Who is a Consumer ?

 Any individual who purchases goods and services from the market for his/her end-use
is called a consumer.
 In simpler words a consumer is one who consumes goods and services available in the
market.
What is consumer Interest ?
Consumer interest is nothing but willingness of consumers to purchase products and services
as per their taste, need and of course pocket.
What is Consumer Behaviour ?
 Consumer Behaviour is a branch which deals with the various stages a consumer
goes through before purchasing products or services for his end use.

 There are infact several factors which influence buying decision of a consumer
ranging from psychological, social, economic and so on.

Consumer Behaviour
The behaviour that consumers display in searching for, purchasing, using, evaluating, and
disposing of products and services that they expect will satisfy their needs.

Personal Consumer
The individual who buys goods and services for his or her own use, for household use, for the
use of a family member, or for a friend

Development of the Marketing Concept

1. The Production Concept
 Assumes that consumers are interested primarily in product availability at low
prices
 Marketing objectives:
– Cheap, efficient production
– Intensive distribution
– Market expansion
2. The Product Concept
 Assumes that consumers will buy the product that offers them the highest quality,
the best performance, and the most features
 Marketing objectives:
– Quality improvement
– Addition of features
 Tendency toward Marketing Myopia

Marketing Myopia
 Marketing myopia is a concept which says that companies focus on their needs &
short term growth strategies instead of taking care of the needs & wants of the
consumer & therefore fail due to their short-sightedness.
 The firm is not able to adapt themselves to the highly dynamic market where
consumer needs & wants are changing frequently. The company is not able to predict
future & think on long terms.
The marketing myopia can be avoided by the company if the business starts focusing on
customer needs & requirements instead of just selling a product to the consumer.
 3. The Selling Concept
 Assumes that consumers are unlikely to buy a product unless they are aggressively
persuaded to do so
 Marketing objectives:
– Sell, sell, sell
 Lack of concern for customer needs and satisfaction
4. The Marketing Concept
 Assumes that to be successful, a company must determine the needs and wants of
specific target markets and deliver the desired satisfactions better than the competition
 Marketing objectives:
– Profits through customer satisfaction

Two Types of Shared Characteristics

Behavioral data is evidence-based; it can be determined from direct questioning (or
observation), categorized using objective and measurable criteria, such as demographics, and
consists of:
1. Consumer-intrinsic factors, such as a person’s age, gender, marital status, income, and
education.
2. Consumption-based factors, such as the quantity of product purchased, frequency of
buying a given product.

Cognitive factors are abstracts that “reside” in the consumer’s mind, can be determined only
through psychological and attitudinal questioning, and generally have no single, universal
definitions. It consists of:
1. Consumer-intrinsic factors, such as personality traits, cultural values, and attitudes
towards politics and social issues.
2. Consumption-specific attitudes and preferences, such as the benefits sought in products and
attitudes regarding shopping.

Basis of Segmentation of Market

(1) Geographic Segmentation –

 Region – North, South, East, West

 Population density – Metropolitan areas, small cities, villages, towns
 Type of Area – Urban, suburban, exurban, rural
 Climate – Cold, hot, humid

(2) Demographic Segmentation –

 Age and Life cycle stages – Baby, teenager, bachelor, parent, grand-parent
 Gender – Male, Female
 Marital Status – Single, married, divorced, living together, widowed
 Income – Lower, middle, upper
 Education – High school, graduate, post-graduate
 Occupation – Salaried worker, businessmen, professionals
(3) Psychological/Psycho-graphic Segmentation –

 Needs – Shelter, safety, security, love, self-esteem, self-actualization

 Personality – Extrovert, introvert, aggressive, compliant
 Perception – Safe players, moderate risk takers, high risk takers
 Learning- Low involvement, high involvement
 Attitudes – Positive attitude, negative attitude
 Lifestyle – Achievers, Strugglers, Strivers, Makers

