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Chapter 14
REFERENCE GROUPS AND FAMILY
AUTHORS' OVERVIEW OF THE CHAPTER
This chapter concerns two types of micro social influences--reference groups and family. In contrast to the broad,
pervasive macro social influences discussed in Chapters 12 and 13, reference groups and family are tangible social
aspects of consumers' immediate environment. Therefore, they have direct and substantial effects on consumers'
cognitions, affect, and behaviors.
Reference Groups. We begin by discussing reference groups--other people who influence a consumer's cognitive,
affective, and behavioral responses. Consumers use reference groups as a basis for comparison or a "point of
reference" in evaluating and judging their own behaviors, beliefs, and attitudes. By serving this comparison
function, reference groups can exert significant influence on a person's cognitive and behavioral responses.
We make several distinctions between types of reference groups, such as formal and informal groups. Then we
describe three types of influences that reference groups can have on consumers' behaviors, knowledge, meanings,
and beliefs--informational, utilitarian, and value expressive.

Informational influence refers to information about products, services, stores, etc. that reference groups
communicate to a consumer. Such information has greater impact on consumers' beliefs and attitudes if
it is relevant to an important goal.

Utilitarian influence occurs when consumers comply with the desires of the reference group in order to
receive rewards or avoid punishments. Reference groups can dispense reinforcers (and sanctions) when
consumers conform (or fail to conform) to the group's expectations and norms.

