Chapter

Unit-8
GROUP INFLUENCES AND CONSUMER BEHAVIOUR

Dr. Ashutosh Kumar Asia-Pacific Institute of Management

Sources of influence on consumer behaviour can be described as marketer dominated or non-marketer dominated and as delivered by mass media or personally
Marketer dominated Non-marketer dominated (2 ) Ne w s Crit ique s/re vi ew s Progra mm e cont ent Ex te rnal endors eme nts Cultural he roes/ heroines Clubs/ organis ations (4 ) Family Friends Neighbours Clas sm ate s Co -w or k er s Low Special: Opinion leaders Sources: Market mavens Low Credibility High High Two - wa y Communication Reach High Reach Low

(1 ) Mass delivered Adve rtis ing Sa les promot ions Publicity

De livered Personality

(3 ) S ale sp ers ons

Reference Group

Person Group Point of Ref.

Values

Formation

Attitudes Behaviour

REFERENCE GROUP
A reference group is one whose presumed perspective or values are being used by an individual as the basis of her/his current behaviour. Individuals use reference the group simply as a guide for behaviour in a specific situation.

When do Groups Exert Influence?

The group influence on an individual's buying behaviour depends on three factors: Attitude Towards the Group: The buying behaviour of a consumer is more likely to be influenced by the group if the individual: 1. 2. 3. Views the reference group as a credible source of information about the product or service. Values the views and reactions of group members with regard to buying decisions. Accepts the rewards and sanctions allotted out by the group for proper or improper behaviour.
Cont.

Nature of the Group: reference groups are more likely to influence a group member's behaviour if they are: i. Cohesive, that is having similar values and norms. ii. Frequently interacting and thus creating more opportunities to influence members. iii. Distinctive and exclusive, that is, the membership in the group is highly regarded. Harley-Davidson group example, the group is closely knit and for many members biking has become a full-time hobby. Membership is exclusive and distinctive as they refer to each other as "brothers" and outsiders as "citizens. Nature of the Product: The nature of the product also determines the degree of influence a group has on an individual. Groups are more likely to be influential for products, which are: (a) visible such as clothing and (b) exclusive that might speak of status such as a Mercedes.

Types of Reference Groups

Reference Groups

membership

Aspirational

Disclaimant

Avoidance/ dissociative

Types of Reference Groups

Reference groups furnish points of comparison by which one can evaluate attitudes and behaviour. An individual can be a member of a reference group such as the family and would be said to be part of a membership group. This same individual may aspire to belong to a cricket club and would be said to be apart of an aspiration group. A disclaimant group is one to which an individual may belong to or join and then reject the group's values. The dissociative reference group includes people that the individual would not like to be like. Membership Groups 1. 2. 3. 4. Primary Informal Groups (family & peer groups) Primary Formal Groups (business groups) Secondary Informal Groups (Womens kitty parties, or sports groups) Secondary Formal Groups (Teachers associations or retailer assoc.)
Cont.

Types of Reference Groups

Membership Positive attitude Negative attitude Positive membership group Disclaimant-group Non membership Aspiration group Dissociative group

Types of membership groups Informal Primary Secondary Positive membership group Disclaimant-group Formal Aspiration group Dissociative group

Types of aspiration groups Contact No Contact Anticipatory Symbolic

Cont.

Aspiration Groups Anticipatory Aspiration Groups: These are groups that an individual anticipates to join at some future time. The individual, generally, has some direct contact with such group(s). For instance, the individual may wish to join a group higher in the organisational hierarchy. The individual's aspiration is more likely to be an outcome of anticipated rewards that go with higher position in an organisation such as power, status, prestige, money and other perks. A good example of a direct appeal to aspiration group norms within the organisation is the ad for Johnnie Walker. The ad appeal focuses on anticipation of ultimately reaching at the top in the business organisation.

Appealing to Increase Position

Cont.

Symbolic Aspiration Groups: The individual admires these groups but is unlikely to join them despite acceptance of the group's beliefs and attitudes. In a study Robert J. Fisher and Linda L. Price found that individuals establish a vicarious connection with such a group by purchasing a product associated to the aspiration group. For example, a tennis fan may buy a Nike sports jacket and shoes because many tennis star wear these. It is important for such an influence that the product is visually obvious. Marketers use certain celebrities to advertise the product and thereby appeal to the symbolic aspirations of consumers

Famous soccer player (David Bekham) endorses Police Sunglasses

Reference Group Influences on Consumers Informational kind (influence is based almost entirely on members knowledge), Normative (members influence what is perceived to be "right," "proper," "responsible," or "cool"). Comparative Consumers tend to constantly compare their attitudes with reference to those of members of important groups.

Cont.

