bb chapter twelve : demographics
TRANSCRIPT
Chapter Twelve:Chapter Twelve:
Australasian (or own) society: Demographics and lifestyles
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Chapter 12Australasian society: Demographics
and lifestyles
• Use of demographic factors• Anticipating demographic shifts• How population segments can influence behaviour
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• Changing gender roles in society• Lifestyle and how it is measured• Psychographics and its applications • Using lifestyle and psychographics for market
segmentation
KEY NOTE
• This chapter is written purely from an Australian perspective
• You can avoid most the details since we are in Singapore
• But what is important is that you understand how
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• But what is important is that you understand how marketers track and analyze the marketing implications of demographic changes in society-and respond accordingly
• I have omitted including much of the data and charts in Chapter 12 and decide to focus on the key issues only
Australasian society: Demographics and lifestyles (cont.)
Some specific questions are:• Which demographic factors help marketers
describe and understand the market segments?
• What is the importance of anticipating demographic
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What is the importance of anticipating demographicshifts in society to develop marketing strategies?
• What are some impacts of changing roles (such as gender roles) on society and consumption?
Demographics and Social StratificationDemographics and Social Stratification
DemographicsDemographics
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Population Population & &
SizeSizeOccupationOccupation EducationEducation IncomeIncome AgeAge
Ads appealing to baby-boomer market
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Ads appealing to
the baby-boomermarket
Note: luxury is
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Note: luxury is highlighted
Australasian (or any other)society: Demographics and lifestyles (cont.)
• What is the nature of lifestyle and how is it measured?
• What is the meaning of psychographics, andhow is it used to understand consumer lifestyle
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how is it used to understand consumer lifestyleand consumption behaviour?
• How are lifestyle and psychographics used in market segmentation to develop marketingstrategies?
Changing societal factors affecting marketing strategy
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Demographics (overview)
• Population size• Age structure• Population distribution
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• Income• Occupation• Education
Projected Australian age structure for 2051
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Source: ABS file 3222.0
Check the Department of Statistics Singapore and find out our OWN demographic profile)
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http://www.singstat.gov.sg/stats/themes/people/demo.html
Demographics
• Population distribution– Changes attributed to internal
migration e.g. baby-boomers moving to Queensland and coastal
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moving to Queensland and coastal regions to retire
• Actual vs self-perceived age
Actual vs self-perceived age
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Demographics (cont.)
• Income / actual incomes• Disposable incomes / buying power• Occupations• Regional influences
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• Regional influences– e.g. industry shutdowns etc.– e.g. city vs country– e.g. internal migration
Demographics and Social StratificationDemographics and Social Stratification
Demographics
��IncomeIncome
�A household’s income level combined with its accumulated wealth determines its purchasing power.
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accumulated wealth determines its purchasing power.
�Income enables purchases but does not generally cause or explain them. Occupation and education directly influence preferences for products, media, and activities; income provides the means to acquire them.
Demographics and Social StratificationDemographics and Social Stratification
Demographics
��Income (cont.)Income (cont.)
�Therefore, income is generally more effective as a segmentation variable when used in conjunction with other
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segmentation variable when used in conjunction with other demographic variables.
�How wealthy one feels may be as important as actual income for some purchases.
��Subjective discretionary income (SDI)Subjective discretionary income (SDI) is an estimate by the consumer of how much money he/she has available to spend on nonessentials. SDI adds considerable predictive power to actual total family income (TFI).
Demographics and Social StratificationDemographics and Social Stratification
Demographics
��OccupationOccupation
�Occupation is probably the most widely applied single cue we use to initially evaluate and define
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single cue we use to initially evaluate and define individuals we meet.
�One’s occupation provides status and income.
�The type of work one does and the types of individuals one works with over time also directly influence one's values, lifestyle, and all aspects of the consumption process.
Demographics and Social StratificationDemographics and Social Stratification
Occupational Influences on Consumption
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Demographics (cont.)
Education• Increase during the 90s:
about 30% more now with university degrees
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degrees• Huge increase in training: less
‘unskilled’
Changing levels of education
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Demographics and Social StratificationDemographics and Social Stratification
Demographics
��EducationEducation
�Approximately 85% of Americans have a high school degree, and 27% have completed college.
