Chapter 13 Household Structure and Consumption Behaviour

Nature of Australian households Stages in the household life cycle

Households also undertake purchase-related

decision making The link between household and consumer socialisation Trends relating to household consumption

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Types of Households
Household designates a variety of distinct social

groups Family household

two or more related persons, who live and eat in private residential accommodation householders who either live alone or with others to whom they are not related

Non-family household

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Influence of Household Consumption on Marketing Strategy

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Changes in Household Structure

(the average size of household and family units)

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Household Life Cycle

Young (under 35)

Older (over 64)

Single I young married full nest I single parent I

single III empty nest II

Middle-aged (3564)

Single II delayed full nest II full nest II single parent II empty nest I

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Stages in the Household Life Cycle

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Young Single Stage

Two subgroups

Living at home Independent

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Young Married: No Children Stage

High level of disposable income Often DINKs

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Full Nest I: Young Married with Children Stage

One partner stops working About 61% keep dual income

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Single Parent I: Young Solo Parent Stage

One in four marriages end in

divorce A high proportion of divorced males remarry (64.2% of males in 1988 compared to 26.1% of females) Latest figures:
http://www.abs.gov.au/Ausstats/abs%40.nsf/94713 ad445ff1425ca25682000192af2/c500a32ee2774a8 cca25699f0005d61b!OpenDocument

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Middle-Aged Single II Stage

Small group of the population High disposable income

Travel often

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Delayed Full Nest I: Older Married with Young Children Stage

Many have delayed having children until their

thirties They have a high income and have acquired more capital and possessions They outspend all groups on childcare, mortgage repayments, home and garden maintenance, and household furnishings High non-child spending e.g. food, alcohol, entertainment and savings

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Full Nest II: Middle-Aged Married, with Children at Home Stage

Older children Heavy consumer of

lessons and clothing Need larger homes

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Single Parent II: Middle-Aged Single with Children at Home Stage

Financially burdened

group Older children take on significant household responsibilities Typically female

(5 times male number)

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Empty Nest I: Middle-Aged Married with No Children Stage

Typically dual

income Time poor, cash rich Spend on dining out, holidays, services

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Empty Nest II: Older Married Couple Stage

Either still working or

fully retired Financial situation in decline

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Older Single III Stage

Typically female Growing segment as

baby boomers age

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A Product Targeted at the Older Single Market

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Household Life Cycle and Social Class

A useful segmentation is household life cycle and

social class People from different social classes have similar problems but seek varying solutions

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Household Life Cycle/Social Stratification Matrix

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Targeting Communications at Influencers and Information Gatherers

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Household Decision Making

Five distinct roles: 1. Information gatherer 2. Influencer 3. Decision maker 4. Purchaser 5. User

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Determinants of Household Purchases

Different members at different stages Different attributes are considered by each

member Involvement is often removed

e.g. Clothes for children, BBQ for Dad Product category Likely conflicts Resolution etc.

Who is doing the purchasing

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Household Decision Making (cont.)

Individuals role within the household

Information gatherer Influencer Decision maker Purchaser User

Cultural and social changes

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Family-Member Influence at Various Stages of the Decision-Making Process

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Conflict Resolution
Approaches used to resolve purchase conflicts: 1. Bargaining 2. Impression management 3. Use of authority 4. Reasoning 5. Playing on emotions 6. Additional information

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Consumer Socialisation
Young people acquiring skills, knowledge and

attitudes relevant to their functioning as consumers in the marketplace

Consumer socialisation and advertising

advertising standards

Role of the household in socialisation

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Managerial Framework for Evaluating the Household Decision-Making Process

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Household Trends Over the Next 25 Years

Single households to double

Average household size down*

2.6 (1996) 2.2 (2021)

Families without children more than with children

by 2016
One-parent families up by 30% to 66%
Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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The Importance of the Family Pet: Ownership in 1998

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Computers and Video Games in Households

Large number of household have Internet access

Opinion of being online and video games is now

more favourably accepted by experts

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Households and the Purchase of Services

High use of services Food

eating-out more frequent fast food frequently purchased

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Implications
As marketers you will need to consider

will these trends continue? what will be the ramifications for the product/service market under your management? When is the household the decision-maker as opposed to individuals

Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

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Summary

Household is the basic consuming unit Family households pass on cultural and social-class values and behaviour patterns Family household2 or more related persons living together Non-family households2 or more unrelated persons HLC is classified into stagesrelatively predictable HLC variablesage, marital status (household head) presence of children Household decision makingwho buys,who decides, and who uses products purchased and used by and for the household
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Copyright 2004 McGraw-Hill Australia Pty Ltd PPTs t/a Consumer Behaviour 4e by Neal, Quester, Hawkins

Summary (cont.)

Marketing managers must take into account each household decision process for each product category Role specialisation Trendsservices, role of pets, etc. Consumer socialisationhow children become socialised, learn how to be consumers Purchasing skills, e.g. shopping, budgeting Indirect skills, e.g. symbols of quality, prestige Families assist by teaching, providing role models, etc.

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Next Lecture
Chapter 14: Group Influence and Communication

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