Question

What are your reference groups? List and discuss at least 4 groups that influence your purchases. For each group, indicate whether it's influence is comparative or normative (or both) and explain your answers.

Please some references also

Answer 1

Solution:-
The concept of reference group is not a new idea in the field of consumer behaviour research. Studies on reference groups dated back to early 70's. However, concept of reference group was first defined by Hyman in 1942. According to him and other authors it refers to the group of individuals which is used as a standard for comparison of self-appraisal and used as a source of personal norms, attitudes, and values. In other words, it refers to the individuals with whom we compare ourselves and in turn defines our social and cognitive identity. Studies have shown that there are 7 determinants of influence that one can perceive through a reference group. This includes perceived risk, individual's need for social approval etc.

Types of reference groups

1. Normative

2. Comprative

it can also be classified as :

1. Informational influence group

2. Normative influence group

3. identification influence group

It can also be categorized as

1. Membership groups

2. Aspiration groups

Four groups that can influence our purchase decisions may includes:

a. Celebrities

This fall under the category of symbolic aspiration group. Celebraties endorsment is a major source of attraction for customers specially in merchandises, FMCG products. Celebrities as a influence group exerts Comparative effects on the consumer. celebraties as a influence group gives the feeling to an individual that the purchase of a particular brand helps show others what he/she is or would like to be, for example a successful actor, a perfect housewife, athlete etc.

b. Peers/Friends

Conformity pressures become most potent when there is both positive motivation to maintain group identity and the motivation of threats of sanctioning power in the form of rewards and punish­ments. Peer groups/Friendship encourages us to adopt a similar identifty in terms of product choices and purchase decisions on one hand and discouragement to be different on such terms on the other hand. This group has both normative and confirmative tendency.

c. Shopping group

it refers to the individuals or group of individuals who often go together for shopping and purchase of products. The purpose for formation of such groups is to reduce the risk of losses while making purchase decisions. shopping groups offers better advice and feedback and thus helps in making more suitable purchase decisions for the buyer. It has more normative tendency owing to the fact that you always try to confirm with the feedback and advices of your group members in order to avoid any secluision . But this does not mean that the group cannot show confirmatory behaviour. However, in general the normative form is dominant.

d. Work groups

It can be both formal and informal. As the name suggests it refers to the group of people who shares common workplace or profession. They usually show normative form.However, we can also trace existance of some form of comparative influence here. While you try to maintain balance between what others do and what you do, you also compare yourself with other group members owing to their success and other factors.