Consumer Behaviour – Types of power

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Types of power include: information power, referent power, legitimate power, expert power, reward power, and coercive power. The chapter explores each of these power aromas and gives examples that apply to the contemporary study of consumer behavior. We conform to the desires of others for one of two basic reasons. People who model their behavior after others because they take others’ behavior as evidence of the correct way to act are conforming because of comparative influence. People who conform to satisfy the expectations of others and/or to be accepted by the group are affected by normative influence.

Although people often like to compare their judgments and actions to those of others, they tend to be selective about precisely homo they will use as benchmarks. This choice of models is of interest to the marketer. On the other hand, there can be resistance to conformity or there can be a loss of individuality. These side effects are some of the consequences of group membership and behavior. Groups have the effect of exerting pressures to conform on individuals. These pressures are based on the norms that groups develop.

Various factors influence the likelihood of conformity, including cultural pressures, fear of deviance, and group size. As strong as the pressures are to conform, however, individuals may exert their win independence and may even defy the group through anti-conformity. Much of what we know about products comes about through word-of-mouth communication (WOMB) rather than formal advertising. The marketer must study how By waveguides this process occurs and learn now to intelligence it it strategies are to be stressful. The chapter examines these issues.

It has been observed that product-related information tends to be exchanged in casual conversations. Although word of mouth is often helpful for making consumers aware of products, it can also hurt companies when damaging product rumors or negative word of mouth occurs. Boycotts can even occur based on negative word of mouth. Opinion leaders who are knowledgeable about a product and whose opinions are highly regarded tend to influence others’ choices. Specific opinion leaders are somewhat hard to identify, but marketers who know their general characteristics can try to target them in their media and promotional strategies. Some opinion leaders, however, are do not fit this pattern.

Market mavens (who have a general interest in the marketplace activities) and surrogate consumers (who are compensated for their advice about purchases) are examples. The lecture concludes with a discussion of socio metric methods that attempt to trace referral patterns. This information can be used to identify opinion leaders and other influential consumers. Marketers may use these methods to learn about those that exert an influential role in the selection of products and services.

Lecture Outline

1 . Reference Groups a.

Humans are social animals. We all belong to groups, try to please others, and take cues about how to behave by observing the actions of those around us. We will often go to great lengths to please the members of a group whose acceptance we vet.

1) A reference group is “an actual or imaginary individual or group conceived of having significant relevance upon an individual’s evaluations, aspirations, or behavior. “

2) Reference groups influence consumers in three ways: a) Informational b) Utilitarian c) Value-expressive

3) Reference groups are not always equally powerful.

This is called risky shift.

3) As more people are involved in a decision, each individual is less accountable for the outcome. This is called a diffusion of responsibility. Another explanation can be the value hypothesis where rockiness is a culturally valued characteristic.

4) A more general effect is that of decision popularization. This occurs where the group adopts an even riskier decision (or conservative) after discussion.

5) Shopping behaviors change when people shop in groups.

Home shopping parties capitalize on group pressures to boost sales.

B. Conformity refers to a change in beliefs or actions as a reaction to real or imagined group pressure.

1) For a society to function, its members develop norms, or informal rules that govern behavior.

2) Norms change slowly over time.

3) Unspoken rules govern many aspects of consumption.

B. Among the factors that affect the likelihood of conformity are the following:

1) Cultural pressures-? teenagers tend to “follow the crowd. “

2) Fear of deviance-?the group applies penalties to “rule violators.

3) Commitment-?the more dedication, the stronger the follower.

4) Group unanimity, size, and expertise-?the “law of large numbers. “

5) Susceptibility to interpersonal influence -? the individual’s need to identify or enhance his or her image in the opinion of significant others.

C. Sometimes we look to the behavior of others to provide a yardstick about reality.

1) Social comparison theory asserts that this process occurs as a way to increase the stability of one’s self-evaluation, especially when physical evidence is unavailable.

2) Consumers are selective about homo they use for benchmarks. Similarity boosts confidence.

3) In general people tend to choose a co-oriented peer, or a person of equivalent standing, when undergoing a social comparison.

Resisting Conformity

d. We take pride in our individualism and uniqueness or in our ability to resist the best sales efforts of salespeople and advertisers.

1) In the study of consumer behavior it is important to distinguish between independence and anti-conformity (where there is a defiance of the group).

2) People have a deep-seated need to preserve freedom of choice.

