Amity Business School

Amity Business School

MBA Class of 2014, Semester II Consumer Behavior Ms.Vandana Gupta

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Social Class and Consumer Behavior

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Social Class

The division of members of a society into a hierarchy of distinct status classes, so that members of each class have either higher or lower status than members of other classes.

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Status Consumption
Consumers endeavor to increase their social standing through consumption Very important for luxury goods Is different from conspicuous consumption

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Social Class Is Hierarchal

Status is frequently thought of as the relative rankings of members of each social class

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Distribution of Five-Category SocialClass Measure

SOCIAL CLASSES Upper Upper-middle Middle Working Lower Total percentage PERCENTAGE 4.3 13.8 32.8 32.3 16.8 100.0

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This luxury cruise line targets upscale customers.

Social Class Measurement

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Subjective Measures
individuals are asked to estimate their own social-class positions

Reputational Measures
informants make judgments concerning the social-class membership of others within the community

Objective Measures
individuals answer specific socioeconomic questions and then are categorized according to answers

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Single-variable indexes
Occupation Education Income Other Variables

Objective Measures

Composite-variable indexes
Index of Status Characteristics Socioeconomic Status Score

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Index of Status Characteristics (ISC)

A composite measure of social class that combines occupation, source of income (not amount), house type/dwelling area into a single weighted index of social class standing.

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Socioeconomic Status Score (SES)

A multivariable social class measure used by the United States Bureau of the Census that combines occupational status, family income, and educational attainment into a single measure of social class standing.

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Occupational ranking in terms of honesty and ethical standards

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Geodemographic Clusters

A composite segmentation strategy that uses both geographic variables (zip codes, neighborhoods) and demographic variables (e.g., income, occupation) to identify target markets.

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PRIZM (Potential Rating Index by Zip Market)

A composite index of geographic and socioeconomic factors expressed in residential zip code neighborhoods from which geodemographic consumer segments are formed.

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The Affluent Consumer

Especially attractive target to marketers Growing number of households can be classified as mass affluent with incomes of at least $75,000 Some researchers are defining affluent to include lifestyle and psychographic factors in addition to income Have different medial habits than the general population

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The middle 50 percent of household incomes - households earning between $22,500 and $80,000 Households made up of college-educated adults who use computers, and are involved in childrens education Lower-middle to middle-middle based on income, education, and occupation (this view does NOT include upper-middle, which is considered affluent)

What Is the Middle Class?

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The Middle Class

There is evidence that the middle class is slowly disappearing in the U.S. Growth of middle class in some Asian and Eastern European countries Many companies offering luxury to the masses with near-luxury models and goods

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The Working Class?

Households earning $40,000 or less control more than 30 percent of the total income in the U.S. These consumers tend to be more brand loyal than wealthier consumers.

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The Techno Class

Having competency with technology Those without are referred to as technologically underclassed Parents are seeking computer exposure for their children Geeks now viewed as friendly and fun

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Consumer Behavior and Social Class

Clothing, Fashion, and Shopping The Pursuit of Leisure Saving, Spending, and Credit Social Class and Communication