Social Class CS

8/8/2019 Social Class CS

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A Project Report On

EFFECT OF SOCIAL CLASS ON CONSUMER BUYING BEHAVIOR

Submitted in partial fulfillment of the requirementsFor the award of the degree of

Post Graduate Diploma in Management [PGDM]

AT

Submitted to Submit by:

Mr. Najmal Huda Varun Narang

Sachin NarulaSamiksha Saxena

Subhanjan

Ashish Ghosh

NIILM Center for Management Studies

New Delhi 110044

Batch (2009-2011)


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CHAPTERCHAPTERCHAPTERCHAPTER ----1111

RESEARCH ANALYSISRESEARCH ANALYSISRESEARCH ANALYSISRESEARCH ANALYSIS

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SOCIAL CLASSSOCIAL CLASSSOCIAL CLASSSOCIAL CLASS

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CONSUMER BEHAVIORCONSUMER BEHAVIORCONSUMER BEHAVIORCONSUMER BEHAVIOR


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EFFECT OF SOCIAL CLASS ON CONSUMER BUYING BEHAVIOR

Abstract

The use of social stratification in consumer research has been criticized for

nave conceptualization. This paper examines the theoretical basis for

asserting a close connection between social class structure and consumer

behavior. Max Weber's seminal contribution to stratification theory provides

the basis for this examination. Special consideration is given to the

dimensions of class and status, which figure prominently in Weber's work.

The relevance of this approach to consumer research Is summarized In the

form of several basic propositions. In the new stream of study between social

class and buying behavior, a convenience sample of 100 people was asked to

complete a questionnaire. The analysis of variance was conducted to know

the significant difference among various groups on the basis of three

dimensions like Income, Education and Occupation. Furthermore, Social

Classification was done on the basis of ISP Score (Index of Social Position).

INTRODUCTION:

Social class is defined as relatively permanent and homogeneous divisions in a society into

which individuals or families sharing similar values, lifestyles, interests, wealth, status,

education, economic positions, and behavior can be categorized (Blackwell, Miniard, Engel,

2001, p. 346).

According to the above definition division into social layers is based on the fact that individuals

of different social status have different values and needs and therefore behave differently in

consumption. In developed western countries belonging of an individual to a particular social

class largely affects his/her behavior in the purchasing process and choice of products and

services.

Every society is characterized by certain class stratification. Social strata vary from one society

to another. In some societies these differences are greater than in other, therefore researchers

tend to use different categorizations of social classes. There are about three classes: upper,


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middle and lower. The upper class includes the upper-upper (aristocracy and old well-established

families), lower-upper (the new rich - newer social elite successful entrepreneurs, managers,

professionals, athletes and artists) and upper-middle class (successful businesspeople, managers,

professionals). The middle class includes middle class (non-managerial white-collar workers and

highly paid blue-collar workers) and working class (lower-level white-collar and average-pay

blue-collar workers), while the lower class can be subdivided into upper and middle-lower class

(elementary education, semi-skilled and low paid service workers, operatives) as well as real

lower class (unskilled laborers, persons on the verge of subsistence, mostly on welfare, bums).

In the late 195O's and early 196O's, several contributions to the marketing literature appeared

that pointed to the significance of social class for understanding consumer behavior. These

early writings drew heavily on Warner's conception of social classone which focused largely

on position and prestige of families within relatively small, self-contained communities. The

connection between social class and consumer behavior that was outlined by such Individuals as

Martineau (1958), Coleman (1960), and Levy (1966) was a somewhat broad one stressing

variations In values, lifestyles, and general consumption goals. Many of the findings presented

were based on syntheses of proprietary studies and thus actual quantitative evidence was rarely

included. Interest In this broad subject area continued through the 1960's and early 1970's,

although with a somewhat different orientation. For it was at this same time that segmentation

research was growing in importance, and social class studies in marketing were largely diverted

into this research stream. To oversimplify somewhat, one might say that in the search for the so-

called superior correlate with buying behavior, social class was perceived as a likely candidate.

More specifically, some argued that social class would prove superior to income as a basis for

segmentation. Thus the social class vs. income issue emerged, and within a period of a few years

about a dozen articles appeared in the marketing literature that joined this debate (e.g., Wasson

1969; Myers, Stanton, and Haug 1971; Myers and Mount 1973; Hisrich and Peters 1974). The

basic social class vs. income issue remained clouded during the seventies, and Interest in it

eventually waned.


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DETERMINANT OF SOCIAL CLASS

Class membership is determined by a number of factors. Most frequently mentioned are

occupation, education and income, while some authors also add wealth, possessions, area of

residence, family background, personal performance, value orientation, cultural level, power,

social acceptance and physical appearance. For the purpose of this research we will consider

occupation, education and income.

Occupation: Both occupation and education predict social class better, but most researchers

agree that occupation is the best single indicator of it. Namely, in a recent survey, researchers

asked people to rate several characteristics that predict social class including income, education,

occupation, lifestyle and attitude. Most people rated occupation first (Morton, 2004, pp. 45-46).

People who function in higher status occupations have characteristic personalities, motives and

values that set them apart from those in less prestigious positions. The values, attitudes and

motives that arise from greater levels of occupational self-direction underlie behavior beyond the

workplace, extending to all phases of existence, including buying behavior (Williams, 2002,

p.251).

Education: is closely correlated with occupation. It represents the primary means that enable

people to move up the social ladder. Education may affect an individuals tastes, values,

consumption patterns, consumer information processing and decision making. According to

Duncan and Olshavsky (Williams, 2002, p. 251) college-educated consumers tend to read more,

read different magazines, spend less time watching television, rely less on well-known brands,

and put more time and effort into purchase decisions than high school-educated consumers.

Income: Many people equate income to social class, but income has proven to be an unreliable

predictor of social class. Thus some authors argue that although it may be related to the social

class, income is not its determinant. This can be explained by the fact that a person with a

university degree, a teacher for instance, can have a lower income than a car mechanic.

Nevertheless, income obviously affects buying behavior in terms of the amount and types of

products purchased.

IMPORTANCE OF SOCIAL CLASS IN INDIAN CONTEXT

India ranks second in terms of its population size and ranks fifth in terms of GDP and ranks 153rd

in terms of per capita income. The pattern of India is the most extreme of BRIC economies. India


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is a developing economy and most of the population comes under middle class strata. Indias

middle classes constitute a sizeable percentage of Indias population and their behavior has a

significant impact on the environment (Gadgil and Guha, 1995; Vyas and Ratna Reddy, 1998).

Wealthier groups, especially in urban areas, make higher demands upon environmental goods

and capacities through their ability to command more resourcessuch as per capita water and

electricity, consumer products and their greater waste production, including vehicle emissions

and garbage (Buch, 1993: 39; Panch, 1993) .

In India, the lower income group has less than one-fifth of the housing penetration of vehicles as

compared to high income group. But at the same time, it has nine times the number of

households in the high income group. According to NCAER survey, it was found that lowest

income group has three times the value of consumption as compared to the highest income

group.