Reference Group Influences on Consumers

Informational Influence Reference groups and other influence sources can exert informational influence by offering information to help make decisions. For example, chat-groups on the Internet often provide information on subjects such as Internet travel sites. This type of influence occurs when a consumer accepts information as credible from a reference group member and believes that the information will enhance knowledge about product choice. Informational influence is based on either the similarity of the group's members to the individual or the expertise of the influencing group member. For instance, an individual may notice several members of a given group using a particular brand of sports shoes.
Cont.

Table presented below shows the nature of informational influence on the consumer by describing her/his objective as acquiring knowledge, the condition for accepting information as credible, the power source as expertise and the behaviour as accepting influence.
Types of Reference Group Influences Perceived source characteristics Credibility Similarity Power

Nature of influence Informational Comparative Normative

Objectives

Type of power Expert Referent Reward or coercion

Behaviour

Knowledge Self-maintenance and enrichment Reward

Acceptance Identification Conformity

Informational influence is likely to be more important when consumers perceive financial, social, or performance risk in buying a product. Cont.

Informational influence is important when the consumer's objective is to seek knowledge, the source credibility is acceptable, the source is viewed as expert and finally the behaviour is acceptance of influence. This has implications for marketers. As the source expertise and credibility affect informational influence, marketers can use sources viewed as credible and expert for a given product category. For example, marketers often use well-known sports figures to promote sporting goods.

Cont.

Comparative Influence
Consumers tend to constantly compare their attitudes with reference to those of members of important groups. They serve as a benchmark and the individual's urge is to seek support to her/his attitudes and behaviour. To accomplish this, individuals are inclined to associate with groups with which they agree and stay away from groups with which they disagree. An example can illustrate this point. When a new student in a college meets other students, she/he is likely to compare their attitudes towards education, student's union, sports, movies and dress etc. In the process, the student may also identify brands of jeans, shoes and two-wheeler autos that they use. The student will be attracted to those who appear to be similar to herself/himself because they reinforce existing attitudes and behaviour.

Cont.

Normative Influence
There is a fine residential educational institution for women in Rajasthan, Banasthali Vidyapith, having the status of a deemed university. Teachers, students and other staff members are required to wear only khadi and remain vegetarian. Robert J. Fisher and D. Ackerman note that normative influence, also called utilitarian influence, refers to social pressure designed to encourage conformity to the expectations of others to gain a direct reward or to avoid any sanctions. Normative influence can also affect conformity which is the tendency for an individual to behave as the group behaves. Research shows that conformity and brand-choice seem to be related, though brand-choice congruence may not be the only way to express conformity. An individual may also conform by performing the activities that the group wants the member to perform. For example, Indian as well as other Eastern cultures seem to be more group oriented and individuals are more likely to go with group desires.
Cont.

Conditions for Conformity 1. 'The individual is committed to the group and values membership in it'. Carrying on with the example of Banasthali Vidyapith, the teachers, other staff members and students are committed and value its membership and conform to the norms and expectations of the institution. 2. 'The group provides significant rewards for compliance and punishment for lack of compliance'. The basic reward for compliance with group norms is acceptance. 3. 'The individual's behaviour in conforming is visible to members of the group'. The rewards for conformity are more likely if the individual's behaviour is visible, such as clothes. Noncompliance may draw sanctions. The basis of normative influence is reward or coercion and the resulting behaviour toward the group Cont. is conformity and compliance.

Reference Group Influences on Publicly and Privately Consumed Luxuries and Necessities Where Consumed In Private Influence weak Razor Toilet soap Water heater Mattress Influence strong Body massage DVD player Hot bath tub Private swimming-pool In Public Influence weak Clothing Watches Shoes Conveyance Influence strong Camcorder Jewelry Health club Car

Necessity Type of Product Luxury

Cont.

Rejection of Conformity A reaction of many consumers to group pressures for conformity is rejection. This has important societal implications. If teenagers could be influenced to reject peer group pressures to smoking, drinking and drug abuse, it could be instrumental in saving numerous lives.

Applications of Reference Group Influences

Marketers employ informational, comparative and normative group influences to develop marketing communication strategies. Advertising often makes use of informational influence through expert spokespersons who communicate information about product features and performance. One approach employed is to use a character posing as an expert, such as a doctor for commonly used remedies, or the engineer for technical products. Advertising applies comparative influence by using either an actual referent in the form of a "typical consumer" or use a celebrity as a symbolic referent with whom consumers identify because she/he is likeable or attractive. The "typical consumer" (Lalitaji of Surf ad) persuades consumers that people like themselves have used the advertised product (a)). The typical consumer is a referent because she/he mentions common needs and problems faced by the target group members. In case of symbolic referent, the ad takes advantage of her/his fame in some area of activity and not her/his expertise in the product category. The ad for Fiat Palio uses Sachin Tendulkar Cont. as a symbolic referent (b)).

(a) Actual referent is a typical consumer

(b) Symbolic referent The famous cricketer