(4) Socio-cultural Segmentation –

 Culture – Indian, American, Japanese, Chinese, Mexican

 Subculture – Shia and Sunni, Brahmin and Kshatriya
 Religion – Hinduism, Islam, Sikhism, Christianity
 Social Class – Lower class, middle class, upper-middle class, upper class
 Family Role – Buyer, Initiator, User, Disposer
 Lifecycle Stage – Bachelors, young marrieds, empty nesters

(5) Use-Related Segmentation –

 Usage Rate – Heavy users, regular users, light users, 1st time user, non-users
 Awareness – Unaware, aware, informed, interested, desire, intend to buy
 Brand Loyalty – Brand Loyalists, Brand Switchers

(6) Behavioural Segmentation –

 Occasion – birthdays, marriages, festivals, national events, holidays

 Benefits – Convenience, prestige, economy, value-for-the money, Quality, speciality
 Innovator
Innovator type of consumer has the high level of income, high self esteem, abundant
resources and often indulge their self in any or mostly all self orientation. They care about
their image as an expression of character and taste.

Favorite Things:
BMW
Wired
sparklingwater
a rewarding experience
 Thinkers
These thinkers consumers are motivated by ideals. They are mature, responsible, decently
educated, professionals. Their spend their free time activities mostly center on their homes,
but they are well informed about what's up in the world (sensitive to news update) and are
open to new ideas and social change. They have high incomes but are practical consumers
and rational decision makers, they don't really care about self esteem and image.
Favorite Things:
Subaru
Kiplinger's Personal Finance
a glass of wine
a substantive discussion

 Achievers
Achievers are motivated by achievement. Successful work-oriented people who get their
satisfaction from their jobs, career, school and families. Politically conservative and respect
authority. Favor established products and services that show off their success to their peers.
 Experiencers.
Motivated by self-expression. Youngest of all the segments categories, with age ranging of
25. very energetic, which they waste it into physical exercise and social activities. Spending
heavily on clothing, fast-foods, music, and other youthful favorites, interested on new
products and services.
Favorite Things:
VW
Rolling Stone
Red Bull
to be entertained

 Believers
Believer consumers also motivated by ideals. Believers are conservative and mostly
predictable consumers who favor products with strong brand identity and established brands.
Their lives are centered on family, community, and the nation with modes way of living.
Favorite Things:
Mercury
Cooking with Paula
local TV news
a close-knit family
 Strivers.
Also motivated by achievements. Mostly very similar to achievers but have fewer economic,
social, and psychological resources. Style is extremely important to them as they strive to
emulate people they admire.
Favorite Things:
Chevrolet
Playboy
Coke Classic
win the lottery
 Makers.
Motivated by self-expression, very practical people who value self-sufficiency. Focused on
the family, and work,and have little interest in the broader world. As consumers, they
appreciate practical and functional products rather than the prestige or whatsoever is being
offered.
Favorite Things:
Dodge Ram
Field & Stream
Budweiser
NASCAR
 Survivors.
Have the lowest incomes. The oldest of all the segments, with a median age of 61. Within
their limited means, tend to be brand-loyal consumers.
Favorite Things:
an American car
AARP Magazine
The 700 Club
a home-brewed cup of coffee

Behavioral Targeting
sending consumers personalized and prompt offers and promotional messages designed to
reach the right consumers and deliver to them highly relevant messages at the right time and
more accurately than when using conventional segmentation techniques

Consumer Research
Quantitative Research
 Descriptive in nature.
 Enables marketers to “predict” consumer behaviour.
 Research methods include experiments, survey techniques, and observation.
 Findings are descriptive, empirical and generalizable.
Qualitative Research
 Consists of depth interviews, focus groups, metaphor analysis, collage research, and
projective techniques.
 Administered by highly trained interviewer-analysts.
 Findings tend to be subjective.
 Small sample sizes