Value-expressive influence occurs when consumers emulate (imitate) a reference group in order to
enhance their self-concept or express their basic values.
Next, we consider reference group influences on consumers' product and brand choices. We discuss the differences
between necessity goods that nearly everyone owns and luxury goods that only certain groups buy. We also describe
the differences between public and private goods that are either known to other people or not. We discuss research
by Bearden and Etzel showing that reference group influence on product choice and brand choice varied according
to the type of product. For instance, reference group influence is likely to have a strong influence on consumers'
choice of both product and brand for public luxury products like snow skis, but not for private necessity goods like
toothpaste.
Then, we discuss how marketing strategies can use reference group influence. For instance, sales persons often refer
to reference groups in their sales strategies ("I sold _____ to some people just like you folks. They thought it was
perfect for them."). As another example, advertisements frequently portray certain types of reference groups using
the product and/or use models that personify (symbolically represent) a reference group.
Families. In the second half of the chapter, we turn our attention to the family and how the family influences
consumer behavior. We note that most marketing research has taken the individual as the focus of attention, even
though the family is a more relevant unit of analysis for many purposes.
We discuss three reasons why marketers should analyze family decision-making. For one, families are the relevant
decision-making unit for many types of purchase decisions (home furnishings, cars, appliances, vacations). In fact,
families make purchase decisions for a great many products and services, including some low-priced items such as
food products and beverages. In these cases, rather than studying how a single consumer makes a decision,
marketers should examine the cognitions, behaviors, and environments of several family members at once. In
addition, marketers should study how these people interact with each other in making the decision. The complex
social interactions involved in such decisions makes analyzing family decision-making difficult.
We distinguish between families and households--both terms are used in analyses of markets. A household consists
of the people who live in a housing unit (which could be a home, an apartment, a dorm room, a nursing home).
Marketers are interested in two types of households--families and nonfamilies. A nonfamily household consists of
unrelated people living together. Families contain at least two people living together who are related by blood,
marriage, or adoption.
Family Decision Making. We then distinguish several roles that members of a household might undertake during
decision making, including influences, gatekeepers, deciders, buyers, users, and disposers (pages 455-456). We
briefly discuss the relative influences of husbands, wives, and children in family decision-making. A major reason
for studying families is that children increasingly influence purchase choices and budget allocations in the family.
Also, many children have considerable money of their own to spend. This importance is reflected in the family life
cycle discussed later in the chapter. Then we discuss conflict in family decision-making, including disagreements
over the appropriate end goals or the means to achieve an agreed-upon goal.
We continue the discussion of family decision making, with a focus on interpersonal influences within the family.
We point out that despite research on the subject, we know relatively little about how husbands, wives, and children
interact when making decisions as a family. We discuss the conflicts that might occur during family decision-making
and how family members might resolve the conflicts. We end with a discussion of different family influence
strategies such as expertise, bargaining, and emotional (Exhibit 14.3) and patterns or styles of influence behavior
(Exhibit 14.4).
We discuss the consumer socialization process by which children (and other newcomers to a culture) acquire
knowledge about products and services and the behavioral skills to search for and select products to buy.
Next, we identify some of the major cultural and demographic changes in the American family and discuss their
implications for marketing strategy. Included are changes in the employment status of women, changes in patterns of
marriage and divorce, and changes in childbirth patterns and child rearing practices.
Family Life Cycle. Then, we discuss the family life cycle, which identifies the key social changes that occur in a
family over time as a function of major life events (marriage, birth, divorce, death). We present a model of the
modern family life cycle that reflects recent changes in family composition caused by changes in marriage, birth, and
divorce patterns (see Exhibit 14.5).
We discuss several types of households and families in modern society that have significant implications for
marketing strategies--including single person households, adult children living with parents, and divorced persons.
We conclude with some marketing implications of the family life cycle including a discussion of the time-stressed
consumer.
Finally, we discuss marketing implications of the family life cycle, especially those directed at the time stressed
shopper.
KEY CONCEPTS AND ISSUES
 Types of reference groups
 Three forms of reference group influence--informational, utilitarian, and value-expressive
 Effects of product and brand characteristics on the relative reference group influence on purchase choice
decisions
 Differences between households and families and nonfamilies
 Family decision making process
 Conflict in family decision making
 Influence strategies used by family members
 Consumer socialization
 Implications of current demographic patterns of family composition
 Family life cycle
CHAPTER OUTLINE
Chapter 14. REFERENCE GROUPS AND FAMILY
A. Chuck E. Cheese
B. Reference groups
1. Analyzing Reference Groups
2. Types of Reference Group Influence
3. Reference Group Influence on Products and Brands
4. Reference Groups and Marketing Strategy
C. Family
1. Family Decision Making
a. Influences on family decision-making
b. Children and family decision-making
c. Conflict in family decision-making
2. Consumer Socialization
3. Factors Influencing American families
a. Changes in female employment
b. Changes in marriage and divorce
c. Changes in childbirths and rearing practices
4. Demographic Changes in Household Composition
5. Family Life Cycle
a. Marketing analysis
b. Marketing implications
D. Back to ... "Chuck E. Cheese"
E. Marketing Strategy in Action: Saturn
TEACHING OBJECTIVES
After completing this chapter, students should be able to:
 define reference groups and describe their general importance for marketers.
 explain the three main types of reference group influence.
 describe the varying influences of reference groups on product and brand choice decisions.
 identify marketing strategies that make use of reference group factors.
 describe several reasons why family behavior and decision making is important to marketers.
 describe various roles that family members can take on during decision-making.
 discuss how conflict can arise in family decision making.
 discuss types of social influence between family members in family decision-making.
 define the family life cycle and discuss its relevance to developing marketing strategies.
TEACHING IDEAS AND SUGGESTIONS
Overview. This chapter presents several general theoretical ideas about two small-scale, micro aspects of the social
environment--reference groups and family. None of the concepts presented here is difficult. Basically, students need
to grasp two fundamental ideas. First, reference groups and families can have powerful effects on people's behaviors
as well as their affective and cognitive responses. Second, marketers usually have little direct control over these
factors. There is little marketers can do to change a person's reference group(s) or their family circumstances. The
key implication for developing marketing strategies is to carefully analyze and understand reference group and
family factors so that marketers can adapt their strategies to the micro social environment.
Possible Mini-Lecture: Types of Reference Group Influence. Students should understand the three types of
reference group influence--informational, utilitarian, and value-expressive. You might briefly lecture on the
following points.
There are many types of reference groups. Reference groups include close friends, co-workers, people who
live in the same household, relatives, membership groups (the school band, business clubs, church groups),
and symbolic or aspirational groups (rock stars, college graduates, business executives, rich people,
politicians).
Some reference groups are actual groups in which people interact directly, in face-to-face
encounters. Other groups (aspirational) do not involve direct interaction. Symbolic reference
groups may not even be real, but just symbolic or imaginary ("movie stars").
There are three types of reference group influence--informational, utilitarian and value-expressive.
Informational influences occur when other people provide information that changes consumer's knowledge,
meanings and beliefs about the product.
Consumers with expertise in a given area may exert considerable influence on others who look to
them as a reference point or expert. Consider how the person who is an expert on computers,
stereo equipment, or fashion clothing can provide useful information to their friends and
acquaintances.
Utilitarian and value-expressive influences operate more in terms of interpersonal or social factors. Factors
such as desire for social interaction, pressures for conformity in order to maintain group membership and
support, and modeling or vicarious learning are relevant here.
Utilitarian influence operates by rewarding people for conforming to the values, beliefs, and norms
of the reference group. A basic reinforcer is continued "membership" in the group and social
interaction with its members. This gives people an important "sense of belonging" and close
personal contacts. Utilitarian influence has a normative effect, tending to make the people in the
reference group comply with the norms of the group.
Value-expressive influence operates by enhancing people's sense of self through identifying with
groups that represent one's personal values.