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degree, and 27% have completed college.
�Education is increasingly critical for a “family wage” job.
�Traditional high-paying manufacturing jobs that required relatively little education are rapidly disappearing.
Demographics and Social StratificationDemographics and Social Stratification
Demographics
��Education (cont.)Education (cont.)
�High-paying jobs in the manufacturing and service sectors today require technical skills, abstract
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sectors today require technical skills, abstract reasoning, and the ability to read and learn new skills rapidly.
�Since individuals tend to have spouses with similar education levels, these differences are magnified with spousal income is considered.
Demographics and Social StratificationDemographics and Social Stratification
Education Level Influences on Consumption
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Ethnicity and country of origin of Australasians
• Ethnic markets
• Country of origin markets
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• Country of origin markets
Specific population segments
Population segments share distinguishing patterns of behaviour.
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Age subcultures
• Mature market• Youth market
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– Generation X– Generation Y
Demographics and Social StratificationDemographics and Social Stratification
Demographics
��AgeAge
�Proper age positioning is critical for many products. Our age shapes the media we e, where we shop, how
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Our age shapes the media we e, where we shop, how we use products, and how we think and feel about marketing activities.
�Age carries with it culturally defined behavioral and attitudinal norms, which affect our self-concepts and lifestyles.
Demographics and Social StratificationDemographics and Social Stratification
Age Influences on Consumption18-24 25-34 35-44 45-54 55-64 65+
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Understanding GenerationsUnderstanding Generations
A Generation Generation or age cohort age cohort is a group of persons who have experienced a common social, political, historical, and economic
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political, historical, and economic environment.
Cohort analysisCohort analysis is the process of describing and explaining the attitudes, values and behaviors of an age group as well as predicting its future attitudes, values, and behaviors.
��PrePre--DepressionDepression
��DepressionDepression
��Baby BoomBaby Boom
Understanding GenerationsUnderstanding Generations
Mature MarketMature Market
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��Baby BoomBaby Boom
��Generation XGeneration X
��Generation YGeneration Y
��MillennialsMillennials
Understanding GenerationsUnderstanding Generations
How to Target the Mature Market
One approach to segmenting older consumers is gerontographicgerontographic ss , based on the theory that people change their outlook on life when they experience major life events such as becoming a grandparent, retiring,
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life events such as becoming a grandparent, retiring, losing a spouse, or developing chronic health conditions.
Those experiencing similar events are likely to have similar outlooks on life, and given similar economic resources, similar lifestyles.
Understanding GenerationsUnderstanding Generations
How to Target the Mature Market
Gerontographics has identified the following four segments of the mature market:
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- Healthy IndulgersHealthy Indulgers (7 million, rapidly growing)- Ailing OutgoersAiling Outgoers (18 million)- Health HermitsHealth Hermits (20 million)- Frail Recluses (18 million)
Understanding GenerationsUnderstanding Generations
�Compared to prior generations, Boomers are:
�Higher income, higher education
�More tech savvy
Baby Boom Generation: A Closer LookBaby Boom Generation: A Closer Look
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�More tech savvy
�Defining retirement differently
�Boomers also are:
�Strong market for “anti-aging” products, travel, and financial services
�Often alienated by overly “youth oriented” appeals in ads
Understanding GenerationsUnderstanding Generations
�Beyond the stereotype:
�Stereotype – Xers as disenfranchised youth
�Reality 1 – Xers are more highly educated than previous generations
Generation Xers: A Closer LookGeneration Xers: A Closer Look
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generations
�Reality 2 – Xer women are more highly educated than Xer men
�Reality 3 – Xers are getting married, having families and facing the time pressures associated with these events
�Reality 4 – Reaching Xers requires special attention to media, particularly online
Understanding GenerationsUnderstanding Generations
Generation Y, Generation Y, oror echo boom generation, account for 71 million Americans. They are the children of the original baby boomers and were born between 1977 and 1994.
Gen Y is characterized by a strong sense of independence and autonomy.
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independence and autonomy.
They are assertive, self-reliant, emotionally and intellectually expressive, innovative, and curious.