Comparisons between Positivism and Interpretivism

PURPOSE
Positivism
Prediction of consumer actions
Interpretivism
Understanding consumption practices
METHODOLOGY
Positivism
Quantitative
Interpretivism
Quantitative
ASSUMPTIONS
Positivism Interpretivism
• Rationality • No single, objective truth
• The causes and effects of • Reality is subjective
behaviour can be identified • Cause and effect cannot be
• Individuals are problem solvers isolated
• A single reality exists • Each consumption experience is
• Events can be objectively unique
measured • Researcher/respondent
• Findings can be generalized interactions affect research
findings
The Consumer Research Process
 Six steps
– defining the objectives of the research
– collecting and evaluating secondary data
– designing a primary research study
– collecting primary data
– analyzing the data
– preparing a report on the findings

Major Sources of Secondary Data

 Government Publications
 Periodicals & Books
 Internal Sources
 Commercial Data
Data Collection Methods
Observational Research
 Helps marketers gain an in-depth understanding of the relationship between people
and products by watching them buying and using products.
 Helps researchers gain a better understanding of what the product symbolizes.
 Widely used by interpretivist researchers.
Experimentation
 Can be used to test the relative sales appeal of many types of variables.
 Only one variable is manipulated at a time, keeping other elements constant.
 Can be conducted in laboratories or in the field.
Survey Data Collection Method
Personal Interview
Mail
Telephone
Online
Validity
 The degree to which a measurement instrument accurately reflects what it is designed
to measure
Reliability
 The degree to which a measurement instrument is consistent in what it measures

Attitude Scales
 Likert scales: easy for researchers to prepare and interpret, and simple for consumers
to answer.
 Semantic differential scales: relatively easy to construct and administer.
 Rank-order scales: subjects rank items in order of preference in terms of some
criteria
Qualitative Data Collection Methods
Depth Interviews
Focus Group
 A qualitative research method in which eight to ten persons participate in an
unstructured group interview about a product or service concept
Projective Techniques
 Research procedures designed to identify consumers’ subconscious feelings and
motivations.
Metaphor Analysis

Customer Satisfaction Data Collection Instruments

 Customer Satisfaction Surveys
 Gap Analysis of Expectations versus Experience
 Mystery Shoppers
 Critical Incident Technique
 Customer Complaint Analysis
 Analysis of Customer Defections
THE INTERDISCIPLINARY NATURE OF CONSUMER BEHAVIOR:
Psychology: This includes the study of the individual as well as the individual determinants
in buying behavior, viz., consumer perception, learning and memory, attitude, self-concept
and personality, motivation and involvement, attitudes and attitudinal change and, decision
making.
Sociology: This includes the study of groups as well as the group dynamics in buying
behavior, viz., family influences, lifestyles and values, and social group influences.
Social Psychology: This includes the study of how an individual operates in group/groups
and its effects on buying behavior viz, reference groups and social class influences.
Anthropology: This is the influence of society on the individual viz., cultural and cross-
cultural issues in buying behavior, national and regional cultures etc.
Economics: This is the study of income and purchasing power, and its impact on consumer
behavior. The underlying premise is that consumers make rational choices while making
purchase decisions. While resource are limited and needs and wants many, consumers collect
information, and evaluate the various alternatives to finally make a rational decision.

What Is Motivation?
 The driving force within individuals that impels them to action
– Produced by a state of tension due to an unfulfilled need
– Which leads to conscious/subconscious attempts to reduce the tension
 Types of Needs
 Innate Needs
– Physiological (or biogenic) needs that are considered primary needs or
motives
 Acquired needs
– Generally psychological (or psychogenic) needs that are considered secondary
needs or motives
Types of Motives
 Rational Motives
– Goals chosen according to objective criteria (e.g., price)
 Emotional Motives
– Goals chosen according to personal or subjective criteria (e.g., desire for
social status)
 Latent Motives
– Motives that the consumer is unaware of or unwilling to recognize
– Harder to identify
– Require projective techniques to identify
 Manifest Motives
– Motives that the consumer is aware of and willing to express

Goals
 Generic Goals
– the general categories of goals that consumers see as a way to fulfill their
needs

Positive Motivation Negative Motivation

A driving force toward some object or
condition
Leads to an Approach Goal
A positive goal toward which behaviour
is directed
A driving force away from some object or
condition
Leads to an Avoidance Goal
A negative goal from which behaviour
is directed away

– e.g., “I want to get a graduate degree”

 Product-Specific Goals
– the specifically branded products or services that consumers select as their
goals
– e.g., “I want to get an MBA in Marketing from Kellogg School of
Management.”

