, and happiness, while U.S. consumers prioritize family security, world peace, and freedom. Chinese consumers focus on preserving achievements, sympathy, self-control, and integrating enjoyment and action. A study spanning 28 countries shows that materialism is commonly linked to positive attitudes toward global products. Cultural differences can be understood through Geert Hofstede's four main value dimensions: individualism vs. collectivism, uncertainty avoidance, masculinity vs. femininity, and power distance. These dimensions help classify cultures and provide insights into cross-cultural behaviors. For instance, tipping habits, price sensitivity for apps, preferences for humorous ad themes, and everyday consumption patterns reflect these cultural dimensions. In the U.S., for example, high masculinity influences men's consumption to support their action-oriented self-view.

Authenticity as a value

Global consumers highly value authenticity, preferring either original items, like the first Levi's 501 jeans or Fender electric bass guitar, or their faithful reproductions. This desire for authenticity aligns with maturity and self-direction values, emphasizing mature love, true friendship, beauty, accomplishment, and self-respect. Consumers who value these aspects are less interested in cheap knockoffs and may shun brands that lose their authentic appeal. For instance, locally brewed U.S. craft beers are often seen as more authentic than mass-produced brands. Authenticity is also valued in services and experiences, like enjoying espresso in a small, local coffee shop compared to a global chain like Starbucks. Authentic sports merchandise, like team caps and jerseys, is increasingly popular among fans. However, for hedonic products, being overly honest about benefits might backfire, as these often rely on a bit of exaggeration.

Health Focus as a value

In the U.S. and other countries, health is highly valued for both self-esteem (appearance) and longevity. This focus is evident in the popularity of exercise and foods with low fat, calories, carbs, salt, sugar, or cholesterol, and those with special nutritional benefits. Consumers often prefer lower-calorie versions of foods over smaller portions of the original. There's also a preference for simple, front-of-package labeling to help with quick, health-conscious choices. Supermarkets and fast-food chains are responding to this trend by highlighting healthier options and offering menus catering to specific dietary needs like gluten-free options. Additionally, concerns about pesticides, additives, and food-related illnesses have increased demand for organic foods in the U.S. Concerns over genetically modified foods are also driving organic sales. Sales of organic non-food products are rising as consumers seek natural options in all categories. Those who prioritize health tend to be less price-sensitive, which is significant given the higher cost of organic products.

How is social class determined?

Income education occupational status are the main determinents

Hofstede's four main value dimensions: individualism vs. collectivism, uncertainty avoidance, masculinity vs. femininity, and power distance.

Individualism versus collectivism. The degree to which a culture focuses on the individuals rather than the group. Uncertainty avoidance. The extent to which a culture prefers structured, ordered to unstructured, unordered situations. Masculinity versus femininity. The extent to which a culture stresses masculine values (as defined by Hofstede) such as assertiveness, action orientation, success, and competition over feminine values such as quality of life, warm personal relationships, and caring. Power distance. The degree to which a society's members are equal or different in terms of status.

Self-Monitoring

Individuals vary in self-monitoring, or how much they look to others for behavioral cues. High self-monitors are sensitive to others' influences, aligning their behavior with social desires and expectations, while low self-monitors rely more on their own preferences. Self-monitoring is associated with agreeableness in the Big-Five personality traits and values like prosocial behavior and restrictive conformity. In advertising, high self-monitors respond more to image-oriented ads and are willing to pay more for such products, whereas low self-monitors are attracted to quality-focused ads. Marketers can enhance decision satisfaction by appealing to consumers' level of self-monitoring. Additionally, susceptibility to social influence varies, with those having lower social confidence being more influenced by advertisements than those with higher self-confidence.

Optimal Stimulation Level

Individuals vary in their optimal stimulation level, which is the balance between too little stimulation leading to boredom and too much causing stress. People generally prefer moderate arousal, but this level differs from person to person. Those with a high need for arousal often seek variety, are curious, take risks, and are innovative. This trait is linked to the Big-Five personality traits of extraversion and openness, and values related to enjoyment, achievement, and self-direction. Consumers with a high need for stimulation are typically drawn to exciting and adventurous activities like skydiving, gambling, and river rafting.