Ask students to identify reference groups in their college experience and discuss how they were
influenced by these groups.
Reference group influences of all types are especially obvious on a college campus. Students
should be able to give numerous examples from their personal experiences.
Students should recognize that reference groups can influence consumers' affective
responses (what is valued; what emotional responses are appropriate), their cognitions
(knowledge, meanings and beliefs about products, stores, or behaviors), and overt
behaviors (how to shop, purchase, use and dispose of products).

Encourage students to identify the basis for each reference group influence (expertise, reward power,
etc.).

You could show a few advertisements that use a reference group appeal and/or portray reference groups.
Alternatively, ask students to bring such examples to class for discussion (see the Project below).
Students can easily find print ads that illustrate one of the reference group appeals. These are
available in virtually any magazine. Students may be able to describe other marketing strategies
that use reference group appeals, such as personal selling strategies.

For each ad/example, ask the class to identify (a) the type of reference group influence being used, (b)
the types of consumers most likely to be influenced (target segment), and (c) the likely effects of the
reference group appeal on those consumers.
Example: Reference Group Image Advertising. Sometimes the reference group is a single person—a referent
other. Thus, movie stars such as Meryl Streep or Mickey Rourke (highly popular in France) or entertainers such as
Madonna or Will Smith can serve as a reference group for some people.
American express has based its advertising on single-person reference group appeals since the early 1970s.
It launched the classic campaign “Do You Know Me?” in 1974. Each ad featured someone who was
famous for his or her achievements, but whose face was not familiar to the public. In 1987 American
Express produced the highly praised “Portraits” campaign with photographs of famous people who have
held American Express credit cards for varying periods of time, including John Elway, Willie Shoemaker,
and Wilt Chamberlain. The ads were intended to establish the American Express card as the prestige card
to own because these successful people used one. The reference group strategy worked for American
Express; earnings grew at a 20 percent rate between 1970 and 1990.
But the early 1990s were a different story. Prestige and status no longer seemed so important. Visa has
been using a different advertising approach since the middle 1980s. The ads are intended to convince
consumers that Visa is a more practical card because it is accepted in more places than American Express.
The ads show real places like Rosalie’s Restaurant or the ticket office for the Winter Olympics and have the
same tag line: “If you go to (Rosalie’s), be sure to bring your Visa card, because they don’t take American
Express.” Between 1986 and 1991, Visa’s worldwide share rose from 44.3 percent to 50.9, whereas
American Express’ share fell from 21.7 percent to 16.4. Calculated in dollars, these are huge changes.
In the meantime, American Express has rethought its image approach based on reference group celebrities.
The 1991 campaign from American Express for the corporate card was still based on an aspirational
reference group appeal but was not oriented toward prestige and status. Their ads portrayed “real-life”
situations in an executive’s busy life, such as opening a foreign branch office or starting a small company.
The ads briefly describe how the Corporate Card and the accompanying good service from American
Express gave these executives advantages in their businesses. The goal was to form a means-end chain
linking the product to the customer. [“American Express Pulls Trigger with New Ads,” Marketing News,
March 4, 1991, p. 6; Derrick Neiderman, “Image Can Be a Fickle Thing,” Investment Vision, OctoberNovember 1991, p. 30]
Possible Mini-Lecture: Why are Families Important? Students should know why, in spite of many changes,
families are still very important to marketers.
The family is the relevant unit of analysis for many product decisions, because several members of the
family are involved and/or the product is purchased for use by the family. In the course of these decision
processes, family members interact and influence each other.
Family members sometimes often pool some of their resources to buy products. Often, family members
share in the consumption of certain goods (foods, furniture, vacations, restaurants).
In addition, the family unit serves to socialize members about most aspects of life, including purchase and
consumption. Thus, the family may have considerable long-term influence on consumers' affect and
cognitions, and their future behaviors.
Students should recognize that the various changes that are occurring in the American family do not
diminish these important influences that the family has on consumer decision making.
In-Class Exercise: Changes in Reference Group Influence over Time. For many products, the type and extent of
reference group influence is likely to vary over the course of the product life cycle, as the product from introduction
to maturity to decline. Thus, the appropriate marketing strategies should change too. This topic allows you to bring
the Wheel of Consumer Analysis into the discussion.

Show a transparency of the Wheel model, and remind students that reference groups are part of the
social environment.

