Today’s Plan

• Review of course schedule

• Assignment 2 brief
• Chapter 6
• Chapter 7
 Review of Course Schedule
Session Date Topic Room

Monday, January 02, 2023 Online

1 Thursday, January 05, 2023 Introduction, chapter 1, assignment 1 brief Online

2 Monday, January 09, 2023 Chapters 2 + 4 Online
3.1 Monday, January 30, 2023 Chapters 6 + 7 and assignment 2 brief Online
3.2 Saturday, February 04, 2023 Market research session 1 by guest speaker Online
4 Monday, February 06, 2023 Lecturer supports students in assignment 3 D2.03
5 Monday, February 13, 2023 Chapters 8 + 9 D2.03
6.1 Monday, February 20, 2023 Chapters 10 + 11 D2.03
6.2 Saturday, February 25, 2023 Market research session 2 by guest speaker D2.03
7 Monday, February 27, 2023 Lecturer supports students in assignment 3 D2.03
8 Monday, March 06, 2023 Chapters 12 + 13 D2.03
9.1 Monday, March 13, 2023 Chapters 14 + 15 D2.03
9.2 Saturday, March 18, 2023 Market research session 3 by guest speaker D2.03
10 Monday, March 20, 2023 Lecturer supports students in assignment 3 D2.03
11 Monday, March 27, 2023 Chapters 16 + 18 D2.03
12 Monday, April 03, 2023 Assignment 3 presentation (in peson) D2.03
 Assignment 2 Brief

Please refer to Assessment 2/Assignment Guide on KFO for details

CHAPTER 6
The Changing
American
Society:
Families and
Households

Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
PART II: EXTERNAL INFLUENCES

6-5
 Learning Objectives

Explain the concept of household types and their

L01
influence on consumption
Summarize the household life cycle’s various stages
L02 and marketing implications

Understand the family decision process

L03
Describe the role that households play in child
L04 socialization

Explain the sources of ethical concern associated with

L05 marketing to children
 The Nature of American Households

The Household Influences Most Consumption Decisions

6-7
 The Nature of American Households

Types of Households1
v Household:
Ø Consists of all the people who occupy a housing unit (a house,
apartment, group of rooms, or single room designed to be occupied
as a separate living quarters).
v Family Household:
Ø One having at least two members related by birth, marriage, or
adoption, one of whom is the householder, who owns or rents the
residence.
v Non-family Household:
Ø A householder living alone or exclusively with others to whom he or
she is not related.

1 U.S. Census Bureau definition of a household. 6-8

The Nature of American Households

6-9
 The Nature of American Households

• The traditional family refers to a

married opposite-sex couple and
their own or adopted children living
at home.
• A stepfamily is a married-couple
family household with at least one
child under the age of 18 who is a
stepchild (i.e., a son or daughter
through marriage).
• A multigenerational family is a family
household containing:
Ø At least two adult generations, or
Ø A grandparent and at least one
other generation

6-10
 The Household Life Cycle
The Traditional view of Family Life Cycle

6.
1. Ø American households follow much more
A few years
People
later the complex and varied cycles today.
married by
female would
their early 20s
die
Therefore, researchers have developed
several models of the household lifecycle
(HLC).
5. 2.
The male Couple had
Ø Each HLC stage presents unique needs
would several
eventually die children and wants as well as financial conditions
and experiences.
Ø HLC provides marketers with relatively

3. homogeneous household segments that

4. Their children
The original grew up and share similar needs with respect to
couple retired started their
own families household-related problems and
purchases.
6-11
 The Household Life Cycle
Stages of the Household Life Cycle

6-12
 Marketing Strategy Based on
the Household Life Cycle

6. 1.
A few years People married
later the female by their early
would die 20s

Ø Factors such as income,

occupation, and education
heavily influence how an
individual meets his/her
5. 2. needs.
The male Couple had
would several
eventually die children Ø So, it makes sense to
combine stage in the HLC
with one of these variables to
aid in market segmentation
and strategy formulation.
3.
4. Their children
The original grew up and
couple retired started their
own families

6-13
Marketing Strategy Based on
the Household Life Cycle

6. 1.
A few years People married
later the female by their early
would die 20s

Examples of market
segments based on
5. household life cycle in 2.
The male Couple had
would Vietnam based on several
eventually die children
consumer needs, wants,
education level, financial
conditions?

