mkt3050 – consumer behavior week 5

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MKT3050 – Consumer Behavior Week 5 – April 15, 2013


Objectives

• This week we’ll compare and contrast consumer behavior and its role across diverse cultures.– What are cultures and micro cultures?

• And we’ll discuss why cultures and micro cultures are important to marketers.– How do cultures and micro cultures influence consumer behavior?

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3

Consumer Value Framework (CVF)


What is Culture?Why do Marketers Care about it?

• Marketers use information about cultures to explain and predict behavior.

Consumer culture–commonly held societal beliefs that define what is socially gratifying.

Consumer culture–commonly held societal beliefs that define what is socially gratifying.


Exhibit 8.1Culture, Meaning and Value

http://www.youtube.com/watch?v=kXI2_ZimlCk




How does culture help consumers?

Gives meanings to objects

Gives meanings to objects

Gives meanings to activities

Gives meanings to activities

Facilitates communication

Facilitates communication

©FOODPIX/JUPITERIMAGES/GETTY IMAGES

Determines what isvaluable. RefrigeratorsIn Japan.

Defines norms thatspecify appropriatebehaviors. Showers!

Defines roles forconsumers. Eyecontact.


Cultural Norms and Sanctions

Cultural NormRule that specifies the appropriate behavior in a a given situation within a specific culture.

Cultural NormRule that specifies the appropriate behavior in a a given situation within a specific culture.

Cultural SanctionPenalty associated with

performing a non-gratifying or culturally

inconsistent behavior.

Cultural SanctionPenalty associated with

performing a non-gratifying or culturally

inconsistent behavior.


Changing Cultural Norms…

• Use of credit cards• Attitude toward saving• Violence depicted in movies / video games• Breastfeeding• Immunizations• Green initiatives / sustainability• Bottled water

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Where does Culture come from?

• Ecological factors– The physical environment affects beliefs and values

• Traditions– The customs and ways of structuring society– Think about some traditions your family follows….

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How are cultures defined?

• Theory of Core Societal Values identifies 5 characteristics that determine how consumers behave within a culture.

1) Individualism – personal responsibility vs large groups

2) Masculinity – assertiveness / control–vs Femininity – caring, conciliation, community

http://www.youtube.com/watch?v=bd2OzZtZJlI

http://www.youtube.com/watch?v=l2j2L2CcF6Q

3) Power distance – social class, levels of mgmt

- low power distance – everyone equal

- high power distance – lower levels must defer to higher. Certain behaviors only available to those with power.

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Messaging will focus on benefits tied to these values







How are cultures defined?

4) Uncertainty avoidance

- preference for the ‘known’

- affects product adoption

- high price = high risk

- need more information to make decision

5) Long-term orientation

- will look for future rewards vs short-term gains

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These behaviors emerge whenthe decision has higherInvolvement.What can we do to offsetuncertainty?

Core values will affect how consumers behave….based on what isimportant to them and within their society


Exhibit 8.4Evaluating Core Values Across Country

• Indicates that marketers must conduct business differently across country.• How do you decide where to do business?

• Look for nations ‘close-in’ to yours – either geographically and / or culturally


How do consumer get culture?

• Through socialization (learning through observation)• Either through…

– Enculturation (learning from the family / native culture)• OR

– Acculturation (from a new culture)

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Operating instructions of German refrigerator"WARNING - THIS APPLIANCE MUST BE EARTHED"This is okay for a British market, but to my American ear, it sounds like they want me to put a handful of potting soil in my fridge. In American English, this should say "grounded".

American cookie packaging (promotion)"Win a Milano Weekend!"...with an illustration of the Eiffel TowerWell, at least the continent was right. So what if the country was wrong? The cookies, named for the city of Milan, Italy is not the location of the Eiffel Tower, which is in Paris, France.


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Product United States China

Automobiles Expression of individual; provides hedonic value through experience and status.

Way to gain acceptance from others and provide transportation for friends/family; can be status symbol as well; utilitarian value emphasized.

