CH-11 Group Influence And Social Media – Consumer Behaviour: Buying, Having, Being : Book Guide

Chapter 11 Group Influence And Social Media CHAPTER OBJECTIVES When students finish this chapter they should: •Understand that other people and groups often influence our decisions about what to buy. •Understand that we are motivated to buy or use products in order to be consistent with what other people do. •Understand that group contexts can have distinct influences on how we make consumer decisions. •Understand that word of mouth about products (good and bad) often is more influential than the advertising we see. •Understand that marketers are using a variety of techniques to harness the power of consumer word of mouth. •Understand that online technologies and social media can accelerate the impact of word of mouth communication and can affect the way in which companies interact with consumers CHAPTER SUMMARY •Consumers belong to or admire many different groups and are often influenced in their purchase decisions by a desire to be accepted by others. Individuals or groups whose opinions or behaviour are particularly important are called reference groups. Both formal and informal groups influence an individual’s purchase decisions, although the impact of reference group influence is affected by such factors as the conspicuousness of the product and the relevance of the reference group for a particular purchase. •Individuals hold influence in a group to the extent that they possess social power. Types of social power include information power, referent power, legitimate power, expert power, reward power, and coercive power. •Brand communities unite consumers who share a common passion for a particular product. Brandfests, organized by companies to encourage this kind of community, can build brand loyalty and reinforce group membership. •We conform to the desires of others for two basic reasons. Some people model their behaviour after others because they take that behaviour as evidence of the correct way to act; these people are conforming because of informational social influence. Other people conform to satisfy others’ expectations or to be accepted by the group; these individuals are affected by normative social influence. Group members often do things they would not do as individuals because their identities become merged with the group; they become de-individuated. •Opinion leaders who are knowledgeable about a product and whose opinions are highly regarded tend to influence others’ choices. Specific opinion leaders are somewhat hard to identify, but marketers who know their general characteristics can try to target them in their media and promotional strategies. Other influencers include market mavens, who have a general interest in marketplace activities, and surrogate consumers, who are compensated for their advice about purchases. •Much of what we know about products is learned through word-of-mouth communication (WOM) rather than formal advertising. Product-related information tends to be exchanged in casual conversations. Using crowd power, guerilla marketing, and viral marketing are all strategies to try to accelerate the WOM process. •Although WOM is often helpful for making consumers aware of products, it can also hurt companies when damaging product rumours or negative WOM occurs. •Social networking, where members post information and make contact with others who share similar interests and opinions, changes the way we think about marketing. As the Internet continues to develop, companies and consumers increasingly interact directly. The “wisdom of crowds” perspective argues that, under the right circumstances, groups are smarter than the smartest people in them. If this is true, it implies that large numbers of consumers can predict successful products. LECTURE/DISCUSSION IDEAS XII. REFERENCE GROUPS – External influences that provide social cues – actual or imaginary, and they have significant influence on a person’s evaluations, aspirations, or behaviour (e.g., co-workers, family, friends); informational; utilitarian, and value-expressive influences A. Types of Reference Groups – Some have greater influence than others o Normative influence – Helps to set and enforce conduct standards o Comparative influence – Affects decisions about specific brands or activities 1. Formal versus informal groups – Commerce Society vs. residence friends; with informal often demonstrating more influence on individuals 2. Brand communities – Set of consumers who share a set of social relationships based upon usage or interest in a product Class Interaction Opportunity: Ask students if they feel they belong to a brand community. Have them describe their associations with this group. 3. Membership vs. aspirational reference groups – People we know, work with, and socialize with vs. people we admire and want to be like (what you want to be, not who you are) •Likelihood of identifying with reference group influenced by: •Propinquity (physical nearness – we imitate those close to us) •Mere exposure – tendency to like things we see often •Group cohesiveness – greatest with small groups (exclusiveness) Class Interaction Opportunity: Give an example of an aspirational reference group of yours.  Human consumers are not alone: Even cockroaches and rats have been found to prefer familiar stimuli over novel ones!i 4. Positive versus negative reference groups – Reference groups can have either positive or negative influences on individuals, but generally people act in a manner consistent with the group expectations •Dissociative reference groups are those that a group (and members) wants to avoid association with, and thus would avoid acting like the dissociative group Class Interaction Opportunity: What is an example of a dissociative reference group for you? 5. Anti-brand communities – People united in their disdain of a celebrity, store, or brand Class Interaction Opportunity: How important are groups to you? What influence do they have on your purchase decisions? B. When Reference Groups Are Important – Most important for publicly consumed goods (e.g., luxuries, socially conspicuous good not privately consumed)  For a study examining reference group effects in both the United States and Thailand that also distinguishes between family and peer groups see reference.ii C. The Power of Reference Groups – ‘Social power’ as the capacity to alter the actions of others 1. Referent power – admired groups are copied (e.g., clothes, cars) 2. Information power – those who know things (e.g., Editor of Vogue) 3. Legitimate power - power by social agreement (e.g., police, doctors) 4. Expert power – specific knowledge or skill (CPAs, prominent economists) 5. Reward power – power to provide positive reinforcement (e.g., boss gives raises) 6. Coercive power – short-term power (e.g., intimidating sales people) Class Interaction Opportunity: Ask students to provide examples of persons or groups who hold each type of power. D. Conformity – Real or imagined group pressures (norms: informal rules of behaviour) Class Interaction Opportunity: Have the class write a list of social norms that they tend to follow on a daily basis. How do these norms get started?  