Chapter Fifteen:

Social Class

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Chapter 15: Social class

1. Concept of social class2. How social classes are measured3. Measurement problems marketing

managers face

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managers face 4. The effect of social position on the

consumption process5. How marketing managers can use their

knowledge of social stratification to develop marketing strategies

Social StratificationSocial 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 rankSocial rank is one’s position relative to others on one or Social rankSocial 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 systemsocial 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 class

• Social class and consumption• Social class

– Cultural differences– Components of social class

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Components of social class– Measurements of social class

• Social class and consumption differences– Global similarities– Segmenting the affluent

• Status symbols

Social standing and behaviour

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Concept of social class

Traditional viewpoint assumes that social classes must meet the following criteria:

• Bounded

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• Bounded• Ordered• Mutually exclusive• Exhaustive• Influential

Not all behaviours are unique

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Behavior and social class

• Unique behaviors– Product: fine china– Situation: entertainment

� e.g. Opera subscription

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• Not all behaviors are unique:• Shared behaviors

– Situation: entertainment� e.g. Football match

Status crystallization

• Degree of consistency on status dimensions– Occupation– Education

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– Education– Income– Ownership

• Status crystallization is low in Australasia

Social class in Australia*

• Upper class– 10% of population

• Middle class– 60%

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– 60%

• Lower class– 30%

*Source: ABS

The functional approach to social-class structure

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The reputational approach to social-class structure

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Positioning within social class

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Upward-pull strategy targeted at the middle class

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Ad aimed at repositioning the meat pie to a different social class

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The Measurement of Social ClassThe Measurement of Social Class

There are two basic approaches to measuring social status:

-- SingleSingle--item indexitem index

-- MultiMulti--item indexitem index

Since an individual’s overall status is influenced by several Since an individual’s overall status is influenced by several dimensions, singlesingle--item indexesitem indexes are generally less accurate than are well-developed multimulti--item indexesitem indexes.

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Measurement of social class

• Single-item indexes– E.g. education– E.g. occupation

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• Multiple-item indexes– E.g. Hollingshead Index of Social Position

The Measurement of Social ClassThe Measurement of Social Class

•• SingleSingle--Item IndexItem Index��EducationEducation

��OccupationOccupation

���� IncomeIncome

• Marketers generally think of these as direct influencers of consumption behavior rather than determinants of status that then influence behavior.

Occupations of the employed Australia

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Occupations of the employed New Zealand

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Measurement of social class and its application to marketing strategy

• Uses:– Differences in product consumption

� instant coffee� snack foods

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� imported wine

Income

Income has been used as a measure of status• Poses a number of measurement problems

– Individual or family income?– Income before or after taxes and allowances?

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– Income before or after taxes and allowances?– Salary or total income?

Multiple-item indexese.g. Hollingshead's Index

• Two-item index using occupation and education

• Designed or measure overall a family’s overall position in society

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overall position in societyExceptions could arise from someone with:– Only secondary schooling and running a

successful small-medium business– Doctor or lawyer working with charities

Consumption differences across the Hollingshead Index of social position

strata

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The Measurement of Social ClassThe Measurement of Social Class

Social statusSocial status is largely derived from demographicsdemographics; that is, one’s income, education, and occupation go a long way toward determining one's social class or status.

Should marketers use an overall measure of social statussocial status

Demographics or Social Status?Demographics or Social Status?

Should marketers use an overall measure of social statussocial status(a multi-item index) or a demographicdemographic variable such as income?

Unless the marketer is interested social standing per se, he/she will most likely focus on demographic characteristics as direct influencers on consumer behavior!

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Which scale to use?• No one scale is suitable for measuring all

status dimensions� Hollingshead’s multi-item index could be

used for measuring personal status in a study of opinion leadership

Studies of intellectually oriented

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� Studies of intellectually oriented activities, e.g. magazine subscription & TV viewing could consider using education

� Occupation could be used for studies on leisure-time pursuits

Social Stratification and Marketing StrategySocial Stratification and Marketing Strategy

While social stratification does not explain all consumption behaviors, it is certainly relevant for some product categories.

�You can clearly see this by visiting a furniture store in a �You can clearly see this by visiting a furniture store in a working-class neighborhood and then an upper-class furniture store.

�A product or brand may have different meanings to members of different social strata, for example, a watch.

�Likewise, different purchase motivations for the same product may exist between social strata.

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Social class and marketing strategy

• Relate status variables to product consumption– Usage, motivation, symbolic meaning

• Target social status– Actual lifestyle, desired lifestyle, media, etc.

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– Actual lifestyle, desired lifestyle, media, etc.

• Develop product position– Select desired position (based on actual/desired

lifestyle)

• Marketing mix decisions– Develop mix

Using social stratification to develop marketing strategy

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Individual’s income may be more restricting than purchase motivation for target market appeal

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