10.1 Social Stratification and Its Influence on Consumption

Social class shapes consumer behavior in profound ways. From product preferences to shopping habits, it influences what we buy, where we shop, and how we perceive brands. Understanding these patterns helps marketers tailor strategies to different segments.

Social class affects adoption of new products too. Upper classes often have earlier access to innovations and more resources to try them. This can create a "trickle-down" effect as products diffuse from higher to lower classes over time.

Social Stratification and Its Components

Components of social stratification

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• Social stratification hierarchically arranges individuals into divisions of power and wealth within a society based on four key principles:
  • Represents a trait of society, not simply a reflection of individual differences
  • Persists over generations
  • Exists in all societies but varies in degree and configuration (universal but variable)
  • Involves not just inequality but beliefs and ideology
• Social class groups individuals who share similar levels of wealth, income, education, and occupational prestige
  • Categorized as upper class, middle class, working class, lower class
• Status indicates the degree of social honor or prestige an individual or group holds
• Power represents the ability to control or influence others, even if they resist
• Social mobility enables individuals to move up or down the social hierarchy

Social Class and Consumer Behavior

Social class influence on consumption

• Social class shapes consumer preferences and tastes
  • Upper classes prefer more expensive, exclusive, status-signaling products and services (luxury cars, designer fashion)
  • Lower classes prioritize functionality, durability, value for money (generic brands, secondhand goods)
• Social class affects types and quantity of products purchased
  • Higher classes spend more on discretionary and luxury items (international travel, fine dining)
  • Lower classes spend higher proportion of income on necessities (groceries, utilities)
• Social class influences shopping habits and outlets patronized
  • Upper classes more likely to shop in upscale department stores and specialty boutiques (Nordstrom, local artisans)
  • Lower classes more likely to use discount stores and budget retailers (Walmart, thrift shops)
• Social class shapes price sensitivity and deal proneness
  • Higher classes less price sensitive, more focused on quality and service
  • Lower classes more price conscious, responsive to sales promotions and discounts

Social class and brand loyalty

• Social class influences brand awareness, perceptions, and preferences
  • Higher classes more brand conscious and loyal to prestigious, established brands (Rolex, Mercedes-Benz)
  • Lower classes more open to trying new or generic brands, more influenced by price (store brands)
• Social class affects perceived risks and benefits of switching brands
  • Upper classes perceive higher risks in switching from known, trusted brands (social, psychological, financial risks)
  • Lower classes perceive higher benefits from switching to cheaper alternatives (cost savings)
• Social class shapes motives and values driving brand loyalty
  • For upper classes, brand loyalty driven more by emotional and symbolic factors (status, self-identity, social acceptance)
  • For lower classes, brand loyalty driven more by functional and economic factors (reliable quality, value for money)

Social class in product adoption

• Social class affects access to information about new products and innovations
  • Upper classes have more diverse social networks and media consumption habits that provide earlier exposure to new ideas
  • Lower classes may face information gaps and time lags in learning about new products (digital divide)
• Social class influences perceived risks and benefits of adopting innovations
  • Upper classes have more resources to absorb risks and are more open to change (higher education, financial cushion)
  • Lower classes are more risk averse and may wait until new products are established and prices decrease
• Social class shapes symbolic meanings and social acceptability of new products
  • Adoption by upper classes can signal aspirational value and hasten diffusion to lower classes (iPhone, Tesla)
  • Adoption by lower classes only can stigmatize a new product as downmarket and deter upper class uptake
• Rate of new product diffusion often follows a "trickle down" pattern from higher to lower social classes over time
  1. Early adopters tend to be younger, more urban, more educated and affluent
  2. Later adopters tend to be older, more rural, less educated and less affluent