The research technique known as ethnomethodology is applied by violating minor social norms to observe the consequences. For example, students might stand in an elevator backward or serve a dessert before a main course to observe people’s reactions.iii E. Factors Influencing the Likelihood of Conformity •Cultural pressures: Teenagers tend ‘to follow the crowd’ •Fear of deviance: Group applies penalties to ‘rule violators’ •Commitment: The more dedication, the stronger the follower •Group unanimity, size and expertise: ‘Law of large numbers’  For a study that examined the effects of peer pressure on drug and alcohol use see reference.iv F. Social Comparison – The behaviour of others is a yardstick of reality (right music, art, clothes, etc.); we like to choose who we want to be compared against: ‘level playing field,’ ‘birds of a feather’ 1. Tactical requests •Foot-in-the-door techniques: Make a small request first, then a bigger one •Low-ball technique: Ask for a small favour that turns out to be costly •Door-in-the-face technique: Make extreme request first, then the reasonable one 2. Group effects on consumer behaviour – An individual’s identity is submerged in a group (de-individuated); more unplanned purchases when you’re in a group Class Interaction Opportunity: Have you ever gone shopping with a group of people your own age? Do you remember buying something that you probably wouldn't have if you were alone? Did you take it back, give it away, or throw it away? o Social loafing – People don’t devote as much time to task when in a large group (e.g., people in large groups leave smaller tips) o The risky shift – Groups show greater willingness to take risks than individuals o Decision polarization – Position becomes more extreme after group discussion o Home shopping parties – Group pressure to buy G. Resisting Conformity – We take pride in our individualism and uniqueness o Anti-confirmity versus independence – Defiance of the group vs. do your own thing o Reactance – Try to overcome any loss of freedom of choice Class Interaction Opportunity: What are some things that you own that are unique? How do you feel when people talk about these things? II. OPINION LEADERSHIP – Important influence on brand popularity in many instances A. The Nature of Opinion Leadership o Opinion leaders: •Are technically competent •Have pre-screened, evaluated and synthesized, unbiased product information •Are socially active •Are similar to the consumer in values and beliefs •Are often among the first to buy new products Class Interaction Opportunity: Whom do you know that you would classify as an opinion leader? In what areas is he/she a leader? Are you an opinion leader? Under what circumstances and to whom do you perform this role? 1. The extent of an opinion leader’s influence •Generalized opinion leader: Someone sought for all types of products •Monomorphic: Experts in a limited field •Polymorphic: Experts in several fields (but usually concentrated) o Types of opinion leaders – Not a static process, different types of consumers •Innovative communicators: opinion leaders who are also early purchasers •Cascades: information triggers a sequence of interactions •Market mavens: transmit marketplace information of all types •Influence network: two-way dialogue with opinion leader to create cascades of information Class Interaction Opportunity: Ask students to describe a market maven that they know. What information do they get from them? How do they think the market mavens got their information? •Surrogate consumers – Person hired by to provide input into purchase decision (e.g., stockbrokers, interior designers, wedding consultants, etc.) B. Identifying Opinion Leaders – Many technical ads are designed for the opinion leader rather than the average consumer  The Roper Organization has been tracking a group it calls Influential’s since 1945. To qualify as an Influential, a person must have done at least three community activities in one year (e.g., attending a public meeting, holding office in a local organization, etc.). Comprising about 10 percent of the population, Influential’s entertain, travel, and spend money on hobbies at a higher rate than the general population.v In 2003, two Roper executives published a very readable book based on their research called The Influentials. 1. The self-designating method – A person is asked ‘Are you an opinion leader?’ 2. Sociometry – Traces communication patterns among group members III. WORD-OF-MOUTH COMMUNICATION – Transmitted by individuals to individuals; this information tends to be more credible and trustworthy than that from formal channels A. Factors Encouraging WOM •The person is highly involved with product •The person is highly knowledgeable about product •The person has genuine concern for someone else •The person may be uncertain about the wisdom of their recent purchase Class Interaction Opportunity: When you are planning to go to a movie, what are some of the sources of information you check before you make your decision? B. Negative WOM – Weighted more heavily than positive WOM Class Interaction Opportunity: Suppose you were going out to dinner at a new restaurant and a close friend of yours said, "I went there last week and the food was cold and the service was lousy!" How would you weigh this information in your decision-making? Would you seek more information? Do you think you would change your plans? C. Buzz Building – Marketer activities that encourage WOM about the brand 1. Crowd power – Groups can be smarter than the smartest people in them 2. Guerrilla marketing – Street marketing tactics Class Interaction Opportunity: Give an example of a guerrilla marketing effort you have seen. Critique it. 3. Viral marketing – Customers sell products on web on behalf of company IV. SOCIAL MEDIA AND CONSUMER BEHAVIOUR – Changing how consumers interact with each other in the marketplace (hardware; software); communities A. Social Networks – Socially relevant nodes (member of the network) connected by relations; based on various affiliations like kinships, friendship and affective ties, shared experiences, hobbies, interests, organizations •Interactions: Behaviour-based ties between nodes like talking to one another, attending events, working together •Flows: Occur between nodes; exchanges of resources, information, or influence; actionable component of sharing information •Media multi-plexity: Flows go in many directions and on multiple platforms •Social object theory: Social networks will be more powerful communities if relationships are activated •Object sociality: Whether the object can be shared in social media related to an audience’s interests B. Virtual Communities – Collection of people who interact online to share; founded by consumers for other consumers: form around a common love for a product; the collective participation of members who together build and maintain a site o Characteristics of online communities •Member contributions •Presence: the effect that people experience when they interact •Collective interest: commonalities that create bonds •Democracy: ruled by the people; media democratization •Standards of behaviour: rules that govern •Level of participation: lurkers; various forms of participation END-OF-CHAPTER SUPPORT MATERIAL Summary of Special Feature Boxes 1. Consumers in Focus I: Group Influence (Runnovation) This box examines how group activities are increasingly replacing solitary activities (such as running on a treadmill) and influencing our decisions. Companies such as New Balance are picking up on this trend as the shoe manufacturer promotes its “Runnovation” campaign that focuses on running as a social activity. 2. Marketing Insight I: Reference Group Power This box puts a spotlight on the power of reference groups to get people to use less energy through ‘report cards’ that highlight the energy consumption of those who lived in the same neighbourhood. 3. Consumers in Focus II: Aspirational Groups Aspirational groups used to be admired from afar, but this box discusses examples of how people are getting close to those they aspire to. Additionally, it talks about the use of negative reference groups as motivators to avoid some products 4. CB As I See It Dr. Sarah J.S. Wilner, Wilfrid Laurier University researches word-of-mouth marketing and in particular ‘product seeding.’ She has found that when it comes to influencing others, the context, character, and community (of the blogger spreading WOM) count. What bloggers contributed to their online communities was then co-created by other community members. Her work provides insights into how consumers behave in relation to marketers, as consumers are at times morphed into the role of marketer. 