One of the more noticeable outcomes of the recent socio-economic and political processes in

India has been the emergence of the socio-economic group described as the middle class. By all

reasonable estimates, the strength of the middle class in India is bigger in size than the entire

population of many nations. The proposed three day seminar endeavours to bring scholars from

diverse disciplines in order to understand, in a much more nuanced manner, the emergence,

sustenance and expansion of the middle class in India.

The emergence of the middle class was facilitated by modern education and the consequent work

opportunities available in offices set up for commercial, administrative and other purposes by the

colonial government. The conceptual and political boundaries of Indian middle class rested on

mediation between the colonial rulers and colonial subjects. The relationship was premised on

subordination to colonial power but at the same time providing cultural leadership to the

indigenous people. In the post-colonial India, the middle class were identified as Nehruvian

civil service-oriented salariat, short on money but long on institutional perks. In the

contemporary period, the new middle class, as a social group, is depicted as negotiating Indias

new relationship with the global economy in both cultural (socio symbolic practices of

commodity consumption) and economic terms (the beneficiaries of the material benefits of jobs

and business in Indias new liberalized economy).

The middle class has been conceptualized as the part of the dominant coalition governing India8

or as a class building hegemony for the present socio-economic and political arrangements 9 or


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as the powerful intermediary class regulating Indias market economy and controlling and

moldings the state towards its interests to varying degrees or as one of the influential

constituency supporting liberalization.

In the last one and half decade, cities in India have become symbols of the economic growth

achieved by the nation in the preceding years. The hitherto centers of large-scale mechanized

industry (Ahmedabad, Kolkatta, Kanpur, Mumbai etc.) as well as other state capitals and major

towns (Bangalore, Chennai, Hyderabad, Pune, Lucknow, Amritsar etc.) including the national

capital region of Delhi are witness to radical socio- economic restructuring.

Many of the cities have become symbols of the post industrial stage propelling the service and

knowledge economy of the country besides being centers of real estate development, policy

experiments of public-private private partnership, privatization of basic services including

security, large scale removal/shifting of working class areas, among many other things.

LITERARY REVIEW

For over 30 yr., social class provided a fruitful arena for consumption patterns (e.g. Coleman

1983; Martineau 1958; Rainwater, Coleman, and Handel 1959; Schaninger 1981). However, by

the end of the 1970s, interest in social class had stagnated. The predominant conception of social

class that marketers had employed across this early period derived from that of Warner, Meeker,

and Eells (1949). This view saw social classes as communities of individuals bounded by

common social status. While this conception was able to delineate community relations within

relatively small, compact communities, it did not translate so well to the case of large

cosmopolitan populations, where social networks exhibit far greater complexity and fluidity.

Holt (1997, 1998) critiqued these Warnerian limitations and reinvigorated the area by employing

Bourdieu's (1984) theory of cultural capital and taste to demonstrate how social class position

and consumption patterns remain intertwined.

According to Bourdieu, the social class structure ultimately sits at the heart of power distribution,

"the most fundamental oppositions in the social order . . . the opposition between the dominant

and the dominated, which is inscribed in the division of labor" (Bourdieu 1984,469). Power is

intertwined with the resources and material life that shape habitus. Bourdieu drew from Weber

(1983), who argued that social class structures were phenomena of the distribution of power

within a societyempowerment is intrinsic to class. This means that the division of labor is

more than just a nominal classification. Weber spoke of social class in terms of people with a


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common causal component of their life chancespossession of economic resources and

financial opportunitiesrepresented by configuration of labor and ownership markets. Thus, an

individual's class situation reflects market-determined life chances. Power derives partially from

economic leverage, but it also includes authority relationships and autonomy perceptions within

the workplace and social setting. Power varies systematically with market situation. Those in

advantageous market situations tend to enjoy greater authority and autonomy. Power and

perceived controls go hand in hand. Perception of power relative to others affects self-worth

evaluations.

Limited authority and autonomy promote the sense of self-powerlessness. Weber (1983)

extended the market-based economic notion of class by delineating status and power. Status is

also related to economic factors, but more directly, it refers to shared community estimations of

relative prestige. Status rests upon interpersonal recognitiondistinction. Estimates of relative

prestige are made from the array of visible lifestyle markers and formal positions. Occupational

prestige has been investigated as a key indicator of status, and consistent patterns of job prestige

have been identified (McMillan and Jones 2000). Perceptions of relative skill, abilities, job

desirability, and authority drive occupational status evaluations.

Social Class, Income or Combination of both

Wind (1978) noted a surprising lack of research based generalizations about the appropriateness

of traditional segmentation variables across contexts and situations. An extension of this view

would hold the social class-income controversey to be spurious: both are accepted as valuable

segmentation variables, but identifying the product classes for which either alone or the two

combined is the superior segmentation scheme is more important than determining which is

generally superior to the other.

Although Coleman (I960) explicitly considered situations in which income, or the combination

of income and social class, was superior to social class alone, most later social class proponents

did not. He argued that the relationship of social class to consumption is stronger than that of

income for very visible goods which serve as symbols of social class membership and are closely

tied to values. He identified the consumption of clothing, furniture, and area of residence as

reflecting the strongest relationship between social class and quality of goods, as well as place

and method of purchase.


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Martineau (1958) suggested that the degree to which different products exemplify values that

differ across social classes would determine whether or not social class was superior to income.

Levy (1966, 1971) viewed social class variations as "variations in life style," or variations in

values, interpersonal attitudes, self- perceptions (roles), and daily life. He stated that differences

among classes in consumption of products, shopping, media use, and response to promotion are

caused by such lifestyle differences. Thus, his work suggests that consumption differences are

not restricted to very visible areas such as those examined by Coleman, but also occur for no

visible low cost convenience items, the consumption of which reflects differences in values,

homemaker roles, or lifestyles (e.g. quality symbolism, immediate gratification, deal proneness).

Coleman (I960) stated that relative income, whether a family is over- or underprivileged in

comparison with others of their social class, will best segment the market for products which are

more nearly symbols of higher status within class than symbols of higher status per se," giving as

examples automobiles, color television sets, more costly brands and larger sizes of some home

appliances, and recreational equipment. Over privileged (higher income) members of any given

strata tend to represent the quality market for such goods, buying larger new primary

automobiles (but new compacts as second cars), appliances, and color TV sets, whereas

underprivileged members buy compacts as primary cars (and used cars as second cars), and

smaller, fewer, or less costly appliances or color TV sets. For such products, ability to pay has

more influence than social class per se. Coleman argued that only the over privileged can afford

such goods from their discretionary income after paying for necessities and first order social

class symbols (home, clothing, and furniture). Peters' (1970) extension of this work on

automobiles also supported the relative income hypothesis. Thus, income and social class appear

to be the choice for segmenting high cost durable goods that serve as symbols of affluence within

social classes rather than as symbols of social class membership. Unfortunately, none of the

subsequent social class or social class versus income studies examined the question of whether

the combination of social class and income was superior to either alone, and only the Coleman

and Peters studies provide a basis for empirical generalizations.

