Thought Paper

The main purpose of this paper is to talk about reference groups in the frames of consumer behavior principle and to connect this concept with real life example.

Like any well-known concept the concept “reference groups” has its own history and defining this term it is necessary to show its main characteristics. According to Solomon (2006) we can define the term “reference group” in the next way: “a reference group is an actual or imaginary individual group conceived of having significant relevance upon an individual’s evaluations, aspirations, or behavior.” In accordance with Solomon’s book “Consumer behavior” we can say that reference groups can influence consumers in three different ways and among them are value-expressive, informational and utilitarian. Analyzing term use we can mention that it is often implemented in description of any external influence that provides social cues. Reference groups usually have formal and informal character and marketers prefer formal groups, because these groups can be easily controlled, due to their accessible and identifiable nature and also because such kind of reference groups can take form of big formal organizations with periodical meetings and understandable structure.

Saying about consumer behavior principles we should mention that traditional inference methods to the market of new products are ineffective, as suppose that buyers will continue to use channels of sales created for them. It is come time to look attentive at that, how buyers behave actually. For instance, let’s remember situation when buyers got that approximately, for what they paid. Now they force salespeople constantly to reduce prices. Several years ago consumer, coming in a shop and getting information about sizes, style and destiny of product, more frequent than all accomplished a purchase in the same moment and in the same place. If the personal service was required to consumer, he chosen the proper shop and paid higher price. An economy consumer gave preference to the shops without the special pretentious novelties. Choosing the channel of sales, a buyer remained in its scopes to the moment of feasance of purchase. Today’s consumer easily changes channels of sales. They use services of highly skilled consultants of one channel gladly, and then acquire a product by other, offering more advantageous terms. As a result many companies have unnecessary and not in use physical and organizational possibilities which depreciate every day. Depending on a situation, to them it is possible to take well-prepared, but bored salespeople, vast, but uninhabited apartments, taken under a retail business, supply of commodity, intended for an exposure in windows.  Probably, for us it is not new information. It follows to revise logic of strategy of going into a market. In place of that to remain within the framework of the old channels of sales, created coming from demographic principles, it follows us to create new so that they reflected the features of consumer behavior principles. It is important to trace at their planning, that an user got exactly product, that he wants, at all stages of process of feasance of purchase, and that in the end our company did not have to outlay on buyers more than they outlay in our shops.  In my opinion reference groups can be used as effective instruments in such situation in the frames of formed consumer behavior principles.

The nature of reference group is interesting and has a dual character, because reference group can be or not to be a group which we belong to. We can examine reference group as source of psychological authentication. The presence of reference groups helps to explain seeming contradictions in a conduct, for example: a revolutionary – aristocrat by birth; a catholic – an apostate; a trade-union figure – a reactionary; pulled about gentleman; betrayer, co-operating with enemies; assimilating immigrant; housemaid, aspiring to attain higher social circles. Simply these individuals took for a standard people, related to other social force, different from that the members of which they are.

Reference groups have great influence on people’s wish to buy something, for example, and they in such way formulate person’s consumer behavior. Let’s imagine situation, when you want to buy something and don’t know what to buy, or even you don’t want to buy some thing, but representatives of your reference group can persuade you to make this step. The notion reference groups can be characterized with the word referent power and its influence was proved by researchers many years ago. Saying about real example, we can remember many situations from own life, when we go to shop with one aim to buy butter, for example, but than remember that we discussed in reference group some product and buy not only butter, but many other, in many cases even unnecessary things.

Reference group executes 2 functions mainly: normative and comparative. A normative function shows up in explaining influence of reference group, salient as a source of codes of conduct, social settings and valued the orientation of man. Except for it, reference group can come forward as a standard by which the standards of conduct accepted in a group, settings etc. come forward for a man as some standards, “frames of reference”, on which he is oriented in the decisions and estimations.

Thus, based on aforesaid we could come to the conclusion that reference group is a variant of influence on consumer’s behavior and can even form necessary stereotypes of choices and thinking about products. As we remember reference groups are executed by both normative and comparative functions. As we would like to see itself the plenipotentiary members of some group (or we aspire to membership in some group), we accept group standards and principles. We “cultivate in itself” the proper vital principles, political persuasions, musical and gastronomic tastes, sexual norms and attitude toward the use of drugs. The conduct of individual is set belonging to the concrete group. We also use the standards of the reference group for estimation itself as a standard mark, on which we estimate the external attractiveness, intellect, health, position in society and standard of life. So, this explanation allows us to say that we make choice like consumers in accordance with our reference group statements and it is really possible to influence on person through reference group.

References:

Kotler, P. and Armstrong, G. (2007). Principles of Marketing Pearson, Prentice Hall, New Jersey.

Marder, E. (1997). The Laws of Choice—Predicting Customer Behavior. The Free Press division of Simon and Schuster.

Solomon, M. (2006). Consumer Behavior. Prentice Hall