5. Marketing Insight II: Group Feedback This box discusses focus groups, and particularly how the opinions of others in a group can influence consumer attitudes. It provides examples of real-life research studies in which consumers varied their reactions in response to how others responded. 6. Consumers in Focus III: Social Loafing This box looks at the issue of social loafing. People do not devote as much effort to a task when their contribution is part of a larger group effort. It examines applications in a business setting. 7. Consumers in Focus IV: Herding Behaviour It’s not unusual to observe herding behaviour among consumers as they blindly mimic what others in their group do. Information cascades can bias what people choose as they take their cues from what others select rather than choosing what they genuinely like. 8. Marketing Insight III: Yelp Group influence is also demonstrated through online review pages and the experiences of others, and Yelp provides a great example of this. This box describes how the website works, and what the motivations for consumers to participate include. 9. Consumers in Focus V: WOM Online This box looks at the ease with which consumers can spread negative WOM online. Many dissatisfied customers and disgruntled former employees create websites simply to share their tales of woe with others. This is pushing more companies to increase their responsiveness and improve their customer service to minimize the risks as much as possible. 10. Consumers in Focus VI: Social Games This box looks at the growing role of social gaming. A social game is a multiplayer, competitive, goal-oriented activity with defined rules of engagement and online connectivity among a community of players. Successful mobile games like FarmVille and Angry Birds boast millions of avid followers and are an important new avenue for virtual consumer transactions. Review Questions 1. Name two dimensions that influence whether reference groups have an impact on an individual’s purchase decisions. Answer: Two dimensions that influence the degree to which reference groups are important are whether the purchase is to be consumed publicly or privately and whether it is a luxury or a necessity. 2. List three types of social power, giving an example of each. Answer: There are six types of social power: a) Referent power: If a person admires the qualities of a person or a group, he will try to imitate those qualities by copying the referent’s behaviours (e.g., choice of clothing, cars, leisure activities) as a guide to forming consumption preferences. b) Information power: A person can have power simply because she knows something others would like to know. c) Legitimate power: Sometimes we grant power by virtue of social agreements, such as the authority we give to policemen, soldiers, and yes, sometimes even professors. d) Expert power: To attract the casual internet user, U.S. Robotics signed up British physicist Stephen Hawking to endorse its modems. e) Reward power: When a person or group has the means to provide positive reinforcement, that entity will have reward power over a consumer to the extent that he values this reinforcement. f) Coercive power: A threat is often effective in the short term, but it does not tend to produce permanent attitudinal or behavioural change. 3. Which groups tend to be more powerful influences on behaviour, large formal groups or small informal groups? Why? Answer: It is small, informal groups that exert a more powerful influence on individual consumers. Small, informal groups tend to be more a part of our day-to-day lives and more important to us, because they are high in normative influence. Larger, formal groups tend to be more product or activity-specific and thus are high in comparative influence. 4. What is a brand community, and why is it of interest to marketers? Answer: A brand community is a group of consumers who share a set of social relationships based upon usage or interest in a product. 5. Explain the difference between a membership and an aspirational reference group, giving an example of each. Answer: Some reference groups consist of people the consumer actually knows (a membership reference group); others are composed of people s/he doesn’t know but admires. These aspirational reference groups comprise idealized figures such as successful business people, athletes, or performers. 6. Name one factor that makes it more likely that a person will become part of a consumer’s membership reference group Answer: Propinquity – residents of a housing complex are much more likely to be friends with the people next door than those who live only two doors away. Mere exposure – we come to like persons or things because we see them more often such as art or political candidates. Group cohesiveness – members of a small book club value their group membership and their consumption decisions are more likely to be influenced by other group members. 7. Define deindividuation and give an example of this effect. Answer: With more people in a group, it becomes less likely any one member will be singled out for attention. People in larger groups or those in situations in which they are likely to be unidentified tend to focus less attention on themselves, so normal restraints on behaviour are reduced. You may have observed that people sometimes behave more wildly at costume parties or on Halloween than they do normally. We call this phenomenon deindividuation, a process in which individual identities become submerged within a group. 8. What is the risky shift, and how does it relate to going shopping with friends? Answer: The risky shift refers to the observation that in many cases, group members show a greater willingness to consider riskier alternatives following group discussion than they would if members made their own decisions with no discussion. 9. What is the difference between normative and informational social influence? Answer: Home shopping parties, such as the Tupperware party or Lia Sophia Jewelry epitomizes, capitalize on group pressures to boost sales. A company representative makes a sales presentation to a group of people who have gathered in the home of a friend or acquaintance. This format is effective because of informational social influence: participants model the behaviour of others who can provide them with information about how to use certain products, especially because the home party is likely to be attended by a relatively homogeneous group (e.g., neighborhood homemakers, friends) that serves as a valuable benchmark. Normative social influence also operates because actions are publicly observed. Pressures to conform may be particularly intense and may escalate as more and more group members begin to “cave in” (this process is sometimes termed the “bandwagon effect”). 10. Define conformity and give three examples of it. Name three reasons why people conform Answer: Conformity refers to a change in beliefs or actions as a reaction to real or imagined group pressure. Among the reasons why people conform are cultural pressures, fear of deviance, commitment, group unanimity/size/expertise, and susceptibility to interpersonal influence. 11. What is social comparison? What type of person do we usually choose to compare ourselves to? Answer: Sometimes we look to the behaviour of others to provide a yardstick about reality. Social comparison theory asserts that this process occurs as a way to increase the stability of one’s self-evaluation, especially when physical evidence is unavailable. In general people tend to choose a co-oriented peer, or a person of equivalent standing, when performing social comparison. 12. What is the difference between independence and anti-conformity? Answer: It is important to distinguish between independence and anti-conformity; in anti-conformity, defiance of the group is the actual object of behaviour. 