ENVIRONMENTAL INFLUENCES ON CONSUMER BEHAVIOR

The factors that influence consumer behavior is

classified into : 1) Internal Factors or Individual Determinants 2) External Factors External factors do not affect the decision process directly, but percolate or filter through the individual determinants, to influence the decision process.

Individual Determinants

External Factors

Motivation and

Cultural influences Sub-culture Influences Social class Influences Social group Influences Family Influences Personal Influences

involvement Attitudes Personality and selfconcept Learning and Memory Information processing

CULTURE
The sum total of learned beliefs, values, and customs

that serve to regulate the consumer behavior of members of a particular society. Complex concept that includes, knowledge, beliefs, art, law, morals, customs and any other capabilities acquired by humans as members of society. Culture includes almost everything that influences an individuals thought processes and behaviors. Culture gradually changes with time.

Culture
Is a comprehensive concept.

Influences our preferences

Is acquired from our experiences and learning. Supplies the boundaries for behavior in modern

societies. Consumers are seldom aware of cultural influences.

Characteristics of Culture
Culture is invented

Culture is learned
Culture is socially shared Culture are similar but different

Culture is adaptive
Culture satisfies needs. It is gratifying and persistent.

Emergence of new consumer culture

Eating out grows in urban India. Pub culture in its infancy Women gain confidence with color cosmetics Fair skin in the wish list Body odour creating a stink Films dictate fashions Skin is in PC games attracting the younger generation No do-it-yourself culture Temple visits attracting followers. Saving rates dropping Metro sexual male arrives in India

Influence of culture on Consumer Behavior

Consumption of food, clothing and housing

Perception on Message and Media

Receptivity to new ideas and change.

SUBCULTURE
Within a culture , there are many groups or segments of

people with distinct customs, traditions and behavior. For eg - In the Indian culture itself, we have many subcultures, the culture of the South, the North, East and the West. Hindu culture, Muslim culture, Hindus of the South differ in culture from the Hindus of the North and so on. Products are designed to suit a target group of customers which have similar cultural background and are homogeneous in many respects. Subculture is a distinct cultural groups that exists as a identifiable segment within a larger, more complex society.

Relationship between Culture and Subculture

Examples of major Subcultural categories

CATEGORIES Nationality Religion Geographic region Race Age Gender Occupation Social class EXAMPLES Greek, Italian, Russian Catholic, Hindu, Mormon Eastern, Southern, Southwestern African American, Asian, Causasian Teenagers, Xers, elderly Female, male Bus driver, cook, scientist Lower, middle, upper

Types
Ethnic Subculture Blacks, Hispanics, Asian

Americans, Euro Americans, Native Americans etc. Religious Subculture Age Subculture Gender Subculture Region Subculture Nationality

Black or African-American Subculture

Largest Racial minority in US

More than 36 millions consumers in US

Younger with very high numbers living in cities. The group is very diverse

1999 earnings : $ 491 billion

1999 purchase : $ 207 billion (ninth largest economy

in the world). Consumers expect respect within the marketplace and must feel a sense of acceptance

Contd..
A high proportion of families are headed by women.

Black women influences many purchases that might

otherwise be purchased by men. Advertising often appeals to the strength black women portray in life. Psychographic characteristics lifestyle pattern

This ad for Vibe Vixen magazine targets the African American Urban subculture

An AD showing many racial Subculture

Asian American Subculture

High incomes, High Education

Multicultural : Chinese, Filipino, Japanese, Asian

Indian, Korean, Vietnamese, Malaysian. The population in US is almost 8 million, 3 % of total population, largely because of immigration. Psychographic Characteristics Womens place is in the home, when making important decisions consideration of family comes first, caring for ones aged parents is the duty of everyone, every family should have a son etc..

Similarities
They are cost conscious and very brand loyal.

They shop mostly within their communities.

Language barrier may be a challenge for marketers. The most effective advertising to Chinese -Americans

reflects traditional family values.

Differences
Significant differences in household decision

making- male or female dominance Differences in reasons for coming to, living in the US, desire to return to homeland Differences in Innovativeness. Differences in use of homeland media- English best for broadcast; Asian language best for print. Similarities and differences in reactions to marketing stimuli, such as colors, themes in ad

HISPANIC SUBCULTURE
Fastest growing ethnic market in US. Attain slightly lower level of education than do black and other non

Hispanics. They think of themselves as Hispanic or Latino first and as Americans second. 90% indicate that Spanish is the most important feature of their culture. 20% of the Hispanic do not speak English at all. Two-third of Hispanics prefer to speak Spanish at home. They are diverse group, bound together by common language and cultural heritage. 90% use Spanish Language media for product information. 65% listen to Spanish-language radio, 80% watch Spanish language TV, 40% read Spanish language newspaper, and 20% read Spanish language magazines.

characteristics
They have positive attitude towards advertising.