Ask students to discuss how reference group influences may change over time as a product moves from
the introduction stage to a mature product.
Social influences may be more important early in a new products' life cycle. Students should be
able to think of products in which success in the introduction stage is highly dependent on
reference group influence. Patronage of movies, new restaurants, and new boutique shops is
influenced by positive word-of-mouth recommendations. Much of this interpersonal
communication occurs between members of reference groups--friends, relatives, co-workers.
The type of reference group influence may also vary over time. Early in the introduction stage, reference
group influences are likely to be largely informational. As more people own the product and know about it,
the influences may become more utilitarian and value-expressive. Late in the life cycle, reference groups
may have relatively little influence on consumers.
Also, fads (products with very short life cycles) are usually very heavily influenced by reference groups in
consumers' social environment. The reference group influence can be positive (in the early stages of the
spreading fad) and negative (as the fad dies out and takes on negative meanings).
College campuses are excellent places to observe the spread and decline of fads (clothing styles
especially) and the influence of reference groups on the diffusion process.
In-Class Exercise: Demographic Implications. We have found that many students have a poor sense of the
sometimes dramatic demographic changes and trends that are occurring in their own and other societies. A
discussion of such changes can be useful. Interesting class discussions usually can be generated by considering the
marketing implications of changes in demographic characteristics.

For instance, present some piece of demographic information such as current characteristics of families
or projected characteristics.
Examples can be found in nearly every issue of the business press and daily newspapers (The Wall
Street Journal is a good source). The magazine, American Demographics, is an excellent source
of current demographic examples to present to your class. Each issue will discuss some interesting
demographic change.
Consider, for example, the implications of the following changes on family decision-making
processes, roles of family members, conflict in decision making, etc.:

the large number of working women

more children born in late 1980s and early 1990s

the continuing high divorce rate

the growing number of single person households

more families with elderly parents to be cared for
Consider the following demographic facts. There are more single parent families today than ever, most of
them headed by a woman.
In 1989, married couples headed 57 percent of households, but there were some 25 million
households (28 percent of all households) headed by a single woman (only 15 percent of
households were headed by single men). Only 6 percent of women live with an unrelated person-an unwed partner or a roommate. Nearly all single parent households are headed by women (86
percent).
These single woman households are quite diverse. Contrary to most perceptions, only 1/3 are
poor. Although the stereotype is an unwed or divorced mother with small children, only 25
percent of female-headed households include children under 18. Some single woman households
include adult children, others include other family members (elderly parents or siblings), while 52
percent involve women who live alone, most of them are elderly, many on fixed incomes.
Certainly the people in these households have distinctive lifestyles. Moreover, the ages and
incomes (and other characteristics) of the women who live in these households vary dramatically.
For many products, the appropriate marketing strategies directed at these women should differ,
too.

Ask your students to discuss the implications of these demographic facts for marketing strategies.
You might select a particular product such as fast food restaurants or home electronics products
(TV, stereo systems, camcorders).
The Wheel of Consumer Analysis provides a useful framework for this discussion.

Ask, "How will these environmental changes affect consumers' affect, cognitions, and behaviors? What
marketing strategies will be necessary to cope?"
In-Class Exercise: Family Life Cycle. The family life cycle is a useful concept for marketers. Students might find
it useful to review the family life cycle a bit more deeply than the text does (see Discussion Question 4).

Ask students to identify the underlying base for the family life cycle.
Students should recognize the key basis for the stages of the family life cycle--major events that
occur in a persons' life including marriage, birth of children, children leaving home, retirement,
and death.

Point out that these life events often lead to or create different social and physical environments. These
events also create changes in affect and cognition, as well as overt behavior.

Challenge students to work through how the environment changes as one goes from one stage in the
family life cycle to another. The Wheel of Consumer Analysis is a useful guide here.
These environmental changes, according to the relationships portrayed in the Wheel of Consumer
Analysis, in turn can cause substantial changes in the behaviors and cognitions of family members.
Of course, as these factors change over the family life cycle, marketing strategies must also change
to continue to be effective.
In-Class Exercise: Family Decision Making. An in-class discussion of family decision making can help students
become more aware of the importance of this topic and the complexities of studying family decision making.

Begin by asking students to describe how their families make decisions about certain products, perhaps
a car, new furniture, breakfast cereal, or a family vacation.
Students should recognize that each purchase involves many decisions including when to buy,
where to buy, how to pay, type of payment, what brand and model to buy, etc. These decisions
may be made by different family members.
Over time, many families probably tend to "automate" recurring decisions, by "assigning" the
responsibility for them to different family members. This tendency is likely to be greater in larger
families and those in which time is more "valuable."

Ask students to discuss how family decision making might vary as a function of social class, subcultures
(ethnic background, for example), age of parents, or number of people in the family.

Ask students to describe the types of decisions that create conflict in their own families.
"What types of decisions seem to arouse the most conflict in your families?" This should generate
an interesting discussion about the basis for conflict in family decision making.
Relate this discussion back to the cognitive section by asking students to discuss the level of the
means-end chains where the major source of conflict exists. Is it at an attribute or consequence or
value level?
One might imagine that conflicts at an attribute level are more easily resolved than those
that involve end values.

