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Inter Generational Differences in Responses to Marketing Sti

Oct 23, 2014





STP MARKETINGMARKET SEGMENTATION Identify segmentation variables and segment the market Develop profiles of resulting segments MARKET TARGETING Evaluate the attractiveness of each segment Select the target segment(s) MARKET POSITIONING Identify possible positioning concepts for each target segment Select, develop, and communicate the chosen positioning concept

Source: Philip Kotler, Marketing Management, 8th edition

SEGMENTATION VARIABLES GEOGRAPHIC Region City or Metro size Density Climate PSYCHOGRAPHIC Social Class Lifestyle Personality DEMOGRAPHIC Age Gender Family size Income Occupation Education Religion Race NationalitySource: Philip Kotler, Marketing Management, 8th edition

BEHAVIORAL Occasions Benefits User status Loyalty status Readiness stage Attitude toward product

Family life cycle Usage rate

SEGMENTATION VARIABLES Traditional demographic breakdowns used in

the past are no longer relevant. Society and culture are changing. (Geller, Geller Media International) Segmenting by age is ineffective because age and life stages do not go hand in hand anymore (Rice & Seals-McDonald, 1995) Marketers need to grasp that there is a difference between the over-fifties of today and those of previous generations (Carrigan & Szmigin, 2000)

SEGMENTATION VARIABLES Generational issues have come to the

forefront in understanding consumer habits, tastes, and buying preferences (Fisherman, 2000) Generationally determined lifestyles and social values exercise as much influence on buying and purchasing as do more commonly understood demographic factors like income, education, and gender (Walker & Clurman, 1997)

GENERATIONS Generations are whole groups of persons who

move through life with a common identity based on their dates of birth. (Crouch, 1999) By knowing how the motivations of customers

are tied to the underlying values of the generation to which they belong marketers will be able to tailor their products, services, and communications to their customers needs, interests, and desires. (Walker & Clurman, 1997)

GENERATIONSA generation is linked by the shared life experiences that occur in its formative years but individuals are also impacted by unique personal experiences via family experiences.






Ref: Sullivan & Ross (1999)

BUYER BEHAVIOURMarketin g Stimuli Product Price Place Promotio n Generational characteristi cs Cultural Social Personal Psychological Generational responses Product choice Brand choice Dealer choice Purchase timing Purchase amountSource: Philip Kotler, Marketing Management, 8th edition (abridged and revised)

FACTORS INFLUENCING BEHAVIOUR/RESPONSES CULTURAL Culture Subculture Social Class SOCIAL Reference PERSONAL Age & life-cycle PSYCHOLOGICAL Motivation Perception Learning Beliefs & Attitudes

groups Family Roles and statuses

stage Occupation Economic situation Lifestyle Personality & self-concept

Source: Philip Kotler, Marketing Management, 8th edition



Grandparents Parents Children

GI (pre 1930) Depression (1930-39) War Babies (1940-45) Baby Boomers (1946-64) Generation X (1965-76) Generation Y (1977-95) Echo Bust (1996-?)

(Ref: American Demographics, 1993)

Average generational span = 20 yrs. Age bands are no longer consistent Intergenerational Transfer Children wide diversity of ages

No standard system of definition or nomenclature Not internationally representative Many commonalities, but also differences within generations


WHO CAN BE REACHED EFFICIENTLY (Gwinner & Stephens, 2001)

Familial Generations Research Findings There is clear evidence that consumer preferences,

skills, and behaviors are transmitted generationally (Moore-Shay & Berchmans, 1996) The character of communication and quality of relationship between parent and child significantly influences the degree of IG consensus Character and tenor of the home environment that influence the degree to which children adopt parents values and attitudes rather than actual economic status Chidrens influence greatest where the product is less expensive & for own use (Foxman et al, 1989)

Familial Generations Research Findings The balance of power is shifting towards the older

generation. Older consumers will switch to brands which recognize their existence and portray them as attractive people with plenty to offer. (Carrigan &Szmigin, 2000) Private necessities attract the greatest amount of IG transfer. (Childers & Rao, 1992) Distinction between luxuries & necessities greater for US than for Thai families Owning the same brand as ones parents less likely to be considered a social faux pas in Thailand as older generation is accorded high respect

