CHP 11 Group Influence & Leadership

Question 1

What is a reference group?

Answer 1

An actual or imaginary individual or group conceived or have significant relevance upon an individual’s evaluations, aspirations, or behaviour

Question 2

What 3 ways do reference groups influence behaviour?

Answer 2

• Information Influence:
  Seeking information, brand-related knowledge and experience
• Utilitarian Influence:
  Seek and purchase particular brands to satisfy other’s expectations
• Value-Expressive Influence:
  Enhance one’s image, to be someone, respected by others

Question 3

What is social power in relation to reference groups?

Answer 3

Social power - refers to the capacity to alter the actions of others

TYPES:
Referent - a person admires the qualities of an individual or a group; try to imitate those qualities by copying the referent’s behaviours

Information - person is an expert; has access to the assumed truth; shares w/ others

Legitimate Power - granted power by virtue of social agreements (e.g. police officers and politicians)

Expert Power - possessing a specific knowledge or skill

Reward - person/group provides positive reinforcement

Coercive - does not tend to produce permanent attitudinal or behavioural change

Question 4

What is a brand community? What are the benefits?

Answer 4

a set of consumers who share social relationships based on usage or interest in a brand

BENEFITS:
Establish brand relationship, cultivate brand loyalty, and enhance emotional attachment
Higher spending probabilities
Spread word of mouth
Get feedback and ideas from consumers
Empower consumers

Question 5

Explain group effects on individual behaviour

Answer 5

1. De-indviduation: the submerging of individual identities within a group
   - People in large groups have fewer restraints on behaviour when they are less likely to be identified
2. Risky shift: people are more likely to consider riskier alternatives when in a group
3. Decision polarization/groupthink: people tend to have a stronger opinion when in a group
4. Social loafing: people devote less effort to a task when in a group
5. Shopping behaviour: people tend to buy more and buy more expensive items when shopping in a group

Question 6

What is the difference between an opinion leader & market maven?

Answer 6

1. Opinion leader: a person who is frequently able to influence other’s attitudes or behaviours
   - Monomorphic (experts in a limited field)
   - Polymorphic (experts in several fields)
2. Market maven: people who are actively involved in transmitting marketplace information of all types

Question 7

How to identify opinion leaders?

Answer 7

Locating these very influential people and let them influence other consumers

Celebrities
* Cameron Diaz bought a Prius and talked about on Jay Leno show

Consumers
* Self report
* Key informants

Sociometric method
* Trace communications among group members

Question 8

What is word of mouth communication?

Answer 8

Product information transmitted by individuals to individuals

Characteristics of W.O.M:
* Influence two thirds of all consumer goods sales
* W.O.M is more effective in creating brand awareness than advertising
* W.O.M may be initiated by different reasons

Why would consumers engage in W.O.M?
* Product involvement
* Product knowledge and ego enhancement
* Concern for someone else