13. What is an opinion leader? Give three reasons why opinion leaders are powerful influences on consumers’ opinions. What are some characteristics of this type of person? Answer: An opinion leader is a person who is frequently able to influence others’ attitudes or behaviours. • They are technically competent and thus convincing because they possess expert power. • They have pre-screened, evaluated, and synthesized product information in an unbiased way, so they possess knowledge power. Unlike commercial endorsers, opinion leaders do not actually represent the interests of one company. Thus, they are more credible because they have no “axe to grind.” • They tend to be socially active and highly interconnected in their communities. They are likely to hold offices in community groups and clubs and to be active outside of the home. As a result, opinion leaders often have legitimate power by virtue of their social standing. • They tend to be similar to the consumer in terms of their values and beliefs, so they possess referent power. Note that although opinion leaders are set apart by their interest or expertise in a product category, they are more convincing to the extent that they are homophilous rather than heterophilous. Homophily refers to the degree to which a pair of individuals is similar in terms of education, social status, and beliefs. Effective opinion leaders tend to be slightly higher in terms of status and educational attainment than those they influence, but not so high as to be in a different social class. • Opinion leaders are often among the first to buy new products, so they absorb much of the risk. This experience reduces uncertainty for others who are not as courageous. Furthermore, whereas company-sponsored communications tend to focus exclusively on the positive aspects of a product, the hands-on experience of opinion leaders makes them more likely to impart both positive and negative information about product performance. 14. Is there such a thing as a generalized opinion leader? Why or why not? Answer: When marketers and social scientists initially developed the concept of the opinion leader, they assumed that certain influential people in a community would exert an overall impact on group members’ attitudes. Later work, however, began to question the assumption that there is such a thing as a generalized opinion leader, somebody whose recommendations we seek for all types of purchases. Very few people are capable of being expert in a number of fields. Sociologists distinguish between those who are monomorphic, or expert in a limited field, and those who are polymorphic, or expert in several fields. 15. What is the relationship between an opinion leader and an opinion seeker? Answer: The fact that we transmit advice about products does not mean other people take that advice. For someone to be considered a bona fide opinion leader, opinion seekers must actually heed his advice. An alternative is to select certain group members (key informants) who we ask to identify opinion leaders. The success of this approach hinges on locating those who have accurate knowledge of the group and on minimizing their response biases (e.g., the tendency to inflate one’s own influence on the choices of others). 16. What is the difference between a market maven and a surrogate consumer? Answer: In addition to everyday consumers who are instrumental in influencing others’ purchase decisions, a class of marketing intermediary called the surrogate consumer is an active player in many categories. A consumer category called the market maven describes people who are actively involved in transmitting marketplace information of all types. 17. How can marketers use opinion leaders to help them promote their products or services? Answer: If the opinion leaders will adopt the products, then there is an automatic effect of those opinion leaders promoting the same products to the public through word of mouth. 18. What are sociometric techniques? Under what conditions does it make sense to use them? Answer: Sociometric methods trace communication patterns among members of a group. These techniques allow researchers to systematically map out the interactions that take place among group members. 19. What is word or mouth, and why is it more powerful than advertising? Answer: Word of mouth (WOM) is product information transmitted by individuals to individuals. Because we get the word from people we know, WOM tends to be more reliable and trustworthy than recommendations we get through more formal marketing channels. 20. Which is more powerful, positive or negative word or mouth? Why? Answer: Consumers weigh negative word of mouth more heavily than they do positive comments. 21. Describe some ways in which marketers are using the Internet to encourage positive WOM. Answer: A virtual community of consumption is a collection of people whose online interactions are based upon shared enthusiasm for and knowledge of a specific consumption activity. Like the brand communities we discussed earlier, these groups form around a shared love for a product, whether it’s Barbie dolls or Blackberry’s. However, members remain anonymous because they only interact with each other in cyberspace. 22. What is viral marketing? Guerrilla marketing? Give an example of each. Answer: Guerrilla marketing is the use of promotional strategies that use unconventional locations and intensive word-of-mouth campaigns to push products. The train line CSX launched a safety-awareness campaign that included hiring people to throw eggs at the company’s outdoor billboards. The billboards carry the stark black-on-white words “Cars hitting trains.” Eggs smashing against the billboard are intended to demonstrate the impact of a car hitting a train. The idea is to get people to be careful when crossing railroad tracks. Viral marketing refers to the strategy of getting visitors to a website to forward information on the site to their friends in order to make still more consumers aware of the product—usually by creating online content that is entertaining or just plain weird. Viral marketing for an oil? Pretty slick. WD-40 quadrupled visitors to its fan club Website by offering 1,000 AM/FM radios in the shape of oil cans to individuals who signed up 10 other members. 23. What is a Klout score? Do you think this is important? Why or why not? Answer: Klout measures how influential we are online. It can serve as a measure of online opinion leadership. CONSUMER BEHAVIOUR CHALLENGE Discussion Questions 1. Although social networking is red-hot, could its days be numbered? Many people have concerns about privacy issues. Others feel platforms like Facebook are too overwhelming. As one media executive comments, “Nobody has 5000 real friends. At the end of the day it just becomes one big cauldron of noise.” What’s your stand on this? Can we have too much of a good thing? Will people start to tune out all of these networks? Answer: You could ask students for ways that social networking sites could be improved to reduce their weaknesses and to describe the features of a perfect social networking site. Social networking's future is uncertain due to privacy concerns and platform saturation. While these networks offer valuable connections, the overwhelming amount of content can lead to user fatigue and disinterest. As people seek more meaningful interactions, there could be a shift towards smaller, niche communities or a reevaluation of social media habits to avoid information overload. 