Ask the class to discuss the likely prevalence of conflict in family purchase decisions for different types
of products, and the implications for marketers.
"What types of strategies might marketers develop if purchase of their products generates
substantial decision conflict in families?"

Show a transparency of several potential influence strategies (see Exhibit 15.3, page 459 in the text),
and encourage students to identify the types of influence strategies used by members of their families.
Focus on the differences between students' families that surely will arise in this discussion. "How
do your families differ?" "What implications do differences family decision making have for
marketing strategies?"
Factors Affecting Family Decision Making. In the text, we briefly review some factors that influence family
decision making. These include husband and wife roles, children in the family, conflict, and different product
categories. Many other factors will affect family decision-making processes.

Ask students to identify factors that might affect family decision making.
Students might use the Wheel of Consumer Analysis as a framework for their answer. For
instance, some factors are aspects of the environment such as the season of the year (choosing gifts
at holiday time might involve different decision processes). Time pressures can also affect family
decision making.
Aspects of the social environment, such as the number of people in the family, or whether there are
two parents or grandparents in the immediate household, can also affect family decision making.
Other factors in the social environment include the cultural norms for such influence (in some
cultures the male head of household has supreme decision-making power, in other cultures it is the
female). Social class and reference groups can also influence family decision-making processes.
Affective and cognitive factors can influence family decision making. For instance, students might
identify the amount of perceived risk in the decision--perhaps parent(s) become more involved as
the perceived risk increases. Other cognitive factors include special expertise (amount of
knowledge) of family members, different social pressures and influences on family members, and
differential involvement of family members in the decision.
In-Class Exercise: Roles in Family Decision Making. The roles family members might take in making a family
decision are discussed in the text. These include the following:


Information gatherer -- the person who takes primary responsibility of searching for and
interpreting relevant information.

Influencer -- the person who tries to convince the decision maker of what product/brand/model to
buy.

Decision Maker -- the person who actually makes the decision, usually to buy a particular item.

Purchaser (buyer) -- the person who makes the purchase, exchanging money for the item that is
bought.

User (consumer) -- the person(s) who consumer or use the product or service.
Ask students to work through a "typical" family decision, in their families, such as choosing a restaurant
for a casual dinner out, or buying a TV for the family, or renting a video for the evening, or selecting a
vacation spot.
Students should discuss the different roles their family members usually take on. Also, they should
note the interactions and the flow of influence between family members during the decision
process.
In-Class Exercise: Family Influence Strategies. Family members have different types and levels of influence at
different points in the decision making process. Exhibit 14.4 could be used as a basis for a class discussion on the
relative influence of different family members at various behavioral stages of the adoption process (information
contact, product contact, funds access, purchase, consumption).