The Selection of Goals

 The goals selected by an individual depend on their:
– Personal experiences
– Physical capacity
– Prevailing cultural norms and values
– Goal’s accessibility in the physical and social environment
Motivations and Goals

 The Dynamic Nature of Motivation

  Needs are never fully satisfied
 New needs emerge as old needs are satisfied
 A given need may lead totally different goals
 Consumers are more aware of their goals than their needs
 Consumer values, personality and self-concept influence consumer goals
 Consumers have multiple needs
 Pre-potent need
 Motives are difficult to infer from behaviour
 Past experiences (success/failure) influence goals
 Defence Mechanisms

Three types of motivational conflict

Motives may conflict with each other
– Three types of motivational conflict
– Approach-approach: when a consumer is drawn towards two positive goals
– Approach-avoidance: when the goal object has both positive and negative qualities
You are both drawn toward and away from the object
– Avoidance-avoidance: when the consequences of buying an object is unpleasant, but the
purchase does not lead to any pleasure

Motives can be aroused in many ways

– Physiological arousal
• Hunger, thirst
– Emotional arousal
• daydreaming
– Cognitive arousal
• Random thoughts
– Environmental arousal
• Cues in the environment (e.g. smell of food)
 Murray’s List of
Psychogenic Needs
 Needs Associated with Inanimate Objects:
Acquisition, Conservancy, Order, Retention, Construction
 Needs Reflecting Ambition, Power, Accomplishment, and Prestige:
Superiority, Achievement, Recognition, Exhibition, Infavoidance
 Needs Connected with Human Power:
Dominance, Deference, Similance, Autonomy, Contrariance
 Sado-Masochistic Needs :
Aggression, Abasement
 Needs Concerned with Affection between People:
Affiliation, Rejection, Nurturance, Succorance, Play
 Needs Concerned with Social Intercourse:
Cognizance, Exposition

McClelland’s Trio of Needs

Power
– individual’s desire to control environment
Affiliation
– need for friendship, acceptance, and belonging
Achievement
– need for personal accomplishment
– closely related to egoistic and self-actualization needs

Mid-range Theories of Motivation

 Psychological Reactance
– Motivational arousal due to threat of behavioural freedom
Opponent Process Theory
– Extreme initial reactions may be followed by extreme opposite reaction
– Priming
 Small amounts of initial stimuli will lead to desire for more
 extreme amounts of exposure to same stimulus will lead to withdrawal
Mid-range theories
Hedonic Consumption
– Need to gain pleasure through the senses
– Explains attraction to scary rides, adventure tours, etc.
Optimum Stimulation Level
– Desire to maintain a certain level of stimulation that the consumer considers to
be optimal
Motivational Research
Qualitative research designed to uncover consumers’ subconscious or hidden motivations.
Consumers are not always aware of, or may not wish to recognize, the basic reasons
underlying their actions.
Motivation and Marketing Strategy
Identify the needs and goals of the target market
– Identify both latent and manifest motives
Use knowledge of needs to segment the market and to position the product
Use knowledge of needs to develop promotional strategies
Reduce motivational conflict

Personality
The inner psychological characteristics that both determine and reflect how a person
responds to his or her environment.
Nature of Personality
Personality reflects individual differences
Personality is consistent and enduring
Personality can change
 Personality is more of an internal factor
 It gets reflected in the pattern of response in humans

Approaches to Personality
Freudian theory
 They work on three factors which act as the basis for all behaviors triggered by
psychology.
 ID which relates to the desires of human beings triggered by the unconscious aspect
of human mind.
 Ego which is nothing but the fully conscious self image. Behaviors that appear more
impulsive tend to get controlled by Ego.
 Superego which is that portion of mind that controls the behavior of human beings
Freud advocates that a proper balance in all the three above given aspects makes a person
become rounded personality. A consumer who has a balanced ID, Ego and Super Ego
exhibits a balanced approach in all their decision pertaining to purchase of products.

