MKT201 - Week 11 Group Influence and Opinion Leadership (Ch. 11)

Reference GroupsReference GroupAn actual or imaginary individual or group conceived of having significant relevance upon an individuals evaluations, aspirations/intentions, or behaviorThree ways reference groups influence consumersInformationalUtilitarianValue-ExpressiveSome people are more influential than others in affecting consumers product preferences.

Reference GroupsA Reference Group is an Actual or Imaginary Individual or Group Conceived of Having Significant Relevance Upon an Individuals Evaluations, Aspirations, or Behavior.Reference Groups Influence Consumers in Three Ways/Forms:InformationalValue-ExpressiveUtilitarianInformation, brand-related knowledge, experts experienceInfluenced by other social/family members, etc.; as expectedImage enhancement, admired or respected by others;Help showing as: athlete, successful person, good parents, etc.

When Reference Groups Are ImportantLuxuries Rather ThanNecessitiesSociallyConspicuous or Visible to OthersA Reference Groups Influence Is More Powerful and Important for Purchases That Are:e.g. sailboatse.g. living room furniture, clothing

Relative Reference GroupsInfluence on Purchase Intention (2 dimensions of the degree of importance of reference group:publicly/privately consumed, luxury/necessity product)Figure 11.1

When Reference GroupsAre Important (or so Persuasive)?Social Power:The capacity to alter the actions of others different sources or basis of social power:1. Referent Power: When consumers imitate qualities by copying behaviors of a prominent person they admire.2. Information Power: Able to influence consumer opinion by virtue of their (assumed) access to the truth3. Legitimate Power: Granted to people by virtue of social agreements, sometimes conferred by a uniform

When Reference GroupsAre Important (cont.)4. Expert Power:Derived from possessing specific knowledge about a content area5. Reward Power:When a person or group has the means to provide positive reinforcement6. Coercive Power:Influencing a person by social or physical intimidation

The Power of Reference GroupsReferent PowerLegitimatePowerInformationPowerExpertPowerCoercivePower

RewardPower

Types of Reference Group Powere.g. Michael Jordan admired persone.g. Editor of a newspapere.g. policemen, professors, doctorse.g. a famous scientist, expert in Roboticse.g. reward, social acceptance awards or medalse.g. social or physical intimidation/threat - gangsters; fear appealsSOCIAL POWER- Capacity to alter the actions of others

Expert PowerA physician has expert power, and a white coat reinforces this expertise by conferring legitimate (legal or high professional quality) power.

Types of Reference Group InfluenceReference Group:Any external influence that provides social cues (signals)(1) Normative Influence:The reference group helps to set and enforce fundamental standards of conduct. (e.g. parents influence on marriage attitude; a Photo club)(2) Comparative Influence:When decisions about specific brands or activities are affected. (e.g. Harley-Davidson club)

Discussion QuestionMarketers often portray products being used in groups that represent favorable reference groups to the target market.What type of message does this ad convey? What type of influence is this ad designed to exert on its target audience?

Discussion QuestionWhat type of message does this ad convey?Persuasive message with the use of Reference Groups influence What type of influence is this ad designed to exert on its target audience?Comparative influence

Brand Communities and TribesBrand Community:A set of consumers who share a set of social relationships based upon usage or interest in a product. (dont necessary live near each other)E.g. Brandfests (e.g. organized events sponsored by Nike)Consumer Tribe: A group of people who share a lifestyle and who can identify with each other because of a shared allegiance (loyalty) to an activity or product (such as skateboarding, basketball, car driving)Tribal Marketing:To link ones product to the needs of a group as a whole. (e.g. Mini Cooper, Mustang car racing)

Products as a Way to be PopularMany products, especially those targeted to young people, are often touted/promoted as a way to take the inside track to popularity. This Brazilian ad lets us know about people who dont like a certain shoe. Bonehead stupid person

Membership vs. AspirationalReference GroupsAspirational Reference GroupsComprise idealized figures such as successful business people, athletes, or performers.Membership Reference GroupOrdinary people whose consumption activities provide informational social influence. Membership are affected by several factors:Propinquity: Physical nearness.Mere Exposure: Liking persons or things simply as a result of seeing them more often (mere exposure phenomenon)Group Cohesiveness: The degree to which members of a group are attracted to each other and value their group membership.