Prefer well known or familiar brand.

Buy brands perceived to be more prestigious. Are fashion conscious.

Historically prefer to shop at smaller personal stores.

Buy brands advertised by their ethnic-group stores. Likely to buy what their parents bought.

Youths are more fashion conscious than non-

Hispanic peers.

RELIGIOUS SUBCULTURE
Consumer behavior is directly affected by religion in

terms of products that are symbolically and ritualistically associated with the celebration of religious holidays. For eg: the bride in a Hindu family is dressed in a traditional deep Red dress; the bridegroom wears a Sherwani, Chooridar and Pagri. Consumption of meet, beef, pork and alcohol is also determined by ones religion. Sikh religion do not permit shaving of hair

REGIONAL SUBCULTURE
It arise due to climatic conditions, the natural

environment and resources, language and significant social and cultural events. Westerners have mug of black coffee. Easterners have cup of coffee with milk and sugar. White bread is preferred in South and mid-west. In India, south prefer coffee while north prefer Tea. It is relevant for marketers to study and understand subcultures on a regional basis, particularly language, food habits, festivals, gift giving, customs etc.

Comparison of Purchase Pattern

PRODUCT/ACTIVITY ANGLOWHITE 102 97 97 103 93 94 107 103 97 101 96 AFRICAN AMERICAN 86 122 118 77 137 137 45 85 121 103 115 HISPANIC AMERICAN 91 102 100 86 161 90 71 81 98 86 133

Dental floss
Mouthwash Hand and body cream Vitamin and dieting supplements Energy drinks Car rental business use Own a digital camera Greeting card Instant breakfast Barbeque and seasoning sauces Ready-to-drink cappuccino

Cat treat

109

45

57

AGE SUBCULTURE

Generation X Market

Generation Y Market

Seniors Market

Baby Boomer Market

Generation X
Born between 1965-1979 in America. In India this period pay more attention in obtaining degree. Most of them experienced dificult economic times and also saw the

emergence of dual income household and nuclear families. Job opportunities were decreasing and the population pressure were increasing. In search of jobs and careers, many people from small towns and rural areas headed towards larger cities. Many of this generation struggled with careers and financial matters and only a small percentage could make a good career in industry and government. Marketers increasingly targeting this group with job promises, autos, appliances, houses/flats, insurance and investment services etc.

Generation Y
Born between 1977-1994.

Subsegment- Gen Y Adults, Gen Y Teens.

First generation to grow up with almost equal

employment oppurtunies for women. The family size is generally small and owns time saving appliances, computers and Internet.

Baby Boomers
The largest age category alive today. Approx 45% of adult population. They have high level of education. They have more discretionary income than other groups

and they buy more and save less. They are health conscious. They are becoming less materialistic in outlook and their product and service selections reflect their concern for the environment and quality of life. They keep up with fashion. They use credit card and buy expensive items.

Teens
They have been segmented into several lifestyles

groups. Increasing influence on purchasing. Increasing spending power. They are preoccupied with their appearance. They are open to new ideas and new products.

Seniors
Generally older consumers.

Subsegment: The young Old (65-74), the Old (75-

84), the Old Old (85 and above). Household are small and their need for purchases is limited. They enjoy convenience in the marketplace and appreciate their leisure time.

Communication to Older People

Keep the message simple.

Make the message familiar.

Make the message concrete. Take it point by point.

Give preference to print media.

Supply memory aids.

Gender Subculture
Masculine Vs Feminine Traits.

The Working Woman

- Segmentation Issues - Shopping Patterns Four Segments: - Stay-at-Home Housewives - Plan-to-work Housewives - Just-a-Job Working Women - Career-oriented Working Women

Important Terms
ASSIMILATION it refers to person being taught some but

not all of the attitudes, values and behavior of another culture. ACCULTURATION when a person is taught the full range of another culture pattern, to the extent that these new attitudes, values and behavior exhibit greater strength than those of ones original culture. A GENERATION or AGE COHORT is a group of persons who have experienced a common social, historical and economic environment. COHORT ANALYSIS is the process of describing and explaining the attitude, values and behaviors of an age groups as well as predicting its future attitudes, values and behavior.