Horney’s CAD Theory/ Non-Freudian or Socio-psychological Theory

  Using the context of child-parent relationships, individuals can be classified into:
– Compliant individuals
– Aggressive individuals
– Detached individuals
 Compliant Personality
One who desires to be loved, wanted, and appreciated by others
 Aggressive Individuals are those who act against the intention of others. They
are highly manipulative.
 Detached Individuals least care for brands. Freedom is important for them. They love
to feel independent and are mostly self reliant in their thinking and activities.

 Trait theory
o Quantitative approach to personality as a set of psychological traits
o Single-trait or multiple-trait theories
Consumer Innovativeness
The degree to which consumers are receptive to new products, new services or new
practices
 Consumer innovators are likely to:
– Score lower on dogmatism
– Score higher on need for uniqueness
– Have higher optimum stimulation levels
– Have higher need for sensation seeking and variety seeking behaviours
Consumer Materialism
 Possessions seen as for one’s identity
 Materialistic People
– Value acquiring and showing-off possessions
– Are particularly self-centered and selfish
– Seek lifestyles full of possessions
– Have many possessions that do not lead to greater happiness

Consumer Ethnocentrism
 Ethnocentric consumers feel it is wrong to purchase foreign-made products
 They can be targeted by stressing nationalistic themes
Personality and Marketing Strategy
 Identify relevant personality traits
 Target consumers with the relevant personality traits
 Develop promotional messages that appeal to consumers with specific personality
traits
 Develop a personality for the brand
Self and Self-Image
 Self-image: A person’s perceptions of his/her self
 People have multiple selves
– Different selves in different situations
Different Self-Images
 Actual Self-Image
– How you see your self
 Ideal Self-Image
– How you would like to see yourself
 Social Self-Image
– How you think others see you
 Ideal Social Self-Image
– How you would like others to see you
 Expected Self-Image
– How you expect to be in the future
 “Ought-to” Self
– The qualities that you think you should possess

Consumer Learning
 Consumer learning is defined as a process by which people gather and interpret
information about products and services and use this information/knowledge in
buying patterns and consumption behavior.
Learning Processes
 Intentional
– learning acquired as a result of a careful search for information
 Incidental
- learning acquired by accident or without much effort
Elements of Learning Theories
 Motivation
- Relevance of need and goal
- A need that motivates action
 Cues
A stimulus or symbol to drive action
It directs a drive when they are match consumer expectations
 Response
- Action to satisfy need.
- The reaction or behavior relative to a drive or a cue
 Reinforcement
- The feedback a consumer receives.
- The reward or action.

Reinforcement
 A positive or negative outcome that influences the likelihood that a specific behaviour
will be repeated in the future in response to a particular cue or stimulus.
Learning Theories
 Behavioural Theories: Theories based on the premise that learning takes place as the
result of observable responses to external stimuli. Also known as stimulus response
theory.
 Cognitive Theories: A theory of learning based on mental information processing,
often in response to problem solving.