Match.com

Positive Versus NegativeReference Groups Avoidance GroupsGroups that consumers purposely try to distance themselves fromNerds (stupid, unattractive)Druggies (addicted to drugs)Preppies (manner and dress like in traditional preparatory school)The motivation to distance oneself from a negative reference group can be as powerful or more powerful than the desire to please a positive group

Positive Reference GroupsThis recruiting ad presents a compelling role model for young women contemplating a career in the armed forces.

Consumers Do it in Groups Some Phenomena Deindividuation: A process in which individual identities become submerged within a group.Social Loafing:People do not devote as much to a task when their contribution is part of a larger group effortRisky Shift:Group members are willing to consider riskier alternatives subsequent to group discussionDiffusion of Responsibility:As more people are involved in a decision, each individual is less accountable for the outcome

Consumers Do it in Groups (cont.) Value Hypothesis (to explain the increased riskiness/risky shift):Riskiness is a culturally valued characteristic to which individuals feel pressure to conform to attributes valued by societyDecision Polarization:Whichever direction the group members were leaning toward before discussion becomes more extreme subsequent to discussion (risky choice Vs conservative choice)Home Shopping Parties:Capitalize on group pressures to increase sales (e.g. Tupperware party)

DeindividuationCostumes hide our true identities and encourage deindividuation.

Home Shopping PartiesWomen at a home Tupperware party.

Group InfluencesGroup pressure often influences our clothing choices.

e.g. behave wildly at costume parties greater willingness to take risk following group discussion moving toward extreme; risky - conservative more purchase with one other persondevote less effort for group work more & more group members, more conform

ConformityConformityA change in beliefs or actions as a reaction to real or imagined group pressure.NormsInformal rules that govern behavior (for a society to function)

Factors Influencing the Likelihood of ConformityCultural PressuresFear of Deviance (resulted in punishment or sanctions)CommitmentPrinciple of Least Interest (person/group that is least committed to staying in a relationship has the most power)Group Unanimity (same opinions), Size, and Expertise as groups gain in power, compliance increasesSusceptibility to Interpersonal InfluenceRole-relaxed consumers (those are low in susceptibility to influence of others)

ConformityInformationalConformity That Occurs Becausethe Groups Behavior is Takenas Evidence About Reality.Conformity Refers to a Change in Beliefs or Actions as a Reaction to Real or Imagined Group Pressure.Types of Social Influence

NormativePerson Conforms to Meetthe Expectations of aPerson or Group.

e.g. clothing; ?? wearing masks in public (SARS)e.g. mimic others behavior, gift-givingSituation is uncertain, ambiguous

Factors Affecting the Likelihood of Conformity Cultural PressuresFear of DevianceCommitmentGroup DynamicsSex DifferencesInterpersonal InfluencesChina/Japan - collectivism e.g. terrorists willing to die As groups gain in power, compliance increases susceptibility to be influenced by others

Social ComparisonSocial Comparison Theory:Asserts that people look to the behavior of others to increase the stability of their self-evaluationPeople tend to choose co-oriented peer: a person of equivalent standingResisting Conformity:Independence: Being oblivious (unaware of) or indifferent to the expectations of othersAnticonformity: Defiance (opposing) of the group is the actual behaviorReactance: The negative emotional state that results when we are deprived of our freedom to choose

Resistance to InfluenceVs.AnticomformityDefiance of the Group is the Object of BehaviorIndependenceOblivious to (unaware of) what is expected by othersReactanceNeed to Preserve Freedom of Choice; People try to Overcome a Loss of Freedom; Negative to extremely overbearing promotions.

Discussion QuestionThis ad for a video game says, Conformity Bytes!, but then captions (titles), Join the Revolution! Why?Does this ad encourage independence or anticonformity?

Word-of-Mouth CommunicationWord-of-Mouth (WOM):Product information transmitted by individuals to individuals.Negative WOM and the Power of Rumors:Negative WOM: Consumers weigh negative info from other consumers more heavily than they do positive comments

Word-of-Mouth CommunicationMuch Information About Products and Services is Actually Conveyed by Individuals on an Informal Basis called Word-of-Mouth Communication (WOM)Factors That Encourage WOM Are:Person May be Uncertain About a Recent Purchase

Word-of-MouthThe U.S. Postal Service hopes to create a buzz via word of mouth.

