Consumer Behavior Social Class and Consumer Behavior

Submitted to : Sir Wajid Zulqarnain Submitted by: Sara Imtiaz,0915106 BSMS 8

Social Class:
Social class is the division of members of a society into a hierarchy of distinct social classes, exists in all societies and cultures. Social class usually is defined by the amount of status that members of a specific class possess in relation to members of other classes. Social class membership often serves as a frame of reference (a reference group) for the development of consumer attitudes and behavior The measurement of social class is concerned with classifying individuals into social class groupings. These groupings are of particular value to marketers, who use social classification as an effective means of identifying and segmenting target markets. There are three basic methods for measuring social class: subjective measurement, reputational measurement, and objective measurement. Subjective measures rely on an individuals self-perception; reputational measures rely on an individuals perceptions of others; and objective measures use specific socioeconomic measures, either alone (as a single variable index) or in combination with others (as a composite-variable index). Composite-variable indexes, such as the Index of Status Characteristics and the Socioeconomic Status Score, combine a number of socioeconomic factors to form one overall measure of social class standing.

Class structures range from two-class to nine-class systems. A frequently used classification system consists of six classes: upper-upper, lower-upper, upper-middle, lower-middle, upperlower, and lower-lower. Profiles of these classes indicate that the socioeconomic differences between classes are reflected in differences in attitudes, in leisure activities, and in consumption habits. This is why segmentation by social class is of special interest to marketers.

In recent years, some marketers have turned to geodemographic clustering as an alternative to a strict social class typology. Geodemographic clustering is a technique that combines geographic and socioeconomic factors to locate concentrations of consumers with particular characteristics. Particular attention currently is being directed to affluent consumers, who represent the fastest-growing segment in our population; however, some marketers are finding it extremely profitable to cater to the needs of nonaffluent consumers.

Research has revealed social class differences in clothing habits, home decoration, and leisure activities, as well as saving, spending, and credit habits. Thus, astute marketers tailor specific product and promotional strategies to each social-class target segment.

Social Class and Social Status:

1. Researchers define each social class by the amount of status (social status) the members of that class have in comparison to members of other social classes. 2. In social class research (sometimes called social stratification), status is frequently thought of as the relative rankings of members of each social class in terms of specific status factors. Examples include: a) Relative wealthamount of economic assets. b) Powerdegree of personal choice. c) Prestigethe degree of recognition received from others. 3. To secure an understanding of how status operates within the minds of consumers, researchers have explored the idea of social comparison theory. a) The idea is that individuals quite normally compare their own material possessions with those owned by others in order to determine their relative social standing. b) Status is often defined in terms of purchasing power. c) A related concept is status consumptionthe process by which consumers endeavor to increase their social standing through conspicuous consumption or possessions. 4. Other theories aside, status is often defined in terms of convenient demographic variables: a) Family income. b) Occupational status. c) Educational attainment.

Social Class is Hierarchical and a Natural Form of Segmentation:

1. Social class categories are usually ranked in a hierarchy ranging from low to high status. a)Thus, members of a specific social class perceive members of other social classes as having either more or less status than they do. b) Within this context, social class membership serves consumers as a frame of reference (i.e., a reference group) for the development of their attitudes and behavior. 2. The hierarchical aspect of social class is important to marketers. 3. Consumers may purchase certain products because these products are favored by members of their own or a higher social class (e.g., a fine French Champagne), and consumers may avoid other products because they perceive the products to be lower -class products (e.g., a digital readout wristwatch as a dress watch). 4. The classification of societys members into a small number of social classes has also enabled researchers to note the existence of shared values, attitudes, and behavioral patterns among members within each social class and differing values, attitudes, and behavior between social classes.

Social Class Categories:

Little agreement exists among sociologists on how many distinct class divisions are necessary to adequately describe the class structure of the United States. The choice of how many separate classes to use depends on the amount of detail that the researcher believes is necessary to explain adequately the attitudes or behavior under study. Marketers are interested in the social class structures of communities that are potential markets for their products and in the specific social class level of their potential customers.

The measurememnts of social Class:

1. There is no general agreement as to how to measure social class. 2. The result is a wide variety of measurement techniques, which may be classified into subjective measures, reputational measures, and objective measures.

