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Understanding Group Influence in Marketing

This document discusses how reference groups influence consumer behavior and product choices. It defines reference groups as individuals or groups that influence a person's evaluations, aspirations or behaviors. Reference group influence is stronger for luxury purchases that are socially visible compared to necessities. The document also discusses different types of reference groups like cultural figures, parents, organizations, and informal social groups. It examines how reference group influence depends on factors like membership, contact level, and attraction to the group. The concluding sections outline marketing strategies to leverage reference group effects and the power of word-of-mouth recommendations.

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Noman Malik
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0% found this document useful (0 votes)
9 views48 pages

Understanding Group Influence in Marketing

This document discusses how reference groups influence consumer behavior and product choices. It defines reference groups as individuals or groups that influence a person's evaluations, aspirations or behaviors. Reference group influence is stronger for luxury purchases that are socially visible compared to necessities. The document also discusses different types of reference groups like cultural figures, parents, organizations, and informal social groups. It examines how reference group influence depends on factors like membership, contact level, and attraction to the group. The concluding sections outline marketing strategies to leverage reference group effects and the power of word-of-mouth recommendations.

Uploaded by

Noman Malik
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

Group Influence and

Opinion Leadership

Chapter 11
Group Influences

11-2
Reference Groups
• An actual or imaginary individual/group
conceived of having significant relevance
upon an individual’s evaluations,
aspirations, or behavior
– Reference groups influence consumers in
three ways:
• Informational
• Utilitarian
• Value-expressive

11-3
Reference Group Influences
• Reference group effects are more robust for purchases
that are:
– Luxuries rather than necessities
– Socially conspicuous/visible to others
PRODUCT
Figure 11.1 Weak Reference Strong Reference
Group Influence Group Influence

Strong Reference PUBLIC PUBLIC


Group Influence NECESSITIES LUXURIES
BRAND

Weak Reference PRIVATE PRIVATE


Group Influence NECESSITIES LUXURIES

11-4
When Reference Groups Are
Important (Cont’d)
• Social power: capacity to alter the actions
of others
– Referent power
– Information power
– Legitimate power
– Expert power
– Reward power
– Coercive power

11-5
Types of Reference Groups
• Any external influence that provides social clues
– Cultural figure
– Parents
– A large, formal organization
• Tend to be more product- or activity-specific: comparative
influence
– Small and informal groups
• Exert a more powerful influence on individual consumers
• A part of our day-to-day lives: normative influence
– Normative influence
– Comparative influence

11-6
Brand Communities and Tribes

• Brand Community
– A group of consumers who share a
set of social relationships based
upon usage or interest in a product
– Brandfests enhance brand loyalty
• Consumer tribe
– share emotions, moral beliefs, styles
of life, and affiliated product
– Tribal marketing: linking a product to
the needs of a group as a whole

11-7
Types of Groups (cont.)

11-8
Types of Groups
• Membership
– either yes or no
• Degree of contact
– larger groups generally have less contact
– primary groups generally have frequent
interpersonal contact
– secondary groups generally have limited
interpersonal contact
• Attraction
– desirability of being member
– either positive or negative
11-9
Changes in Reference Groups as
the Situation Changes

11-10
Types of Groups (cont.)
• Aspirational reference groups
– non-membership groups
– positive attraction
– exert a strong influence on some products

11-11
Membership vs. Aspirational
Reference Groups
• People the consumer actually
knows vs. people the consumer
doesn’t know but admires
– Admirational strategies
concentrate on highly visible,
widely admired figures (athletes
or performers)
– Membership strategies focus
on “ordinary” people whose
consumption provides
informational social influence
• Propinquity, mere exposure, and
group cohesiveness
11-12
Positive vs. Negative Reference
Groups
• Reference groups may exert either a
positive or negative influence on
consumption behaviors
– Avoidance groups: motivation to distance
oneself from other people/groups
– Marketing: ads with undesirable people using
competitor’s product
– Discussion: Identify a set of avoidance groups
for your peers. Can you identify any
consumption decisions that are made with
these groups in mind?
11-13
Consumers Do It in Groups
• Deindividuation
– Binge drinking at college parties
• Social loafing
– We tend to tip less when eating in groups
• Risky shift
– Diffusion of responsibility
– Value hypothesis
• Decision polarization
11-14
Consumers Do It in Groups
(Cont’d)
• Home shopping parties
– Tupperware and Botox parties
– Informational and normative social
influence
– Deindividuation
– Risky shift
• Discussion: Are home shopping
parties that put pressure on friends
and neighbors to buy merchandise
ethical?
11-15
Conformity
• Most people tend to follow society’s
expectations regarding how to look/act
– Change in beliefs/actions toward societal
norms
• Appropriate clothing/personal items, gift-giving,
sex roles, and personal hygiene

