Consumer Groups & Reference Groups (Part 2).pptx

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1. Consumer Groups & Reference Groups (Part 2)

2. Group – Reference Group Two or more people who interact to accomplish either individual or mutual goals Reference groups are a pivotal concept in sociology, shaping our behaviors, choices and self-identity. Coined by the renowned sociologist Robert K. Merton, the Reference Groups Theory provides a profound understanding of how individuals compare themselves to others in society.

3. Reference Group Theory Reference groups, as envisioned by Robert K. Merton, are the social groups or individuals that individuals use as benchmarks for evaluating their  attitudes , behaviors, and self-concept. These groups serve as a mirror against which we measure our actions and identity. Understanding reference groups is essential to comprehend the way we adapt, conform, or deviate from social norms and expectations. Reference groups are influential in shaping personal values and behaviors. They provide individuals with standards for social comparison. These groups play a significant role in the development of self-identity. In essence, reference groups are the yardstick against which we measure ourselves. They help us navigate the complex landscape of social interactions and individual identity.

4. CHARACTERISTICS OF REFERENCE GROUP Reference groups serve various functions in society, and these functions often overlap: They provide a standard for social comparison, influencing our behavior and decision-making. Reference groups contribute to the formation of personal identity and self-concept. They can offer social support and a sense of belonging to individuals. Reference groups play a role in reinforcing or challenging social norms and values. These functions highlight the multifaceted role that reference groups play in our lives. They guide our choices, help us define ourselves, offer support in times of need, and can even push us to question established norms.

5. Reference Group Examples The concept of reference groups extends beyond sociology and finds applications in marketing and consumer behavior. Marketers use this theory to understand consumer choices and motivations. Marketing strategies often leverage aspirational reference groups to influence consumer behavior. Social media and influencer marketing rely heavily on the concept of reference groups to shape purchasing decisions. Reference groups can help predict trends and product adoption rates. The influence of reference groups goes beyond our personal lives and extends to the products and services we choose. Marketers use this understanding to create advertising campaigns that resonate with our desires to belong to certain groups.

6. CRITICISM While the Reference Groups Theory is valuable, it is not without criticisms and challenges: Critics argue that the theory oversimplifies the complexity of social influence. The theory may not account for individual agency and unique factors that shape behavior. Cross-cultural applications of the theory require consideration of cultural variations. Like all theories, the Reference Groups Theory has its limitations. It provides a framework for understanding social influence, but it may not capture the intricacies of individual  decision-making  and the influence of unique circumstances.

7. Types of Reference Groups In our daily lives, we all get influenced by a variety of people while making our purchase decisions. We, as humans do a lot to try to impress others. We make purchase to get compliments and try that others should not think less of us. A reference group is the group whose perspective we consider. Now our reference could be very large or very small including few of our family members or few close friends. Reference groups influence people a lot in their buying decisions. They set the levels of lifestyle, purchasing patterns, etc. Reference groups are of two types − Primary Groups Secondary Groups

8. Primary Groups Primary reference groups are basically the set of people whom you meet every day. They can be from your family, your close friends, your roommates, etc. These people from primary groups may have a direct and strong impact in your lives and your buying decisions since they are very significant to you. Primary groups make you comfortable and give you a feeling that they are with you when you are confused about a purchase. These people give you very honest and clear advices as they are so close to you, due to which you could be more confident about the purchase. Research shows that the bond between people leads people to be effectively social and as satisfied consumers. 1 2 - 8

9. Second ary Groups Secondary reference groups are usually formal and they speak less frequently. They might be professionals, your collogues, your seniors at work or your acquaintance at club, etc. In secondary reference groups the power to influence people is quite less as compared to primary reference groups as people in these groups are not that comfortable in sharing their thoughts or views on the purchase. 1 2 - 9

10. Aspirational Groups Aspirational group is the one to which a person may want to become part of. They currently are not part of that group but wish to become and get with that group. For doing the same, they try to dress, talk, act and even think the way the members of that group do. For example, people who like Madhuri Dixit wish to become like her and meet her and so start purchasing and using all those products that she endorses. 1 2 - 10

11. Dissociative Groups The people in these groups are totally opposite to the people in the aspirational group. Here people deny of becoming or getting connected to a particular group. They just hate being related to that group. For example, if people don’t like a particular community, they would never like being connected to them. So they would try all the possible ways to avoid the way in which they dress, think or act. Thus marketers need to understand the likes and dislikes of the consumers and also the groups to which they belong. Marketers should recognize the extent to which a reference group influences the consumer and he should also understand out of all the groups which group influences him the most. 1 2 - 11

12. Family Family of a consumer plays an important role in the decision making process. The parents, siblings, relatives all have their own views about a particular purchase. A consumer gets influenced by his family members as well as friends. Since childhood the culture which he follows or the rituals which he observes and the moral values and the religious principles he usually receives them from his family. However, the individual learns fashion, attitude or style from his friends. All these attributes or traits together influence the buyer’s decision making. 1 2 - 12

13. Conclusion Reference groups, as elucidated by Robert K. Merton, play a vital role in our social lives, influencing our choices, behaviors, and self-identity. These groups serve as the benchmarks against which we measure ourselves, providing standards for social comparison. Whether they are primary or secondary, membership or aspirational, reference groups are integral to our development and social interactions. Their applications in marketing and consumer behavior highlight their significance in understanding contemporary society.

14. Queries/Discussions !