3.
4. Their children
The original grew up and
couple retired started their
own families

6-14
 Family Decision Making

• Family decision making is the process by which decisions that

directly or indirectly involve two or more family members are
made.
• Family purchases are often compared to organizational buying
decisions. However, with family purchasing, there is usually less
explicit criteria, and most family purchases directly affect the other
members of the family.
• Most important, many family purchases are inherently emotional
and affect the relationships between the family members.

6-15
 Family Decision Making

• Family Purchase Roles

• Determinants of Family Purchase Roles

• Conflict Resolution

• Marketing Strategy and Family Decision Making

• Consumer Socialization and Marketing to Children

6-16
Family Decision Making
Family Purchase Roles

6-17
 Family Decision Making
Determinants of Family Purchase Roles
Families interact in a purchase decision is largely dependent on:
ü The culture/subculture in which the family exists
ü The role specialization of different family members
ü The degree of involvement each has in the product area of concern
ü The personal characteristics of the family members

6-18
 Family Decision Making
Decision-Making Influence and Relative Income

6-19
 Family Decision Making
Conflict Resolution
One study revealed six basic approaches that individuals use to
resolve purchase conflicts1.
Approach Description
Bargaining Trying to reach a compromise.
Impression Misrepresenting the facts in order to win.
Management
Use of Authority Claiming superior expertise or role appropriateness (the
husband/wife should make such decisions).
Reasoning Using logical argument to win.
Playing on Using the silent treatment or withdrawing from the
Emotion discussion.
Additional Getting additional data or a third-party opinion.
Information

1 C. Kim and H. Lee, “A taxonomy of Couples Based on Influence Strategies,” Journal of Business Research, June 1996, pp. 157-68.

6-20
Marketing Strategy and Family Decision Making

honda

children > parent parent > children

both

both

--> marketers: maybe targeted both but focus more on the larger consumption
--> children maybe try to manipulate/ pursue parents to consider the value of products
--> the gap btw beside stage and current stage is really important to make decision

6-21
 Consumer Socialization
• Consumer socialization is the process by which young people
acquire skills, knowledge, and attitudes relevant to their functioning as
consumers in the marketplace.
• The family provides the basic framework in which consumer
socialization occurs.
• Understanding the content and the process of consumer socialization.
Ø Consumer socialization content refers to what children learn with
respect to consumption.
Ø Consumer socialization process refers to how they learn it.

6-22
 Consumer Socialization
The Content of Consumer Socialization
Consist of three categories:
1. Consumer skills: capabilities
necessary for purchases to occur
such as understanding money,
budgeting, product evaluation, etc.
2. Consumption-related preferences:
knowledge, attitudes, and values that
cause people to attach differential
evaluations to products, brands, and
retail outlets.
3. Consumption-related attitudes:
cognitive and affective orientations
toward marketplace stimuli such as
advertisements, salespeople,
warranties, etc.
6-23
 Consumer Socialization
The Process of Consumer Socialization
Consumer socialization occurs primarily through family, as well as through a
number of avenues including advertising and friends.
Parents socialize their children through the following:
1. Instrumental training—occurs when a parent or sibling specifically and
directly attempts to bring about certain responses through reasoning or
reinforcement.
2. Modeling—occurs when a child learns appropriate, or inappropriate,
consumption behaviors by observing others.
3. Mediation—occurs when a parent alters a child’s initial interpretation of, or
response to, a marketing or other stimulus.
 Marketing to Children

• Children are a large and growing

market.
• However, marketing to children is
fraught with ethical concerns,
including:
Ø The limited ability of younger
children to process information
and to make informed purchase
decisions.
Ø Marketing activities, particularly
advertising, can produce
undesirable values in children,
resulting in inappropriate diets,
and cause unhealthy levels of
family conflict.
6-25
CHAPTER 7
Group
Influences on
Consumer
Behavior

Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
PART II: EXTERNAL INFLUENCES

7-27
 Learning Objectives

L01 Explain reference groups and the criteria used to classify

them
Discuss consumption subcultures, including brand and
L02 online communities and their importance for marketing

Summarize the types and degree of reference group

L03 influence

Discuss within-group communications and the

L04 importance of word-of-mouth communications to
marketers
L05 Understand opinion leaders (both online and offline) and
their importance to markets

L06 Discuss innovation diffusion and use an innovation

analysis to develop marketing strategy
 Reference Group
• A group is defined as two or more individuals who share a
set of norms, values, or beliefs and have certain implicitly or
explicitly defined relationships which make their behaviors
are interdependent.
• A reference group: a group that an individual uses as a guide
for behavior in a specific situation.