Two sociological concepts, "status crystallization and its opposite counterpart "status

incongruence" (Lenski 1956; Malewski 1966), are related to the "relative income" hypothesis.

Individuals of crystallized status (consistency among several status dimensions such as

education, occupation, income, race, dwelling area) tend to conform to social class stereotypes.


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Those exhibiting status inconsistency or incongruence tend to behave in a discrepant,

nonconformist fashion and may be more liberal and acceptant of social change and product

innovation (Engel, Kollat, and Blackwell 1973). The relative income hypothesis suggests that

income is linearly and positively related to consumption of expensive or high quality goods

within each social class. If the effect of income within social classes is not consistent across

social classes i.e., is positively or negatively related to consumption for some social classes

but not otherswe have evidence in support of the status incongruence hypothesis. Coleman

(1960) did concede that income itself is superior for some products, giving air conditioners as an

example of a product that is very costly and does not serve as a symbol of either social class or

status within class. One might also anticipate that for some lower cost, non-necessity, non visible

goods, income alone (or ability to pay after providing for necessities and symbolic status-

oriented goods) determines purchase frequency. Foods such as candies, nuts, ice cream, cheese,

and steak might be in such a category. Other goods might be typified by inability to pay and

hence restricted to lower income groups e.g., small black and white TV sets as primary sets,

cheapest types of foodstuffs, or used appliances. Zaltman and Wallendorf (1979) proposed that

income would be superior to social class for staple, inconspicuous products bought for in-home

use, but that social class would be superior for convenience products.

Social Class And Consumer Behavior

Social class has been treated as an important force driving buyer behavior and consumer research

for decades. The potential for social class as a marketing segmentation variable was first noted in

the 1940s when Warner (in Coleman, 1983) found that each of the social class groups that he

identified displayed unique purchase motivations and shopping behaviors (Henry, 2002, p.425).

Extensive research studies indicate that people across social strata tend to exhibit differentiated

psychological and behavioral patterns. Variations in education, attitudes, values, communication

style, etc. across social class levels lead to variations in consumer information processing and

decision-making styles within and across social strata (Komarovsky, 1961; Martineau, 1958;

Kohn and Schoenbach, 1983 in Williams, 2002, p.250). Some researchers do indicate that social

class membership is a determinant of the nature and extent of consumer information search

(Prasad, 1975; Hugstad et al., 1987 in Williams, 2002, p.251). Furthermore, research indicates

that consumers socialized in middleclass families tend to be less independent in their buying


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behavior (Psathas, 1957; Moschis et al., 1977 in Williams, 2002, p.251). Children in upper status

families receive much more direct training in consumption skills than those in lower status

families. Lower class children rely more on brands, and middle class youngsters rely more

heavily on other aspects of products in their purchase decisions (Moschis and Moore, 1979 in

Williams, 2002, p.251). All of this suggests that evaluative criteria and their importance vary

across social classes.

Other works have also confirmed the value of social class in explaining consumer behavior.

Rich and Jain (1968 in Myers et al., 1971, p.9) found significant differences in shopping

behavior between social classes. They classified respondents according to Warners Index of

Status Characteristics. The importance of fashion was found to vary with social class as class

increased, the importance of fashion increased. Also, shopping frequency was greater among the

higher classes. The same authors also found that the higher social classes placed greater

importance on the type of store preferred and were less likely to shop downtown. By using

Hollingsheads Two Factor Index of Social Position Mathews and Slocum (1969 in

Myers et al., 1971, p.9) found that commercial bank credit card usage was different among social

classes. It was found that members of the lower classes tended to be installment users, whereas

members of the upper classes tended to be convenience users. Convenience users used their

credit cards less often than installment users. Also, convenience users did not seek stores that

accepted their cards, whereas installment users did. Coleman (1983 in Henry,

2002, p.425) proposed that the upper-class held strongest desire for prestige brands reflecting

an expressive orientation driven by intrinsic self-preference. Middle class were focused on

buying what is popular reflecting an expressive orientation driven by concern for what others

will think of them. Lower class focuses lies on evaluation of how well products work utilitarian

function. Coleman also (1983) suggested that except for luxury goods and specialty items, there

is no significant difference in the consumption of mass marketed products between upper class

and upper-middle class Americans. On the other hand, this difference is present in consumption

patterns between the middle and working class (in Sivadas, 1997, p.465).

Media habits also vary with social class. Levy (1966; 1978) suggested that the upper class is

interested in current events and drama. As one moves down the social class scale, there is greater

interest in soap operas and quiz shows (Levy, 1978 in Sivadas, 1997, p.465). Studies have found

that social class, among other variables (mostly the age of the listener) influences music


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METHODOLOGY

In the particular study, a survey was conducted to know the effect of social class on consumer

buying behavior. The questionnaire was made based on three dimensions Food, Clothing and

Housing to know whether consumers buy Veblen good because of the status or social class. The

Consumer Involvement Profile (CIP) scale was used on five point Likert scale.

Then a sample of 100 respondents was taken in the study. People were taken from shopping

malls and from the internet. People were segregated on the basis of occupation, age, income and

education.

Table 1: showing result of number of respondents on the basis of age, education and income

Group Range No of Respondents

AGE

< 20 yrs 8

20-40 yrs 83

> 40 yrs 9

Income

< 20,000 13

21,000 350000 24

36000 -50 000 26

51000 70000 19

71000 100000 3

> 100000 15

Education

10th 2

12th 6

Graduate 55

Post-Graduate 37

Occupation

Unemployed or Housewives 51

Service class 13

Middle Managers 21

Self Employed 8

Big Entrepreneur 7


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PIE CHARTS AND DIAGRAM

Classification of Respondent on the basis of Occupation

Our respondents are mainly students/ unemployed or housewives. There are only 13% of service

class people in the list of respondents. There are 21% of middle managers and 8% of business

man and 7% of big entrepreneur or top managers.

Classification of Respondents on the basis of Education

Our respondents are mainly graduates. There are 37% of the respondents who are post graduate

and less than 10% of consumers who are either 12th

pass or 10th

pass.


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Classification of Respondents on the basis of Income

Our respondents are mostly middle income group consumers. Respondents whose salary lies

between 21000- 35000 constitute 24% of total respondent. Respondents whose salary lies between 36000- 50000 constitute 26% of total respondent. Respondents whose salary lies

between 51000 - 70000 constitute 19% of total respondent and those of them whose salary is

above 100000 constitute 24% of total respondent.

Classification of Respondents on the Basis of Age

Our respondents are mostly the young students or youth service class consumers. Respondents

whose age is below 20 years constitute 8% of total respondent. Respondents whose age is

between 20 - 40 years constitute 83% of total respondent. Respondents whose age is above 40

years constitute 9% of total respondent.


