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Chapter 10
Household Decision Making
12-2
Decision Roles
In collective decisions, one may play any (or all) of the following roles:
• Initiator: bring up idea or identifies need
• Gatekeeper: conducts information search and “presents” information to other decision-makers
• Influencer: sways outcome of decision
• Buyer: actually makes the purchase
• User: winds up using product
12-3
The Modern Family
• Before 1900s: extended family
• 1950s: nuclear family (mother, father, and children)
• Today:• Married couples constitute less than
50% of households• Majority of adult women live without
spouse• Unmarried opposite sex couples (co-
habitation) is 10-15% of all couples• Same-sex couples• Friends, workers and SM/Web are the
“new family”
12-4
Family Size
• Depends on educational level, availability of birth control, and religious influences
• Marketers keep an eye on fertility and birth rates• Worldwide, women want smaller families (especially
in industrialized countries)• Contraception/abortion are more readily available• Divorce is more common• Older people now pursue “non-grandchildren”
activities (i.e. travel, education, work)• Some countries want people to have more
children (Europe)
12-5
Sandwich Generation
• Sandwich generation: middle-aged adults who care for their parents as well as their own children
• Boomerang kids: adult children who return to live with their parents• Roommates and “failed-
relationship” kids are most likely to boomerang
• Spend less on household items and more on entertainment
12-6
Pets as Family Members
• Pets are treated like family members
• Spending on pets has doubled in the last decade
• Pet Owner Psychology and Characteristics
• Pet-smart marketing strategies:• Name-brand pet products• Designer water for dogs• Lavish kennel clubs, gyms, pet classes/clothiers• Pet accessories in cars• Pet Therapists
12-7
Family Life Cycle
• Factors that determine how couples spend money:• Whether they have children• Age of children; whether at home or
emancipated• Whether the partner works• Family Lifestyles and attitudes towards money• Life Stage of family members
12-8
Life-Cycle Effects on Buying
Life Cycle stages can show marked differences in consumption patterns:
• Young bachelors and newlyweds: exercise, go to bars/concerts/movies
• Early 20s: apparel, electronics, gas expenditures high
• Families with young children: health foods
• Single parents/older children: junk foods
• Newlyweds and New Home Owners: appliances, furniture
• Older couples/bachelors: home maintenance/re-modeling services, travel, “edutainment”, insurance
12-9
Household Decisions
Families make two types of decisions:
• Consensual purchase decisions: members agree on the desired purchase, perhaps differing only in terms of how it will be achieved
• Accommodative purchase decision: members have different preferences or priorities and they cannot agree on a purchase to satisfy the minimum expectations of all involved • Frequently result in multi-laterally unwanted
compromises or no decision at all
12-10
Household Decisions (cont.)
Specific factors that determine how much family decision conflict there will be when making “joint” decisions:
• Interpersonal need
• Product involvement and utility
• Responsibility for ownership and/or payment
• Relationship power
12-11
Sex Roles and Decision-making Responsibilities
Who makes key decisions in a family?
• Autonomic decisions: when one family member makes decisions for the family• Wives still make decisions on groceries, toys,
clothes, and medicines
• Syncretic decisions: when both partners “jointly” make decisions• Typically happens with cars, vacations, homes,
appliances, furniture, home electronics, interior design, phone service
• Increases with education and household income increases
12-12
Identifying the Decision Maker
“Family Financial Officer (FFO)”• Traditional family norm: the man makes the money
and the woman spends it• Modern family norm: either partner can make
money; either partner can spend money
Four factors in joint versus sole decision making:• Adherence to sex-role stereotypes• Comparative spousal resources• Experience with purchase• Socioeconomic status
12-13
LeoShe Mother Types
• June Cleaver: traditional, stay-at-home mom
• Tug of War: work but not happy about it
• Strong Shoulders: lower income but optimistic and strong
• Mother of Invention: enjoy working and being mothers
12-14
Heuristics in Joint Decision Making
• Synoptic Ideal: Husband and wife take a common view and act as joint decision makers
• Heuristics simplify or encourage decision making:• Agree on salient, objective dimensions; different
opinions on less salient/objective dimensions• Task specialization• Concessions based on intensity of each spouse’s
preferences (bargaining process)• Trade away lower value outcomes for higher
value outcomes
12-15
Children as Decision Makers
Children make up three distinct markets:
• Primary market: kids spend their own money
• Influence market: parents buy what their kids tell them to buy (parental yielding)
• Future market: kids “grow up” quickly and purchase items that normally adults purchase (smartphones, laundry detergent)
12-16
Consumer Socialization
• Consumer socialization: process by which young people acquire skills, knowledge, and attitudes relevant to their functioning in the marketplace
• Occurs at different rates in different cultures
• Children’s purchasing behavior is influenced by:• Parents• Television and web (“electronic babysitters”)• Sex roles• Peers• Teachers
12-17
Cognitive Development
• Marketers segment children by their stage of Cognitive Development• ability to comprehend concepts of increasing
complexity
• Three segments often used today:• Limited: Below age 6, children do not use
storage and retrieval strategies• Cued: Between ages 6 and 12, children use these
strategies, but only when prompted• Strategic: Children age 12 and older
spontaneously employ storage and retrieval strategies
Five Stages of Consumer Development
Parental Styles for Socializing Children
Authoritarian
Neglecting
Indulgent
Marketing Research and Children
• Kids tend to:• Be undependable reporters of own behavior• Have poor recall• Be flippant • Be overly influenced by other kids• Not understand abstract questions
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