7-29
 Group Classification
Criteria useful in classifying groups:

1. Membership (either yes or no)

2. Strength of social tie (primary groups vs secondary groups)

3. Type of contact: direct contact (i.e., face-to-face interaction) vs indirect

contact (i.e., online interaction)

4. Attraction: negative desirability vs positive desirability

7-30
 Types of Groups

Consumption Subcultures
Ø Self-selects on the basis of a shared commitment to a particular product,
brand or activity.

Ø Identifiable hierarchy

Ø Shared beliefs & values

Ø Unique jargon and rituals

7-31
 Types of Groups
Online communities and social networks:
Ø Community interacts around a topic of interest on the Internet

Ø Social network sites: Facebook, YouTube, Tiktok, Instagram,

Twitter...

7-32
 Types of Group
Brand Communities

üA group of people united in their admiration for a particular brand

üCharacterized by a shared sense of belonging among members

7-33
 Reference Group Influence on the
Consumption Process
Types of Reference Group Influence

Informational influence Normative influence Identification influence

Ø Using behaviors and Ø Using group norms and
opinions of other Ø Choosing to fulfil
group expectations values to guide one’s
reference group attitudes or values.
members as useful to gain a reward or
avoid a sanction Ø Also known as value-
pieces of information expressive influence

7-34
Reference Group Influence on the
Consumption Process
Consumption Situations and Reference Group Influence

7-35
 Communications within Groups and
(Key) Opinion Leadership

Ø WOM

Ø (Key) Opinion Leaders

Ø Marketing and Online Strategies

7-36
Communications within Groups and
Opinion Leadership
WOM Versus Advertising
(% who put people vs. advertising as best source)

7-37
 Communications within Groups and
(Key) Opinion Leadership
(Key) Opinion Leaders
ü Has greater long-term involvement with a product or service category
than other members in the group
ü Filters, interprets, or provides information about the product or service
for other members
ü Normally include celebrities and influencers

7-38
Communications within Groups and
Opinion Leadership
Mass Communication Information Flows

7-39
Communications within Groups and
Opinion Leadership
Likelihood of Seeking an Opinion Leader

7-40
 Communications within Groups and
Opinion Leadership
Crowdsourcing
Ø Goes well beyond consumer-
generated ads.
Ø Can involve setting up a forum in
which customers help other
customers.
Ø Can include input into product and
service design.

7-41
 Communications within Groups and
Opinion Leadership
Marketing Strategy, WOM, and Opinion Leadership
Strategies designed to generate WOM and encourage opinion
leadership include:
1. Advertising
2. Product Sampling
3. Retailing/Personal Selling
4. Creating Buzz

https://www.youtube.com/watch?v=KmWmK6x6vtQ

7-42
Communications within Groups and
Opinion Leadership
Online Strategies to Leverage Buzz and WOM

Personal or group influences

may be present at any stage
of the consumer decision
making process, especially
during the stage of
information search.

7-43
 Diffusion Innovations

• An innovation is an idea, practice, or product perceived to be

new by the relevant individual or group.
• The manner by which a new product spreads through a
market is basically a group phenomenon.
• New products can be placed on a continuum from no change
to radical change, depending on the market’s perception.

7-44
 Diffusion Innovations
Categories of Innovations
• Continuous Innovation
Ø Adoption of this type of innovation requires relatively minor changes in
behavior(s) that are unimportant to the consumer.
• Dynamically Continuous Innovation
Ø Adoption of this type of innovation requires a moderate change in an
important behavior or a major change in a behavior of low or moderate
importance to the individual.
• Discontinuous Innovation
Ø Adoption of this type of innovation requires major changes in behavior
of significant importance to the individual or group.

7-45
 Diffusion Innovations
Adoption Process and Extended Decision Making

7-46
 Diffusion Innovations
Factors Affecting the Spread of Innovations
Type of
Group

Perceived Type of
Risk Decision

Marketing
Trialability
Effort

Rate of
Diffusion

Fulfillment of
Observability
Felt Need

Complexity Compatibility

Relative
Advantage

7-47
 Diffusion Innovations

Adopter Categories

• Innovators

• Early Adopters

• Early Majority

• Late Majority

• Laggards
grandparents: fear of complication,...

7-48