2. The average Internet user in North America spends three hours a day online, with much of that time devoted to work and more than half of it to communications. Researchers report that the Internet has displaced television watching and a range of other activities. Internet users watch television for 1 hour and 42 minutes per day, compared with the national average of two hours. One study reported increasing physical isolation among Internet users; the study created a controversy and drew angry complaints from some users who insisted that the time they spent online did not detract from their social relationships. However, the researchers said they have now gathered further evidence showing that Internet use has lowered the amount of time people spend socializing with friends—and even sleeping. According to the study, an hour of time spent using the Internet reduces face-to-face contact with friends, co-workers, and family by 23.5 minutes, lowers the amount of time spent watching television by 10 minutes, and shortens sleep by 8.5 minutes per day. What’s your perspective on this issue? Does the increasing use of the Internet have positive or negative implications for interpersonal relationships in our society? Answer: The answer to this question all depends on how “interpersonal” is defined. If the definition sticks to that of traditional face-to-face communication, then it will be hard to argue that increased time online does not detract from interpersonal communications. Time is a limited resource. And as is shown above in the question itself, there is research to back this up. However, if students lean toward defining interpersonal communication as any type of communication between people, then there will be strong argument for the fact that increased time online enhances such. Given that many people spend time emailing, IMing, chatting, interacting in forums, blogs, etc., then in many cases, the time spent online is providing opportunities to interact with others that would otherwise not be there. The increasing use of the Internet has both positive and negative implications for interpersonal relationships. While it facilitates communication and connects people globally, it can also reduce face-to-face interactions and affect time spent with loved ones. The balance depends on how individuals manage their online activities; excessive use may lead to isolation, whereas mindful use can enhance and complement real-world relationships. 3. The Word of Mouth Marketing Association recently announced a new set of rules and guidelines for word-of-mouth advertising. The trade group maintains that marketers must make sure that people talking up products or services disclose whom they are working for. They also must use real consumers, not actors, who discuss what they really believe about a product. What do you think about “stealth” campaigns like this? Should marketers be required to disclose their true intentions when they try to initiate positive word of mouth? Answer: Traditionally, most students will respond that there is nothing wrong or even ethically questionable about such stealth practices as those described above. Even when they lead toward thinking that such practices are unethical, most will say that this is just another promotional practice, and that companies are within their rights to do such; that no harm is done. With the inclusion of the information that the AMA has actually censured such practices, the responses by students might be different. 4. The adoption of a certain brand of shoe or apparel by athletes can be a powerful influence on students and other fans. Should high school and college coaches be paid to determine what brand of athletic equipment their players will wear? Answer: You might want to raise the issue of consumer needs versus wants, the role of advertising in determining needs and wants, and the general ethics of marketing products to children and youth. The increasing use of the Internet has both positive and negative implications for interpersonal relationships. It facilitates global communication but can reduce face-to-face interactions and time with loved ones. The impact largely depends on how individuals manage their online activities; excessive use may lead to isolation, while mindful use can enhance and complement real-world connections. 5. The strategy of viral marketing gets customers to sell a product to other customers on behalf of the company. That often means convincing your friends to climb on the bandwagon, and sometimes you get a cut if they wind up buying something. Some might argue that means you’re selling out your friends (or at least selling to your friends) in exchange for a piece of the action. Others might say you’re just sharing the wealth with those you care about. Have you been involved in viral marketing by passing along names of your friends or sending them to a website such as www.hotmail.com? If so, what happened? How do you feel about this practice? Answer: Although this strategy has a fancy new name, it has been in practice for decades (anyone recall the vacuum cleaner salesperson or knife salesperson asking for names of friends and family?). Students may not be old enough to have been exposed to some of these more traditional applications of the concept. But many will have been confronted by other more modern applications. With the advent of the Internet, there are various ways that viral marketing is being applied. Be sure to try to bring out those cases where individuals were given some type of incentive to provide names of friends or for getting them to sign up for something. Viral marketing can blur the lines between genuine recommendations and sales pitches, potentially straining friendships. Personally, I've shared links or recommendations, like with Hotmail, to help friends or spread useful tools. While it can feel like sharing benefits, it's crucial to balance promoting products with maintaining authentic relationships and ensuring the motives are clear and considerate. 6. Are home shopping parties that put pressure on friends and neighbors to buy merchandise ethical? Answer: Such tactics are similar to those employed by official sales people. The AMA’s code of ethics stipulates that marketers should reject high-pressure manipulations and misleading sales tactics. If it is unethical for sales people to do it, then it is unethical for friends and neighbors to do it as well. In fact, it may be more so because often, people go to these parties under the impression that it is to be more of a social event. Once they get there and find that their friend is really a sales rep and is putting on the pressure, then essentially, they have been deceived. Experiential Exercises 7. The power of unspoken social norms often becomes obvious only when these norms are violated. To witness this result first hand, try one of the following: Stand facing the back wall in an elevator; serve dessert before the main course; offer to pay cash for dinner at a friend’s home; or tell someone not to have a nice day. Answer: Encourage students to be creative and to conduct these investigations and use a debriefing session in class to discuss some of their findings, reactions, and attitudes. Violating unspoken social norms, like standing facing the back wall in an elevator, can reveal how deeply ingrained these norms are. It often leads to confusion or discomfort among others, highlighting the role of social conventions in guiding behavior. Experiencing these reactions can offer insights into the importance of following accepted norms in social interactions. 8. Identify a set of avoidance groups for your peers. Can you identify any consumption decisions that you and your friends make with these groups in mind? Answer: Students will vary on their responses with regards to avoidance groups, but they should be able to identify at least one group that they wish to purposefully avoid being associated with. From there, it is likely that they would be able to identify products and behaviours associated with the avoidance group that they would then avoid engaging with. Avoidance groups for peers might include brands or lifestyles associated with values they reject. For instance, if a group avoids fast fashion for environmental reasons, they may choose sustainable clothing brands. Consumption decisions are influenced by these avoidance groups to align with their values and avoid products or brands they disagree with. 9. Identify fashion opinion leaders on your campus. Do they fit the profile discussed in the chapter? Answer: The class might agree to focus on a particular group of fashion opinion leaders. After deciding on the group, they could go through an opinion leader profile and determine whether or not the group members actually are fashion experts. (Possible Field Project Idea). Fashion opinion leaders on campus might include students known for their distinctive style or those frequently featured in fashion-related social media posts. They often fit the profile of trendsetters with a strong sense of personal style and influence over their peers' fashion choices. They may also have a keen awareness of current trends and a proactive approach to showcasing new styles. 