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Classification of Respondents on the Basis of Social Class

The social class of respondents is found out on the basis of Index of Social position which is

explained below. On the basis of that index, it is analyzed that our respondents mostly consist of

middle class consumers (65%)

SAMPLE, DATA COLLECTION AND RESEARCH HYPOTHESIS

Empirical research was carried out on the sample of 100 respondents in Delhi. In the selection of

sample units, non-probability and within it judgment or purposive sample was used. Namely,

when choosing respondents we took into account their basic characteristics important for the

research. Therefore using personal evaluation we chose such respondent, or groups of them, who

in terms of their occupation, education and income could well represent the three social classes -

upper, middle, and lower. Survey methodology was used to collect data. The questionnaire

consisted of 20 questions, of which questions are referred to the preferences and behavior in

eating, clothing and buying durable or prestige goods and services (apartments, brands, life

insurance, and holidays). The intention was to comprise such categories of products and services

the consumption of which can indicate the differences in buying behavior of different social

classes. The questions used were structured multiple choice questions.

FORMATION OF INDEX OF SOCIAL POSITION

For classification of respondents into social classes we used a modified Index of Social Position

(ISP) formed by three determinants: occupation, education and income. The largest weight (4)


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was given to occupation, as the most important determinant of the social class, while education

and income were given the same weight (3). Each respondent was accordingly given a certain

number of points which classified him/her as a member of one of three classes (upper, middle,

and lower). To calculate the index we used the following formula:

ISP score = (Occupation score x 3) + (Education score x 3) + (Income score x 4)

Table 2: Income Scale (Weight of 4)

Score Description

1 Income < 20,000

2 21,000 - 350000

3 36000 -50 000

4 51000 - 70000

5 71000 - 100000

6 > 100000

Table 3: Occupation Scale (Weight of 3)

Score Description

1 Unemployed or Housewives

2Service class

3Middle Managers

4Self Employed

5Big Entrepreneur

Table 4: Education Scale (Weight of 3)

Score Description

110

thpass

212

thpass

3Graduate

4Post-Graduate


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Table 5: Classification System

Social

Strata

Range of Score Number of respondents

Upper Class 51 - 35 9

Middle Class18 - 34

65

Lower Class0 - 17

26

RESEARCH RESULT

The results obtained by processing of data collected in the survey are as follows

Table 6: While purchasing clothes, I Give more importance to brands or Status rather than price

CATEGORY LOWER CLASS MIDDLE CLASS UPPER CLASSNUMBER %AGE NUMBER %AGE NUMBER %AGE

DISAGREE OR STONG.DISAGREE

4 44.44444 33 50.76923 12 46.15385

NEUTRAL 1 11.11111 6 9.230769 1 3.846154

AGEE OR STRONGLYAGRE

4 44.44444 26 40 13 50

According to the result of the survey, 50% of respondents agree that they give more importance

to brands or status while purchasing clothes. This result is significant because this stratum of

society can pay more for better services or brands. These are oriented towards money for value.On the other hand, 40% of middle class respondent agree that for them brands are more

important. This is because this stratum of people always aspires to be rich and hence imitate the

rich class people.

Table 7: I always consider quality of clothes rather than status while taking purchase decision

CATEGORY LOWER CLASS MIDDLE CLASS UPPER CLASS

NUMBER %AGE NUMBER %AGE NUMBER %AGE

DISAGREE OR STONG.DIS

1 11.11111 10 15.38462 6 23.07692

NEUTRAL 1 11.11111 3 4.615385 4 15.38462


7 77.77778 52 80 16 61.53846

According to the result, 77% of the lower class and 80% of the middle class agree that they

consider quality on status which purchasing clothes. This is because these strata of society are


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cash constrained benefit maximizer or Cost benefit optimizer and they believe in value for

money. They do not waste their money on brands.

Table 8: I try to wear elite class atires and choose expensive and famous brands


NUMBER %AGE NUMBER %AGE NUMBER %AGEDISAGREE OR STONG.DIS

8 88.88889 40 61.53846 13 50

NEUTRAL 1 11.11111 8 12.30769 5 19.23077


0 0 17 26.15385 8 30.76923

The result shows that 30% of upper class and 26% of middle class agree to wear elite and

expensive brand. But on the other hand all most half of the upper class respondents disagree to

wear elite and famous brands. Hence it can be referred that most of the upper class people do not

take purchase decision only on the basis of status.

Table 9: I usually purchase gold for investment purpose and not as an ornament to wear




7 77.77778 29 44.61538 13 50

NEUTRAL 1 11.11111 14 21.53846 5 19.23077


1 11.11111 24 36.92308 8 30.76923

Usually destitute and climbers do not purchase gold and aspirants purchase gold either on

occasion or as an investment purpose. Gold is always considered to be a Veblen good (luxurious

product). But according to the research 77% of lower class respondents disagree that they

purchase gold for investment purpose.

Table 10: While purchasing perfumes, I gave more importance to the brand




2 22.22222 24 36.92308 7 26.92308

NEUTRAL 3 33.33333 4 6.153846 6 23.07692


4 44.44444 37 56.92308 13 50


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Usually elite class people buy branded perfumes and consuming class cannot afford to buy

premium brands perfumes. But according to the results, 56% of the middle class agree to buy

premium brand perfumes as compared to 50% of upper class. This is because of two reasons:

1) Superior product that usually comes with high end premium price tag, is now available at

discount segment prices*

2) Rich consumers are opting to buy popular products and not premium category product.*

Table 11: I usually shop from speciality stores




5 55.55556 22 33.84615 13 50

NEUTRAL 2 22.22222 15 23.07692 6 23.07692


2 22.22222 28 43.07692 7 26.92308

Specialty stores are small stores which specialize in a specific range of merchandise and related

items. Most stores have an extensive depth of stock in the item that they specify in and provide

high levels of service and expertise. The pricing policy is generally in the medium to high range.

Hence elite consumers usually shop from speciality store. But according to the results, 43%

middle class consumers agree to shop from speciality stores as compared to 26% of upper class

consumers.

Table 12: I fequently visit exhibitions, museums and art galleries




6 66.66667 35 53.84615 14 53.84615

NEUTRAL 2 22.22222 13 20 6 23.07692


1 11.11111 17 26.15385 6 23.07692

According to the results, 26% of the middle class respondents agree to visit exhibition, museums

and art gallery as compared to 26% of upper class respondents. Visiting of exhibition by lower

class respondents are very less (11%).


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Table 13: I prefer to do my shopping from discount stores




2 22.22222 12 18.46154 9 34.61538

NEUTRAL 1 11.11111 11 16.92308 7 26.92308AGEE OR STRONGLYAGRE

6 66.66667 42 64.61538 10 38.46154

Usually aspirants and climbers shop from discount store because they are considered as value

optimizers or cost benefit optimizers. According to the survey, 66.6% of lower class consumers

agree to shop from discount stores. 64% of middle class consumers agree to shop from discount

stores. But strangely 22% of lower income group disagree to shop from discount store.

