Family or Household Decision Making. families are related by blood or marriage households are people living together, but not necessarily related. Families and Households. What’s the difference between a Family and Household ?. Types of Households/Families.
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Family or Household Decision Making
families are related by blood or marriage
households are people living together, but not necessarily related
What’s the difference between a Family and Household?
Why is it Important for Marketers to know about Families and Households?
newly married, no kids
young couple, kids < 6
young couple, kids >6
older married w/ dep.
empty nesters, working
widower - working, not working
Changes Over Life-Cycle
primary decision maker
Why is it of value to understand the family life cycle?
What are the Critical Consumption factors?
Stages of the family life cycle
1) Bachelor Stage. (Young single people not living at home):
(a) Few financial burdens,
(b) Fashion/opinion leader led,
(c) Recreation orientated,
(d) Experiment with personal financial management
(e) men and women differ in consumer behaviour
- women more housing-related items and furniture,
basic kitchen equipment,
basic furniture, cars, holidays,
cars, fringes, cookers, life assurance, durable furniture, holidays,
2) Newly married couples (Young, no children) (DINKS)
(a) Better off financially than they will be in the near future,
(b) High levels of purchase of homes and consumer durable goods,
(c) Establish patterns of personal financial management and
necessities - washers, dryers, baby food and clothes, health foods vitamins, toys, books etc.;
3) Full nest I. (Youngest child under six):
(a) Home purchasing at peak,
(b) Liquid assets/saving low,
(c) Dissatisfied with financial position and amount of money saved, (d) Reliance on credit finance, credit cards, overdrafts etc.,
(e) Child dominated household,
necessities - foods, cleaning material, clothes, bicycles, sports gear, music lessons, pianos, junk foods, holidays etc.;
4) Full nest II.
(Youngest child six or over):
(a) Financial position better,
(b) Some wives return to work,
(c) Child dominated household,
5) Full nest III. (Older married couples with dependent children.:
(a) Financial position still better,
(b) More wives work,
(c) School and examination dominated household,
(d) Some children get first jobs; other in further/higher education, (e) Expenditure to support children's further/higher education,
new, more tasteful furniture, non-necessary appliances, boats, holidays, etc.
luxuries, home improvements e.g. fitted kitchens etc.;
) Empty nest I. (Older married couples, no children living with
them, head of family still in labor force):
(a) Home ownership at peak,
(b) More satisfied with financial position and money saved,
(c) Interested in travel, recreation, self-education,
(d) Make financial gifts and contributions,
(e) Children gain qualifications and move to Stage 1.
medical appliances or medical care, products which aid health, sleep and digestion, hobbies and pastimes,
7) Empty nest II. (Older married couples, no children living at
home, head of family retired):
(a) Significant cut in income,
(b) Keep home,
(d) Concern with level of savings and pension,
(e) Assist children
hobbies and pastimes,
8) Solitary survivor I. (In labour force):
(a) Income still adequate but likely to sell family home and purchase smaller accommodation,
(b) Worries about security and dependence;
(c) Concern with level of savings and pension,
9) Solitary survivor II. (Retired):
(a) Significant cut in income,
(b) Additional medical requirements,
(c) Special need for attention, affection and security,
(d) May Seek sheltered accommodation,
(e) Possible dependence on 'others for personal financial, management and control.
How do the following overall demographics of the modern family affect marketers?
Households vary in consumption habits depending on stage where they are in family life cycle
Household decision making is also different from individual decision making
Family role structure orientation influences household decision making
Nature of good or service to be purchased and consumed influences household decision making
Types of Purchase Decisions
Made by Families
Group Members Have Different
Preferences and Can’t Agree
on a Purchase That
Will Satisfy Everyone.
Group Agrees on the Desired
Purchase, Differing Only in
Terms of How It Will
Consensual Decision Making
Conflict Occurs When There is Not Complete Correspondence in Family Members’ Needs and Preferences.
Some Specific Factors Determining the Degree of Family Decision Conflict Include the Following:
Person’s Level of Investment in the Group
Degree to Which the Product in Question Will Be Used or Will Satisfy a Need
For Procurement, Maintenance, Payment, etc.
One Family Member’s Influence Over the Others in Making Decisions
Influence may depend on the good or service to be purchased, role structure orientation, stage of the decision making process
autonomous or unilateral;
Who makes the Decisions?
Made by One Spouse or the Other
Decisions Made Jointly
Four Factors Influencing Family Decision Making
1. Sex-role stereotypes - separation of decision-making for sex-typed products.
2 Spousal Resources - spouse contributing the greater resources (usually, but not always, money) has the greater influence
3. Experience - individual decisions are made more frequently when the couple has gained experience as a decision-making unit
4. Socio-Economic Status - middle class families make more joint decisions than either upper or lower class families.
Initiators: initiate consumption behaviour
Information Gatherers: research alternatives
Gatekeepers: control flow of information to other members
Influencer(s): provide information about a good or service to other members
Deciders: have power to make final buying decision
Buyers: member(s) who actually make purchase
Preparers: transform product into useable form
Users: family members who use the good or service
Maintainers: responsible for maintenance of good
Disposers: responsible for disposal of good/service
Marketing communication: advertising message, media used, person targeted, product positioning
Product development: products, e.g. minivans and cars built specifically for families; vacations; services, e.g. insurance, hotel
Pricing decisions: e.g. discounts for bulk purchases
Distribution: changes in family lifestyle means changes in distribution, e.g. longer retail hours
Public policy regulations re marketing to children
Households can be targeted by advertising by lifestyle .
Marketing to the Family
When marketing to the family children must be a consideration.
How would you reach families with your marketing message?
Internet, e-mail and other technology
marketing to families employs strategies and practices that strongly appeal to parent customers and their children for the ultimate purpose of increasing sales. It involves looking at your sales and marketing processes from the viewpoint of a consumer who has money to buy, children beside them and is stretched for time.
Family marketing has three components:
For many households, a car purchase is a family event. It can be a pleasant one or a story that is retold with embarrassment and horror. Which do you think will lead to a repeat sale or referral? If you were the owner of a car dealership how would you make the purchase of a car a pleasant family event.
Since 1976, the real income (in constant dollars corrected for inflation) of Canadian families has remained relatively constant. How is this situation affecting the purchasing behaviour of Canadian Families?
How should a firm use this information to develop a marketing strategy for
For what kinds of products would the family-life cycle concept be most useful in estimating demand?
Give some examples of the effects of the changing role of women on marketing practices (product, promotion, price, place)