Subjective Measures: In the subjective approach to measuring social class, individuals are asked to estimate their own social class positions. The resulting classification of social class membership is based on the participants se lfperceptions or self-images. Social class is treated as a personal phenomenon, one that reflects an individuals sense of belonging or identification with others. This feeling of social-group membership is often referred to as class consciousness. Subjective measures of social class membership tend to produce an overabundance of people who classify themselves as middle class. Moreover, it is likely that the subjective perception of ones social class membership, as a reflection of ones self-image, is related to product usage and consumption preferences.

Reputational Measures:

In this form, selected community informants make initial judgments concerning the social class membership of others within the community, rather than themselves. This gives researchers a better understanding of the specific class structures of the communities being studied. Consumer researchers, however, are more concerned with understanding markets and consumers than social structure. This method is often considered impractical.

Objective Measures: Objective measures consist of selected demographic or socioeconomic variables concerning the individual(s) under study. These are measured through questionnaires of factual questions. The most frequently used questions are about occupation, amount of income, and education. Sometimes geodemographic data in the form of zip codes and residence-neighborhood information is added. Socioeconomic measures of social class are important when segmenting the market. Marketers match the socioeconomic profiles of their target audience with the audience profiles of selected media. Marketing managers who have developed socioeconomic profiles of their target markets can locate these markets (i.e., identify and measure them) by studying the socioeconomic data periodically issued by the United States Bureau of the Census and numerous commercial geodemographic data services. Socioeconomic audience profiles are regularly developed and routinely made available to potential advertisers by most of the mass media. These objective measures of social class fall into two basic categories, single variable and composite variable.

Lifestyle profiles of the social causes:

1. Consumer research has found evidence that within each of the social classes, there is a constellation of a specific lifestyle factors (shared beliefs, attitudes, activities, and behaviors) that distinguish members of a social class from members of other social classes. 2. People in any class may possess values, attitudes, and behavioral patterns that are a hybrid of two or more classes.

Social Class mobility:

Individuals can move either up or down in social class standing from the class position held by their parents. Most Americans think of upward mobility. This results in the upper classes being the reference group for many ambitious men and women in America. Recognizing these aspirations, marketers frequently incorporate higher-class symbols into their advertising. Social class mobility also contributes to products and services filtering down from a higher level to a lower one.

The working class cosumers: Although many marketers go after the affluent, the size and income of the nonaffluent group make them an important target market. Lower-income, or downscale, consumers are households earning $30,000 or less. Downscale consumers are more brand loyal than wealthier consumers because they can less afford to make mistakes in switching to unfamiliar brands.

Middle Class consumers: It is not easy to define the borders of what is meant by middle class. Though other measures are possible (such as those earning between $25,000 and $75,000) the upper boundary of being middle class is about $85,000. For many marketers middle class can be thought of as including households that range from lower-middle to middle-middle class. Because technological and luxury products are becoming more affordable to this class, it is even more difficult to define middle class. There is mounting evidence that the middle class is disappearing in America. This is not true in other countries where the middle class is increasing.

The techno-class consumers: Techno is a new basis of class standing The degree of literacy, familiarity, and competency with technology, especially computers and the Internet sets the standard for this class. Those who are unfamiliar or lack computer skills are being referred to as technological underclassed. These extraordinary stories of entrepreneurial and technological accomplishments, when coupled with a general sense of not wanting to be left out of the sweep of computer technology have propelled parents to seek out computer training for their children, even their infant children. Fifty-five-year-old professionals, who were initially reluctant to learn computers, are now seeking personal computer training. Consumers throughout the world have come to believe that it is critical to acquire a functional understanding of computers in order to ensure that they do not become obsolete, or hinder themselves socially or professionally. It appears that those without necessary computer skills will increasingly find themselves to be underclassed and disadvantaged.

References:
Levy, S. J. (1999). Social class and consumer behavior (pp. 297-308). Thousand Oaks, CA Sage Publications. Sheth, Jagdish N., Banwari Mittal, and B. Newman. "Consumer behavior and beyond." NY: Harcourt Brace (1999).