Select a product, such as a new stereo system or a family vacation, and ask students to analyze the likely
influences of different family members across the stages.
This discussion could be expanded to a consideration of how family decision making might vary in
different social classes (e.g., upper, middle, or lower classes) or different subcultures (e.g., black,
Hispanic, white).
PROJECTS
Here are two simple projects to give students experience in analyzing concepts regarding reference group influence
and family decision making.
Reference Group Influences
This project is intended to give you experience in thinking about and analyzing reference group influences.
 Find an example of a marketing strategy that uses a reference group appeal.
 Next, identify the target consumer.
 Then, identify the type of reference group influence that is involved--informational, utilitarian, or valueexpressive--and describe that influence in detail.
 Then, critique and evaluate the strategy as to its likely effectiveness.
 Write up your analysis in a page or two and hand it in (or come prepared to discuss it in class).
Family Decision Making
This project is intended to give you experience in thinking about some of the issues concerned with family decision
making.
 First, select a recent decision in which several of your family members were involved.
 Then, describe the family decision making process you observed and/or participated in. How did the
members of your family interact during this decision process? What family members did what? What
types of conflict occurred? How were these resolved?
 (as an alternative) Describe how your current household (perhaps a group of friends living together)
made a recent "family" decision.
 Write up your description and speculate as to some of the causal factors that were involved
(environmental factors, influence strategies, marketing strategies). For instance, stage in the family life
cycle might be an influencing factor.
NOTES AND ANSWERS TO REVIEW AND DISCUSSION QUESTIONS
1. Identify two reference groups that influence your consumption behavior. Describe each according to the types
listed in the text and tell what categories of purchases each influences.
This is a simple review/application question that will produce idiosyncratic answers.
Reference group types are categorized and described in Exhibit 14.1, page 349 of the text. Several
distinctions were made between types of reference groups: formal versus informal, primary versus
secondary, and membership versus aspirational versus disassociative.
Students should be able to apply these types of reference groups to their own social environments and
behavior. Products for which reference groups are especially relevant include clothing for casual,
recreation or work purposes. Decisions about vacations, beverage choices, automobiles, home furniture and
decoration, jewelry, and gifts may be influenced by reference groups.
2. From a marketing manager's viewpoint, what are some advantages and problems associated with each type of
reference group influence?
This is a challenging application question. Students will have to think hard about the three types of
reference group influence.
Marketers face several difficulties in working with reference groups. First, marketers have to identify the
relevant reference group for their product. Usually they will find that controlling or influencing the groups
is difficult. Predicting effects on consumers' behaviors is difficult, especially in the face of multiple
conflicting influences.
There are three basic types of reference group influence: informational, utilitarian, and value-expressive.
Informational influence can be powerful, and is perhaps the most easily affected by a well-planned
marketing strategy. Marketers might direct certain information directly to experts and opinion leaders who
serve as reference points for groups of consumers. Problems arise because this marketing information has
to be processed by multiple individuals. Thus, the information may be selectively attended to and
interpreted by both the reference person and the group members to which it is transmitted. There is no
guarantee that the reference person will transmit positive information.
Utilitarian influence is very difficult for marketers to use directly, since the reference group members
control the possible rewards or punishments. However, marketers can devise advertising strategies that
portray people receiving reinforcements (or punishments) for appropriate behaviors. Through vicarious
learning, consumers might develop these same behaviors.
To use the value-expressive influence, marketers should have a good understanding of the key values in the
reference group and how the group influences the self-concepts of individuals. These values could be
portrayed in advertising or salespeople could be trained to bring out the values during their presentations.
As the text notes, the expressive value of the product may not be consistent with marketer objectives.
Sometimes different segments have conflicting values expressed by product usage.
3. Describe how the public visibility and the distinction between luxury and necessity goods affect reference group
influence on choice at the product and brand levels.
This review question will require some thought, since discussion of these concepts in the text is relatively
short.
Basically, students should use Exhibit 14.2 to discuss how social visibility of product and brand ownership
and use affect reference group influence. Also, they should be able to discuss the effects of whether the
product is considered a necessity (that nearly everyone owns) or a luxury product that is discretionary.
Students should recognize that reference group influences on purchase choice will be greater for
luxury products and those for which ownership and use are public (visible to others). "Private"
products tend to have lower reference group influence.
Perhaps some students will recognize that although the ownership and use of a product or brand is
usually either public or private, it can vary somewhat in different situations. For instance, a
typically private product might not be private in situations involving shared living quarters (a
dormitory or a family). Similarly, the definitions of luxury and necessity may not be identical
across all social classes. Personal computers, for example, could be defined differently by
individuals in a social class--some people consider PC's to be a necessity, but they are a luxury
item for others.
Brand choices are probably most critical for marketing managers, except when they need to build primary
demand in a new product category or are trying to increase general usage levels in a category. The key
issue is to identify the reference group influence most likely to affect the brand selection decision, and then
stimulate that influence in advertising. Good examples can often be found in ads for over-the-counter
medicine and recreational products.
4. What is the family life cycle? Discuss how it can be used to develop effective marketing strategies.
This is a straightforward review question. This material is covered in the text. The family life cycle should
be a review concept for most students. We suspect, however, that most students try to memorize the model
without carefully considering its strengths and weaknesses for marketing purposes.
Students should realize that marketers who recognize the many variations in family structure and makeup
are still faced with several challenges. For instance, some meaningful homogeneity must be found as a
basis for segmentation. What groups should be combined? Probably, family life cycle stages are more
meaningful for some product categories (and brands) than others.

