BUS630: Consumer Behavior

One of the newer and increasingly important set of factors that is being used to understand consumer behaviour is lifestyle. Lifestyle has been generally defined as the attitudes (or attitudes), interests, and opinions (AIOs) of the potential customer. It is widely regarded as means to connecting products offered in the market with targeted lifestyle groups such that a product appeals to the AIOs of the target market. Consumers are not only asked about products they like, where they live, and what their gender is but also about what they do - that is, how they spend their time and what their priorities, values, opinions, and general outlooks on the world are. Where do they go other than work? Who do they like to talk to? What do they talk about? Researchers hired by Procter & Gamble have gone so far as to follow women around for weeks as they shop, run errands, and socialize with one another. Other companies have paid people to keep a daily journal of their activities and routines.

Lifestyle Marketing

In consumer marketing, lifestyle is considered a psychological variable known to influence the buyer decision process for consumers. Lifestyle can be broadly defined as the way a person lives. In sociology, a lifestyle typically reflects an individual's attitudes, values, or world view. A lifestyle is a means of forging a sense of self and to create cultural symbols that resonate with personal identity.

Marketing campaigns to reach and persuade consumers are created with the intention to align the product's position with the target market's lifestyle characteristics. Variables such as consumers' interest in hunting; their attitude toward climate change; and, their deeply held opinion on fair-trade products, can therefore be used to both better understand the market and its behaviour, and position products effectively.

It is the multifaceted aspect of lifestyle research that makes it so useful in consumer analysis. A prominent lifestyle researcher, Joseph T. Plummer, summarizes the concept as follows:

A useful application of the lifestyle concept relates to consumer's shopping orientation. Different customers approach shopping in very different ways. They have different attitudes and opinions about shopping and different levels of interest in shopping. Once people know their alternatives, how do they evaluate and choose among them? In particular, how do people choose among brands of a product?

Psychographic Segmentation

The following is a review of how marketers segment a market based on demographics, geography, behaviour, and psychographic information.

Psychographic segmentation involves profiling a market segment based on a descriptive set of characteristics - such as personality, traits, lifestyle, and values. We also use AIO's - to define a psychographic profile. Most students are familiar with market segmentation as it relates to geographic (specific place-based marketing) and demographic (specific data gathered through secondary research sources relating to age, income, education level, family status, etc.). Psychographic segmentation however, examines consumers in the context of their motivations, their values, their interests, their passions, their lifestyle choices, and even the kind of media they consume. One of the most widely used systems to classify people based on psychographics is the VALS (Values, Attitudes, and Lifestyles) framework. Using VALS to combine psychographics with demographic information such as marital status, education level, and income provide a better understanding of consumers.

The Newest Market Segment You Never Knew Existed: "PANKs"

Professional Aunt, No Kids" is considered a new and attractive market segment.

Consider a relatively new market segment, Professional Aunt, No Kids (or "PANKs" - a term coined by Savvy Auntie founder Melanie Notkin) discussed in a 2018 report by Melanie Notkin, founder of SAVVY AUNTIE. Notkin's research provides ample evidence that PANKs are both a growing and substantial market segment, mainly characterized by a high disposable income with considerably fewer expenses than if they had children of their own.

Demographic and psychographic characteristics of PANKs from the report include:

• In the US, there are 18.4 million PANKs aged 20-50 (roughly equals more than a quarter of all American women in that age group)
• Four in five PANKs are aged 33-52; half are 38-47 years of age
• Significant social and economic influence
• Close relationships with children of friends and/or relatives
• More likely to be college educated (74 per cent); 3 times as likely to have earned a master's degree
• 47 per cent of PANKs own their own home
• Affluent and generous gift-givers (collectively spend $61 billion on children in their lives, a figure that excludes occasional items and newborn gifts)
• 63 per cent have contributed to a niece's or nephew's education

What are PANKs spending money on? Travel is by far the biggest expense, followed by food and beverage, entertainment, toys and games, and apparel. "Adventure" days and big-ticket gifts also amount to large expenditures by loving Aunts.

Notkin segments PANKs further by identifying, "Aunts by Relations" (93 per cent) and "Aunts by Choice" (57 per cent), all of whom rank participation in a child's life of high importance. In 2013, Euromonitor reported that as of 2010, 42.6 per cent of women in the U.S. between 15-44 were childless (up from 40.1 per cent in 2002): while some women are childless by circumstance, many women are holding off having children (or choosing not to at all) until later in life.

Marketers yet to heed Notkin's advice and actively target PANKs are potentially ignoring this large and growing market segment. Her recommendations on how to engage this market includes:

• Recognizing the value of "Generation PANK" as influential women in children's lives
• While they may be secondary caregivers, PANKs are often the primary gift-givers
• Education is a priority for PANKs: these highly educated women are also contributing to their loved one's future educational needs
• Most PANKs want to be moms one day

A wise marketer will recognize both the value and potential in a growing and substantial market segment, even one that may be dismissed, ignored, or not taken seriously by others.

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Source: Andrea Niosi, https://opentextbc.ca/introconsumerbehaviour/chapter/lifestyle-and-psychographics/
This work is licensed under a Creative Commons Attribution 4.0 License.