Family and social class Consumer Behavior The changing

Family and social class Consumer Behavior

The changing family • Nuclear family • Extended family • Increase in the large number of working women in India. • Fewer children or no child in a family • Husbands of working wives made fewer decisions or a joint decisions 11 - 2

THE CHANGING FAMILY • Married couple, the nuclear family and the extended family. • There are many factors associated with how family lifestyles are changing that impact on family consumer behavior. • E. g about 55 % of career women who are 35 yrs old are childless. • The Indian family or household has been changing in size and composition especially in urban areas, where the family is growing smaller in size, with fewer children per family. 11 - 3

Households Family Households: Married couple, Nuclear family, Extended family Households Nonfamily Households: Unmarried couples, Friends/ Roommates, Boarders 11 - 4

Socialization & related roles of family members • Socialization of family members, ranging from young children to adults is central family function. In case of young children, this process includes imparting to children the basic values and modes of behavior consistent with culture. • This generally includes moral and religious principles, interpersonal skills, dress, grooming standards, appropriate manners and speech, and the selection of suitable educational and occupational career goals. 11 - 5

• Parental socialization responsibility seems to be constantly expanding, parents are anxious to see their young children possess all qualities, constant pressure to help their children secure an advantage or keep ahead are demanding daily schedules that rule the lives of many children, • Such hectic schedules foster a concentration on competition. • With the structured activities of today and with the child constantly surrounded by media, there is little opportunity for the child to explore his world 11 - 6

Contd. . • Marketers are sensitive to the fact that the socialization of young children provides opportunity to establish a foundation on which later experiences continue to build throughout life. • These experiences are reinforced and modified as the child grows into adolescence, the teenage years and eventually into childhood. 11 - 7

Consumer Socialization of Children The process by which children acquire the skills, knowledge, and attitudes and experience necessary to function as consumers. 11 - 8

Consumer Socialization of Children • Many children acquire their consumer behavior norms through observation of their parents. Coshopping is when mother and child shop together • Preadolescent children rely on their parents, adolescents and teenagers are likely to look at their friends for models of accepted behavior • Children perceive their families as a close and reliable sources of information. 11 - 9

Consumer Socialization of Children • Shared shopping experiences also give children the opportunity to acquire in-store shopping skills. Co-shopping is when mother and child shop together. • Consumer socialization of children has other aspects when parents use promise or reward as a device to modify or control a child’s behavior (Promise to buy something or rewarding with chocolate / gift) 11 - 10

• A socialization agent is a person involved in the socialization process. Mothers are considered to be stronger consumer socialization agents than their husbands, because they tend to be more involved with their children and are more likely to mediate their children's exposure to commercial messages. • Mothers play important role. • Married daughters tend to follow the rituals and buy the brands that their mothers used to do 11 - 11

• Mother-daughter association in the advertisement or mother-son association impacts the buying behavior. • Brands that have used these linkages in the Indian context are vicks, bournvita, complan, dettol, knorr soups, pears soap, kent water filter, clinic plus, Horlicks, Johnson & johnson, pepsodent toothpaste. • The lady of the house is also seen to provide care and comfort to her family e. g. suffola oil, wheel detergent, Quaker Oats, Kellog’s Cornflakes 11 - 12

Children growing up in the materialistic world • Children learn to attach importance to worldly possession at an early age. • School age is when they become aware about fashion and brand conscious and they incline towards shopping. • Ridicule is a mechanism used by adolescents to exchange information about what should and should not be consumed. Ridicule is used to criticize the peers who violate consumption norm. 11 - 13

INTERGENERATIONAL SOCIALIZATION • Brand preferences are transferred from one generation to another. It is a intergenerational brand transfer. • Grandparents are influencers sometimes for the choices • The preferences of a married daughter are from her mother. 11 - 14

A Simple Model of the Socialization Process 11 - 15

Dynamics of Husband-Wife Decision Making • Marketers are interested in the relative amount of influence that a husband a wife have when it comes to family consumption choices. • The relative influence of husbands and wives can be classified as Ø Husband dominated Ø wife dominated Ø Joint Ø autonomic 11 - 16

Dynamics of Husband-Wife Decision Making • The relative influence of a husband wife on a particular consumer decision depends in part on the product category. • E. g automobile : HD • Financial decision making : WD or Joint • Household purchases : WD 11 - 17

Eight Roles in the Family Decision-Making Process ROLE Influencers Gatekeepers Deciders Buyers Preparers Users DESCRIPTION Family member(s) who provide information to other members about a product or service Family member(s) who control the flow of information about a product or service into the family Family member(s) with the power to determine unilaterally or jointly whether to shop for, purchase, use, consume, or dispose of a specific product or service Family member(s) who make the actual purchase of a particular product or service Family member(s) who transform the product into a form suitable for consumption by other family members Family member(s) who use or consume a particular product or service Maintainers Family member(s) who service or repair the product so that it will provide continued satisfaction. Disposers Family member(s) who initiate or carry out the disposal or discontinuation of a particular product or service 11 - 18

The expanding role of children in family decision making • Over the past several decades, there has been a trend toward children playing a more active role in what the family buys as well as in the family decision-making process. • This shift in influence has occurred as a result of families having fewer children, more dual-income couples who permit their children to make a greater number of choices, and encouragement of media to allow children to express themselves. • Children are participating the buying for the products generally which are a low involvement products • Single-parent child is pushed by parent to be self-reliant. 11 - 19

• Research indicate that kids in supermarkets with a parent make an average of 15 requests, of which about half are granted. • They take decisions for their clothes, shoes, cinemas, CDs, soft drinks, holiday trip, family car etc. 11 - 20

