Question knowledge and ability to cope with the

Question
1

Distinguish
between informational, utilitarian and value-expressive influence. How can such
types of influence impact on consumers` attitude towards car sharing
membership?

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Answer
1

Influence
of social reference groups is one of the many subconscious factors that can
form a consumer behaviour for products used in public settings. This phenomenon
also affects preferences for particular brands, products or services and
influences purchase decisions relating to them. Every marketer strives to tap
the subconscious factors that can help strengthen the brand associations and
drive purchase.

Informational Influence

The
influence which is based on the craving to make informed decisions and optimize
the choice is called informational influence. One would accept an influence
that improves one’s knowledge and ability to cope with the environment. When
consumers lack knowledge regarding a certain product or the experience of
purchasing the item, they may perceive the information and recommendation from
their reference group as credible and thus accept it with a certain degree of
confidence.

Utilitarian Influence

This
influence can be explained by the so-called “compliance process” in which an
individual is willing to satisfy a certain group’s expectation in order to
obtain their praise or to avoid punishment from the group.

Value-Expressive Influence

This
influence may best be explained by the “identification process” in which people
are willing to better express themselves to society in a manner that makes them
appear to be similar to the group they want to belong to. Under this influence,
one may actively follow the group’s beliefs and rules.

 

 

 

Impact
on consumers attitude towards car sharing membership:

Informational Influence: Consumers are
likely to be influenced towards car sharing membership if the information
provided by the company directly or indirectly is perceived as enhancing their
knowledge of the environment. If company provide benefits and facts about using
car sharing membership against owning a personal car, specially its financial
benefits by comparing cost of car sharing service vs cost of owning a car,  consumers will opt for the membership as they
will realize that they are able to perform same function i.e. move from one
place to another in a comfortable car environment without worrying about cost
of ownership. Knowledge of ability to cope with other aspects such as
environmental aspect will help to attract  more consumers, everyone one is conscious in
one way or other about environmental issues. If a company is able to provide
facts that how their service will help consumers in contributing to save
environment, they will feel sense of proud using company’s services.

If
consumers believe it will help them to achieve some goal (save money, save
environment), they will respond and use car sharing services.

Utilitarian Influence: Utilitarian
influence occurs when consumers comply with the expectations of their group
which may be formal or informal group and when they want other group members to
like and accept them. If car sharing company can convince an active member of
such groups to use their services by providing him/her some discount or
referral benefits, slowly other members of the group will also start using
company’s services.

Car
sharing company should target active members of work unions or a person at high
authority in an organization. People working under a person at higher authority
will also start using car sharing services in order to impress him/her, to get
accepted or praised by him/her. This will help company to get more memberships
from same organizations.
A car sharing company can tie up with startup or particular organization, and
this organization provides benefits to employees using car sharing service in
some form, most of the employees will avail for the membership.

 

 

 

Value Expressive Influence:

Consumers
who want to stand out from the crowd, are concerned about the environment and
show that they are socially responsible can use car sharing service to better
express themselves to society.

When
car sharing company sets up their parking area in a particular society, members
of the society will start using the services following other members using it.

Car sharing company can target active social media
vloggers who post content related to their daily life on regular basis and have
huge fan following. If the followers of these socially active people see them
using car sharing membership services they will also start using the services
as it will give them sense of belonging.
Online Marketing often called e-marketing is defined as use of internet
and related digital technologies to achieve marketing objectives.

Above data shows the increase in expenditure on digital
advertising in the US market which tells us that in order to stay relevant in
this competitive world businesses need to go online. This becomes more
important for small businesses like Flexcar as it increases their visibility
and also legitimates itself that company is active. Also, in order to change
the ingrained behavior of consumers and make them realize the advantages of
using the car sharing platform, company needs to connect with the consumers and
it can easily be done through online marketing domains. (Rasool Madni 2014).
With an estimated one in four Americans making at least one purchase a week,
and 70% of social media platform users, interacting with it daily, there are
numerous reasons that being online is not just important but a must for a
company to connect with consumers.(Nicole Leinbach-Reyhle,Forbes 2015).

The above image shows the influence these social media
platforms have on consumer’s buying decision and trust they have on these platforms
and some studies show that many consumers trust online recommendations as much
as they do a peer recommendation.  