It is a multiracial generation, with African American and Hispanic teenagers often being the style leaders.
Understanding GenerationsUnderstanding Generations
�Interesting Facts About Gen Y:
�Really Two Sub-Markets: Twenty-somethings and Teens
�Expected to have the highest education of previous generations with incomes to follow
Generation Yers: A Closer LookGeneration Yers: A Closer Look
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generations with incomes to follow
�Very tech savvy with media options including Internet, cell phones, and video games
�A strong market for automobiles with brands like Toyota creating edgy and affordable models such as the Scion to target them
Gender roles
• Ascribed roles —an attribute over which the individual has little or no control
• Achievement roles —based on
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• Achievement roles —based on performance criteria over which the individual has some degree of control
• Traditional versus modern orientation
Marketing strategy and gender roles
1. Market segmentation2. Product strategy3. Marketing communications
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4. Retail strategy
The Nature of LifestyleThe Nature of Lifestyle
Lifestyle Lifestyle is basically how a person lives. It is how one enacts his or her self-concept.
Influences all aspects of
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Influences all aspects of one’s consumption behavior.
Is determined by the person’s past experiences, innate characteristics, and current situation.
The nature of lifestyle
• Lifestyle is the expression of the individual’s situation, life experiences, values, attitudes and expectations
• It is defined simply as how the individual
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• It is defined simply as how the individual lives
• ‘Lifestyle’ has been used interchangeably with the term ‘psychographics’
The Nature of LifestyleThe Nature of Lifestyle
Measurement of LifestyleMeasurement of Lifestyle
Attempts to develop quantitative measures of lifestyle were initially referred to as psychographicspsychographics . Measures includeMeasures include:
Attitudes Evaluative statements about other people, places, ideas, products, etc.
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Values Widely held beliefs about what is acceptable or desirable
Activities and Interests
Nonoccupational behaviors to which consumers devote time and effort, such as hobbies, sports, public service, and church
Demographics Age, education, income, occupation, family structure, ethnic background
Media patterns The specific media the consumer utilize
Usage rates Measurements of consumption within a specified product category; often consumers are categorized as heavy, medium, light, or nonusers
The Nature of LifestyleThe Nature of Lifestyle
General versus Specific Lifestyle SchemesGeneral versus Specific Lifestyle Schemes
Lifestyle measurements can be constructed with varying degrees of specificity.
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1. Marketers can study the generallifestyle patterns of a population.
2. Firms can conduct very specific lifestyle studies focused on aspects of individual or household lifestyles most relevant to their product or service.
Determinants of lifestyle
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Continuum for lifestyle measurements
Lifestyle measurements can be constructed with varying degrees of specificity.
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Several components of AIO questionnaires
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The Nature of LifestyleThe Nature of Lifestyle
Three specific lifestyle Three specific lifestyle examplesexamples ::
1.1. Luxury Sports CarsLuxury Sports Cars
2.2. ShoppingShopping
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2.2. ShoppingShopping
3.3. TechnologyTechnology
The Nature of LifestyleThe Nature of Lifestyle
Lifestyle Schemes: Lifestyle Schemes: Luxury Sports CarsLuxury Sports Cars
Porsche examined the lifestyles of its buyers.
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Key demographics (e.g., high education and income) were similar across buyers.
However, their lifestyles and motivations were quite different.
The Nature of LifestyleThe Nature of Lifestyle
PorschePorsche Consumer SegmentsConsumer Segments
Top Guns (27%) Ambitious and driven, this group values power and control and expects to be noticed.
Elitists (24%) These old-family-money “blue-bloods” don’t see a car as an extension of their personality. Cars are
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car as an extension of their personality. Cars are cars no matter what the price tag.
Proud Patrons 23%) This group purchases a car to satisfy themselves, not to impress others. A car is a reward for their hard work.
Bon Vivants (17%) These thrill seekers and “jet-setters” see cars as enhancing their already existing lives.
Fantasists (9%) This group uses their car as an escape, not as a means to impress others. In fact, they feel a bit of guilt for owning a Porsche.