11-16
Factors Influencing Conformity
• Cultural pressures
• Fear of deviance
– Sanctions against “different” behavior
• Commitment to group membership
– Principle of least interest
• Group unanimity, size, expertise
• Susceptibility to interpersonal influence
– Role relaxed
11-17
The Nature of Reference -Group Influence

Conformity is not a uni-dimensional concept


• Information influence
– behaviours and opinions of reference groups are used
as potentially useful pieces of information
• Normative influence (utilitarian influence)
– when an individual fulfils group expectations to gain a
direct reward or avoid a punishment
• Identification influence (value-expressive influence)
– when an individual uses perceived-group norms and
values as a guide for their own attitudes or values

11-18
Consumption Situations and
Reference-Group Influence

11-19
Consumption Situations and
Reference-Group Influence (cont.)

11-20
Consumption Situations and Reference-
Group Influence (cont.)

11-21
Determinants of the Degree of Reference-
Group Influence
• R-Group influence is strongest when use of the product
or brand is visible and relevant
– e.g. product category, product type and brand are all
visible
• R-group influence increases as necessity of an item
decreases
• The more commitment an individual feels to a group,
the higher the level of conformity to group norms
• Individual’s confidence with purchase: low confidence,
then higher influence

11-22
Product Characteristics and Type of Reference-
Group Influence

11-23
Influence of Two Consumption Situation Characteristics on
Product/Brand Choices

11-24
Consumption-Situation Determinants of Reference-Group
Influence

11-25
Social Comparison
• “How’m I doing?”
– We look to others’ behavior
to inform us about reality
– Occurs as way to increase
stability of one’s self-
evaluation (sans physical
evidence)
• Tastes in music and art
– We tend to choose co-
oriented peer when
performing social
comparison 11-26
Resisting Conformity
• Independence vs. anticonformity
– “Marching to own drummer” vs. being aware
of what is expected (and not doing it)
• Reactance
– Negative emotional state when we are
deprived of our freedom of choice
– Censored books, TV shows, music lyrics

11-27
Marketing Strategies Based on
Reference-Group Influences
• Personal sales strategies
– Asch phenomenon

• Advertising strategies
– all three types of reference groups are used
by advertisers:
• informational (use of information)
• normative (to avoid/gain)
• identification (aspire to join)
11-28
Word-of-Mouth Communication
• WOM: product information
transmitted by individuals to
individuals
– More reliable/trustworthy form of
marketing
– Backed up by social pressure to
conform
– Influences two-thirds of all sales
of goods
– We rely upon WOM in later
stages of evaluation and
adoption
– WOM is powerful when we are
unfamiliar with product category
11-29
WOM Communication (Cont’d)
• Product-related conversation factors:
– High involvement with product (pleasure)
– Knowledgeable about product (impressing
others)
– Genuine concern for others (avoid wasting
money)

11-30
Negative WOM and
Power of Rumors
• We weigh negative WOM more heavily
than we do positive comments!
– Negative WOM is easy to spread, especially
online [Link]
– Determined detractors
• Discussion: What is the best way for a company
to deal with determined detractors?
– Information/rumor distortion
• Assimilation, leveling, and sharpening

11-31
Virtual Communities
• A collection of people who share their love of a
product in online interactions
– Multi-user dungeons (MUD)
– Rooms (IRC), rings, and lists
– Boards
– Blogs/blogosphere
• Great potential for abuse via untrustworthy
members
– [Link] lawsuit (charging publishers to post
positive reviews of Web site)
11-32
Types of Web Surfers
Figure 11.3

Discussion: Which type of Web surfer are you?