Upward mobility

Involves moving up to a higher class than one's parents were in. also called intergenerational upward mobility

Voluntary Simplicity

Limiting acquisition and consumption to live a less material life.

Marketing Implications of specific personality traits that influence consumer behavior

Marketers can tailor offerings and communications to resonate with specific personality traits, enhancing the effectiveness of their campaigns. By understanding personality-related consumption behaviors, they can develop strategies that appeal to different consumer types. For example, ads targeting self-monitoring consumers might emphasize social approval, while those appealing to consumers with a high need for stimulation or uniqueness could focus on novel experiences. Internationally, marketers can leverage cultural and personality differences between countries. Innovative marketing strategies include Ben & Jerry's using a Facebook app in Europe that merges a personality test with ice cream preferences and voting for new flavors. Similarly, the Los Angeles Kings hockey team engages competitive consumers with a website game offering points for social media interactions, leading to exclusive rewards. These examples illustrate how understanding and applying personality traits in marketing can create more engaging and effective consumer interactions.

Money as Both Good and Evil

Money can be perceived as the just reward for hard work and can lead to the acquisition of needed items, a higher quality of life, and the ability to help others and society in general. On the downside, the quest for money can lead to negative emotions such as anxiety, anger, depression, and loneliness. It can instigate greed, dishonesty, and potentially harmful practices such as gambling, prostitution, and drug dealing Moreover, individuals who do not share their wealth with others may be seen as selfish and greedy. Interestingly, consumers with an annual household income under $25,000 donate about 4 percent of their income to charity, whereas consumers with household incomes of $100,000 or more donate about 3 percent of their income.

Downward mobility

Moving down to a lower class than one's parents were in. status panic - children who are struggling to reach their parents level of success

Extended Family

Nuclear family plus relatives such as grandparents, aunts, uncles, and cousins in u.s. family is considered to be nuclear family

Household

One or more people in the same residence, regardless of familial relationship. number of people with a non traditional (not just a nuclear family) households has increased due to demographics, later marriages, cohabitation (two or more ppl of opposite sex living together without marriage) divorce, dual careers, boomerang children returning to live with parents, people living longer, lower birth rate avg household size is decreasing

locus of control

People's tendency to attribute the cause of events and outcomes to the self (internal) or not to the self (external, such as others, the situation, luck, or fate). Locus of control, a key aspect of personality, affects how people attribute causes of events, influencing their consumer behavior. Those with an internal locus of control believe they are responsible for outcomes, while those with an external locus attribute results to external factors like luck or others' actions. This trait impacts consumer satisfaction, choice habits, and preferences, such as a tendency towards products perceived as 'lucky'. It's linked to the openness trait in the Big Five personality model and involves a balance between internal and external attributions for events and outcomes.

Factors of Influence on a spousal household role

Personal discretionary income influences the ability to influence and personal felt involvement increases the motivation to influence partners demographics including education level and age gender Compared to others, recent generations of consumers and consumers in industrialized countries have less traditional sex-role orientations related to household decision-making than other consumers do. Keep in mind that parents play a massive role in the socialization of their children

fraudulent symbols

Products, services, or brands that becomes so widely adopted that they lose their status.

Conflict resolution

Resolving a problem in a household through a variety of techniques such as problem solving, persuasion, bargaining, and politics usually is not systematic households often avoid rather than confront conflicts

How Does Social Class Affect Consumption?

Social class influences consumer acquisition, consumption, and disposition behaviors. This section examines four major topics conspicuous consumption and voluntary simplicity, status symbols, compensatory consumption, and the meaning of money.

what is the influence of social classes?

Social class structures influence the norms, values, behavior, satisfaction, and health of consumers—and this may differ across cultures. Members of a social class interact regularly with each other formally and informally, for instance, via social media. Therefore, people are more likely to be influenced by members of their own social class than by people in other social classes. In this way, social class influences reflect the fact that people with similar life experiences tend to exhibit similar lifestyles and behaviors.