Behavioural Learning Theories

1.Classical Conditioning
Classical conditioning is a learning process in which an association is made between two
stimuli. With classical conditioning, two stimuli are linked together to produce a new learned
response.
Strategic Applications of Classical Conditioning
Repetition
Repetition increases strength of associations and slows forgetting
but over time may result in advertising wearout.
Cosmetic variations reduce satiation.
Stimulus Generalization
The inability to perceive differences between slightly dissimilar stimuli.
Marketing applications
– Product Line, Form and Category Extensions
– Family Branding
– Licensing
– Generalizing Usage Situations
Stimulus Discrimination
The ability to select a specific stimulus from among similar stimuli because of
perceived differences
 Classical Conditioning and Marketing Strategy
Identify and pair product with a known, well-liked stimulus
– More attention
– More favourable attitudes
– Greater intention to buy the product
– Learning of key attributes
Use stimulus generalization effectively
Distinguish the product through effective use of stimulus discrimination

2.Instrumental Conditioning
Consumers learn by means of trial and error process in which some purchase
behaviours result in more favorable outcomes (rewards) than other purchase
behaviours.
A favorable experience is instrumental in teaching the individual to repeat a specific
behaviour.

Reinforcement
Positive Reinforcement: Positive outcomes that strengthen the likelihood of a specific
response
Example: Ad showing beautiful hair as a reinforcement to buy shampoo

Negative Reinforcement: Unpleasant or negative outcomes that serve to encourage a

specific behaviour
Example: Ad showing wrinkled skin as reinforcement to buy skin cream

Other Concepts in Reinforcement

Punishment
– Choose reinforcement rather than punishment
Extinction
– Combat with consumer satisfaction
Forgetting
– Combat with repetition
Instrumental Conditioning and Marketing
Make the product the ultimate reward
Provide samples and free trials
Provide non-product rewards
Practice relationship marketing
Reinforcement Schedules
– Shaping
Massed versus Distributed Learning

3.Cognitive Learning Theory

Learning through problem solving, which enables individuals to gain some control over
their environment.
Three types:
– Observational learning
– Rote Learning
– Reasoning
Observational Learning
Observational learning or modeling is a process in which learning occurs through observing
the behaviors of others and then imitating those behaviors
Iconic Rote Learning
Learning concepts through simple repetition
– Repeated ads teach consumers about a product’s attributes
Reasoning
Highest level of cognitive learning
Involves creative thinking
Depends on how information is processed and stored

Cognitive Learning and Marketing Strategy

 Use rote learning to teach consumers about the brand
Use reasoning or problem solving for complex or high-involvement products
Use modelling to extinguish negative behaviour
Use knowledge of information processing to help consumers store, retain and retrieve
messages.
Measures of Consumer Learning
Recognition and Recall Measures
– Aided and Unaided Recall
Cognitive Responses to Advertising
Copy-testing Measures
Attitudinal and Behavioural Measures of Brand Loyalty

Attitude
Attitude refers to a way of thinking or behaviour of a person towards a product or service
which is developed through his/her past purchase experiences, use, knowledge, beliefs etc.

Characteristics of Attitudes
Attitudes have an “object”
Attitudes are learned
– Can ‘unlearn’
Attitudes have behavioural, evaluative and affective components
– Predisposition to act
– Overall evaluation
– Positive or negative feelings
Attitudes have consistency
Attitudes have direction, degree, strength and centrality
– Positive or negative
– Extent of positive or negative feelings
– Strength of feelings
– Closeness to core cultural values
Attitudes occur within a situation

How are attitudes learned

Classical conditioning - through past associations

Operant conditioning - through trial and reinforcement
Cognitive learning – through information processing
 – Cognitive dissonance theory (refers to a situation involving conflicting
attitudes, beliefs or behaviors. This produces a feeling of discomfort
leading to an alteration in one of the attitudes, beliefs or behaviors to
reduce the discomfort )
Attribution theory (a theory which supposes that people attempt to understand the
behaviour of others by attributing feelings, beliefs, and intentions to them

Attitude Models
 Structural Models of Attitudes

The Tricomponent Attitude Model is based on three elements that help a consumer to
evaluate a product. They are:

 Affective Element – Feelings and emotions about a product or service

 Cognitive Element – Knowledge and belief about the product or service
 Conative or Behavioral Element – Actions and behaviour towards the product or
service

The Multi Attributes Model substantiates the interest of the consumers on a specific object
and likes and dislikes of consumers towards a product or a brand. This model is divided in to
two types namely –

 Attitude towards the Behaviour Model

A consumer’s attitude toward a specific behaviour is a function of how strongly he or she

believes that the action will lead to a specific outcome (either favorable or unfavorable).