11-33
Guerrilla Marketing
• Promotional strategies that use
unconventional locations and intensive
WOM to push products
– Recruiting legions of real consumers for street
theater
• Hip-hop “mix tapes”/street teams
• P&G’s Tremor
• Kayem Foods’ Great Sausage Fanout
– Brand ambassadors
11-34
Viral Marketing
• Getting visitors to a Web site to forward
information on the site to their friends (for
product awareness)
– Creating online content that is entertaining or
weird

11-35
Social Networking
• Web sites letting members post
information about themselves and make
contact with similar others
– Share interests, opinions, business contacts

MYSPACE

[Link]

11-36
Opinion Leadership
• We don’t usually ask just
anyone for advice about
purchases!
• We most likely seek advice
from someone who knows a lot
about a product
– Opinion leaders frequently
influence other’s
attitudes/behaviors
• E-fluential advice
• Discussion: Identify fashion
opinion leaders on your
campus. Do they fit the profile
discussed in this chapter?
11-37
Opinion Leadership
• Opinion leaders filter, interpret or provide
information for individuals within groups
• Situations in which opinion leadership
occurs:
– one individual exchanges information with
another
– one individual volunteers information
– as a by-product of normal group interaction

11-38
Characteristics of Opinion
Leaders
• Opinion leaders have enduring involvement with product
category
• Function primarily through interpersonal communications
and observation
• Similar demographic characteristics to the group
• Public individuation – attention seeking
• High level of exposure to media
• The market maven – expert on all products!
• Motivation of dissatisfied customers to tell others of their
negative message

11-39
Likelihood of Seeking an Opinion Leader

11-40
Marketing Strategy and
Opinion Leadership
• Identifying opinion leaders
• Targeting for marketing research
• Product sampling
• Retailing/personal selling
• Advertising attempts to encourage and
simulate opinion leadership

11-41
Reasons to Seek Advice from
Opinion Leaders
• Expertise
• Unbiased knowledge power
• Highly interconnected in communities
(social standing)
• Referent power/homophily
• Hands-on product experience (absorb risk)
CLICK ON LOGO TO SEE
VIDEO CLIP ABOUT WILD
PLANET’S EFFORTS TO
APPEAL TO “TREND
SETTER” KIDS 11-42
Opinion Leadership (Cont’d)
• Generalize opinion leader vs.
monomorphic/polymorphic experts
• Although opinion leaders exist for multiple
product categories, expertise tends to overlap
across similar categories
– It is rare to find a generalized opinion leader
• Innovative communicators
• Opinion seekers
– More likely to talk about products with others and
solicit others’ opinions
– Casual interaction prompted by situation
11-43
The Market Maven
• Actively involved in transmitting
marketplace information of all types
– Just into shopping and staying on top of what’s
happening in the marketplace
– Solid overall knowledge of how and where to
procure products
• “I like introducing new brands/products to friends”
• “People ask me for information about products,
places to shop, or sales”
• “My friends think of me as a good source of
information when it comes to new products or
sales”
11-44
The Surrogate Consumer
• A marketing intermediary who is hired to
provide input into purchase decisions
– Interior decorators, stockbrokers, professional
shoppers, college consultants
– Consumer relinquishes control over decision-
making functions
• Marketers should not overlook influence of
surrogates!

11-45
Identifying Opinion Leaders
• Many ads intend to reach
influentials rather than
average consumer
– Local opinion leaders are
harder to find
– Companies try to identify
influentials in order to create
WOM “ripple effect”
– Exploratory studies identify
characteristics of opinion
leaders for promotional
strategies
11-46
The Self-Designating Method
• Most commonly used technique to identify
opinion leaders…
– Simply ask individuals whether they consider
themselves to be opinion leaders
– Method is easy to apply to large group of
potential opinion leaders
– View with skepticism…inflation or
unawareness of own importance/influence
• Alternative: key informants identify opinion
leaders
11-47
Sociometric Methods
• Trace communication patterns among
group members
• Systematic map of group interactions
• Most precise method of identifying
product-information sources, but is very
difficult/expensive to implement
• Network analysis
– Referral behavior/network, tie strength
– Bridging function, strength of weak ties
11-48

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