Social Class as a driver of values

Social classes have distinct values that influence their consumption patterns. With Eastern Europe and Latin America transitioning to market economies, the global middle class is expanding, bringing with it values like materialism, a preference for less government interference, and a desire for greater information access. Upper-upper-class consumers, equipped with ample resources, value contributing to society and often engage in social, cultural, and civic causes. They also value self-expression, which is evident in their choices of homes, clothing, cars, and other forms of consumption.

Specific Personality Traits That Influence Consumer Behavior

Specific personality traits have a strong influence on consumer behavior, which can be divided into self-and-growth traits (like need for cognition and competitiveness) and others-and-stability traits (such as self-monitoring and dogmatism). Locus of control, bridging both groups, determines how individuals attribute outcomes to internal or external causes. Marketers can leverage these traits to develop targeted strategies, such as using personality-based appeals in advertising, to cater to different consumer preferences and behaviors.

Family Lifecycle

Stage which family is in (empty nester, etc) based on number and age of caregivers and how many children are living in the household characterized by: age of adults, number of adults, grandparents, other caregivers, age and number of children at home and so on changes occur to change the stage in the life cycle (ex: someone dies)

Compensatory consumption

Takes place when buying products, services, or brands to offset frustrations or difficulties in life.

Circumplex of core values includes whihc 7?

The "Other and stability" values maturity, Terminal Values (desirable end states): Mature love true friendship wisdom a world of beauty Instrumental values (desirable intermediate states): courageous security, Terminal Values (desirable end states): national security freedom inner harmony family security a world at peace Instrumental values (desirable intermediate states): prosocial, Terminal Values (desirable end states): equality salvation Instrumental values (desirable intermediate states): forgiving helpful belief in a higher power honest loving restrictive conformity, Terminal Values (desirable end states): Instrumental values (desirable intermediate states): obedient polite self-control responsible "self growth" values enjoyment, Terminal Values (desirable end states): comfortable life pleasure happiness Instrumental values (desirable intermediate states): cheerful achievement, Terminal Values (desirable end states): social recognition an exciting life Instrumental values (desirable intermediate states): ambitious capable self-direction Terminal Values (desirable end states): sense of accomplishment self respect Instrumental values (desirable intermediate states): imaginative independent broadminded intellectual logical

Big-Five personality traits

The Big-Five personality traits are core dimensions of human personality, showing consistent patterns in thinking, feeling, and behavior. These traits, which have a biological basis, are neuroticism, extraversion, openness, agreeableness, and conscientiousness. Each trait influences various aspects of behavior and consumer preferences, and they can be measured using tools like surveys and factor analysis. The Ten-Item Personality Inventory (TIPI) is an efficient instrument to measure the Big-Five personality traits. Each trait is represented by two items that are opposites.

Personality

The broad, stable patterns of feelings, thinking, and behaviors that differentiate people from each other, and that influence their future behaviors. Values and personality traits, being broad aspects of individuals, have wide-ranging but typically modest effects on consumer behavior. Specific attitudes, like one's view on snacking before bed, greatly impact that particular behavior but are less likely to influence unrelated behaviors, such as choice of news websites. Personality characteristics can affect both behaviors, but their influence is usually more subtle compared to specific attitudes.

Middle Class

The middle class in the U.S. is primarily composed of white-collar workers, with around 50% of households falling into this category, down from 61% in 1970. Their values and consumption patterns are diverse, but many look to the upper class for cues in areas like dining etiquette, fashion, and leisure activities including golf and tennis. Middle-class consumers, especially those aspiring for upward mobility, also show interest in theatre, vacations, and adult education for self-improvement. They often try to balance emulating higher classes with originality, leading to explorations in sustainable products, diverse foods, and international travel. In Latin America, the middle class is expanding rapidly and is poised to outnumber the lower class. While countries like Brazil and Chile see a growing middle class, others still face economic struggles. The Mexican middle class shares many spending patterns with its U.S. counterpart, focusing on cars, clothing, vacations, and household goods. In Africa, the middle class, accounting for about 33% of households, is growing fast, boosting regional businesses and attracting global corporations due to their increasing disposable income.