 Attitude towards the Object Model

According to this model, consumers choose products and brands based on comparative
analysis of various product or brand attributes. Consumers go in for products based on
many attributes like options of accessories available along with the product, product
performance, durability of the product and reliability aspects of the same.

 Theory-of-Reasoned-Action Model
o A comprehensive theory of the interrelationship among attitudes, intentions,
and behaviour

Why Might Behaviour Precede Attitude Formation?

Cognitive Dissonance Theory

 Holds that discomfort or dissonance occurs when a consumer holds conflicting

thoughts about a belief or an attitude object.
  Post-purchase Dissonance
– Cognitive dissonance that occurs after a consumer has made a purchase
commitment

Attribution Theory

 Examines how people assign casualty to events and form or alter their attitudes as an
outcome of assessing their own or other people’s behaviour.
 Examples
– Self-perception Theory
– Attribution toward others

Self-Perception Theory

 Attitudes developed by reflecting on their own behaviour

 Judgments about own behaviour
 Internal and external attributions
 Consumers are likely to accept credit for successful outcomes (internal attribution)
and to blame other persons or products for failure (external attribution).
 Foot-In-The-Door Technique

Attitudes and Marketing Strategy

 Appeal to motivational functions of attitudes

 Associate product with a special group, cause or event
 Resolve conflicts among attitudes
 Influence consumer attributions
 Alter components of the attitude
 Change relative evaluation of attributes
 Change brand beliefs
 Add an attribute
 Change overall brand evaluation
 Change beliefs about competitors’ brands
 Change affect first through classical conditioning
 Change behaviour first through operant conditioning

What is a Group?

 Two or more people who interact to accomplish either individual or mutual goals
Reference group

 A Reference group refers to a group of people you refer to, while making buying
decisions. It is a group that serves as a reference point for an individual for his/her
beliefs, attitude and behaviour.

Types of Reference Groups

 Non-Membership and Membership Groups – As the very name suggests,

Membership Groups are the ones which insist on people to become members to avail
benefits offered by the same.
 Non-Membership group are general groups in which one associate them for keeping
self updated about certain aspects of their interest. Such groups do not insist on any
type of memberships.
Primary and Secondary Groups –
 Primary Groups are basically ones whose members are closely knit. Family and
relatives fall in this group
 Secondary Groups are not as closely knit as Primary Groups. They may be
memberships in clubs where the meeting may happen only once a while. The
influence exerted by both the Primary and Secondary Group members play a crucial
role in the decision making process pertaining to purchase of goods and services
Aspirational Groups –
These are groups in which people are not members but desires to become one on a future
date. The aspiration may become true once they are ready to join the group at the future point
of time. The influences exerted by such group members on consumers make them join many
groups every now and then.
Formal and Informal Groups –
 While formal groups are bound by set rules and which are highly structured
 Informal groups are unstructured in nature which tends to exert lesser influence over
consumer preferences than the
 Due to the structure nature of Formal groups, the influence on the group members
with respect to various aspects is generally high.

Factors Encouraging Conformity:

A Reference Group

 Inform or make the individual aware of a specific product or brand

 Provide the individual with the opportunity to compare his or her own thinking with
the attitudes and behaviour of the group
 Influence the individual to adopt attitudes and behaviour that are consistent with the
norms of the group
 Legitimize the decision to use the same products as the group

Reference Groups and Marketing Strategy

 Recognize the extent of reference group influence in a situation

 Identify the most effective type of reference group influence
 Identify possible reference group members to use in promotions
 Attempt to increase reference group influence

Family and Marketing Strategy

 Use the FLC for segmentation and positioning

 Recognize the diverse consumption roles within the family
 Understand and use the dynamics of husband-wife decision making
 Understand and use the consumer socialization role played by the family
 Recognize the changing nature of Canadian families.