10. Conduct a sociometric analysis within your dormitory or neighbourhood. For a product category such as music or cars, ask each individual to identify other individuals with whom they share information. Systematically trace all of these avenues of communication and identify opinion leaders by locating individuals who are repeatedly named as providing helpful information. Answer: Student responses will differ with regards to product category and individuals, but they should be able to trace back within a small social setting to identify interactions that have taken place and who the opinion leaders in the network area. To conduct a sociometric analysis, ask individuals in your dormitory or neighborhood about others they consult for information on music or cars. Map out these connections to identify who is frequently mentioned as a source of valuable insights. Those who are repeatedly named are likely opinion leaders in that product category. 11. See if you can demonstrate the risky shift. Get a group of friends together and ask each to privately rate the likelihood on a scale from one to seven that they would try a controversial new product (e.g. a credit card that works with a chip implanted in a person’s wrist). Then ask the group to discuss the product and then rate the idea again. If the average rating changes from the first, you’ve just observed a risky shift. Answer: Any type of controversial practice can be substituted into this exercise. To demonstrate the risky shift, have friends privately rate their willingness to try a controversial product before discussing it. After the group discussion, have them rate their willingness again. If the average rating becomes more extreme, showing increased willingness to try the product, it indicates a risky shift influenced by group dynamics. 12. Trace a referral pattern for a service provider (such as a hairstylist) by tracking how clients came to choose that individual. See if you can identify opinion leaders who are responsible for referring several clients to the business person. How might the service provider take advantage of this process to grow his or her business? Answer: Students are likely to come up with all types of incentive programs that will motivate customers to refer friends. Once something like that is in place, the likely hood of a referral network emerging is greater. To trace a referral pattern for a service provider, ask clients how they found out about the provider. Identify individuals who refer multiple clients, as they are likely opinion leaders. The service provider can leverage these opinion leaders by offering incentives or rewards for referrals, using their influence to attract new clients and enhance business growth. CASE STUDY TEACHING NOTES 1. What is your opinion on the social media efforts of Lululemon? How much of the company’s success is attributable to their social media activity? Answer: Lululemon has been reasonably successful with their social media efforts to date. As indicated in the case, the social media efforts of the company have grown organically and at present they have active efforts in all major social media channels. Their goal is to replicate the community feeling they have established in the in-store experience. Students should experience the social media efforts of the company in preparing/discussing the case and it would be useful to have them indicate the pros and cons of the various social media efforts the company has developed. As example, the Youtube channel that Lululemon has cultivated has produced a number of significant hits, but also has a number of postings that have received very little attention. Asking the students why this would be the case should foster good discussion. 2. How would you handle the first assignment Yoonji has been given? What would be your criteria in assessing the Heylululemon.com site? What recommendations would you make here? Answer: In assessing Heylululemon.com site it would be important to analyze the actual metrics and analytics achieved on the site. Specifically, Yoonji should assess the number of visitors/referrals, bounce and exit rates, conversions, etc. that are standard when assessing the success of a website. Importantly, Yoonji should also assess the actual interaction and co-creation efforts that come out of the site. For example, how many actual recommendations from consumers in the community are implemented and utilized by the company? Does the co-creation opportunity provide actual value to the product development efforts of the company? Further, does the opportunity to co-create build community – i.e., are co-creation participants more likely to spend, be involved, and reach brand ambassador status? If the Heylululemon.com site is successful in engaging consumers Yoonji should think about how best to augment the site to further build the community. Co-creation as a marketing tool is in its infancy and it might be interesting to see what other organizations are doing here. Perhaps Lululemon could more directly involve consumers that have ideas that show merit – i.e., directly involving them in the creation of a garment design and launch. A promotion that involved travelling to the Lululemon headquarters in Vancouver would probably be aspirational to many members in the community. Students should be encouraged to be creative on what next steps might look like here. 3. What new social media trends would you advise Lululemon to get involved in? Why? Answer: Relatedly, it is important that Lululemon continue to monitor and assess new social media opportunities. This medium is fluid and it is important that a brand like Lululemon stay on top of new mediums in this space. However, it is also critical that Lululemon not simply invest in any new social media trend that comes along – Yoonji should assess new mediums for fit and ROI with the brand. For example, would SnapChat or FourSquare fit the brand? How would involvement in these social media formats build the Lululemon community? In the case of SnapChat there is not a clear benefit or application whereas the FourSquare application has not seen the success of other social media formats (e.g., Instagram, Pinterest). Moving forward, Yoonji needs to monitor trends here, but also needs to be judicious in which new applications will meet the company’s needs. Finally, Yoonji should also consider experimenting with new social media trends as they are identified. Small scale efforts that do not take up too many resources, but effectively “test the waters” should be embraced. Such experimentation will enable better decision-making on which trends to put significant effort towards. FIELD PROJECT IDEAS Individual Assignments 1. Ask students to find one magazine advertisement for a consumer product that uses “the expert” as a reference group appeal and another which features a top corporate executive. Have the student discuss the impact of each appeal on consumers. Answer: Magazine Advertisements: Compare ads featuring “the expert” and a top corporate executive. Discuss how expert endorsements lend credibility and appeal to consumers seeking reliability, while corporate executives might convey authority and brand trustworthiness. 