Money and Happiness

The popular belief that money can buy happiness is rarely completely true. Relatively poor people can be happy, and rich people can be sad. But the belief is rarely entirely false. Consumers who experience extreme poverty and who cannot meet their basic daily needs experience stress with respect to their current expenses and worry about their future financial situation—both of which reduce happiness. Moreover, people who grew up in poorer environments have a less positive outlook on life and expect to have a shorter life span. This may reduce their likelihood of buying health insurance or making long-term financial and other commitments, such as about retirement saving plans. But research also shows that in poor nations where basic human needs can be met, consumers with a high degree of relatedness and autonomy can feel a sense of life satisfaction. In large-scale surveys in the United States, a higher income is not associated with day-to-day feelings of enjoyment and happiness, but it is associated with how satisfied one is with life overall.

hedonism

The principle of pleasure seeking by searching for goods, services, and sensory experiences that make life comfortable and enjoyable, such as good-tasting foods and beverages, music, shopping, vacations, intimacy, and the company of friends

Household decision tasks and roles

The roles of each person in a household of a particular purchase decision. There are 8 types of roles: Problem recognition: Who identifies the gap between desired and actual state? Information search: Who searches for info? Influence: Who influences the purchase? Choice: Who makes the final choice? Purchase: Who clicks pay or goes to the store? Payment: Who pays? Consumption: Who owns and uses the product? Post consumption action: Who shares the result of and experiences the usage of the offering?

Political Orientation

The set of beliefs that people have about the proper order of society and how it can be achieved. Political orientation significantly influences consumer behavior, reflecting personal values and personality traits. It ranges from conservative to liberal and has two dimensions: tradition-change and hierarchy-equality. Conservatives often support the current social order and accept social hierarchy, while liberals advocate for change and equality. Conservative orientation correlates with values like security, tradition, power, and restrictive conformity, and traits like conscientiousness and politeness. Liberals align with values of inner harmony, world peace, fairness, and openness to experience. Conservatism is linked to a need for order and structure, while liberalism is associated with tolerance for uncertainty and open-mindedness. In terms of consumer behavior, liberals tend to seek horizontal differentiation through unique products, while conservatives prefer vertical differentiation, signaling success with luxury items and associating price with quality. Liberals are more likely to experiment with new products, while conservatives show more satisfaction with their choices and are less likely to complain. Political orientation also interacts with other factors like socioeconomic status and cultural norms, influencing consumer responses to marketing initiatives and political issues differently.

Value System

The total set of values and their relative importance to a person.

The Upper Class

The upper class in society consists of diverse individuals like the aristocracy, inherited wealth holders, new elites, and upper-middle-class professionals. In the U.S., notable examples include families like the Waltons and Mars. This group is characterized by their investment habits, preference for quality over price, and self-expression through prestigious brands. They engage in intellectual and socially conscious activities, and are major consumers of luxury products. The U.S. has the most millionaires globally, with a growing number in China. Ultra-high-net-worth individuals, with assets over $30 million, receive specialized financial services.

Working Middle class

The working class, mainly comprising blue-collar workers, has become younger, more ethnically diverse, more female, and more educated. These consumers rely on family for economic and social support, including job opportunities and advice on major purchases. Due to their limited budgets, they have a short-term and local focus, often showing strong preferences for local sports teams, news, and vacations. They are more inclined to donate to immediate, urgent causes than to long-term ones. Financially, working-class consumers tend to spend rather than save. When saving, they prefer savings accounts for financial stability but often struggle with bulk buying or advanced purchase strategies due to budget constraints. Many in this class are "unbanked" and pay fees for basic financial services like check cashing. They typically associate higher prices with better quality, shop at discount stores, and often have less information when making purchases.

