Social Class .…

• This is another difficult area to teach - with “class” comes inequalities that are built in by a group of people who establish a system of values
• It ranks households by variables that have been found to similar buying behavior and similar product constellations - such as where one lives, type of house, education, etc.
• Economic:  occupation, income, wealth - “old money”
• Interaction:  personal prestige, association, socialization - e.g. contribution and status in the community
• Political:  power, class consciousness, mobility
• Social rankings may operate differently in other countries
• Social class—a status hierarchy by which groups and individuals are classified on the basis of esteem and prestige.—American Marketing Association

• A social class is a group of people whom other members of the community see as equal to one another in social prestige and whom others believe to be superior or inferior in prestige to other groups that constitute the social classes below them or above them (Warner).
• Relatively permanent  and homogenous divisions in a society in which individuals or families sharing similar values, lifestyles, interests, and behavior can be categorized
• Measures typically are a combination of demographic identifiers which are correlated with product bought, values held, etc.

Social Class Membership

• Members of the same social class tend to share common values, beliefs, and behaviors that unite them (as opposed to simple demographics).
• Common factors used to place people into different social classes: occupation, source of income, possessions, associations with others, and level of influence.

Level of Influence

• Membership in a higher class generally leads to greater influence within the workplace, organizations, and society as a whole.
• The more responsibility one has the greater the influence she/he can exert on others—coordination.

• What is Your Social Class?
• What is the social class of the person sitting next to you?
• How can you tell?  What info are you using to make this judgment?
• Subjective (rank self), reputational (someone gives opinion of your social class), objective methods (uses scores on various observable variables)

Occupation
What a person does for a living
It is an indicator of other signs of class membership: income, personal associations, and status
Further class assumptions within an occupation may be based on performance level
 

Income Source

• Level of income is not by itself a good indicator of class.
• Income source along with occupation may  help us determine whether two individuals that have the same income belong in the same class: investments, inheritance, old wealth, etc.
• Does a professional athlete making $20 million belong in the same social class with a physician making $150,000?

Associations
Consumption patterns and interaction networks are inherently linked.
People tend to associate with others that share the same tastes and recreational activities.
Class consciousness—our sense of a belonging to a particular class—is reinforced by the people with whom we associate.
A mechanic wins $50 million in the lottery…will his social class change?
 

Have you ever calculated Social Class?

• Scores on weighted scales - each item represents something of value in the specific culture. The weights represent the relative importance in that culture.
• Computerized Status Index (CSI) – separates out data on both spouses
• Hollingshead’s Index (residence x 6, occupation x 9, education x 5)
• Warner’s Index:  occupation, source of income, house type, dwelling area

• The five indicators are not always used directly to establish an individual’s class status.
• Methods normally used to classify people into social classes include:
• The reputational approach
• The subjective approach
• Objective approaches:
• Single-item measures
• Multiple-item measures

• A five-class hierarchy
• Upper class
• Attend elite schools, engage in inconspicuous consumption
• Upper-middle class
• Professionals, independent businesspeople, corporate executives
• Lower-middle class
• Salespeople, clerical workers, supervisors, construction contractors, small retail store owners
• Upper-lower class
• Skilled and semi-skilled blue-collar workers
• Lower-lower class
• Lower blue-collar workers, the unemployed, families on welfare, and unskilled workers
• Marketing to the poor

Can marketers use Social Class?

• Its relevance may be product-specific
• products people buy:  clothing, home furnisihings and appliances
• Conspicuous items - things people are likely to talk about and compare among themselves
• Certain brands are associated with specific social classes (occupations, educ, etc)
• Brands of beer, wine, etc.

Social Class and Marketplace Behavior
Influence on media use

• Lower-class people are less likely to subscribe to newspapers than are members of the middle class.

• Lower-middle class—Reader’s Digest, Ladies Home Journal
• Upper-middle class—Time, SI, The New Yorker, etc.

• Upper-middle class—NBC vs. lower-middle class: CBS
• Lower-middle class—more responsive to audiovisual forms of communication

Influence on Advertising Acceptance

• Lower-status consumers are more receptive to advertising that depicts activity, ongoing work and life, expressions of energy, etc.
• Upper-middle class consumers are more critical of advertising, suspicious of emotional appeals, and skeptical of claims.

Influence on Shopping and Choice Behavior

• Lower-class women are the most “impulsive” about shopping
• Outlet choice varies by social class
• Upper-lower class women are likely to respond to promotions offering coupons or other special inducements
• Members of the upper class prefer traditional home furnishings
• Bowling, TV, and bingo are favorite lower-class leisure pursuits
• Most activities enjoyed by middle- and upper-class people are less time consuming than lower-class choices

Reference Groups:  Have you Ever Sought the Opinions of Others in making a consumer decision?

• What’s common about an Avon sales call, a Tupperware party, a Mary Kay makeover party?  The use of social pressure.
• Coercion and Obligation:  norms and rules of behavior, sets up expectations
• Sanctions and Rewards (for being a good guest)
• Social Psychology - the influence exerted on persons by agents (an individual, a group, a norm, a role, or a value)

Why are Reference Groups Important?

• Any person or group  (actual or imaginary) that serves as a point of comparison for an individual in the formation of either general or specific values, attitudes, or behavior
• When shopping in a group, you bring your reference group with you.
• Why?  To get information or advice
• To satisfy the expectations of others
• To be like a certain type of admired person

Reference Group Influences

• A reference group is the group whose perspective an individual takes on in forming values, beliefs, attitudes, opinions, and overt behaviors.
• They set levels of aspiration
• They help define the actual items/services considered acceptable for displaying             those aspirations

Social Norms and Conformity
Social norm—any rule or behavior for meeting societal expectations ? normative system
Conformity pressures—actions taken to encourage or force members to act, think, and/or express themselves in certain ways
The more important a group is in our lives, the greater our desire to accept and conform to  its norms
 

Types of Reference Groups:

• primary vs. secondary:  people at your office vs. people in a professional organization
• membership vs. aspirational: your gym friends vs. the Olympic team - want to be trim so join an exercise club
• positive vs. negative (dissociative):  liked vs. disliked groups - do not want to be unemployed, so seek degree with high employment rate
• formal vs. informal: like SBC vs. a group of friends - learn the rules of a company where you would like to work
• NEW! Virtual group – internet communities

Remember - the question is how much impact the ref group has!

• Conspicuousness
• Public necessities:  don’t need influence to get one - in U.S., watches and cars - so weak product and strong brand influence – what brand of watch you’ll wear
• Public luxuries: golf clubs - strong product and strong brand
• Private necessities: washer and dryer - most everyone has these - weak product and weak brand - people not talk about it
• Private luxuries:  hot tub - people not talk about brands - strong product and weak brand
• These vary by country

Promotional Messages and Power

• Reward power:  parental reward, peer approval, rebates
• Coercive power:  punishment, disappointment, “I should have bought _____ ”
• Legitimate power:  your country says that here is what you ought to do, “Buy American”
• Referent power: be like someone you aspire to imitate - Olympics
• Expert power:  authorities, who can give you advice - Inquirer asks professor to talk about Christmas shopping