The Nature of LifestyleThe Nature of Lifestyle
Lifestyle SchemesLifestyle Schemes
ShoppingShopping
Hedonic shopping motives underlying consumer shopping patterns include*
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patterns include*
1. Adventure - fun2. Gratification reward/stress reduction3. Role - shop for others4. Value - good deal5. Social - bonding6. Idea - trends
*Discussed in Chapter 10
Five shopping lifestyle segments emerged based on these motives.
The Nature of LifestyleThe Nature of LifestyleFive Shopping LifestyleFive Shopping Lifestyle SegmentsSegments
Minimalists (12%)
Primarily motivated by value; least motivated by fun and adventure; low in appreciation for retail aesthetics, low in innovativeness, do not tend to be browsers-- middle-aged, with 57% being men
Gatherers (15%)
Primarily motivated by keeping up with trends and joy of shopping for others; least motivated by value; low in appreciation of retail aesthetics, low in innovativeness, moderate browsers-- mix of younger and older shoppers, with 70% being male
Providers Primarily motivated by enjoyment of shopping for others and value;
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Providers (23%)
Primarily motivated by enjoyment of shopping for others and value; not motivated by fun and adventure; moderate in appreciation of retail aesthetics, low in innovativeness, moderate browsers-- oldest group, with 83% being female
Enthusiasts (27%)
Highly motivated by all hedonic aspects including fun and adventure; highest in appreciation of retail aesthetics, most innovative, spend the most time browsing-- youngest group, with 90% being female
Traditionalists (23%)
Mmoderately motivated by all hedonic aspects, gratification high on the list; moderate in appreciation of retail aesthetics, highly innovative, moderate browsers-- mix of younger and older shoppers, with 58% being female
The Nature of LifestyleThe Nature of Lifestyle
Lifestyle SchemesLifestyle SchemesTechnologyTechnology
How technology is utilized by consumers is of critical importance to marketers.
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Numerous technology and Internet lifestyle profiles exist, including
• Pew Internet User Types• Ebates.com Dot-shoppers• TDS Shopper Clusters: Onliners Group
Forrester Research created Technographics, a segmentation scheme that examines lifestyle segments relating to technology, online access, online shopping, instant messaging, etc.
The Nature of LifestyleThe Nature of Lifestyle
TechnographicsTechnographics
Sidelined Sidelined CitizensCitizens
29%29%
TechnoTechno--Strivers Strivers
5%5%
Fast Fast Forwards Forwards
10%10%
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Media Media Junkies Junkies
6%6%
Gadget Gadget GrabbersGrabbers
7%7%
Mouse Mouse Potatoes Potatoes
9%9% Traditionalists Traditionalists 10%10%
Digital Digital Hopefuls Hopefuls
6%6%
New Age New Age Nurturers Nurturers
8%8%
Handshakers Handshakers 7%7%
Technology Technology SegmentsSegments
The VALSThe VALS TMTM SystemSystem
Underlying Differences Across VALSUnderlying Differences Across VALS TMTM Motivational TypesMotivational Types
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VALS Lifestyle System
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The 8 psychographic segments of VALS
1. Innovators
2. Thinkers and Believers: ideals motivated
3. Achievers and Strivers: achievement
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motivated
4. Experiencers and Makers: self-expression
motivated
5. Survivors
Shortcomings of VALS
• Measures of individuals - some decisions are by households
• Few individuals have ‘pure’ primary motivations, a secondary motivation may be very influential
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• VALS may not be useful for products that are evenly spread over all VALS types as it is for ego-involved purchases, e.g. laundry detergent
The VALSThe VALS TMTM SystemSystem
Ideals MotivationIdeals Motivation
Consumers who are guided in their choices by
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guided in their choices by their beliefs and principles rather than by feelings or desire for social approval.
They purchase functionality and reliability
The VALSThe VALS TMTM SystemSystem
Achievement MotivationAchievement Motivation
Consumers who strive for
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a clear social position and are strongly influenced by the actions, approval, and opinions of others.
They purchase status symbols.
The VALSThe VALS TMTM SystemSystem
SelfSelf--Expression Expression MotivationMotivation
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Action-oriented consumers who strive to express their individuality through their choices.
