1. Chapter 14: Group Influences

2. What is a Reference Group?
An actual or imaginary group which has an influence
on a person’s evaluations, aspirations and behavior.
Forms of Influence:
~ informational (pre-purchase, purchase,
and post-purchase)
~ utilitarian (group’s preferences)
~ value-expressive (social image)

3. Types of Reference Group Influence
Normative:
Setting fundamental standards of
“how” to conduct oneself. This kind of
influence affects the product class one
consumes, not so much the specific brand.
Comparative:
This influences the specific brands one
purchases rather the broader product
class level decisions.

4. Variations in Reference Groups
Formality:
(1) Formal reference groups characterized by structure
charter, periodic meetings, officers, explicit set of rules
(e.g., Religious groups etc.). These are more “marketable”
(2) Informal reference groups (e.g., Friends)
Nature of Relationship:
(1) Membership groups. Here identification depends on:
~ propinquity or physical distance
~ group cohesiveness
~ mere exposure
(2) Aspirational

5. Variations in Reference Groups (Continued)
Valence of Relationship:
(1) Positive or Approach
(2) Negative or Avoidance
In summary, reference groups vary in terms or
(a)degree of formality, (b) nature of relationship and
(c) valence of relationship.

6. When Do Reference Groups Have the most Influence?
Some factors are: Level of Risk
Luxury or Necessity
Public or Private Consumption
Also, some times the influence is at the brand level and other
times it may be at the product level.

7. Necessity Luxury Public Private
The effect of the reference group depends on the visibility
of the consumption and the extent to which a product is a
necessity. For example, in the grid below, reference groups
generally affect brand choice for publicly consumed necessities, and affect product class choices for privately consumed luxury goods.
Necessity Luxury
Brand Product Class
Brand
None Product Class
Public
Private

8. Types of Power Which Reference Groups Have
Social Power refers to the ability to change a person’s
behavior.
~ referent power (the model)
~ informational power (editors)
~ legitimate power (officers in a formal structure)
~ expert power (your friend who is a computer expert)
~ reward power
~ coercive power

9. Factors that Influence Conformity to the Group Dictat
Culture Pressures
Fear and Consequences of Deviance
Commitment
~ principle of least interest
Group Unanimity, Size and Expertise
Gender Differences