Familial Generations Research Findings Grandmothers enjoy shopping for their

grandchildren generally prefer discount stores, value quality and price, guided by grandchildren on items to be purchased (Kinley & Sivils, 2000) 2/3 of adult generation reported at least a fair amount of influence on parents purchase decision (Sorce, Loomis & Tyler, 1989) Mothers are primary socialization agents and influence the MAB of their children (Carlson et al., 1994)

Familial Generations Research Findings FCP may play a role in the acquisition of marketplace

MAB (Carlson et al., 1994) Greater communication and influence lead to greater similarity in family members brand purchase behaviour (Moore et al.,2000) Intergenerational effects decrease with age. Most prominent in early adulthood. Cultures where the emphasis is on interdependence and cohesion due to extended family structure lead to a greater cumulative impact on intergenerational influence

Familial Generations Research Findings Parental style has an influence on the

consumer socialization of children (Carlson et al., 2001)

FAMILY INFLUENCESConsumer Socialization Research Intergenerational Transfer ResearchFamily Characteristics Parenting Styles Time Away from Home Dyad Linkages Product Category Level of Childrens Education Perception of Parents values & views Communication Pattern Brand Preference Brand Loyalty Store Loyalty/Preference Shopping Strategies Information search beh. Response to promotion Price-Quality Beliefs Price Consciousness Price Sensitivity






SOCIETAL GENERATIONS Sociologists report that common experiences create a central

tendency that differentiates one generation from another Should not make sweeping generalizations (Zill & Robinson, 1995) e.g. Net Generation (4 groups identified) (Napoli & Ewing, 2001) Each has distinctive differences due to a different historical perspective (Sullivan & Ross, 1999) Knowing the nature of the shared experiences, based on when people were born, allows us to predict motivations, attitudes and behaviour (Smith & Clurman, 1997; Sullivan & Ross, 1999) Each has specific buying behaviour, responsiveness to different media & require different marketing approaches (Harris, 1999; Smith & Clurman, 1997)

SOCIETAL GENERATIONS Every generation will ultimately pass through the

same life stages youth to old age but will respond based on shared values of their generation. Preferences are deeply implanted. (Smith & Clurman, 1997) Pre Baby Boomers (Late 50s and over) have a more constrained set of expectations and hold to traditional values hence are slow to embrace new products (Smith & Clurman, 1997) Now more than willing to spend on themselves. (Fisherman, 2003) Over 70s are avid readers (Fisherman, 2003) Older minds are more responsive to nuances, subtleties, emotional content and context of information. Prefer narrative-style presentations (Sullivan & Ross, 1999)

SOCIETAL GENERATIONS Boomers most populous and influential

generation in US.(Smith & Clurman, 1997) They love self-improvement and are self-absorbed. (Fisherman, 2003) Baby Boomers are externally motivated; appearances and possessions count. (Tycer, 1999) Have a belief in, and search for the quick fix and are hesitant to change. (Tycer, 1999)

SOCIETAL GENERATIONS GENERATION Xers: More likely to seek a balance of work and leisure

activities than boomers were as young adults. (Ritchie, 1995) Very diverse group (teams of psychologists and cultural anthropologists id 4 groups) (Rice & Seals McDonald, 1995) Dislike overstatement, hype, self-importance in ads (Ritchie, 1995) Very practical orientation (Ritchie, 1995). Prefer honest, straight-forward approach (Fisherman, 2003; Tycer, 1999)

SOCIETAL GENERATIONS GENERATION Xers (continued): Place importance on traditional values of family

and stability (Ritchie, 1995) Tend to be more self-confident and start about 70% of new businesses in the US (Tycer, 1999) Like alternative methods and new products, are computer-dependent, need flexibility, value opportunities to learn and to improve themselves (Tycer, 1999)

SOCIETAL GENERATIONS Young adults are more interested in art, TV, and movies

than physical exercise. Unifying traits are insecurity, importance of education, length of time to enter the adult world (Zill & Robinson, 1995) Generation Y needs constant change and speed (Fisherman, 2003) Younger minds are more