Rolex Expression of individual status and achievement; hedonic value emphasized.

Expression of status within group; hedonic value (more intricate point is that it provides utilitarian value as a way of gaining recognition).

Notebook computer

Primarily a tool for work; utilitarian value emphasized.

Can be used for work, but also as an important mechanism for communicating with others; can also provide status; utilitarian value emphasized.

Ruth’s Chris Steak House

Pleasant and intimate dining experience; hedonic value emphasized.

True luxury product, but perhaps also a tool for building business relationships, particularly with westerners; in the latter case, utilitarian value emphasized.

Blackberry Torch Mobile Device

Tool for work and communication; leans toward more utilitarian value.

Tool for staying in contact with one’s primary groups. Leans toward utilitarian value but slightly more hedonic value than among Americans.


How do consumers learn culture?

• We learn our culture from…– Family– School– Church– Media

16http://www.youtube.com/watch?v=rMajmEtDqi4

We model (imitate) and are shaped (adapt)

http://www.youtube.com/watch?v=rMajmEtDqi4


Every culture has diversity within it….

• When a group of people within a culture share values, they form a ‘microculture’– We belong to 1 or 2 cultures – but many microcultures – each with

its own set of expectations and affects on members and values.– How many do you belong to?

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Why do Marketers Care about Micro cultures?Understanding the priorities of these groups

helps with product, promotion, messaging• Regional micro cultures

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Exhibit 9.3 Regional Differences and Preferences Among U.S. Consumers

If you’ve lived in different region(s) of the country, what did you notice about the regional culture?


• Sex roles refer to the societal expectations for men and women among members of a cultural group.

• Marketers must be aware of sex-roles because they are linked to purchasing behavior.

• Marketing communications are carefully segmented towards males or females and their cognitive structuring.

Sex-Roles and Micro culture

©SIMON RAWLES/ALAMY

http://www.cbsnews.com/video/watch/?id=6893540n

http://www.cbsnews.com/video/watch/?id=6893540n


Age-Based Micro culture

• People of the same age tend to share similar values and consumer preferences.

• This is especially true if teens and seems to apply across nations leading to a world teen culture.

• What ‘age’ are you?


Religious Micro culture

Religion affects consumer culture because religious beliefs, even for the non-devout, can

effect all manner of daily life.

WeekendDays

WeekendDays

MaterialAcquisitions

MaterialAcquisitions

Food and Beverage

Consumption

Food and Beverage

Consumption

BudgetAllocations

BudgetAllocations

ClothingChoices

ClothingChoices


Asian CultureAsian Culture

Ethnic Micro cultures

Hispanic CultureHispanic Culture

African-American CultureAfrican-American Culture


Social Class Micro Cultures

• Social Class– Defined as:

• Individuals / families sharing values, lifestyles, interests, wealth, status, education, economic positions and behavior

– Defined by:• Occupation• Personal performance• Possessions• Values• Class consciousness

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Types of Micro Cultures – Social Class

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Important to marketersIn determining• What to make• Price value• Messaging

How does the social classmicro culture relate to Maslow’s hierarchy ofhuman development?

Are there social classes atNorthwood?


• ‘Dollar store economy’ characteristics:

– Elevated unemployment.

– Continued job concerns.

– Wavering consumer confidence.

– Cautious shopper spending.

– Rising gasoline prices.

– Rising costs of services (e.g. healthcare, education, entertainment), personal debt reduction and retirement savings dictate what remains to spend on goods.

Source: US Bureau of Labor Statistics

Feb-13:7.7%

Jan-

80

Jan-

82

Jan-

84

Jan-

86

Jan-

88

Jan-

90

Jan-

92

Jan-

94

Jan-

96

Jan-

98

Jan-

00

Jan-

02

Jan-

04

Jan-

06

Jan-

08

Jan-

10

Jan-

12

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

US: National Unemployment Rate, 1980-2013

Unemployment remains elevated despite coming down from the 9-10% range where it hovered for 2.5 years through late 2011.