You may have to intervene in the discussions to sort out family life cycle issues from stereotypical
thinking about people in these various stages of life.
The impact of life style changes associated with marriage or a new baby may be useful to illustrate how
stage in the family life cycle affects consumers' affect and cognitions and their behaviors. Or, students
might consider how their purchasing is different from their parents or grandparents may help them to
understand the issues.
If students do not reach this conclusion themselves, suggest that the family life cycle concept is most useful
for understanding consumers' responses at the product category level. More detailed research will be
needed to determine brand selection processes.
5. Identify three different family purchases in which you have played a role in the decision process. What role did
you play? Describe the key factors and interpersonal interactions that were involved in the presses.
This is a fairly simple review/application question. Most students will be able to easily answer this from
their own experiences.
Students' examples will necessarily be idiosyncratic. Their examples can be sorted into the influence
strategy categories given in Exhibits 14.3 and 14.4. Alternatively, you could show the Exhibits and use the
types of influence strategies to elicit examples from the class.
Key questions to consider and discuss include:
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Which family members were involved?
Are there patterns to influence strategies selected?
Is this common across product categories?
How could a marketing manager develop a strategy to change the outcome?
6. Suggest two ways in which marketing strategies could influence the decision process in your family or
household. How are these different from strategies that might be used to influence individual decisions?
This application question follows from the examples and concerns of the previous question.
Students could develop an answer by considering the different roles that family members might take on
during a decision process.
For example, information often goes through a "gatekeeper" who must select it for attention and
interpretation before "passing it on" to other family members. In some families, for instance, the
person who first sees the mail might throw away direct mail before it can be seen by all the
participants in the decision.
Some products are used by many family members--televisions, homes, recreational vehicles--who might be
involved in the decision-making process. Other products such as clothing (for kids) and personal care items
are used by individuals but might involve a family decision process. Marketers might design product
information specifically for relevant family members (husband, wife, and children). Information should be
appropriate for each decision maker and the expected influence patterns. Generally, such strategies will be
more complex than strategies aimed at individuals.
7. Offer examples of conflict in family household decision making which you have experienced or observed. What
types of marketing strategies could help to reduce such conflicts?
This is another review/application question that draws on students' personal experiences. Although
students' answers will necessarily be idiosyncratic, they should be useful as examples of more basic
concepts.
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In the classroom discussion, keep the focus away from details of family arguments and instead on how
marketing strategies can be used to reduce or resolve conflicts.
Students might categorize marketing strategies according to the major elements of the marketing
mix to show that product, price, promotion, and distribution strategies can all play a role in
meeting family needs.
Students should recognize that some family conflicts about purchase and consumption issues might
reflect deeper, underlying problems in family relationships that marketers cannot resolve.
Perhaps some students will suggest that marketers, through their various strategies, may increase or
cause family conflicts. Some critics have argued that advertising to children creates additional
family conflicts when children beg or pester their parents for certain products (new toys and
breakfast cereals are notorious examples).
Perhaps students who have worked in retail sales or in various service organizations can describe some of
their observations about family conflicts at the purchase stage, and what, if anything, they were trained to do
about it.
8. Discuss the differences between households and families. Describe how each is important to marketers.
Students should have no trouble with this simple review question.
Marketers often analyze families and households in describing markets. A household consists of the people
who live in a housing unit (which could be a home, an apartment, a dorm room, a nursing home). Marketers
are interested in two types of households--families and nonfamilies. A nonfamily household consists of
unrelated people living together. Families contain at least two people living together who are related by
blood, marriage, or adoption.
9. How are family influence strategies similar to or different from other reference group influences? What
marketing implications are related to these distinctions?
Students should recognize that the influence strategies shown in Exhibit 14.3 are not only relevant for
family situations. These influence strategies can be observed in many other types of reference groups.
Generally, students enjoy identifying the application of these influence strategies in various social settings,
including classrooms, social groups, work groups, churches, or various other types of organizations.
A key difference between these social groups and family influences is the increased duration and intensity
of social interactions in the family. Many families stay together for long periods of time and interact with
each other daily. Families are much more closely tied economically, too, including sharing of resources in
the consumption of goods and services.
The marketing implications provide a good opportunity if you desire, to compare consumer and industrial
strategies, since both usually involve group decision making.
10. Identify two different household or family compositions. Assume that each unit has the same level of income
and discuss how the decision processes and conflicts might vary for products such as an automobile, a vacation,
and a stereo system.
Students are naturally inclined to make assumptions about family behavior based on generalizations from
their own family or other families they know well. One purpose of this application exercise is to help
students be more objective about how families can vary and how these differences can impact consumption
behavior.
Students can be paired on a random basis to maximize the differences in each dyad. A wide variety of