2. Have students think about some goods and services that they has purchased recently. To what extent did word-of-mouth communication influence purchases? Answer: Word-of-Mouth Influence: Reflect on recent purchases and assess how much word-of-mouth influenced decisions. Consider recommendations from friends, family, or online reviews in shaping your choices. 3. Send students to interview three friends about a product they recently purchased for the first time. Why did they purchase it? What was the role of “word of mouth” and personal influence (whether real or simulated)? You might encourage students to make a short video of the interview and show it to the class. Answer: Product Interviews: Interview three friends about a recent first-time purchase. Explore their reasons for the purchase, the influence of word-of-mouth, and any personal or social factors that played a role. A video interview can capture their insights effectively. 4. Encourage students to think of something they recently purchased in which advice was sought actively from others. For what reasons was advice sought? Why was the particular person selected to provide this advice? Answer: Advice-Seeking: Think of a recent purchase where you actively sought advice. Analyze the reasons for seeking advice and why you chose the specific person. This reveals the importance of trusted sources in decision-making. 5. Ask students to interview someone who has attended a home party where products were sold (e.g., Amway, cookware, Tupperware, Lia Sophia jewelry, Mary Kay, lingerie, candles). What types of group power (such as referent, expert, reward, coercive) can be identified? Answer: Home Party Interviews: Interview someone who attended a home party. Identify types of group power such as referent (personal admiration), expert (product knowledge), reward (incentives), or coercive (pressure tactics) used during the event. 6. Have students conduct a sociometric analysis within college or university housing or their neighborhood or family. Choose five varying product/service categories (e.g., fast food, medical care, hair care, movies, music, clothes, car repair) and ask a few individuals to identify other people with whom they share information. Try to trace the avenues of communication. See if opinion leaders for various categories can be identified. Answer: Sociometric Analysis: Conduct a sociometric analysis within a college dorm or neighborhood. Track information-sharing about various product/service categories to identify opinion leaders and map communication pathways. Team Assignments 7. Ask the class to write down the various groups to which they are members. In which of these groups are conformity pressures the greatest? Why do they think this the case? (In Class Project) Answer: Conformity Pressures: Have the class list their various group memberships and identify where conformity pressures are strongest. Discuss reasons for these pressures, such as shared values or high group cohesion, which increase the impact of social influence. 8. Ask students to think about individual family members, friends, and acquaintances. On paper, have them identify people who act as opinion leaders, product innovators, and market mavens. Describe what each person does. Have a few students share their observations with the class. Answer: Identifying Influencers: Have students list family members, friends, and acquaintances who act as opinion leaders, product innovators, and market mavens. Describe their roles and influence. Share these observations in class to understand different types of influencers and their impact. Individual or Team Assignments 9. Ask students or teams of students to make a list of aspirational groups that are of interest to many college or university students. Then ask them to bring to class a few print ads that are targeted to college or university students with these particular aspirations. Answer: Aspirational Groups: List aspirational groups popular among college students, such as tech enthusiasts or fitness buffs. Collect and bring print ads targeting these groups to class, showcasing how brands appeal to these aspirations. 10. Have students determine who the fashion leaders are at your university (or his/her church, place of employment, social group, neighbourhood, etc.). See how well they fit the profile discussed in the chapter. This assignment can be adapted to a team activity. Answer: Fashion Leaders: Identify fashion leaders at your university or within other social circles. Assess if they fit the profile of trendsetters, including their style influence and social dynamics. This can be done individually or in teams. 11. Have students look around and identify what special language, clothes, props, and sets are characteristic of various groups present in society. Answer: Group Characteristics: Observe and identify distinctive language, clothing, props, and settings associated with various societal groups. Highlight how these elements define and differentiate group identities. 12. Social norms tend to become obvious only when they are broken. Send students out to violate one or more social norms. (Tell them to shake hands with their left hand, eat their desserts first, belch during class, wear shoes that don't match, walk with their books on their head, make the narrow end of their ties extend a little below the wide end, sing in the elevator, or ask them to violate a social norm of their own. Note: Remind them to make sure they are only violating norms--not a law!) What do these students observe when they violate the social norm? Answer: Norm Violations: When students violate social norms, such as eating dessert first or wearing mismatched shoes, they often observe discomfort, confusion, or even amusement from others. These reactions highlight how strongly social norms influence behavior and social expectations. 13. For students who are a little more shy tell them to watch TV for about 10 minutes and jot down as many violations of social norms as they can identify. Answer: TV Norm Violations: Students should watch TV and identify as many social norm violations as possible, such as inappropriate behavior or unconventional portrayals. This exercise reveals how media often bends norms for dramatic or comedic effect. 14. Ask students or a student team to collect ads that attempt to incorporate word-of-mouth communications. Have them comment on the credibility of the ads. Is the promoter used in the ad an effective influencer? Answer: Word-of-Mouth Ads: Collect ads that incorporate word-of-mouth strategies and evaluate their credibility. Consider if the promoter is a believable and effective influencer, and how their endorsement impacts the ad’s persuasive power. 15. Encourage students or a team of students to read the book, The Influentials, and tell the class about their reactions to it. Ask the students to propose marketing communication strategies based on the recommendations proposed in the book. Answer: The Influentials: After reading The Influentials, students should share their insights and reactions. They should propose marketing strategies based on the book’s recommendations, focusing on leveraging key influencers to enhance brand reach and effectiveness. eLAB Individual Assignments 1. Go to www.nra.org. The National Rifle Association is one of the most vocal of all special interest groups. How does the organization use reference groups to spread its message? What type of power did you observe on the website? Explain how the NRA uses opinion leadership to influence public opinion. Answer: www.nra.org: The NRA uses reference groups like gun enthusiasts and political supporters to spread its message. It employs expert power through endorsements from well-known figures and authority power through its advocacy and lobbying. The NRA’s opinion leadership is leveraged through influential spokespeople and public figures to sway public opinion and mobilize supporters. 