Consumer behavior and marketing strategy 12e hawkins motherbaugh chapter 04

CHAPTER

04

The Changing
American
Society:
Demographics
and Social
Stratification
McGraw-Hill/Irwin

Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.


PART II: EXTERNAL INFLUENCES

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Learning Objectives
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Understand the critical role that demographics play in
influencing consumer behavior
Define the concept of generations and discuss the
generations that exist in America
Explain the concept of social stratification and the role
that socioeconomic factors play
Identify and discuss the major social classes in
America
Understand how social class is measured
Discuss the role of social class in developing
marketing strategies
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Consumer Behavior In The News…
Where Is The Growth For Luxury Brands?
 Who do you think will fuel growth in luxury
brands in the future?
 Aspiring Group – 35 years or older with
income of $100k-199k in income (65% of all
people who earn $100k or more per year)
 Emerging Group – Under 35 years old with
$100k-199k in income (12% of all people who
earn $100k or more per year)

Source: D. Hirschman, “On Road to Riches,” Advertising Age, May 23, 2011, p. 9.

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Consumer Behavior In The News…
Where Is The Growth For Luxury Brands?
 Who do you think will fuel growth in luxury
brands in the future?


Emerging Group – Under 35 years old with $100k199k in income – if you answered Emerging you are
right!



Though smaller, Emerging are younger and will move
into the truly affluent ($200k plus) – a big predictor of
luxury purchases



Aspiring no longer “feel” wealthy in today’s
economy, which relates subjective discretionary
wealth (SDI)

Source: D. Hirschman, “On Road to Riches,” Advertising Age, May 23, 2011, p. 9.

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Demographics and Social Stratification

Demographics

Population and Size
Occupation
Education
Income
Age

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Demographics and Social Stratification

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Demographics and Social Stratification

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Demographics and Social Stratification
Demographics
Age
U.S. Age Distribution1
Key Growth Categories

1“Resident Population Projections by Sex and Age: 2010 to 2050,” Statistical Abstract of the United States 2008 (Washington, DC: U.S. Bureau of the Census, 2008), Table 10.

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Demographics and Social Stratification

18-24

25-34

35-44

45-54

55-64

65+

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Understanding American Generations
A Generation or age cohort is a
group of persons who have
experienced a common social,
political, historical, and economic
environment.
Cohort analysis is the process
of describing and explaining the
attitudes, values and behaviors
of an age group as well as
predicting its future attitudes,

values, and behaviors.

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Understanding American Generations
Pre-Depression
Depression

Mature Market

Baby Boom
Generation X
Generation Y
Generation Z

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Understanding American Generations
How to Target the Mature Market
Gerontographics has identified the following four
segments of the mature market:
- Healthy Indulgers
- Ailing Outgoers
- Health Hermits
- Frail Recluses

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Understanding American Generations
Baby Boom Generation: A Closer Look
Compared to prior generations, Boomers are:
Higher income, higher education
More tech savvy
Defining retirement differently
Boomers also are:
Strong market for “anti-aging” products, travel, and
financial services
Often alienated by overly “youth oriented” appeals in ads

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Understanding American Generations
Segmenting the Boomer Market
Marketers must look beyond the stereotypes:
Stereotype 1
• Boomers all have the same values and outlook
Stereotype 2
• Boomers are self-centered
Stereotype 3
• Boomers are not tech savvy
Stereotype 4
• Boomers are married empty nesters who are
downsizing
Stereotype 5
• Boomers are all retiring early and wealthy
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Understanding American Generations
Generation Xers: A Closer Look
Beyond the stereotype:
Early stereotype – Xers as disenfranchised youth
• Reality 1– Xers are more highly educated than
previous generations
• Reality 2– Xer women are more highly educated
than Xer men
• Reality 3– Xers are getting married, having families
and facing the time pressures associated with
these events
• Reality 4– Reaching Xers requires special attention
to media, particularly online
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Understanding American Generations
Generation Yers: A Closer Look
Really Two Sub-Markets: Young Gen Y and Older Gen Y
Expected to have at least as high of education level as
previous generation
Very tech savvy including Internet, text messaging, and
social media
A strong market for apparel with brands like Metropark
Tapping into consumer-generated buzz works with the high
level of social media of this segment

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Video Application
The following Video Clip demonstrates
how FreeAgent.com tries to appeal to
the Gen Y segment!

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Understanding American Generations
Targeting Generation Z
Known as Digital Natives, Generation @, Net Generation
$200 billion purchase power!
Buying patterns formed as young teen will follow through life
Gen Z easily bored; use of music, language and images key
to remain relevant and fresh

Vibration Online Media Helps Firms Reach Gen Y and Z
YouTube Spotlight
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Applications in Consumer Behavior
EVO 3D Superphone
ad targets the active

and diverse Gen Z
“youth market.”
Notice the use of
texting and emphasis
on device power.

Courtesy HTC Corporation.

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Social Stratification
Social Rank and Social Class System
Status Crystallization
Social Structure in the United States
The Coleman-Rainwater Hierarchy
The Measurement of Social Class
Social Stratification and Marketing Strategy

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Social Stratification
We are all familiar with the concept of social class, but
most of us would have difficulty explaining our class
system to a foreigner.
Social rank is one’s position relative to others on one or
more dimensions valued by society, also referred to as
social class and social standing.
A social class system is a hierarchical division of a

society into relatively distinct and homogeneous groups
with respect to attitudes, values, and lifestyles. "Pure”
social classes do not exist in the U.S. or most other
industrialized societies.

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Social Stratification
Status dimensions, such as parental status, education,
occupation and income, set limits on one’s lifestyle,
including one’s residence.
Status crystallization, which is moderate in the U.S.,
reflects the consistency of these status dimensions.

Web Exercise
What Social Class are You?
Play the “Chintz or Shag” Game from PBS

Click button to link to PBS site

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Social Structure in the United States
Social Standing is Derived and Influences Behavior

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