differences might be evidenced, most of which will affect family decision making. Consider how the
following differences might affect family decision making--single versus married parent(s), mothers who
work outside the home versus not, number of children, age ranges of children, age of parent(s), presence of
grandparents in home or close by versus not, presence of other relatives close by (large extended family),
social class, subcultural factors (racial or ethnic backgrounds), etc.
Students should recognize that family composition affects consumer behavior and that family units are
changing.
For instance, many families will make multiple purchases in certain product categories because one
product/brand cannot meet the needs of every family member. But, these multiple purchases are
be equivalent to multiple individual decisions, since the family unit, somehow, makes these
decisions.
NOTES FOR DISCUSSION QUESTIONS TO MARKETING STRATEGY IN ACTION—
Saturn
1.
Visit the Saturn website and try to determine the market segments the carmaker is targeting. What should
Saturn do to better serve those segments? How might Saturn tailor its offerings to address the different stages
of the family life cycle?
Many of Saturn’s vehicles seem to be positioned as family cars. In its descriptions of the various Saturn
models, the Website discusses important safety features—like a “head curtain airbag”—and the amount of
cargo room. Moreover, most Saturn models are 4-door cars and, one could argue, are not particularly
sporty looking. The Website emphasizes reliability and practicality over performance. Saturn probably
also attracts a number of young consumers who are buying their first new car. They are affordably priced,
and the no-dicker sales force might prove attractive to those consumers new to the car-buying process.
Saturn appears to recognize that its cars are not luxury vehicles, although it wants to give consumers the
impression that they are getting luxury characteristics for bargain dollars. The aforementioned “head
curtain airbag” is described on the Website as being similar to the airbags found in Mercedes, Audis, and
Volvos.
Saturn might be able to attract more family vehicle buyers if it sold a minivan and/or an SUV. Those are
two types of vehicles very popular with families, and Saturn doesn’t have either one among its offerings.
To attract younger car buyers, Saturn might try to make its cars look a bit sportier—perhaps it could offer a
convertible or some kind of an affordable sports car.
One thing that might make Saturns more attractive to current and new customers is a wider variety of
models. Most of its cars are roughly the same size and look very similar. General Motors’ traditional
strategy has been to get young people to buy a Chevy, move them along later to a Pontiac, then up the scale
again to a Buick or Oldsmobile, and finally to the high-end Cadillac. Each of those GM makes looks
different and has different customer meanings associated with it. Saturn owners might display even stronger
long-term loyalty if they could choose from different makes and models appropriate for various stages of
the family (and personal) life cycle.
2.
Other vehicles—like Porsches, Mustangs, and Harley-Davidson motorcycles—also have “cult” followings. But
these products also have very strong symbolic meanings associated with them. The Saturn is a solid and
reliable, but basically unspectacular car. Identify and discuss three reasons why you think Saturn has such a
devoted following of involved customers.
Saturn’s no-haggle policy is one factor that almost certainly contributes to its loyal following. Going to a
car dealer can be a frustrating and nerve-wracking experience for many consumers. They might feel that
they are being pressures or treated with disrespect by a salesperson. For these consumers, car shopping in a
more laid back atmosphere, without having to worry about negotiating a price, can be a very compelling
lure.
Saturn’s well-cultivated reputation as “a different kind of car company” also likely fosters loyalty. The
notion that labor and management are all part of the same team might strike some as refreshing, especially
given the history of labor-management conflict in the American automobile industry. There is also the idea
that Saturn is making a car “just for you,” giving the idea that the company isn’t just churning out car after
car on an assembly line (even though that may be exactly what they are doing). Well-publicized stories like
the one in the case about the dealership in Salt Lake City flying the customer in to look at the car also
reinforce Saturn’s “different” image.
A third reason for Saturn’s devoted following is the sense of community that has developed among owners.
As the case states, many Saturn owners feel themselves part of a “family” and will go out of their way to
commune with other members of that “family.” Buying a car other than a Saturn would mean that these
consumers would lose touch with the other members of that important reference group.
3.
An automobile is a high-involvement purchase. Discuss how the manufacturer of a lower-cost, lowerinvolvement product could generate greater personal relevance and long-term loyalty. Find and discuss an
example of a company that has done so.
The topic of loyalty is addressed in greater detail in Chapter 16. Among the ways to increase brand loyalty
is through brand extensions (i.e. Coca-Cola, Diet Coke, Caffeine Free Coke, etc.) A company can also
increase the importance of its brand name (i.e. Oscar Mayer hot dogs, which are mentioned in Chapter 16).
Moreover, a company can also look to find a tangible, sustainable competitive advantage. In the late 1998
Proctor & Gamble introduced Febreze, a product which eliminated odors from fabrics. You can simply
spray Febreze on a fabric without washing it and the odor will be gone. It was the first product of its kind
on the market, and it quickly generated high levels of trial and loyalty, reaching a reported $107 million in
sales in its first year. P & G holds several patents related to the chemical technology behind Febreze, and
thereby hopes it can sustain its competitive advantage.
4.
Saturn is a company that generates sales and loyalty through meaningful one-on-one interactions with
customers. What is the role of traditional mass media advertising for firms such as Saturn that use innovative
ways to reach consumers?
Saturn has utilized mass media to spread the word of those meaningful one-on-one interactions and allow
millions of consumers to hope that they can have similarly fulfilling interactions. The satisfied Saturn
owners highlighted in the ads form an informational reference group for consumers at large. Because
automobiles are public necessities, reference groups’ brand influence is strong. Saturn believes potential
customers will see the ads, and then begin to yearn for the kind of one-on-one experience the ads describe.
The company hopes the consumer will turn to Saturn for that experience.