Ch 13 Summary

This section describes consumers experiencing poverty and homelessness, who are at the lower end of the social status hierarchy. Their income is often supplemented by governmental assistance programs. In 2021, an estimated 7.8 to 11.6 percent of the U.S. population experienced poverty. Financial constraints in this group can lead to negative generalizations about services and overconsumption of high-calorie foods. Raising the minimum wage may help improve their access to healthier food options. Homelessness affects a significant portion of society, including those employed but unable to afford housing, as well as the unemployed, underemployed, and those facing other challenges like substance abuse or mental illness. In the U.S., estimates suggest around 600,000 people are homeless on any given night, with the number potentially much higher. Homeless individuals struggle for survival and dignity, relying on scavenging and maximizing the use of any possessions they have. The section also discusses marketing implications across social classes. Product development and advertising messages are tailored to each class's unique needs and aspirations. Media exposure varies by class, influencing how marketers reach their target audiences. Distribution channels also differ, with luxury boutiques catering to the upper class and discount stores appealing to the working and lower classes. The needs of homeless individuals include basic necessities like socks, hygiene items, and food, with shelters also requiring donations and volunteer support.

Consumers Experiencing Poverty and Homelessness

This section describes consumers experiencing poverty and homelessness, who are at the lower end of the social status hierarchy. Their income is often supplemented by governmental assistance programs. In 2021, an estimated 7.8 to 11.6 percent of the U.S. population experienced poverty. Financial constraints in this group can lead to negative generalizations about services and overconsumption of high-calorie foods. Raising the minimum wage may help improve their access to healthier food options. Homelessness affects a significant portion of society, including those employed but unable to afford housing, as well as the unemployed, underemployed, and those facing other challenges like substance abuse or mental illness. In the U.S., estimates suggest around 600,000 people are homeless on any given night, with the number potentially much higher. Homeless individuals struggle for survival and dignity, relying on scavenging and maximizing the use of any possessions they have. The section also discusses marketing implications across social classes. Product development and advertising messages are tailored to each class's unique needs and aspirations. Media exposure varies by class, influencing how marketers reach their target audiences. Distribution channels also differ, with luxury boutiques catering to the upper class and discount stores appealing to the working and lower classes. The needs of homeless individuals include basic necessities like socks, hygiene items, and food, with shelters also requiring donations and volunteer support.

Three and six major social classes

Three: High, Medium, and Low Six: Capitalist class income: $150,000 - infinity, Upper middle > > $70,000, Middle > $40,000, Working class > $25,000, Working poor > $14,000, Underclass < $14,000 Upper classes are more similar to each other lower classes are more culture bound

Socialization

Two way process in which caregivers tech children how to make consumption decisions and actions in emerging economies, children have less influence over their caregiver Ex: eating habits

conspicuous compassion

Use of charitable donations of money to enhance donor's social prestige and superior socio-economic status

value segmentation as a byproduct of market segmentation

Value segmentation: Grouping consumers by their shared values and customizing marketing offerings and communication based on these values. Marketers use value segmentation to identify consumer groups with distinct values. Even for basic products like pencils, different value segments exist. For instance, Faber-Castell caters to segments valuing quality, creativity, durability, status, and style. This approach helps marketers understand what attributes are important to consumers in a segment, influencing their brand choices. For example, in fashion, consumers valuing status may seek luxury, while those valuing uniqueness opt for nonmainstream styles. The Body Shop targets Millennials and Gen Z who prefer natural, ethical, and environmentally conscious products.

domain-specific values

Values that apply to a particular life domain or area of activities, such as consumption, health, work, leisure, family, technology, and the environment. have a stronger influence on consumer behavior Materialism, for example, is a domain-specific value which concerns the importance of the acquisition and ownership of material goods Although core and domain-specific values differ in scope, they are jointly part of a person's value system such that domain-specific values (like health) can be instrumental to achieving of one or more core values (such as sense of accomplishment and self-respect).

conspicuous waste

Visibly buying products and services that one never uses.

