MKT 341: Understanding Consumer Behavior

KUSOM, BBA
Fall 2022

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Lecture 10:
Reference Groups, Communities
Opinion Leaders & WOM

© Sujan R Shrestha, KUSOM 2022.

Consumer Decision
Consumer Decision Making Process
 Reference Groups

Groups that serve as sources of comparison, influence, and

norms for people’s opinions, values, and behaviors

Word-of-mouth represents communications where, when

positive, satisfied customers tell other people how much
they like a business, product, service or event.
 The Credibility and Persuasive Power of
Reference Groups
Reference groups have a high degree of source credibility,
defined as a source’s persuasive impact, stemming from its
perceived expertise, trustworthiness, and believability.

Membership
Symbolic

Types of Influence
 Normative Influence versus Comparative Influence

Degree of formality
 Formal versus informal
 Selected Consumer-Related
Reference Groups

Friendship groups

Shopping groups

Work groups

Virtual groups or communities

Brand communities

Consumer-action groups

Celebrities
 Endorsers and Spokesperson

Source credibility is the believability of the endorser,

spokesperson, or individual in an advertisement.
The greater the fit between the celebrity and the product
endorsed, the higher the persuasiveness of the message.
 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
Opinion Leaders
 Opinion Leadership

The process by which one person (the opinion leader)

informally influences the consumption actions or
attitudes of others who may be opinion seekers or opinion
recipients

What is Opinion Leadership?

Opinion Opinion
Leader Receiver

Opinion
Seeker
 Special Issues

Opinion leaders are four times more likely to be asked

about political issues, three times more likely to be asked

about computers or investments, and twice as likely to be
asked about restaurants
Information seekers seek a “strong-tie” source when they

know little about a topic, and “weak-tie” sources when

they have some knowledge
 Purchase Pals and Surrogate Buyers

Purchase Pals

Information sources who accompany a consumer on a

shopping trip

Surrogate Buyers

Professional buyers who help consumers with their

purchases
 Market Maven

Individuals whose influence stems from a general

knowledge or market expertise that leads to an early
awareness of new products and services.
 Opinion Leadership and
Marketing Strategy

Identify and provide samples to opinion leaders

Design programs to stimulate opinion leadership

Develop ads simulating opinion leadership

Create opinion leaders

Control negative word-of-mouth communication

 Word-of-Mouth’s Strategic Applications

In marketing, word-of-mouth consists of transmitting advice

and other types of information about products, brands, and
shopping experiences.

Other word-of-mouth occurs in social networks, brand

communities, blogs, chat rooms, and tweets – Word of Mouse.
Word of Mouth in Action
 Innovations’ Adopters as Reference Group

Groups greatly affect diffusion of innovations.

Adopter categories is a classification that depicts where

consumers stand in relation to other consumers in terms

of the first time they purchase an innovation.

Sociologically, the model assumes that all members of a

given society would, eventually, adopt the innovation

under a theory called Diffusion of Innovations.
 Product Characteristics That Influence
Diffusion

Relative Advantage

Compatibility

Complexity

Trialability

Observability

Felt Need

Risk
 Social System and Diffusion

Does the target market have:

A positive attitude towards change?

Technological skill?

A general respect for education and science?

A focus on rational and ordered social relationship?

An outreach perspective?

The ability to accept different roles?

 Adopter Categories

A sequence of categories that describes how early (or

late) a consumer adopts a new product in relation to
other adopters.
An Enhanced Adoption Process Model
 Diffusion Process and Marketing Strategy

Identify diffusion inhibitors and find ways to compensate

for these

Identify innovators and early adopters and cater to them

Move consumers from awareness to adoption

Make effective use of word-of-mouth communications

 The Road Ahead - reminder

1. Assignments, Cases, and Quizzes – Continue

Pls submit your missed Assignments, Cases or Quizzes
(if any) to makeup your score
Pls mail to sujan@kusom.edu.np
2. Midterm - OVER
3. Group Project – High time to START
 Deadline: 24th February 2023
 In ARTICLE format and Presentation file
4. Final Exam – as per KUSOM instruction