A) Reactant is a negative emotional state herein people try to overcome a loss of freedom.

For example, censorship makes us want things more.

3. Word-of-Mouth Communication

a. Much information about the world is actually communicated by individuals on an informal basis. This is called word-of-mouth communication (WOMB). Word-tot-mount communication is viewed as being reliable and trustworthy by most people.

2) WOMB is often backed up by social pressure to conform with recommendations. Negative WOMB b. Word of mouth is not only rapid, it can be a double-edged sword for marketers.

1) Negative WOMB is weighted more heavily than positive WOMB.

2) Rumors are the chief form. Rumors can easily be spread online.

3) Though most people would rather tell positive than negative information, rumors tend to reveal the underlying fears of society.

4) Rumors often result in boycotts of products, companies, or services.

These boycotts can be successful or unsuccessful depending on their popularity, duration, and strength.

C. Various strategies have been used by marketers to try to influence WOMB among consumers.

One of these is to create an environment for a virtual community of consumption to grow and thrive.

1) Forms of these communities include: ) Multi-User Dungeons (MUD)-?environments where fantasy game players meet.

2) Rooms, rings, and lists-?chat rooms, organizations of related home pages, and groups of people on a single mailing list who share information.

C) Boards-?online communities organized around interest-specific electronic bulletin boards.

D) Blobs-?wobbles are online personal Journals containing random thoughts of thousands of individuals. The universe of active Wobbles is known as the “Philosopher”. 2) The intensity of identification with a virtual community depends on two factors:

a) The more central the activity too arson’s self-concept, the more likely he or she will be to pursue an active membership in a community. b) The intensity of the social relationships the person forms with other members of the virtual community helps to determine his or her extent of involvement. A) Tourists b) Mingles c) Devotees d) Insiders

3) Types of members include:

d. Guerrilla marketing consists of promotional strategies that use unconventional location and intensive word-of-mouth campaigns to push products.

E. Viral Marketing is the strategy of getting customers to sell a product on behalf of the many that creates it. This strategy is well suited to the Web.

4. Opinion Leadership a. Although consumers get information from personal sources, they do not tend to ask Just anyone for advice about purchases. The Nature of Opinion Leadership Everyone knows people who are knowledgeable about products and whose advice is taken seriously by others. These people are called opinion leaders. Reasons for opinion leaders being taken seriously as information providers include: They are technically competent.

2) They have pre-screened, evaluated, and synthesized (in an unbiased way) reduce information.

3) They are socially active and interconnected in their

4) They are similar to the consumer in value and beliefs. Immunity.

5) They are often among the first to buy new products.

They often absorb risk because they purchase products first. C. When marketers and social scientists initially developed the concept of the opinion leader, it was assumed that certain influential people in a community would exert an overall impact on group members’ attitudes.

1) There is a question today as to whether there is such a thing as a generalized opinion leader.

2) Opinion leaders tend to be concentrated in their field of interest or expertise.

3) Some opinion leaders overlap into other fields, but not into all fields.

Anamorphic-?experts in a limited field.

B. Polymorphic-?experts in several fields (but usually concentrated).

D. It is thought that opinion leadership is more complex than a set static process.

1) Opinion leaders may or may not be purchasers of products they recommend.

2) Characteristics of opinion leaders include: a) Innovators b) Early and innovative communicators c) Socially active d) Appearance conscious and narcissistic e) Like music and contemporary music culture.

Adders g) Own more clothing and have a broader range of styles Opinion seekers f) Magazine h) .

A consumer category called the market maven has been proposed to describe people who are actively involved in transmitting marketplace information of all types. Market mavens are closer to the conception of a general opinion leader. “Floggers” are an example. F. A surrogate consumer is a person who is hired to provide input into purchase decisions. The surrogate consumer is usually compensated for this involvement.

1) Examples would include interior decorators, stockbrokers, professional shoppers, r college consultants. Identifying Opinion Leaders g.

Marketers are interested in identifying opinion leaders. Many ads are intended to reach these consumers.

1) Unfortunately, opinion leaders are hard to find.

2) Methods of identifying opinion leaders include:

a) The self-designing odd-?ask individual consumers whether they consider themselves to opinion leaders.

1. A bona fide opinion leader

2. A key informant b) Goniometry-?tracing communication patterns among group members. This is called socio metric method.

2. Examines networks

3. Examines cliques End. 1. Examines referral behavior

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