They purchase experiences.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegments
Innovators Innovators are successful, sophisticated, active, take-charge people with high self-esteems and abundant resources.
They are motivated by a blend of ideals, achievement, and self-
InnovatorsInnovators
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They are motivated by a blend of ideals, achievement, and self-expression. Image is important as an expression of their taste, independence, and character.
They often see brands and products as extensions of their personalities.
They have a wide range of interests, are concerned with social issues, and are the most receptive to new products, ideas, and technologies.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegments
Thinkers Thinkers are mature, satisfied, comfortable, reflective people who value order, knowledge, and responsibility.
Most are well-educated and are in or near retirement from
Thinkers: Thinkers: Ideals MotivatedIdeals Motivated
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Most are well-educated and are in or near retirement from professional occupations.
They plan their purchases and are cautious concerning big-ticket items, looking for functionality, value, and durability in products.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegmentsBelievers: Believers: Ideals MotivatedIdeals Motivated
BelieversBelievers are conservative, conventional people with concrete beliefs based on traditional, established codes: family, church, community, and the nation.
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community, and the nation.
They are conservative, predictable and highly loyal consumers.
They favor American products and established brands, and are averse to change.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegments
Achievers Achievers are successful career- and work-oriented people who like to, and generally do, feel in control of their lives.
Achievers: Achievers: Achievement MotivatedAchievement Motivated
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They value consensus, predictability, and stability over risk.
Image is important to them, favoring established, prestige products and services that demonstrate success to their peers.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegmentsStrivers: Strivers: Achievement MotivatedAchievement Motivated
StriversStrivers are style conscious and trendy.
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They have limited education and tend to have narrow interest.
Money defines success for them, favoring stylish products that emulate the purchases of people with greater material wealth.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegments
Experiencers Experiencers are young, vital, enthusiastic, impulsive, and rebellious.
Experiencers: SelfExperiencers: Self--Expression MotivatedExpression Motivated
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They seek variety and excitement and savoring the new, the offbeat, and the risky.
They are avid consumers and spend much of their income on clothing, fast food, music, movies and videos and technology.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegments
Makers: SelfMakers: Self--Expression MotivatedExpression Motivated
MakersMakers are practical people who have constructive skills and value self-sufficiency.
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They live within a traditional context of family, practical work, and physical recreation.
They buy tools, pickup trucks, washing machines, fishing equipment, etc.
The VALSThe VALS TMTM SystemSystem
VALSVALSTMTM SegmentsSegments
Survivors’ Survivors’ lives are constricted. They live simply on limited incomes but are relatively satisfied.
SurvivorsSurvivors
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Frequently elderly and concerned about their health, they are not active in the market place and show no evidence of a strong primary motivation.
They represent a modest market, are cautious consumers who look for low prices, buying familiar, trusted products.
VALS Survey
Try it for yourself!
http://www.sric-bi.com/VALS/
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presurvey.shtml
Roy Morgan Research’s Values Segment System: the Segments
• Young optimism (8%)• Socially aware (14%)• Something better (7%)• Visible achievement (18%)• Look at me (11%)• Look at me (11%)• Conventional family life (10%)• Traditional family life (20%)• Real conservatism (5%)• A fairer deal (4%)• Basic needs (3%)
Geo-demographic lifestyle analysis
• Analysis focusing on the demographics of geographical areas
• based on the belief that lifestyle and therefore consumption are largely driven by demographic factorsfactors
• Based on research that shows that neighbours have shared patterns of consumer behaviour towards goods, services, media and promotions.
• An example is Mosaic Australia
International LifestylesInternational Lifestyles
� Marketing is increasingly a global activity.
� Marketers can develop cross-cultural strategies around those discernible lifestyle segments that cut across cultures.
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� Although language and other differences would exist, individuals pursuing similar lifestyles in different cultures should be responsive to similar product features and communication themes.
� Large international advertising agencies and marketing research firms, such as Roper Starch Worldwide, are leading the way.
International LifestylesInternational Lifestyles
Global Lifestyle Segments Identified by Roper Starc h WorldwideGlobal Lifestyle Segments Identified by Roper Starc h Worldwide
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