Buyer behaviour income and social class
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Buyer Behaviour Income and Social Class. Chp. 13 with Duane Weaver. Income & Social Class OUTLINE. INCOME PATTERNS $ PENDING Consumer Confidence Social Class Impacts Measuring Affect on Purchase Decisions. INCOME PATTERNS. Average Cdn . Income is up

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Buyer behaviour income and social class

Buyer BehaviourIncome and Social Class

Chp. 13 with Duane Weaver


Income social class outline

Income & Social ClassOUTLINE

  • INCOME PATTERNS

  • $PENDING

  • Consumer Confidence

  • Social Class

    • Impacts

    • Measuring

    • Affect on Purchase Decisions


Income patterns

INCOME PATTERNS

  • Average Cdn. Income is up

  • Steady increase in working women, thus middle & upper income Family earnings UP!

  • Education increases income2006 results:

    • 50%+ Cdns. with some post secondary education/income

    • 25% have some University, 16%+ have degree


Pending

or

+

?

$PENDING

  • Discretionary Incomea.k.a “disposable income”

    • “the money available for a household over and above that required for a comfortable standard of living.”^^^what does this really mean??^^^


Consumer confidence and the propensity to spend

Consumer Confidenceand the propensity to spend

  • Behavioural Economics (economic psychology) tries to determine:how consumers’ motives and expectations about the future affect the entire society’s economic well-being.

  • Optimism vs. Pessimism

  • Spend vs. Hoard/Save(e.g. Great Depression, severe weather, impending war, threats of terror…social or political unrest)


Social class

SOCIAL CLASS

  • Social Class = a consumer’s standing

    • Determined by a complex set of variables including income, family background, and occupation within a particular culture.(note we will look at cultural implications separately)

  • Is it Have vs. Have not?

  • What is the “have”???

  • How does the perception of social class impact the cognition of spending?(e.g. minimalism vs. materialism)


Impacts of social class

IMPACTS of SOCIAL CLASS

  • Pecking order

  • Access to resources

  • Tastes and Lifestyle

  • Social stratification and status hiearchy

  • Please get together with your team NOW:

    • take 8 minutes to come up with one example for each of the above.

    • Your examples should exemplify how social class impacts a decision to spend by that social group.


Measuring social class

Measuring Social Class

  • Why bother?What is the value to a marketer, advertiser, or product manager?

  • Complex concept that is difficult to measure

  • Problems with metrics:

    • Badly dated, not as relevant today

    • Most based on traditional nuclear family

    • Relies largely on interviewer’s judgment

    • Mixed rankings: income, ethnicstatus, job status, & actual social behaviour


Measuring social class1

Measuring Social Class

  • Social Class Segmentation Issues:

    • Ignore status inconsistency

    • Ignore intergenerational mobility

    • Ignore subjective social class (self-identity vs. classification of value)

    • Ignore aspirations to change one’s standing

    • Ignore social status of working spouse


Social class s affect on purchase decisions

SOCIAL CLASS’sAffect on Purchase Decisions

  • Social class “standing” can be used to segment markets as we see examples of buyer behaviour that are related. E.g.: Working class focusing on Function and Yuppie focusing on Image.

  • World-view of classes

  • Taste cultures (aesthetic and intellectual preferences), codes (restricted v.s elaborated), cultural capital (destinctive rare practices)


Social class s affect on purchase decisions1

SOCIAL CLASS’sAffect on Purchase Decisions

  • Targeting Social Class

    • From what we have learned, how can we better target a specific social class?

      • High income

      • Middle income

      • Low income

  • Invidious distinction – products that inspire envy in others through display of wealth or power.

  • Conspicuous consumption – people’s desire to provide prominent, visible evidence of their ability to afford luxury goods.

  • Parody Display – seek status by reverse consumption, mocking status symbols.


Thank you

Thank You


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