The Influence of Familial and Peer-based Reference Groups on Consumer Decisions

Abstract:A replication and extension of a study performed by Bearden and Etzel are reported in this article. The influence of peers on individuals' product and brand decisions for products that range in their degree of conspicuousness is examined for comparable samples in the United States and in Thailand to assess the validity of the original framework over time and across cultural contexts. Further, the influence of the family is addressed through an examination of intergenerational influences across the two cultures. The results of the study lend support to the original theoretical approach and also provide insight into how reference-group influence may vary depending on whether the influence is exercised by a member of a peer group or by a family member.

Terry L. Childers and Akshay R. Rao, “The Influence of Familial and Peer-based Reference Groups on Consumer Decisions”, The Journal of Consumer

Research, Vol. 19, N°2, PP. 198-211, 1992

Presented by: Solveig JaccoudCourse: Research Methods

Date: 09.12.2010

Context

• The research is about consumer decisions.• “Replication and extension of a study

performed by Bearden and Etzel”.Extension:• Reference-group divided in two groups: family

and peers.• Two different cultural contexts. (USA and

Thailand)

Research objective and question

• Research objective:Measure the influence of peers and family on individuals’ product and brand decisions. (over time and across two different cultural contexts)

• Research question:“How reference-group influence may vary depending on whether the influence is exercised by a member of a peer group or by a family member”.

• Bearden and Etzel realized that “reference-group influence varied for products consumed publicly versus privately and for products considered luxuries versus those considered necessities”.Reference: Bearden, William 0. and Michael J. Etzel (1982), "Reference Group Influence on Product and Brand Purchase Decisions," Journal of Consumer Research, 9 (September), 183-194.

• Bourne mentioned that “first, luxuries, unlike necessities, are not owned by everybody and thus tend to be relatively more conspicuous. Secondly, publicly consumed products are more conspicuous than privately consumed ones”.Reference: Bourne, Francis S. (1957), "Group Influence in Marketing and Public Relations," in Some Applications of Behavioral Research, ed. R. Likert and S. P. Hayes, Basel: Unesco.

Literature review

Methodology

• Questionnaire and sampling strategy.

• Hypothesis testing1) There is no relationship between the influence of peers and consumer decisions.1) There is a relationship between the influence of peers and consumer decisions.2) There is no relationship between the influence of family and consumer decisions.2) There is a relationship between the influence of family and consumer decisions.

Findings

• “The influence of the two types of reference groups vary across product and brand purchase decisions depending on whether the product is publicly or privately consumed or considered a luxury or a necessity”.

• “Intergenerational influence is significantly higher in Thailand than it is in the United States”.