34. Demographic Influences

While the decision-making process appears quite standardized, no two people make a decision in exactly the same way. As individuals, we have inherited and learned a great many behavioral tendencies: some controllable, some beyond our control. Further, the ways in which all these factors interact with one another ensures uniqueness.

Although it is impossible for a marketer to react to the particular profile of a single consumer, it is possible to identify factors that tend to influence most consumers in predictable ways. The factors that influence the consumer problem-solving process are numerous and complex.

In the first 5 chapters of this book, we examined the internal factors that influence consumer decision making, including perception, learning, motivation, personality, and attitudes. In the previous chapter we identified the different emerging trends that also influence consumer decision making. In these final two chapters of this book, we explore the external factors that influence consumer decision making, which include demographic, social, situational, and cultural.

As depicted in the diagram below, cultural, social, individual, and psychological factors influence consumers at each stage of the decision making process: this means that marketers have a responsibility to understand the impact (and consequence) of their messaging on both the individual consumer and the greater society.

There are many internal as well as external factors that independently and collectively influence our decisions as consumers. These influences start at a very young age and continue to resonate with us throughout adulthood. Whether we are exploring the internal or external factors, it is important to recognize that our attitudes and behaviours at each stage of the consumer process has been shaped by years of learning, perceptions, socialization, experiences.

Demographic Influences

An important set of factors that should not be overlooked in attempting to understand and respond to consumers is demographics. Such variables as age, sex, income, education, marital status, and mobility can all have significant influence on consumer behavior. People in different income brackets also tend to buy different types of products and different qualities. Thus, various income groups often shop in very different ways. This means that income can be an important variable in defining the target group. Many designer clothing shops, for example, aim at higher-income shoppers, while a store like Kmart appeals to middle-and lower-income groups.

Social Class

A social class is a group of people who have the same social, economic, or educational status in society (“WordNet,” n.d.). While income helps define social class, the primary variable determining social class is occupation.

To some degree, consumers in the same social class exhibit similar purchasing behaviour. In many countries, people are expected to marry within their own social class. When asked, people tend to say they are middle class, which is not always correct. Have you ever been surprised to find out that someone you knew who was wealthy drove a beat-up old car or wore old clothes and shoes or that someone who isn’t wealthy owns a Mercedes or other upscale vehicle? While some products may appeal to people in a social class, you can’t assume a person is in a certain social class because they either have or don’t have certain products or brands.

In a recession when luxury buyers may be harder to come by, the makers of upscale brands may want their customer bases to be as large as possible. However, companies don’t want to risk “cheapening” their brands. That’s why, for example, Smart Cars, which are made by BMW, don’t have the BMW label on them. For a time, Tiffany’s sold a cheaper line of silver jewelry to a lot of customers. However, the company later worried that its reputation was being tarnished by the line. Keep in mind that a product’s price is to some extent determined by supply and demand. Luxury brands therefore try to keep the supply of their products in check so their prices remain high. Some companies, such as Johnnie Walker, have managed to capture market share by introducing “lower echelon” brands without damaging their luxury brands. The company’s whiskeys come in bottles with red, green, blue, black, and gold labels. The blue label is the company’s best product. Every blue-label bottle has a serial number and is sold in a silk-lined box, accompanied by a certificate of authenticity (“Teen Market…,” 2009).

Family Influences

A consumer’s family has a major impact on attitude and behaviour. The interaction between partners/spouses and the number and ages of children (if any) in the family can have a significant effect on buying behaviour.

One facet in understanding the family’s impact on consumer behaviour is identifying the decision maker for the purchase in question. In some cases, one partner/spouse is more dominant than the other, and even more so over the children. And in others a joint decision is made between partners/spouses. The store choice for food and household items may fall to one spouse/partner while purchases that involve a larger sum of money, such as a refrigerator, a joint decision is usually made. The decision on clothing purchases for teenagers may be greatly influenced by the teenagers themselves. Thus, marketers need to identify the key family decision maker for the product or service in question.

Most market researchers consider a person’s family to be one of the most important influences on their buying behaviour. Like it or not, you are more like your parents than you think, at least in terms of your consumption patterns. Many of the things you buy and don’t buy are a result of what your parents bought when you were growing up. Products such as the brand of soap and toothpaste your parents bought and used, and even the “brand” of politics they leaned toward are examples of the products you may favour as an adult.

Companies are interested in which family members have the most influence over certain purchases. Children have a great deal of influence over many household purchases. For example, in 2003 nearly half (47 per cent) of nine- to seventeen-year-olds were asked by parents to go online to find out about products or services, compared to 37 per cent in 2001. IKEA used this knowledge to design their showrooms. The children’s bedrooms feature fun beds with appealing comforters so children will be prompted to identify and ask for what they want (“Teen Market…,” 2009).

Family Lifecycle

Another aspect of understanding the impact of the family on buying behaviour is the family lifecycle (“FLC”). Most families pass through an orderly sequence of stages. These stages can be defined by a combination of factors such as age, marital status, and parenthood.

You have probably noticed that the things you buy have changed as you age. Think about what you wanted and how you spent five dollars when you were a child, a teenager, and an adult. When you were a child, the last thing you probably wanted as a gift was clothing. As you became a teen, however, cool clothes probably became a bigger priority. Don’t look now, but depending on the stage of life you’re currently in, diapers and wrinkle cream might be just around the corner.

If you’re single and working after graduation, you probably spend your money differently than a newly married couple. How do you think spending patterns change when someone has a young child or a teenager or a child in college? Diapers and day care, orthodontia, tuition, electronics—regardless of the age, children affect the spending patterns of families. Once children graduate from college and parents are empty nesters, spending patterns change again.

Empty-nesters and baby boomers are a huge market that companies are trying to tap. Ford and other car companies have created “aging suits” for young employees to wear when they’re designing automobiles. The suit simulates the restricted mobility and vision people experience as they get older. Car designers can then figure out how to configure the automobiles to better meet the needs of these consumers.

Age Cohorts & Generations

There are four consumption cohorts, or generations, who are active in today’s consumer culture; Baby Boomers, Generation X, Generation Y (or Millennials), and Generation Z. Let’s break down each one and examine some similarities and differences, keeping in mind, these are generalizations and there are exceptions within each generation.

How has marketing to Gen Z changed over the last two decades? Student explore how changes in society and culture have been reflected in the marketing and advertising towards Millennials. Created by KPU students Aidan Maurice Richard and John Donahoe. Click on the arrow on the right to pass through the timeline.

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