The Economy and its Effect on Social Class

http://www.youtube.com/watch?v=Hfl8kU1gI4Y&cid=ppc_yt_nb_vid_113-Hfl8kU1gI4Y&srid=sr3_50030301_go&adid=YouTube&skw=unemployment&kw={searchQuery}&ven=yt

http://www.youtube.com/watch?v=dSyViaW35Vg

http://www.youtube.com/watch?v=3hGVOhIRKFY

http://www.youtube.com/watch?v=Hfl8kU1gI4Y&cid=ppc_yt_nb_vid_113-Hfl8kU1gI4Y&srid=sr3_50030301_go&adid=YouTube&skw=unemployment&kw=%7BsearchQuery%7D&ven=yt





http://www.youtube.com/watch?v=3hGVOhIRKFY


• According to the US Census Bureau, median household income (in real terms, i.e. removing the effects of inflation) declined from 2010 to 2011, a second consecutive annual decline.

• In 2011, real median household income was 8.1% lower than in 2007.

• The number of households earning less than USD50,000 in 2011 was up 11% compared to 2006; the lowest income segment (< USD25,000) saw the highest increase of +15%.

There are a growing number of households that ‘feel poor’

Compared to five years ago, there are more low-income households in the US and a middle class that is getting squeezed.

< $25k $25-49.9k $50-99.9k $100k+0

5

10

15

20

25

30

35

40

US: Distribution of Income, 2006 vs. 2011Number of Households

2006

2011

Num

ber

of H

ouse

hold

s (m

illio

ns)

Source: US Census Bureau

+15% +7%

+1%

-5%


The number of households on the government-assisted food program SNAP (formerly known as ‘food stamps’) - has nearly doubled in the past five years.

* Note: formerly known as Food Stamps.Source: US Department of Agriculture

Oct-06

Dec-0

6

Feb-

07

Apr-0

7

Jun-

07

Aug-0

7

Oct-07

Dec-0

7

Feb-

08

Apr-0

8

Jun-

08

Aug-0

8

Oct-08

Dec-0

8

Feb-

09

Apr-0

9

Jun-

09

Aug-0

9

Oct-09

Dec-0

9

Feb-

10

Apr-1

0

Jun-

10

Aug-1

0

Oct-10

Dec-1

0

Feb-

11

Apr-1

1

Jun-

11

Aug-1

1

Oct-11

Dec-1

1

Feb-

12

Apr-1

2

Jun-

12

Aug-1

2

Oct-12

Dec-1

2

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

22.0

24.0

26.0

US: Supplemental Nutrition Assistance Program (SNAP)*, 2006-2012

Nu

mb

er

of H

ou

seh

old

s (m

illio

ns)

2007 average11.8 mn

2008 average12.7 mn

2009 average15.2 mn

2010 average18.6 mn

2011 average21.1 mn

2012 average22.2 mn

12.3 millionDecember

2007

23.1 millionDecember

2012

Today, nearly one in every five households is on SNAP.


Consumer Influencers

Street Microcultures

Sports Music Goth Gaming Virtual

How many street microcultures exist at Northwood? Would Facebook be considered a street microculture?


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Cultural and Demographic Trends Affecting CB

• We’ve used demographics – human characteristics that describe consumers such as age, ethnicity, sex, occupation, income, region, religion, and gender – to describe micro cultures.

• Elements affecting the demographic composition of countries…

DecliningBirth Rates

DecliningBirth Rates

IncreasingLife Expectancy

IncreasingLife Expectancy

IncreasingConsumerAffluence

IncreasingConsumerAffluence

IncreasingCulturalDiversity

IncreasingCulturalDiversity


Projected Birthrates per Couple and Life Expectancies for Countries around the World

(2010)

http://www.youtube.com/watch?v=_m6MTNb99Z8



mkt3050 – consumer behavior week 5

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