One theme that has often received wide attention among
researchers is the factors that influence consumers to shop online. The traditional
framework for analysis of the buyer decision process is a five-step model.
Given the model, the consumer progresses firstly from a state of felt
deprivation (problem recognition), to the search for information on problem solutions.
The information gathered provides the basis for the evaluation of alternatives.
The development and comparison of purchase evaluation criteria result in the
actual decision to buy. Finally, post-purchase behavior is critical in the
marketing perspective, as it eventually affects consumers’ perception of
satisfaction/dissatisfaction with the product/service (Wells et al.2000).This
classic five stage model comprises the essence of consumer behavior under most
contexts. Nevertheless, the management of marketing issues at each stage in the
virtual environment has to be resolved by individual Internet-marketers. And
Tractinsky (2001) proposed a model of attitudes and buying intention towards
Internet purchases in general. The model included several indicators, belonging
to four major categories; the value of the product, the shopping experience,
the quality of service offered by the website and the risk perceptions of
Internet  shopping. Also understanding
the mechanisms of virtual shopping and the behavior of the online consumer is
of top most priority for practitioners in the fast expanding virtual
marketplace.

So Flexcar’s real major consumers are the businesses which
use the social media like LinkedIn, twitter etc. as shown in the above data
Flexcar can focus on the decision making factors of online consumers and also
focus on advertisements which are customized to the specific platforms to gave
the consumers a great experience as it is a very important factor influencing
the consumer’s buying decision and can create a niche market for itself and
boost their sales.

References

https://www.google.com.mt/search?q=consumers+trust+digital+marketing+stats=lnms=isch=X=0ahUKEwiM9qT0_8LXAhVCDMAKHcnIBl4Q_AUICigB=1366=588#imgrc=naFRh5bsEPZLPM:

Chung?Hoon Park, Young?Gul Kim, (2003) “Identifying key factors affecting consumer
purchase behavior in an online shopping context”, International
Journal of Retail & Distribution Management, Vol. 31 Issue: 1,
pp.16-29, https://doi.org/10.1108/09590550310457818

Efthymios Constantinides, (2004) “Influencing the online consumer’s behavior:
the Web experience”, Internet Research,
Vol. 14 Issue: 2, pp.111-126, https://doi.org/10.1108/10662240410530835

SamreenLodhi1 , Maria Shoaib2 “Impact of E-Marketing on
Consumer Behaviour: a Case of Karachi, Pakistan” IOSR Journal of Business and
Management (IOSR-JBM) e-ISSN: 2278-487X, p-ISSN: 2319-7668. Volume 19, Issue 1.
Ver. V (Jan. 2017), PP 90-101 www.iosrjournals.org

Dr. Asir
AjmalBy: Irfan Ghafoor (2011)”Influence of internet marketing on Consumer

behavior in online shopping” http://www.iosrjournals.org/iosr-jbm/papers/Vol19-issue1/Version-5/N19010590101.pdf

Nicole Leinbach-Reyhle(2015) ” The Single
Most Important Reason Why Online Marketing Is More Important Than Ever” https://www.forbes.com/sites/nicoleleinbachreyhle/2015/06/16/the-single-most-important-reason-why-online-marketing-is-more-important-than-ever/#72be32c63bff

 

 

 

We
understand that consumer always evaluates and creates a perception about the
product as well as the brand before buying the product. The consumer behaviour
is greatly influenced by the personality of the product’s actual customers. It
is how the brand is marketed that creates a brand image in the customer’s mind
and if there is a fit between the self-concept of the potential customer and the
way the brand is marketed or the personality of the brand’s customer, then it
leads to positive purchase intention and positive attitude towards the brand by
the customer. Study conducted by Seong-Yeon Park and Eun Mi Lee (2005)
reinforced that the congruence between brand personality and self-image led to
increase in customer satisfaction, customer-brand relationship and brand
loyalty.

If
the company is focusing on targeting the consumers who want to have a car but
cannot afford one, then marketing the car sharing concept in such a way that it
builds a brand image that it is about saving a lot of money and not
compromising on the luxury as well which on the other hand is an expensive
affair, it will be appealing to both the middle-class segment and lower end
segment who tend to maintain a close eye on their expenditure due to limited
money but also wish to have luxuries in their lives. For example, advertisements
showing middle class families using the services for their weekend getaways and
saving money will influence more people to switch from public transport to car
sharing. Also, by collaborating with the different companies  which will in turn pursue their employees to
use the services of the car sharing, the marketers can create a self-image
congruence in the minds of aspiring working professionals for example someone
who is in his final year of studies and is eager to take on the corporate world
will be inclined to use the services of car sharing. This will also create a
competition between employees in the rival companies will want to have the
access to same services.   

