changing societies us & china: demographics and …...demographics and social stratification...

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CHAPTERCHAPTER 44CHANGINGCHANGING

SOCIETIES US &SOCIETIES US &CHINA:CHINA:

DEMOGRAPHICSDEMOGRAPHICSAND SOCIALAND SOCIAL

STRATIFICATIONSTRATIFICATION

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Demographics and Social StratificationDemographics and Social Stratification

DemographicsDemographics

Population Population & &

SizeSizeOccupationOccupation EducationEducation IncomeIncome AgeAge

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Population and SizePopulation and Size

OccupationOccupation

EducationEducation

IncomeIncome

AgeAge

Demographics

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Demographics

Population and SizePopulation and Size

The population of the U.S. is approximately 298million today and is expected to surpass 320 million by2015.

The population has grown steadily since 1960despite a declining birthrate due to longer lifeexpectancies, the large baby boom generation movingthrough their child-bearing years, and immigration.

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Demographics

OccupationOccupation

Occupation is probably the most widely appliedsingle cue we use to initially evaluate and defineindividuals we meet.

One’s occupation provides status and income.

The type of work one does and the types ofindividuals one works with over time also directlyinfluence one's values, lifestyle, and all aspects of theconsumption process.

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Demographics and Social StratificationDemographics and Social StratificationOccupational Influences on Consumption

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Demographics

EducationEducation

Approximately 85% of Americans have a high schooldegree, and 27% have completed college.

Education is increasingly critical for a “family wage”job.

Traditional high-paying manufacturing jobs thatrequired relatively little education are rapidlydisappearing.

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Demographics

Education (cont.)Education (cont.)

High-paying jobs in the manufacturing and servicesectors today require technical skills, abstractreasoning, and the ability to read and learn new skillsrapidly.

Since individuals tend to have spouses with similareducation levels, these differences are magnified withspousal income is considered.

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Education Level Influences on Consumption

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Demographics

IncomeIncome

A household’s income level combined with itsaccumulated wealth determines its purchasing power.

Income enables purchases but does not generallycause or explain them. Occupation and educationdirectly influence preferences for products, media, andactivities; income provides the means to acquire them.

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Demographics

Income (cont.)Income (cont.)

Therefore, income is generally more effective as asegmentation variable when used in conjunction with otherdemographic variables.

How wealthy one feels may be as important as actualincome for some purchases.

Subjective discretionary income (SDI)Subjective discretionary income (SDI) is an estimateby the consumer of how much money he/she has availableto spend on nonessentials. SDI adds considerablepredictive power to actual total family income (TFI).

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Demographics

AgeAge

Proper age positioning is critical for many products.Our age shapes the media we e, where we shop, howwe use products, and how we think and feel aboutmarketing activities.

Age carries with it culturally defined behavioral andattitudinal norms, which affect our self-concepts andlifestyles.

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Demographics

Age (cont.)Age (cont.)

U.S. Age Distribution1

Key Growth Categories

1 “Population by Age Group,” Statistical Abstract of the United States 2001 (Washing, DC: U.S. Bureau of the Census, 2001), p. 16.

16.230.526.3>69

47.933.922.960-69

18.743.336.550-59

-12.239.444.940-49

3.339.938.630-39

10.442.538.520-29

-1.241.141.610-19

8.341.538.3<10

Percent

Change20152005

Age

Category

16.230.526.3>69

47.933.922.960-69

18.743.336.550-59

-12.239.444.940-49

3.339.938.630-39

10.442.538.520-29

-1.241.141.610-19

8.341.538.3<10

Percent

Change20152005

Age

Category

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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 agroup of persons who haveexperienced a common social,political, historical, and economicenvironment.

Cohort analysisCohort analysis is the processof describing and explaining theattitudes, values and behaviorsof an age group as well aspredicting its future attitudes,values, and behaviors.

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Applications in Consumer BehaviorApplications in Consumer Behavior

McDonaldMcDonald’’s targetss targetsthe active andthe active anddiverse diverse ““youthyouthmarket.market.””

Notice the use ofNotice the use ofmusic and sports asmusic and sports as““touch points.touch points.””

Courtesy McDonald’s Corporation

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China’s Changing Demographics

• Big changes in China as a result of the onechild policy

• We will focus on this change• In the late 1990’s the government estimated

that children 0-4 years old made up 94 million• 2000 census revealed only 64 million, a very

big difference!

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What the changes mean

• The population profile is getting older• In 2006 51% of married adults over 40 years• By 2014 it will rise to 62%• Now 36% of households do not have a child

under 20 years• By 2014 this rises to 50% and by 2024, 71%• Working age, empty nesters will triple in 20

years

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