RumorsHoaxkill.com is a Web site dedicated to tracking hoaxes/tricks and debunking/exposing product rumors.

The Transmission of MisinformationFigure 11.2

Cutting-Edge WOM StrategiesVirtual CommunitiesVirtual Community of Consumption: A collection of people whose online interactions are based upon shared enthusiasm for and knowledge of a specific consumption activity.Multi-user Dungeons (underground chamber) (MUD)Rooms, rings and lists (e.g. chat rooms)BoardsBlogs (weblog)

Multi-User Dungeons

Four Types of VirtualCommunity Members

Tourists:Lack strong social ties to the groupMinglers (merger, mixer):Maintain strong social ties, but are not interested in the central consumption activityDevotees:Express strong interest in the activity, but have few social attachments to the groupInsiders:Exhibit both strong social ties and strong interest in the activity

Virtual CommunitiesFigure 11.32 factors: self-centrality (dominance of activity towards self-concept); intensity of social relationship/ties

Guerrilla and Viral MarketingGuerrilla MarketingPromotional strategies that use unconventional locations and intensive word-of-mouth campaigns to push products.Brand AmbassadorsViral MarketingRefers to the strategy of getting customers to sell a product on behalf of the company that creates it. (e.g. a small ad embedded in Hot Mail)

Guerrilla Marketing AdsAds painted on sidewalks are one form of guerrilla marketing.

Social NetworkingWeb sites letting members post information about themselves and make contact with similar othersShare interests, opinions, business contactshttp://www.myspace.com/http://www.facebook.com/

Opinion LeadershipThe Nature of Opinion LeadershipOpinion Leaders: People who are knowledgeable about products and whose advice is taken seriously by others.Homophily: The degree to which a pair of individuals is similar in terms of education, social status, and beliefs. (appear to be more convincing than heterophily)How Influential Is an Opinion Leader?Generalized Opinion Leader: Somebody whose recommendations are sought for all types of purchases.Monomorphic: An expert in a limited field.Polymorphic: An expert in many fields (in a broad domain such as electronics or fashion).

Reasons to Seek Advice from Opinion LeadersExpertiseUnbiased knowledge powerHighly interconnected in communities (social standing)Referent power/homophilyHands-on product experience (absorb risk)

Opinion Leaders Market ShoesOpinion leadership is a big factor in the marketing of athletic shoes. Many styles first become popular in the inner city and then spread by word-of-mouth.

Types of Opinion LeadersInnovatorsEarly purchasersInnovative CommunicatorsOpinion leaders who also are early purchasersOpinion leaders also are likely to be opinion seekers

The Market Maven (Expert) a consumer categoryDescribes people who are actively involved in transmitting marketplace information of all types. (not necessarily have interests or have purchased the products)The Surrogate Consumer a class of marketing intermediaryA person who is hired to provide input in purchase decisions. (e.g., interior decorators, stockbrokers, college consultants)

Perspectives on theCommunications ProcessFigure 11.4(tend to be opinion seekers)

Fashion Opinion LeadersFashion opinion leaders tend to be knowledgeable about clothing and highly motivated to stay on top of fashion trends.

Identifying Opinion LeadersMany ads intend to reach influentials rather than average consumerLocal opinion leaders are harder to findCompanies try to identify influentials in order to create WOM ripple effectExploratory studies identify characteristics of opinion leaders for promotional strategies

Identifying Opinion LeadersSelf-designated Opinion LeadersSociometric MethodsTrace Communication patterns among members of a group.To better understand Referral Behavior Network Analysis: Focuses on communication in social systemsReferral NetworkTie Strength: The nature of the bond between people.Bridging Function (weak ties): Allows a consumer access between subgroups.Cliques: Subgroups (friends or associates, etc.; sharing preferences or brand choices for various products)

Characteristics of Opinion LeadersAppearance-Conscious andNarcissisticOwn More Clothing With aBroader Range of StylesAre Opinion Seekers EarlyCommunicatorsInnovatorsKeyCharacteristicsofOpinionLeadersSocially ActiveLike Music andMagazinesSelf-worship, love of oneself

Revised Opinion Leadership ScaleFigure 11.5