1. GROUPS, FAMILIES AND HOUSEHOLDS

2. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-2 Groups, families and households At the end of this session, you should understand: The roles of families and households as consumers The influence of different family lifecycle stages and family decision-making processes on consumption behaviour The marketing implications of changing household composition and consumption trends The nature of groups and their influence on consumption behaviour The role of opinion leaders in influencing consumer behaviour The influence of different social types on consumption behaviour

3. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-3 Families and households - defined Family – Family Law Act – ‘fundamental unit in society’ – ABS – ‘the basic unit of social organisation’ Household – A group of people that live together and form a purchasing unit – Can be related (family) or not related (friends)

4. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-4 The family lifecycle The family lifecycle concept is based on the idea that families move and evolve through stages over time Consumption patterns change over the stages, for example: – Income and expenditure levels vary over the stages – Needs change with the addition of children and vary according the age of the children – Financial commitments vary depending on the size of the family

5. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-5 Family lifecycle model

6. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-6 Who are these ads targeted at? See EXHIBIT 11.2 and EXHIBIT 11.3 on page 322. PowerPoint slides supplied on the Instructor Resource CD to accompany Consumer Behaviour include advertisement images.

7. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-7 Family purchasing decision roles Different roles in the decision-making process: – Information gatherers/holders – Influencers – Deciders – Purchaser – User How are these roles changing in our society?

8. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-8 Changing family structures Identify the changing trends that are occurring in families and households today Find examples of where marketers are targeting these changing groups See EXHIBIT 11.5 Herbert Adams caters for singles and smaller households, page 326. PowerPoint slides supplied on the Instructor Resource CD to accompany Consumer Behaviour include advertisement images.

9. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-9 The nature of groups A group is two or more people that join together for a common goal or need Some terms commonly used with groups: – Norms – the expected rules of behaviour within a group – Roles – the set of expectations other people have of the behaviours and attributes appropriate to that position – Status – a person’s actual or perceived position within a group – Socialisation – the process through which group norms and role definitions are learned

10. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-10 Types of groups Primary Groups with which we have frequent interpersonal contact vs Secondary Groups with which we have limited interpersonal contact Informal Groups based on very loose structures, such as family groupings and work colleagues vs Formal Groups which have a defined structure, such as a sporting club or work committees Associative Groups to which we actually belong vs Aspirational Groups the consumer identifies with and looks up to, but is unlikely to ever be a part of

11. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-11 Reference groups A group that influences the attitudes and behaviour of individuals who look to it as a reference point for evaluating their own situation

12. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-12 Types of reference group influence Normative – Conformity and social pressures – group outlines what is acceptable behaviour – Two functions of normative reference groups  Utilitarian – conform to the group’s influence in order to gain a reward or avoid punishment  Value-expressive – conform to the group’s influence in order to enhance your own self-concept Informational – Providing credible and needed information

13. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-13 Types of reference groups and their influences

14. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-14 Opinion leaders Individuals who are perceived to be knowledgeable about various topics and whose advice is taken seriously by others Important in the information search and evaluation stage A role taken on by different people in different situations because they have perceived expertise in that area Unlike paid advertising, word of mouth communication from opinion leaders is respected because they offer both positive and negative information about a product’s performance

15. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-15 Who are opinion leaders? You don’t have to be famous to be an opinion leader Opinion leaders can be anyone - including you! They tend to be people that you: – Perceive as being more credible – Perceive as being more knowledgeable  Experts in this area - job related  Interested in this area - hobbies Roles change - where you might be an opinion leader in one situation, you might be an opinion receiver in another situation

16. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-16 Opinion leaders and power Reward power – Power to give physical and psychological rewards to people Legitimate power – Power based on official capacity Expert power – Influence and credibility that a person has, based on their expertise in a particular area Coercive power – Use of messages that warn of bad or unpleasant consequences of behaviour Referent power – Influence that some people have due to their popularity

17. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-17 Marketing implications of opinion leaders Opinion leaders influence the diffusion of innovation - the rate that new ideas are widely accepted by markets - by encouraging product interest as well as trial Products are endorsed by spokespeople or representatives that are: – Credible – Attractive – Trustworthy Market to opinion leaders, for example: – Offer free samples to potential opinion leaders – Encourage them to talk to others

18. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour by Karen Webb Slides prepared by Sarah Fletcher and Morena Dobrowolski 11-18 Teenagers and the youth market This group is highly influenced by the social power of their peers and other reference groups