Table 14: I frequently visit clubs for recreation and relaxation




5 55.55556 37 56.92308 13 50

NEUTRAL 3 33.33333 4 6.153846 7 26.92308


1 11.11111 24 36.92308 7 26.92308

Earlier, a decade ago only elite class people frequently visit clubs for recreation and rich

consumer can only afford to pay for the membership of the clubs. With the increase in the

economy and standard of living even middle income group started visiting clubs, discotheque

etc. According to the result, 36% of middle class respondents visit clubs for recreation as

compared to 26% of the upper class consumers. This shows that middle class consumers have

started imitating the upper class consuming pattern.

Table 15: I wear watches for style, elegance and status rather than for seeing time




3 33.33333 28 43.07692 15 57.69231

NEUTRAL 2 22.22222 15 23.07692 4 15.38462


4 44.44444 22 33.84615 7 26.92308


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According to the results, 44% of the lower class respondents agree to wear watches for elegance

and style. This is a strange fact that merely 26% of rich consumers wear watches for elegance.

Table 16: When furnishing a house I would pay more attention to furniture design




1 11.11111 11 16.92308 2 7.692308

NEUTRAL 3 33.33333 8 12.30769 1 3.846154


5 55.55556 46 70.76923 23 88.46154

The greatest attention to furniture design is paid by the upper class respondents (88%). Middle

class consumers do pay attention on furniture design while furnishing the house (70%). The only

possible reason is that with the increase in the economic growth the middle class people can

purchase those items which they were unable to buy earlier.

HYPOTHESIS

Impact on the Basis of Income

Income of the family combined with family's accumulated wealth determines the purchasing

power (Hawkins et al 2003). However, income enables purchases but does not generally cause or

explain them. It is likely that the occupation and education directly influence the preferences for

products, media and activities; income provides the means to acquire them (Mulhern et al 1998).

Jain and Sharma (2002) and Slama and Taschian (1985) identified that income influences the

involvement levels. Hence, the hypothesis as follows

H01: There is no significant difference among different income groups on consumer buying

Impact on the basis of education

Education is one of the widely applied cues to evaluate an individual (Hawkins et al 2003). It is

strongly related to occupation and income. Various studies have found differences in

consumption of products with differences in the Educations. Jain and Sharma (2002) could

gather a minimal support for the argument that consumer involvement differs for differences in

consumers' Education. However, it may be speculated that the differences in the involvement

levels of consumer would be influenced by different Educations


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H02: There is no significant difference among different education groups on consumer buying

Impact on the basis of Occupation

Occupation is one of the widely applied cues to evaluate an individual (Hawkins et al 2003). It is

strongly related to education and income. Various studies have found differences in consumption

of products with differences in the occupations. Jain and Sharma (2002) could gather a minimal

support for the argument that consumer involvement differs for differences in consumers'

occupation. However, it may be speculated that the differences in the involvement levels of

consumer would be influenced by different occupations. Hence, the sixth hypothesis is stated as:

H03: Consumer buying behavior of product would not differ with different occupations.

H04: Consumer buying behavior of product would not differ with different social class

Randomized Blocked Design Hypothesis

H05: Given that income is blocked, there is no significant difference of the mean rating of

respondents on education.

H06: Given that education is blocked, there is no significant difference of the mean rating of

respondents on Occupation.

H07: Given that Occupation is blocked, there is no significant difference of the mean rating of

respondents on income.

RESULTS

TABLE 2: Showing the results of all the hypothesis

HYPOTHESIS F Sig. RESULT

H1No significant difference among different income

groups in consumer buying behavior 0.429 .295 Not Significant

H2

No significant difference among differenteducation groups in consumer buying behavior 0.773 0.512 Not Significant

H3

No significant difference among different

occupation groups in consumer buying behavior 0.429 0.788 Not Significant

H4No significant difference among different social

class groups consumer buying behavior 0.019 0.362 Not Significant


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H5No significant difference among different

education groups , given that income is blocked 0.614 0.763 Not Significant

H6

No significant difference among different

occupation groups , given that education is blocked 0.508 0.730 Not SignificantH7

No significant difference between income group,

given that occupation is blocked 0.653 0.760 Not SignificantNote: the optimal level of accepting null hypothesis is p < 0.05 at 95% confidence level

FINDINGS

The main objective of this study was to find out the relationship between social class and

consumer buying behavior. We need to know whether social structure of India affects the

consumer buying or not. In order to achieve the object we prepared a questionnaire consist of 20

questions on the basis of various attributes like buying pattern of consumers for food, clothing,

housing, luxurious ornament and leisure services. We analyzed the data and used some statistical

tools like one way ANOVA, Randomized Block Design, etc. The finding are :

There is no significant difference among different income groups in consumer buying. Since the

F test is 0.429 which is more than 0.05 at 95% confidence level, hence income does not affect

the consumer buying. Another finding is that there is no significant difference between the mean

rating of respondents on education group. It is referred that the level of education does not affect

the consumer buying. Since the F Test is 0.773 which is more than 0.005 at 95% confidence

level it can be referred that the preference of consumer does not change whether the consumer is

post graduate or graduate.

Another finding is that there is no significant difference among different occupation groups in

consumer buying behavior. Since the F test is 0.429 which is greater than 0.005 at 95%

confidence level, hence it can be referred that the preference of consumers does not change with

the change in occupation level.

One of the finding can also be that the preference of consumers do not change with the change in

social class. Since the F test is greater than 0.05 at 95% confidence level, it is referred that there

is no significant difference among different social group on consumer buying.


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We also used randomized block design to find out the effect of education, income and

occupation on consumer behavior if one of the variables gets blocked. So we found that there is

no significant different among different education group given that the income group is blocked.

And it was also found that there is no significant difference among different occupation group on

consumers given that education group is blocked. We found this because the F test is 0.508

which is greater than 0.05 at 95% confidence level.

Hence it can be stated that social class is not the only determinant that affect the consumers

buying behavior. There can be other factors that affect the buying behavior of consumers. The

Cronbach alpha for the five point Likert scale measuring the effect of social class on consumer

buying is 0.59. Cronbach Alpha measures the reliability of the test and if Cronbach Alpha is

more that 0.6 then the test is said to be reliable. Our research is almost reliable.

SUMMARY WITH REFERENCE TO SIMILARITIES AND DISSIMILARITIES

The objective of the study was to know the effect of social class on consumer behavior. It was

found that there is no significant difference among various social groups on consumer buying

behavior. A similar study was done by Mirela Mihi in his study on Consumers' social class as

the starting point for creation of enterprise marketing strategy. His study states that Preferences

of respondents - members of different social classes and their buying behavior is significantly

different in particular product categories. There are some dissimilarity in both the research study.

The study conducted by Mirela Mihi states that upper class respondents frequently visits the

exhibitions and clubs and middle class consumer rarely visit the exhibition for recreation. But

our study states that 36% of middle class respondents visit clubs for recreation as compared to

26% of the upper class consumers. Another dissimilarity was that according to Mirela Mihi

study on consumer social class 70% of rich consumers wear watches for elegance and status. On

the other hand our research states that 44% of the lower class respondents agree to wear watches

for elegance.

