"The influence of Reference Groups varies according to the nature of the product and/or service. Reference groups have varied influence on consumers depending upon the type of the product, whether a luxury or a necessity, and whether it used in public and viewed by others or whether it is used in private. Docsity.com Bearden and Etzel have examined the issue from two perspectives, viz., a) the decision to purchase the type of product; and b) the choice of the brand. They conclude that reference group influence varied by 1) the type of product; whether it is a luxury or a necessity; and 2) its visibility; whether it is used in public or private settings or environment (See Figure). According to Bearden and Etzel, reference group influence is strong both for the purchase decision as well as for the brand in case of public luxuries, like expensive carpets, paintings, antiques etc. The consumer does not possess a need for such products, but requires them for social approval and acceptance, and finds these purchases as crucial for avoidance of social embarrassment, and ridicule. Because of the lifestyle and the social class that a consumer belongs to, he is conscious towards the purchase of such products as well as the brands that he buys. Thus, reference groups influence both the consumer's need for the product in general as well as the choice of brand. On the other hand, when in case of products which are public necessities, like a car or a cell phone, reference group influence is weak with respect to the purchase decision, but strong with respect to the choice of the brand. The reference group does not affect the decision to make a purchase as the product is already regarded as one of necessity and will be purchase regardless of what the members of the reference group have to say; the only impact that a reference group can make is with respect to the brand. Source:http://in.docsity.com/en-docs/Consumer_Reference_Groups_-_Consumer_Behavior_-_Solved_Quiz_"
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"Reference group influence is an important concept in consumer behavior. An empirical examination of reference group influence reveals two underlying dimensions: informational and normative components. Results suggest that the role of product conspicuousness in determining consumers' susceptibility to reference group influences depends on whether affective or cognitive buying motives are aroused in purchase decisions. Normative social influence is pronounced when affective buying motives are aroused for conspicuous products. Informational social influence, on the other hand, is dominant when buying motives are cognitive in nature regardless of product conspicuousness. "
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