Value conflict

When consumers are aware that a particular behavior is consistent with one or more of their important values but inconsistent with one or more of their other important values. For example, a consumer who values both enjoyment and environmental sustainability and talks about this may experience a value conflict when traveling by cheap air to another state or country to attend a musical festival such as Austin City Limits in Texas or Glastonbury in the U.K. Then the behavior's immediate consumption benefits and its environmental costs may produce psychological tension.

Status crystallization

When consumers are consistent across indicators of social class income, education, occupation, etc.

Conflict in household decision making

When members of the household disagree on who is responsible for which decision making role. Conflicts csan arise over: the motivations for buying; (2) which option to choose; (3) who should make the final choice; and (4) who gets to pay, use or consume the product, service or brand. For instance, conflict may occur in decisions about "green" consumption, such as using organic food and conserving water or energy.

Trickle down consumption

When offerings are first adopted by upper class are adopted by lower classes

Trickle up consumption

When offerings are first consumed by lower classes and move up in class

Trickle- across cosnumption

When products, services, or brands are adopted by all social classes (almost) instantaneously.

Parody Display

When status symbols start in the lower social classes and move upward.

allocentric

consumers who prefer interdependence and social relationships Allocentric consumers exhibit more interest in health consciousness, group socializing, reading, and food preparation.

money

anything that serves as a medium of exchange, a unit of account, and a store of value Money allows consumers to acquire status objects as indicators of social class standing or to rise to a higher class levels through product acquisition.

terror management theory relating to materialism

consumers relieve anxiety over the inevitability of death by acquiring and possessing things. On the other hand, members of communes and certain religious orders have chosen a lifestyle that rejects material possessions, and some people more generally try to shift away from materialism and live a life of frugality and material simplicity

idiocentric

consumers tend to put more emphasis on individual freedom and assertiveness. Idiocentric consumers exhibit more interest in sports and adventure, financial satisfaction, gambling, and brand consciousness. When these consumers make unilateral choices for a whole group (movie to watch, restaurant to go to, dish to eat), their choices differ depending on group size: For smaller groups, they make choices that balance self and others' preferences, while for larger groups, they make choices that more strongly reflect their own preferences

downward vertical brand line extension

downward vertical brand line extensions, because new product lines are added to a brand below the brand's core offering. It is a risky strategy because brands may lose their status appeal, but can it be profitable when the markets accept the line extension, such as in the case of the successful Mercedes A-class.

Individualism

giving priority to one's own goals over group goals and defining one's identity in terms of personal attributes rather than group identifications Placing a high value on individualism and being independent can be expressed ruggedly by wearing hunting boots, but also by placing a high value on owning one's own car rather than using public transportation, by engaging in individual sports (golf, biking, running) rather than team sports (basketball), or relying on self-medication rather than consulting a physician.

Terminal values

highly desired end states such as social recognition and pleasure

Instrumental values

intermediate values that help to attain end states For example, two terminal values in the prosocial category are equality and salvation. Instrumental values such as loving, forgiving, helpfulness, honesty, and belief in a higher power help a person to achieve these terminal values.

Earned Status

status acquired later in life through achievements

Inherited Status

status that derives from parents at birth

social class fragmentation

the disappearance of class distinctions happening because: There are several reasons for this. First, both upward and downward mobility have blurred class divisions. Second, the increased availability of mass media, especially TV and the Internet is exposing consumers worldwide to the values and norms of diverse classes and cultures, leading some people to adopt elements of other groups' behavior. Third, advances in communication technology have increased interaction across social class lines.

Social Class Heirarchy

the grouping of members of society according to status, high to low These social classes consist of identifiable groups of individuals whose wealth, behaviors, and lifestyles differ from those of members of the other classes. Members of a particular social class tend to share similar values and behavior patterns.

Status Threat

when consumers fear downward social mobility

consumption emulation

where members of a social class adopt the brands, products, or services of their own or other classes, or have equal access to them