Tactics used by children to Influence their Parents Pressure Tactics The child makes demands, uses threats to persuade you to comply with his/her request Upward appeal The child seeks to persuade, saying that the request was approved or supported by an older member of the family Exchange Tactics The child makes an explicit or implicit promise to give you some sort of service in turn of favor Coalition Tactics The child seeks the aid of other to persuade to comply with his request or uses the support of others Ingratiating Tactics The child seeks to get you in a good mood Rational Persuasion The child uses logical arguments and factual evidence to persuade to agree with his request Inspirational Appeals The child makes an emotional appeal Consultation Tactics The child seeks your involvement in making decision 11 - 21

PESTER POWER • Advertisers have recognized the importance of children’s “pester power” and therefore encourage children to “pester” their parents to purchase what they see in ads. 11 - 22

Family communication’s impact • Research supported that the extent to which children influence a family’s purchase is related to the family communication patterns. • Pluralistic parents (parents who encourage children to speak up and express their preferences on purchase) • Consensual parents (parents who encourage to seek harmony but not open their children’s viewpoint on purchases. • Protective parents (parents who stress that children should not stress their own preferences, but rather go along parents judgment. 11 - 23

The Family Life Cycle ( FLC) • FLC analysis enables marketers to segment families in terms of a series of stages spanning the life course of a family unit. • FLC is composite variable created by systematically combining such commonly used demographic variables such as marital status, size of family, age of family members, and employment status of the head of household. 11 - 24

Traditional FLC – Stage I: Bachelorhood – Stage II: Honeymooners – Stage III: Parenthood / full-nest stage – Stage IV: Post parenthood or empty-nest stage – Stage V: Dissolution 11 - 25

Modification to FLC • Non- Traditional Family Life Cycle Stages – Family Households • • • Childless couples ( DINK) Couples who married late Couples who have first child at later stages Single Parent Extended Family – Non-Family Households • • Unmarried couples Divorced Persons Single Persons Widowed Persons 11 - 26

Social Class The division of members of a society into a hierarchy of distinct status classes, so that members of each class have either higher or lower status than members of other classes. 11 - 27

Social class and social status • The social class is measured in terms of social status. • Social status is the amount of status the members of that class have in comparison with members of other social classes. • In social-class research (also called social stratification) status is frequently thought of as the relative rankings of members of each social class in terms of specific status factors. • While estimating the social class mainly relative wealth, power and prestige factors are used for while estimating social class. 11 - 28

Social comparison theory • To secure an understanding of how status operates within minds of consumers, researchers have explored the idea of social comparison theory. • According to this social psychological concept, individuals quite normally compare their own material possessions with those owned by others in order to determine their relative social standing. • Status is often associated with consumers purchasing power 11 - 29

• Researchers most often approach the actual study of status in terms of one or more of the following convenient demographic ( socioeconomic) variables Ø family income Ø Occupational status Ø Educational attainment • The socioeconomic variables, as expressions of status are used by marketing practioners to measure social class. 11 - 30

Status Consumption • Consumers endeavor to increase their social standing through consumption • Very important for luxury goods Five question status consumption scale 1) I would buy a product just because it has status 2) I am interested in new products with status 3) I would pay more for a product of it had status 4) The status of a product is irrelevant to me 5) A product is more valuable to me if its giving value for money. 11 - 31

Social class is hierarchical and a form of segmentation • Social-class categories are usually ranked in a hierarchy, ranging from high to low status. • Thus members of specific social class perceive members of other social classes as having either more or less status than they do • Therefore social-class categories suggest that others are either equal to them, superior to them, or inferior to them. 11 - 32

Contd. . • The hierarchical aspect of social class is important to marketers. • Consumers may purchase certain products because these products are favored by members of either their own or a higher social class, & consumers may avoid other products because they perceive the products to be “lower-class” • Thus the various social-class strata provide a natural basis for market segmentation for many products and services. 11 - 33

Social Class Measurement Ø Subjective and objective measures 1. Subjective measure – In individuals are asked to estimate their own social-class positions – Which one of the following four categories best describes your social status. 1) Lower class 2) Lower-middle class 3) Upper-middle class 4) Upper class 5) Do not know It is based on the participants self-perceptions or self -images. 11 - 34

Objective measures • In contrast to the subjective methods, which require people to envision their own standing or that of other community members, objective measure consist of selected demographic or socioeconomic variables. • These variables are measured through questionnaires that ask respondents several factual questions about themselves, their families, or their place of residence, occupation, income education. 11 - 35

Objective Measures • Single-variable indexes – – Occupation Education Income Other Variables • Composite-variable indexes – Index of Status Characteristics – Socioeconomic Status Score 11 - 36

Index of Status Characteristics (ISC) A composite measure of social class that combines occupation, source of income (not amount), house type/dwelling area into a single weighted index of social class standing. 11 - 37

Socioeconomic Status Score (SES) A multivariable social class measure used by the United States Bureau of the Census that combines occupational status, family income, and educational attainment into a single measure of social class standing. 11 - 38

Geodemographic Clusters A composite segmentation strategy that uses both geographic variables (zip codes, neighborhoods) and demographic variables (e. g. , income, occupation) to identify target markets. 11 - 39

The Affluent Consumer • Especially attractive target to marketers • Growing number of households can be classified as “mass affluent” with incomes of at least $75, 000 • Some researchers are defining affluent to include lifestyle and psychographic factors in addition to income • Have different media habits than the general population 11 - 40

Most large banks offer “private banking” services to their most affluent customers. weblink 11 - 41

Consumer behavior applications of social class • Clothing, fashion and shopping • Saving, spending and credit • Social class and communication 11 - 42