CH007 Group Influences

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PART II: EXTERNAL INFLUENCESPART II: EXTERNAL INFLUENCES

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CHAPTERCHAPTER

77GROUPGROUP

INFLUENCESINFLUENCESON CONSUMERON CONSUMER

BEHAVIORBEHAVIOR

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Consumer Behavior In The NewsConsumer Behavior In The News

What are the top 5 brands in terms of Word of MouthWhat are the top 5 brands in terms of Word of Mouth

(WOM) in the U.S.?(WOM) in the U.S.?

How has the internet aided WOM?How has the internet aided WOM?

Source: M. Fielding, Talk of the Town, Marketing News, September 1, 2006, p. 4.7-3


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Consumer Behavior In The NewsConsumer Behavior In The News

What are the top 5 brands in terms of Word of MouthWhat are the top 5 brands in terms of Word of Mouth

(WOM) in the U.S.?(WOM) in the U.S.?

ToyotaToyota

Wal-MartWal-Mart

HondaHonda

iPodiPod

ChevroletChevrolet

How has the Internet aided WOM?How has the Internet aided WOM?

The Internet allows for easy WOM in the form of e-mail,The Internet allows for easy WOM in the form of e-mail,

blogs, etc., that can create buzz.blogs, etc., that can create buzz.

Source: M. Fielding, Talk of the Town, Marketing News, September 1, 2006, p. 4.7-4


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Reference Group InfluenceReference Group Influence

A groupgroup is defined as two or more individuals who share a

set of norms, values, or beliefs and have certain implicitly

or explicitly defined relationships to one another such that

their behaviors are interdependent.

A reference groupreference group is a group whose presumed

perspectives or values are being used by an individual as

the basis for his/her current behavior.

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Reference Group InfluenceReference Group Influence

Four criteria that are particularly useful in classifying groupsgroups:

1.1. MembershipMembership

2.2. Strength of Social TieStrength of Social Tie

3.3. Type of ContactType of Contact

4.4. AttractionAttraction

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Types of GroupsTypes of Groups

Consumption SubculturesConsumption Subcultures

Identifiable hierarchyIdentifiable hierarchy

Set of shared beliefs and valuesSet of shared beliefs and values

Unique jargon and ritualsUnique jargon and rituals

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Types of Groups

Brand communitiesBrand communities can add

value to the ownership of the

product and build intense

loyalty.

When a consumer becomes

part of a brand community,

remaining generally requires

continuing to own and use thebrand.

This can create intense brand

loyalty!

Brand CommunitiesBrand Communities

Jeep has a longstanding loyal brand communityJeep has a longstanding loyal brand community

Click the online button to link to theClick the online button to link to the

Jeep Jamboree Web siteJeep Jamboree Web site

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http://www.jeepjamboreeusa.com/


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Online CommunityOnline Community

Community interacts around a topic of interest on theCommunity interacts around a topic of interest on the

InternetInternet

Online Social Network SitesOnline Social Network Sites

MySpaceMySpace

TwitterTwitter

YouTubeYouTube

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Four Guiding PrinciplesFour Guiding Principles

Be transparentBe transparent

Be part of the communityBe part of the community

Adapt efforts to fit nature of siteAdapt efforts to fit nature of site

Take advantage of the unique capabilities of each venueTake advantage of the unique capabilities of each venue

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Reference Group Influences on theReference Group Influences on the

Consumption ProcessConsumption Process

Types of Reference Group InfluenceTypes of Reference Group Influence

Situational determinants of Reference Group InfluenceSituational determinants of Reference Group Influence

Brand vs. Product Class InfluenceBrand vs. Product Class Influence

Marketing Strategy and Reference GroupsMarketing Strategy and Reference Groups

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Consumption ProcessConsumption Process

Reference group influence can take three forms:

1.1. Informational InfluenceInformational Influence

2.2. Normative Influence (a.k.a. utilitarian influence)Normative Influence (a.k.a. utilitarian influence)

3.3. Identification Influence (a.k.a. value expressive)Identification Influence (a.k.a. value expressive)

Types of Reference Group Influence

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Consumption ProcessConsumption ProcessConsumption Situation Determinants of Reference Group InfluenceConsumption Situation Determinants of Reference Group Influence

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Consumption ProcessConsumption ProcessDifferential Reference Group Influence onDifferential Reference Group Influence on

Product Versus Brand ChoiceProduct Versus Brand Choice

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WOMWOM

Opinion LeadersOpinion Leaders

Market Mavens, Influentials, and e-fluentialsMarket Mavens, Influentials, and e-fluentials

Marketing and Online StrategiesMarketing and Online Strategies

Communications within Groups and

Opinion Leadership

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Opinion LeadershipWOM Versus Advertising

(% who put people vs. advertising as best source)

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Opinion LeadershipOpinion Leaders

An opinion leaderopinion leader is the go to person for specific types

of information. This person filters, interprets, and

passes along information.

