Chapter 12 Social Class and Lifestyles CONSUMER BEHAVIOR

Chapter Objectives When you finish this chapter, you should understand why: 1. Both personal and social conditions influence how we spend our money. 2. We group consumers into social classes that say a lot about where they stand in society. Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -2

Chapter Objectives (continued) 3. A person’s desire to make a statement about his social class, or the class to which he hopes to belong, influences the products he likes and dislikes. 4. Consumers’ lifestyles are key to many marketing strategies. 5. Identifying patterns of consumption can be more useful than knowing about individual purchases when organizations craft a lifestyle marketing strategy. Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 11 -3

Learning Objective 1 • Both personal and social conditions influence how we spend our

Discretionary Income • The money available to a household over and above what it requires to have a comfortable standard of living • How we spend varies based in part on our attitudes toward money • Tightwads • Spendthrifts Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -5

Consumer Confidence • Behavioral economics • Consumer confidence • Factors affecting the overall savings rate: • Pessimism/optimism about personal circumstances • World events • Cultural differences in attitudes toward savings Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -6

For Reflection • How does your own attitude toward spending affect your general shopping

Learning Objective 2 • We group consumers into social classes that say a lot

Social Class Structure • “Haves” versus “have-nots” • Social class is determined by income, family background, and occupation • Universal pecking order: relative standing in society • Social class affects access to resources Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -9

Picking a Pecking Order • Social stratification • Artificial divisions in a society • Scarce/valuable resources are distributed unequally to status positions • Achieved versus ascribed status • Status hierarchy Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -10

Social Mobility Horizontal Mobility Upward Mobility Downward Mobility Copyright © 2013 Pearson Education, Inc.

Figure 12. 1 American Class Structure Copyright © 2013 Pearson Education, Inc. publishing as

For Reflection • How do you assign people to social classes, or do you at all? • What consumption cues do you use (e. g. , clothing, speech, cars, etc. ) to determine social standing? Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -13

Learning Objective 3 • Individuals’ desire to make a statement about their social class, or the class to which they hope to belong, influences the products they like and dislike. Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 2 -14

Components of Social Class • Occupational prestige • Is stable over time and similar across • cultures • Single best indicator of social class Income • Wealth not distributed evenly across classes (top fifth controls 75% of all assets) • How money is spent is more influential on class than income Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -15

Predicting Consumer Behavior • Social class is better predictor of lower to moderately priced symbolic purchases • Income is better predictor of major nonstatus/nonsymbolic expenditures • Need both social class and income to predict expensive, symbolic products Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -16

Consumer View of Luxury Goods • Luxury is functional • Luxury is a reward

Taste Cultures • Taste culture differentiates people in terms of their aesthetic and intellectual preferences • Upper- and upper-middle-class are more likely to visit museums and attend live theater • Middle-class is more likely to go camping and fishing Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -18

Figure 12. 2 Living Room Clusters and Social Class Copyright © 2013 Pearson Education,

Status Symbols • What matters is having more wealth/fame than others • Status-seeking: motivation to obtain products that will let others know that you have “made it” Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -20

Figure 12. 3 A Typology of Status Signaling Copyright © 2013 Pearson Education, Inc.

Problems with Social Class Segmentation • • Ignores status inconsistencies Ignores intergenerational mobility Ignores subjective social class Ignores consumers’ aspirations to change class standing • Ignores the social status of working wives Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -22

For Reflection • Provide examples of quiet versus loud brand signals used among your reference groups. What do these signals say about social class and lifestyle? Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -23

Learning Objective 4 • Consumers’ lifestyles are key to many marketing strategies. Copyright ©

For Reflection • Identify a brand that appeals to your lifestyle. Does it appeal specifically to the things you like to do, how you spend your leisure time, or how you spend your money? Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -25

Learning Objective 5 • Identifying patterns of consumption can be more useful than knowing about individual purchases when organizations craft a lifestyle marketing strategy. Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -26

Figure 12. 6 Consumption Style Copyright © 2013 Pearson Education, Inc. publishing as Prentice

For Reflection • Identify products and settings that would be at home in your consumption styles. • Have marketers identified these consumption styles and used them in advertising? Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -28

Chapter Summary • Both personal and social conditions • • • influence how we spend our money. We group consumers into social classes that say a lot about where they stand in society. A person’s desire to make a statement about social class influences the products he likes and dislikes. Lifestyle is the key to many marketing strategies. Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12 -29