According
to the study conducted by Lisa Watson and Mark T. Spence (2007), the emotions
do affect the consumer’s buying behaviour that is in accordance with the
cognitive appraisal theory.

Fig
1 Model showing appraisal theory (source: Lisa Watson and Mark T. Spence
(2007))

In
the case of car ownership, the marketers can attach the ownership of car to
machoism for example Ferrari has a tag line ‘those who dare, truly live’ and
‘We are the competition’, thus creating an aura of heroism around owning a car which
will lead to greater level of attraction among the opposite sex. Also, the
consumer sees himself as belonging to the upper class of the society after
owning the car and feels a lot of pride driving around as he can afford the car
and maintain it. Car ownership can be linked to external motivation where one
feels that after owning the car he has grown in his social stature. As defined
in the big five personality traits theory, someone who is extraverted likes
being social and thus will be more inclined to car ownership rather than car
sharing. For example, by buying a BMW, which is often being promoted as ‘the
ultimate driving machine’, a man will make sure that he is better off than many
people he is socialising with or he can socialize with the upper class of
people owning luxury cars. Whereas someone who possesses of an open personality
according to the big five personality traits theory will be open to new
experiences like car sharing. He will not be under any societal pressure to let
his emotions get influenced and stick to the conventional things.  In case of car ownership past experiences
like large maintenance costs might affect the attitude, people have towards the
car ownership and might want to opt for car sharing rather than buying a second
car. Someone who has an inherent attitude of being efficient and does not gets let
his emotions get affected by what others think of him will prefer concept of
car sharing over the car ownership.

 

In our view point, it is very
difficult to change the ingrained beliefs, but it is still possible to alter
the consumer behaviour. Though the customer behaviour is governed by the
belief-value structure of the consumer as suggested in the study done by Erik Lindberg,
Tommy Gärling, Henry Montgomery (1989), it
is still important to change the behaviour rather than changing the beliefs through
the marketing campaigns carried out to promote the product. The way to push a
new product into the market is to target a specific market through smarter
promotional techniques. Study conducted by Michael L. Rothschild and William C.
Gaidis (1981) suggests that it is important to use the cues which positively
reinforces the idea in customer’s mind and leads to purchase repetition, but
the product should be competitive enough to sustain the expectations in the
long run. By using reinforcers which satisfy the needs which in our case is
travelling from one spot to the other, one can expect to bring about a change
in the consumer behaviour. The same study talks about the promotional tools we
can use to enhance the sales of the services.

By making use of the in-package
coupon promotional tool we can alter the behaviour while making sure the
customer repeats his behaviour while also making sure that the value that the
product is offering is also consumed. In package coupon can also include
referral code which is pioneered by Uber (USA) and Ola (India) in today’s time and
implementing the same cash back system (that is getting a percentage discount
on the next ride) through the smart card that they are already using. Showing
famous celebrities using their services in ad campaigns can be useful to build
an image that upper class also uses the services which will help in removing
the social stigma attached to the car sharing. 

 

References

1.      
Seong-Yeon Park and Eun Mi Lee
(2005),”Congruence Between Brand Personality and Self-Image, and the
Mediating Roles of Satisfaction and Consumer-Brand Relationship on Brand
Loyalty”, in AP – Asia Pacific Advances in Consumer Research Volume 6,
eds. Yong-Uon Ha and Youjae Yi, Duluth, MN : Association for Consumer Research,
Pages: 39-45.

2.     
Lisa
Watson, Mark
T. Spence, (2007) “Causes and consequences of emotions on consumer
behaviour: A review and integrative cognitive appraisal theory”, European
Journal of Marketing, Vol. 41 Issue: 5/6, pp.487-511, https://doi.org/10.1108/03090560710737570

3.      
Lindberg, E., Gärling, T. & Montgomery, H.
Journal of Consumer Policy (1989) 12: 119. https://doi.org/10.1007/BF00412067

4.      
Michael L.
Rothschild and William C. Gaidis (Spring, 1981), “Behavioral Learning Theory:
Its Relevance to Marketing and Promotions”, Journal of Marketing, Vol. 45, No.
2 pp. 70-78, http://www.jstor.org/stable/1251666