Opinion leaders possess enduring involvement for

specific product categories. This leads to greater

knowledge and expertise.Opinion leadership is category specific an opinion

leader in one product category is often an opinion

seeker in others.

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Opinion Leadership

Mass Communication Information FlowsMass Communication Information Flows

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Opinion Leadership

1. Individual seeks

information from

another or

2. Individual volunteers

information

Situations in Which WOM and Opinion Leadership Occur

The exchange of advice and information between group members

can occur directly via WOM in the following situations:

Likelihood of Seeking an Opinion LeaderLikelihood of Seeking an Opinion Leader

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Opinion Leadership

Mavens, Influentials, and e-fluentialsMavens, Influentials, and e-fluentials

1. A market mavenmarket maven is a generalized market influencer who

provides significant amounts of information about various

products, places to shop, and so on.

2. Roper Starch identifies a group similar to market mavens

called influentialsinfluentials. Influentials are 10% of population but

use broad social networks to influence the other 90%!

3. Roper Starch identifies a group similar to internet market

mavens called e-fluentials.e-fluentials. They wield significant online

and offline influence. 7-20


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Opinion Leadership

Marketing Strategy, WOM, and Opinion Leadership

Marketers are increasingly relying on WOM and

influential consumers as part of their marketing

strategies. Strategies designed to generate WOM andencourage opinion leadership include:

1.1. AdvertisingAdvertising

2.2. Product SamplingProduct Sampling3.3. Retailing/Personal SellingRetailing/Personal Selling

4.4. Creating BuzzCreating Buzz

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Applications in Consumer Behavior

Marketing Strategy, WOM, and Opinion LeadershipMarketing Strategy, WOM, and Opinion Leadership

AdvertisingAdvertising can

stimulate and

simulate WOM and

opinion leadership.

This ad would likely stimulate WOM via interest and excitementThis ad would likely stimulate WOM via interest and excitement

Christopher Kerrigan

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Opinion Leadership

Online Strategies to Leverage Buzz and WOM

Viral marketingViral marketing is an online pass-it-along strategy,

utilizing electronic communication to trigger brand

messages (often via email) throughout a widespreadnetwork of buyers.

Consumer review sitesConsumer review sites provide consumer product and

service reviews in a host of different formats.

BlogsBlogs are personalized journals where people and

organizations can keep a running dialogue.

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Applications in Consumer Behavior

Example of Online Viral Marketing CampaignExample of Online Viral Marketing Campaign

Courtesy of Hershey Corporation.

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Diffusion of InnovationsDiffusion of Innovations

An innovationinnovation 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 amarket is basically a group

phenomenon.

New products can be placed

on a continuum from nochange to radical change,

depending on the markets

perception.

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Categories of InnovationCategories of Innovation

Adoption ProcessAdoption Process

Diffusion RateDiffusion Rate

Adopter CategoriesAdopter Categories

Marketing Strategies and the Diffusion ProcessMarketing Strategies and the Diffusion Process

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Categories of Innovations

Continuous InnovationContinuous Innovation

Adoption of this type of innovation requires relatively minor

changes in behavior(s) that are unimportant to the consumer.Dynamically continuous InnovationDynamically continuous Innovation

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 InnovationDiscontinuous Innovation

Adoption of this type of innovation requires major changes in

behavior of significant importance to the individual or group.

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Diffusion of Innovations

Adoption Process and Extended Decision MakingAdoption Process and Extended Decision Making

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Diffusion Rates for Popular Consumer Electronics (Cumulative)Diffusion Rates for Popular Consumer Electronics (Cumulative)

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Factors Affecting the Spread of InnovationsFactors Affecting the Spread of Innovations

Perceived RiskPerceived Risk

TrialabilityTrialability

ObservabilityObservability

ComplexityComplexity

Relative AdvantageRelative Advantage

CompatibilityCompatibility

Fulfillment ofFulfillment of

Felt NeedFelt Need

Marketing EffortMarketing Effort

Type of DecisionType of Decision

Type of GroupType of Group

Rate of DiffusionRate of Diffusion

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InnovatorsInnovators

Early AdoptersEarly Adopters

Early MajorityEarly Majority

Late MajorityLate Majority

LaggardsLaggards

Adopter Categories

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CH007 Group Influences