One of the similarity in both the article that both the article agree that upper class pay greater

attention on furnishing a house. The greatest attention to furniture design is paid by the upper

class respondents.


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FUTURE IMPLICATION

As the economic growth occurs, the destitute will transform into aspirants and enter the

consumption arena, creating an automatic volume growth for several categories. The middle

class consumer would transform into the upper class group as according to the research the

middle class is already imitating the buying pattern of the upper class.

As the aspirants become climber, they fuel volume growth by consuming greater quantities of

products than they did earlier.

Climber would also contribute to the volume and value through occasional use of luxury or

indulgence items. This is the reason that in this study lower class and middle class respondents to

wear watches for elegance and buy gold for status not for investment purpose.

In future consuming class grows with their quest for better value drive value growth. They would

transform into rich consumers. And rich class would also buy popular brands rather than buying

elite brands.

LIMITATION

The finding suffered from some limitations. One of the limitation was that majority of selected

sample was between the age group 20-40. We post the questionnaire oon the internet and

requested people to fill out the questionnaire. So our sample frame confined to the students of

NIILM and young executives who possess similar age group, Education Qualification. Another

limitation was the Response bias. Many of the respondents gave inaccurate answers. There was

some Inability error i.e. Respondent were unable to provide accurate answers because on

unfamiliarity, fatigue, question content, question format.

CONCLUSION

In a nut shell it is being concluded that the preference of consumer are not influenced by the

social structure. There is no significant difference among various social group on consumer

buying.

It is concluded that middle and lower class consider more on quality rather status while

purchasing clothes. This is because these strata of society are cash constrained benefit maximizer

or Cost benefit optimizer and they believe in value for money. They do not waste their money on

brands. It is also concluded that middle class people usually buy luxurious items in order to be


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more ostensive. According to the research it is stated that lower class respondent do not purchase

gold for investment purpose but for some other purpose and it is also stated that lower class

respondents usually wear watches for elegance and style. This shows that lower class people

always wanted to be as an upper class and strive to be in the top of the pyramid

Nowadays middle class people are starting imitating the buying behavior of rich consumers. This

is the reason that middle class consumers are shopping more in speciality stores rather than

discount stores. The middle class consumers are also buying Veblen goods for status and style.

And upper class is become more inclined to buy high end popular brands rather than premium

brands especially in FMCG sector. This is because of the fact that superior styling that comes

with high end price is now available at discount segment.

There is a trend of down trading by the customers (elite). Many have suggested that this is a

nature of India consumers. But it is not the consumer who has down traded but the suppliers who

have up traded. There is a shift in consumer choice affected by change in related categories,

which marketer chooses not to buy. Lower middle class consumers are buying high end popular

priced brands and product like anti aging cream and other specific soaps. On the hand, the rich

consumers are happy to settle for basic toilet soaps. This is happening because the quality of the

popular products has risen to an acceptable level. Now rich consumers also go for quality.


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Bibliography

Bourdieu. (1984). A social critique of the judgment of taste.New York.

Bourdieu. (n.d.). Modes of Thought That Vary Systematically with Both.

Coleman, R. P. (1983). The continuing significance of social class to marketing. Journal Of

Consumer Research , 265-280.

D. Hendon, E. W. (1988). Social class system revisited.Journal of Business Research , 268-289.

Dass, E. (1997). A preliminary examination of the continuing significance of social. Journal of

Consumer Behavior, 463-479.

Fisher, J. E. (1987). 'Social Class and Consumer Behavior: The Relevance of. Advance

Consumer Research , 492- 496.

Halsey, J. K. (1987). Power and ideology in education. Oxford University Press .

Henry, P. (2000). Modes of Thought That Vary Systematically with Both. University of New

South Wales , 421-440.

Henry, P. (2002). Systematic variation in purchase orientations across social. Journal of

Consumer Behavior, 424-438.

Marshall, J. H. (1992). The promising future of class analysis. A response to recent critique ,

381-400.

Mihic, M. (2005). 'Systematic variation in purchase orientations across social. 6th International

Conference on Enterprise Development.

Slocum, J. J. (n.d.). Social Class or Income.

Tomlinson, M. W. (1995). Social Class And Consumer Eating.Food Eating Journal, 3 -7.


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W.H, C. (1972). Social Class and Income as an indicator of Consumer Credit Behavior. Journal

of Marketing, 67-68.

Williams, C. (2001). A preliminary examination of the continuing significance of social.journal

of Marketing.

Williams, T. (2002). Social class influences on purchase evaluation criteria. Journal of

Consumer Marketing.


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ANNEXURE

QUESTIONAIRE

Please rate the following questionnaire

Strongly

Disagree Disagree

Neither

Agree

nor

Disagree AgreeStrong

Agree

1

While purchasing clothes, I Give more importance to

brands or Status rather than price

2

I always consider quality of clothes rather than

status while taking purchase decision

3 I am loyal to reasonable priced quality brands

4

I follow fashion trends and ussualy wear designer

clothes

5

I try to wear elite class atires and choose expensive

and famous brands

6

I usually purchase gold for investment purpose and

not as an ornament to wear

7

While purchasing perfumes, I gave more importance

to the brand

8 I usually shop from speciality stores

9 I watch movies only on multiplexes

10

When furnishing a house I would pay more

attention to furniture design

11

I fequently visit exhibitions, meusiums and art

galleries

12

While buying a house, I would pay more attention

to the Society (elite) in which the house is located

rather than the look and features of the house.

13 I prefer to do my shopping from discount stores


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14

While Purchase footwears, I give more importance

to the quality, price and features of the Footwear

rather than brands

15 I frequently visit clubs for recreation and relaxation

16 I visit restaurant only on a particular occasion

17

During my Summer Holidays, I prefer to stay at

home

18

I wear watches for style, elegance and status rather

than for seeing time

19

Whenever I travel outstation, I prefer to stay in 5

star hotels rather than staying at my friend's/

relative's place

20

I prefer to eat in a Restaurant or Hotel rather than

eating from a Dhaba

Name

Age

Household Monthly Income

Education

Occupation

Phone No.


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RESULTS

Reliability

Reliability Statistics

Cronbach's Alpha N of Items

.577 20

ONEWAY AVERAGE BY INCOME /MISSING ANALYSIS.

ANOVA

AVERAGE

Sum of Squares df Mean Square F Sig.

Between Groups .921 5 .184 1.244 .295

Within Groups 13.920 94 .148

Total 14.841 99

ONEWAY AVERAGE BY EDUCATION /MISSING ANALYSIS.

ANOVA

AVERAGE


Between Groups .263 4 .066 .429 .788


Total 14.841 99

ONEWAY AVERAGE BY OCCUPATION /MISSING ANALYSIS.


