Reference Group – Meaning, Nature, Categories, Influence on Consumer Behaviour, Application
A group consists of two or more individuals who share a set of norms, values or beliefs and have a defined relationship such that their behaviour is interdependent.
A Reference group is a group of people you refer to, while making buying decisions. It is a group that serves as a reference point for the individual of his/her beliefs, attitude and behaviour.
Nature of Reference Group →
(i) Norms – These are unwritten codes or standards of conduct that are assigned to an individual within a group.
(ii) Roles – These are functions that an individual assumes or that the group assigns to an individual to attain group objectives. E.g. The influencer, the gatekeeper, decision maker, purchaser, consumer
(iii) Status – It is the position of authority that is designated within a group. High status implies greater power and influence.
(iv) Socialisation – It is the process by which an individual learns the group norms and role expectations.
Categories of reference group →
(i) Normative group – Park and Lessig – A consumer is motivated to conform to the norms and behaviour of the group if :
- The group provides significant rewards for the compliance
- The individual’s behaviour in conforming is visible to the member
(ii) Comparative group – These are groups with whom the individual compares himself and his attitudes. They provide a basis for validating beliefs, values and attitudes. Value expressive influence.
(iii) Dissociative Group – Some individuals do not want to be linked to, or identified by a group of individuals and try to dissociate themselves from the group.
(iv) Status Reference Group – A group in which one refers to the position or status of the people in a group before making a purchase decision.
The influence of reference groups depends upon –
- An individuals information and experience
- Credibility of the group
- Attitude towards the group
- The nature of the product
Application of Reference groups in Marketing of a product –
Product purchases can be influenced by using:
- Experts and Professionals in the relevant field
- Good spokesperson
- Opinion leaders
- Reward Power – It is the power to restrict or allocate material resources and rewards to a person.
- Coercive Power – It is the power based on application of fear, pain, restrictions etc. on a person.
- Legitimate Power – This power is based on the position of a person in an organization or social unit.
- Referent Power – A person tries to copy the behaviour of another person whom he takes as an idol and wants to be identified as him. The referent power lies with the person whose personality characteristics others try to copy and are attracted towards him.
- Expert Power – It is one`s power to withhold information from others. It is based upon one`s experience, special skill, or knowledge.