2. Go to www.hairclub.com. One of the great problems facing men in our day and age is the prospect of going bald. Some find it beautiful and some find it socially unacceptable. How does the Hair Club for Men play to male fears? How do they use reference groups and opinion leaders to persuade prospective customers to give their products a try? What do you think of the organization’s promotional campaigns and ethics? Explain. Answer: www.hairclub.com: Hair Club for Men addresses male fears about baldness by emphasizing the social and personal impacts of hair loss. They use testimonials and endorsements from satisfied clients (reference groups) and celebrities (opinion leaders) to build credibility. Their promotional campaigns are designed to appeal to insecurities, though some may question the ethics of their fear-based marketing. eLAB Team Assignments 1. Go to www.ihatestarbucks.com and www.homedepotsucks.com. Have your group evaluate the tactics of these anti-sites. How did they get started? Do you think they are effective? Are they distributing information or misinformation? Were you motivated to see the organizations’ other websites? What was of interest to you on these sites? How should the affected companies respond? Answer: www.ihatestarbucks.com and www.homedepotsucks.com: These anti-sites use tactics like exposing negative customer experiences and organizing public complaints to criticize the companies. They often start from dissatisfaction and spread through word-of-mouth. Their effectiveness varies; they distribute information, though sometimes biased. Companies should respond by addressing grievances and improving customer service. 2. Go to www.saladmaster.com. Examine the concept behind using Saladmaster waterless cookware. Become familiar with their products. Your group’s task is to assume the role of a market maven. Design an approach that would encourage your sphere of influence to try the Saladmaster approach. Explain your thoughts and procedures. What would it take to cause a shift in tastes and preferences in your influence sphere? Explain. Answer: www.saladmaster.com: Saladmaster’s waterless cookware promotes health benefits and cooking efficiency. As a market maven, design an approach that leverages personal recommendations and social proof within your network. Highlight health benefits and unique features to shift preferences. Creating compelling demonstrations and sharing success stories can drive interest and adoption. PROFESSORS ON THE GO! Chapter Objectives
When students finish this chapter they should understand why: •Other people and groups often influence our decisions about what to buy Have students in class write down the various groups to which they are members. In which of these groups are conformity pressures the greatest? Why do they think this is the case? Ask students to make a list of aspirational reference groups that are of interest to many college students. Then ask them to bring to class a few print ads that are targeted to college students with these particular aspirations. Have groups of students consider and identify what special language, clothes, props, and sets are characteristic of various groups present in society. You may wish to require students to make actual observations in a public place such as a shopping mall or airport. •We are motivated to buy or use products in order to be consistent with what other people do Ask students to think about individual family members, friends, and acquaintances. On paper, have the students identify the people who act as opinion leaders, product innovators, and market mavens. Describe what each person does. Have a few students share their observations with the class. Ask students to find one magazine advertisement for a consumer product that uses “the expert” as a reference group appeal and another that features a top corporate executive. Have the student discuss the impact of each appeal on consumers. •Group contexts can have distinct influences on how we make consumer decisions Ask students to interview someone who has attended a home party where products were sold (e.g., Amway, cookware, Tupperware, Sarah Coventry jewelry, Mary Kay, lingerie). What types of group power (such as referent, expert, reward, coercive) can be identified? •Word of mouth about products (good and bad) is often more influential than the advertising we see Students should collect ads that attempt to influence or promote word-of-mouth communications. Have them comment on the credibility of the ads. Is the promoter used in the ad an effective influencer? Have students think about some goods and services that he or she has purchased recently. To what extent did word-of-mouth communication influence purchases? Encourage students to think of something he or she recently purchased in which advice was actively sought from others. For what reasons was advice sought? Why was the particular person selected to provide this advice? •Marketers are using a variety of techniques to harness the power of consumer word of mouth Have each student identify one case of guerrilla marketing. It should be the objective to find a case where the maximum amount of promotional benefit was achieved with the least amount of resources. They should attempt to find information that will allow for estimates of these figures. Upon sharing cases with the class, keep track to determine the most effective campaign based on this ROI type of measure. Go to http://www.gogorillamedia.com/ . This is an agency that specializes in guerilla marketing tactics. Summarize five such tactics, identifying benefits and examples of using each. Describe how opinion leaders can be formed and found on the Internet. Describe the advantages and disadvantages of using opinion leaders on the web. How would this form of opinion leadership be different from any other form of opinion leadership (if at all)? •Online technologies and social media can accelerate the impact of word of mouth communication Each student group will have the task of forming or joining a brand community. Have them decide upon a brand that none of them really use. Then, have them research the brand extensively and begin their own pro-product dialogue among themselves. If they wish to establish an online chat room or message board, that would be all the better. After having done this for a set period of time, have group members discuss how they feel about the brand. Whether they have purchased or not, do they feel more “loyal?” Have they developed positive attitudes? Do they find themselves engaging in WOM outside the group? •Social media are changing the way companies and consumer interact Go to www.ihatestarbucks.com and www.homedepotsucks.com. Have your group evaluate the tactics of these anti-sites. How did they get started? Do you think they are effective? Are they distributing information or misinformation? Were you motivated to see the organizations’ other websites? What was of interest to you on these sites? How should the affected companies respond? ENDNOTES i H.A. Cross, C.G. Halcomb, and W. Matter, "Imprinting or Exposure Learning in Rats Given Early Auditory Stimulation," Psychonomic Science 10 (1967): 223 34; R. B. Zajonc, H. M. Markus, and W. Wilson, "Exposure Effects and Associative Learning," Journal of Experimental Social Psychology 10 (1974): 248-63. ii Terry L. Childers and Akshay R. Rao, "The Influence of Familial and Peer-based Reference Groups on Consumer Decisions," Journal of Consumer Research 19 (September 1992): 198-221. iii Harold Garfinkel, Studies in Ethnomethodology (Englewood Cliffs, N.J.: Prentice-Hall, 1967). iv Randall L. Rose, William O. Bearden, and Jesse E. Teel, "An Attributional Analysis of Resistance to Group Pressure Regarding Illicit Drug and Alcohol Consumption," Journal of Consumer Research 19 (June 1992): 1-13 v Rebecca Piirto, "The Influentials," American Demographics (October 1992) 6: 30. Solution Manual for Consumer Behaviour: Buying, Having, Being Michael R. Solomon, Katherine White, Darren W. Dahl 9780133958096