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ANOVA

AVERAGE


Between Groups .263 4 .066 .429 .788


Total 14.841 99

Univariate Analysis of Variance

Between-Subjects Factors

Value Label N

INCOME 1.00 < 20,000 p.m 13

2.00 20000-35000 24

3.00 36000-50000 26

4.00 51000-70000 19

5.00 71000-100000 p.m 3

6.00 Above 100000 p.m 15

AGE 1.00 < 20 yrs 7

2.00 20 - 40 yrs 69

3.00 > 40 yrs 24


Value Label N

INCOME 1.00 < 20,000 p.m 13

2.00 20000-35000 24

3.00 36000-50000 26

4.00 51000-70000 19

5.00 71000-100000 p.m 3

6.00 Above 100000 p.m 15

AGE 1.00 < 20 yrs 7

2.00 20 - 40 yrs 69

3.00 > 40 yrs 24


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Value Label N

INCOME 1.00 < 20,000 p.m 13

2.00 20000-35000 243.00 36000-50000 26

4.00 51000-70000 19

5.00 71000-100000 p.m 3

6.00 Above 100000 p.m 15

AGE 1.00 < 20 yrs 7

2.00 20 - 40 yrs 69

3.00 > 40 yrs 24

Univariate Analysis of Variance


Value Label N

INCOME 1.00 < 20,000 p.m 13

2.00 20000-35000 24

3.00 36000-50000 26

4.00 51000-70000 19

5.00 71000-100000 p.m 3

6.00 Above 100000 p.m 15

EDUCATION 1.00 10tH passed 2

2.00 12th passed 6

3.00 Graduate 55

4.00 Post Graduate 37


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Tests of Between-Subjects Effects

Dependent Variable:AVERAGE

Source Type III Sum of

Squares

df Mean Square F Sig.

Intercept Hypothesis 27.988 1 27.988 189.376 .000

Error 12.709 85.993 .148a

AGE Hypothesis .080 1 .080 .515 .475

Error 12.762 82 .156b

INCOME Hypothesis .624 5 .125 1.182 .367

Error 1.462 13.854 .106c

EDUCATION Hypothesis .182 3 .061 .497 .687

Error 4.443 36.333 .122d

INCOME * EDUCATION Hypothesis .765 8 .096 .614 .763

Error 12.762 82 .156b

a. .077 MS(EDUCATION) + .010 MS(INCOME * EDUCATION) + .914 MS(Error)

b. MS(Error)

c. .835 MS(INCOME * EDUCATION) + .165 MS(Error)

d. .556 MS(INCOME * EDUCATION) + .444 MS(Error)


Value Label N

INCOME 1.00 < 20,000 p.m 13

2.00 20000-35000 24

3.00 36000-50000 26

4.00 51000-70000 19

5.00 71000-100000 p.m 3

6.00 Above 100000 p.m 15

OCCUPATION 1.00 Unemployed or Housewives 51

2.00 service class (clerical) 13

3.00 middle manager (financial

analyst, teacher, lecturer, etc)

21

4.00 self employeed 8

5.00 top executive or big enterpreneur 7


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Tests of Between-Subjects Effects

Dependent Variable:AVERAGE

Source Type III Sum of

Squares

df Mean Square F Sig.

Intercept Hypothesis 20.946 1 20.946 141.079 .000

Error 11.651 78.477 .148a

EDUCATION Hypothesis .198 1 .198 1.283 .261

Error 11.727 76 .154b

INCOME Hypothesis 1.363 5 .273 1.982 .121

Error 3.042 22.121 .138c

OCCUPATION Hypothesis .188 4 .047 .336 .852

Error 4.442 31.660 .140d

INCOME * OCCUPATION Hypothesis 1.728 13 .133 .862 .595

Error 11.727 76 .154b

a. .054 MS(OCCUPATION) + .002 MS(INCOME * OCCUPATION) + .944 MS(Error)

b. MS(Error)

c. .786 MS(INCOME * OCCUPATION) + .214 MS(Error)

d. .656 MS(INCOME * OCCUPATION) + .344 MS(Error)


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CHAPTERCHAPTERCHAPTERCHAPTER ----2222

ANALYSISANALYSISANALYSISANALYSIS

ONONONON

INTERVIEW WITHINTERVIEW WITHINTERVIEW WITHINTERVIEW WITH

MARKTING MANAGERMARKTING MANAGERMARKTING MANAGERMARKTING MANAGER


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INTERVIEW WITH MARKETING MANAGER

Manager: Supriyo Sarkar

Company: Targray India Private Ltd.

Tel: 91 124 4554 100 Ext. 323

1.What are the special characteristics of Indian consumers?

Most of them are price sensitive; they would always favour a brand with a discountedprice to the MRP. Whenever you give a big discount on a MRP (even if the intrinsic

value is not worth the MRP), the customer would try to lap it up thinking that they aregetting a good brand at a discount and the feeling of bringing home a product at a much

lesser price to MRP gives them a high.

2.How important is the understanding of consumer behavior?

Very important; time is the essence. A prospect doesnt give much time to a seller. Inwhatever less time a seller gets, he should identify vibes that the prospect emanates so

that he hits the bulls eye. Understanding the current state of mind and psyche of theconsumer is utmost important. While doing so, beware that you are not the only one who

offers the product that is being sought by the prospect. So be a realist and dont over

charge.

3.Do you find the relevance of learning the theories of consumer behavior?

Bookish knowledge doesnt help much as much as basic intelligence. The application ofthe theory is more important than to memorize the concepts. The concepts are just ABCthat you use to coin words. Its up to you on how effectively you make a word out of

those alphabets that is apt for a situation.

4.What factors do you consider the most important when attempting to influence consumer

behavior?

a. The knowledge of the marketer (sales person)

b. How polished and well behaved the salesman is (polished doesnt mean blurting out

English in Americanized twang. That is show-off. Please try to refrain from aping

others. Be yourself.

c. Understand what exactly the customer wants. Understand how much time the

customer is willing to devote to buy a product. It could be a fact that the customer is

just surveying; if so, please help him with the requisite knowledge without expecting

a sale at that moment. Please note that if you help him with the requisite knowledge,

he just might come back to you to buy it finally even after a month.

5. What are the biggest challenges a Marketing Manager faces today?


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a. Unorganized markets.

b. Fake imitations.

c. Unethical marketers (fly-by-night operators who dont intend to stick to a specific

trade for long but who tarnishes the market scope and potential by diluting the value)

d. Uneducated customers

6. How consumer behavior differs from one product range to other?

It all depends on attachment. A man who buys a shirt for himself would be mor cautiousand would give his heart more to buy the product than to buy a shirt for his servant whoneeds to be bought in shirts as well. It all depends on the money spent as well. The more

money spent, the more detailed a consumer research happens.

7. How can one identify the marketing (branding, promotion) strategy for particular segment or

area? This question is beyond the scope& relams of the space allocated. STP (segmentation-

targeting-positioning) should be the basis to start off with. Branding is all related to a product offering. A branding in apparel brand is more important than branding in an

industrial product wherein the functionality would build a brand eventually. In the case

of apparel, its not that much related to functionality. Its more related to the hype andhoopla associated with the brand.

8.Is marketing promotion gets affected by competitors strategy?

Yes indeed, if the marketing and promotion by competitor underlines offering somethingextra at the same price This extra can be in terms of savings in price, increase in

functionality, etc.

9. Is your company or product has seen any major change in last 5 yrs.? If yes then what?

I have been around for 3 years. Yes, as the PLC (product life cycle) gets matured, our

products loses the competitive edge thus diluting the margins and prices eventually.

More entries of competition worsens the situation. Earlier we were everything to

everyone. Now we are something to some ones.

10. How does the social class influence the consumer?

It influences much depending on the type of product he buys in. Considering the productline that we deal in, it doesnt as they are mainly related to industrial selling.

11.Does the consumer behavior change? Have you noticed any change in Indian Consumers?

In my industry, consumer behavior changes with time and age and of course when anoffering is made with something EXTRA at same price. But generically speaking, abehavior changes always with time and age. A man in his 20s wont like the same brand

of shirt when he is in his 40s.


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12.How are the companies adapting to the change? Companies are changing with change in taste of the end consumer. The ones who are

rigid are downing shutters for sure. Companies are trying to identify values that are

unthinkable and unheard off in the currnt context of things. Companies are trying to

build in values in their offerings. Lets take the classic case of Micromax mobiles. Theyare offering features that Nokia, Samsumg couldnt have dreamt so far like month-long

batter, universal remote, gaming console, etc.

13.Your suggestions on how the learning of consumer behavior be made more effective.

Read the texts and try to use the fundamentals in current situations. Honestly the idea of

holding mock sessions of trying to sell combs to bald men etc still go a long way inmaking a seasoned marketer. Try to understand people and make new friends every day.

The more friends you make, the more you delve deep into their psyches. Happy selling.

After having the interview with the Product Development & Regional Sales Manager of

TARGRAY Corporation, the following conclusions can be drawn:-

Indian consumers are price sensitive. They are attracted the most for shopping when they are

provided with discounts. Thus, they feel good in bringing home the products at a lesser price.

It is very important for the sales person to understand the needs of the customer to serve him

better. The former should understand the customer and serve the latter in a way that is acceptable

by him. It is so because in this competitive world, the number of players in the market is large.

Moreover, the more one learns through the practical experience, the better it is. It is said that the

theoretical concepts of marketing should be applied in real life to get the maximum exposure.

From the point of view of marketer, it is very important for him to understand what the customer

wants. He should not focus on pitching in the customer for sales only. It might be possible thatthe customer has come for window-shopping only and if the marketer focuses on sales, it would

result in bad word-of-mouth promotion.

It is consumers psyche to spend more time on products on which they are spending a huge

amount and vice-versa. It is so because the customers want a value for the money spent.


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It is also seen that consumers are attracted towards those market players that offer a wide range

of discounts. Moreover, the way of promoting the brand also influences the consumers. But to

top the list, brand positioning plays a vital role in pitching in the customers for sales.

In the product life cycle stage, it has been seen that product looses competitive edge on reaching

the maturing stage. This is the phase where the new competitors enter the market and fully

exploit it to establish them, thereby having a firm position in the scenario.

Consumer behavior depends on type of product that is being bought by the consumer. Moreover,

there has been seen a significant change in the behavior of the consumer with his passing age. As

the age of the consumer increases, his taste and preferences for the products and services also

changes.

Before affixing the concluding dot, it can be said that it is very expedient for the marketers tounderstand the behavior of customers in an efficient way in order to serve them better thereby

satiating their wants and desires.


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CHAPTERCHAPTERCHAPTERCHAPTER ---- 3333

CASECASECASECASE ANALYSISANALYSISANALYSISANALYSIS

ONONONON

THE UNINSUREDTHE UNINSUREDTHE UNINSUREDTHE UNINSURED


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Case Study: The UninsuredTrue Stories of Unnecessary Sickness, Death and Humiliation

Summary

The given case The Uninsured by Howard Bell appeared in The New Physician magazine

September 2000 issue and all the data present pertains to findings till that year. The case clearly

reflects the impact of social class on financial service like insurance. The true incidents are

discussed by Dr. Debra Richter, Dr. Rudy Mueller and Dr. Bob Lebow and the findings are

summarized below.

The given case talks about stories of sickness, deaths and humiliation caused to people in

American scenario. It revolves around people who cannot afford health insurance in spite the fact

that they living in one of the worlds greatest economy. One in six Americans does not have a

health insurance. Diseases like diabetics, cancer, bacterial endocarditic, hypertension involve

heavy medication expenses. Most of the employers do not offer health insurance and a large

group of people belong to the class where they earn too much money to qualify for Medicaid

provided by government. Thus the result is that there are lots and lots of people in need of

medical help but since they cannot afford the expenses, they are destined to suffer and die.

People delay care or avoid care and ration their medicine because they don't have insurance to

pay for it. The case states that there are no differences in urban or rural, minority or white. The

irony of the situation is that United States spends more per capita on health care than any other

nation, yet in fairness and access for all, they rank 54th, along with the island of Fiji, according

to "The World Health Report 2000," a World Health Organization analysis of 191 health

systems.


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Analysis

The case brings about few facts into light which need careful attention:

Forty-five million Americans do not have any kind of health insurance and the number

increases each month.

Social classes of poor earning capacity find it unaffordable to pay premiums for

Insurance.

Social class belonging to old age face the ironic situation of getting the facility of

medical insurance (Medicaid) at an age (65years) where they are already badly damaged.

Emergency rooms, which are not well equipped with insurance of Dialysis,

Chemotherapy and other serious ailments are targeted by economically weak social

classes as basic healthcare facility.

Patience belonging to the economically weak social classes use to feel ashamed to visit a

doctor second time because they use to be in debt since the first time they had gone to the

doctor.

The class termed as working poor suffers the most. Seventy-five percent of them have

full-time jobs or live in a family where at least one person works full time.

More than half are Caucasian and have incomes higher than the federal poverty level.

One in five adults say that they or their family faced collection agencies because theyowed money for medical bills.

Women ages 25-34 are least likely to have insurance.

Individuals moving from welfare to work take low-paying jobs that do not offer health

benefits. And even if they are offered benefits, they often can't afford the premiums.

Children suffer eventually as their parents lose insurance.

Racial and ethnic minorities are much more likely to be uninsured.

Men are dying at an alarming rate since most government health programs and social

services focus on poor women and children.

Most Americans think Medicaid takes care of the poor but Medicaid covers only 41

percent of the poor.

No proper Government Intervention.


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Recommendations:

Increases the amounts of tax charged and provide the facility of free treatment (Medicaid)

from the age of 35.

Rules of mandatory Insurance policy for the employees of the organizations need to be

imposed on employers.

Government of US must start providing medical facility for economically weaker

sections of the society because most of the medical institutions in US are private.

Emergency rooms need to be facilitated with modern days equipment so that it can

provide treatment for serious illness.

There should be a more brief and simplified form of the Medicaid application procedure.

Documents

Social Class CS