Group Marketing: Theory, Mechanisms, and Dynamics

Colleen M. Harmeling, Robert W. Palmatier, Eric (Er) Fang, & Dainwen Wang
Article Snapshot
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Group Marketing
Key Takeaways

​What? Technology is enabling customers to organize into groups that have strong effects on purchase decisions.  

So What? Group marketing effectiveness is dependent on a firm's ability to guide a customer's affiliation to the firm's desired group and exposure to the desired group norm.

Now What? Group marketing may be adapted over time to accommodate the changing strength of group influence on information and identity appraisals.

​Article Snapshot: Executive Summaries from the Journal of Marketing

Enabled by technology customers are organizing into groups more than ever before and these groups have strong and pervasive effects on the purchase decisions and behaviors of their members that firm's can strategically guide through group marketing.


Group marketing—the use of the psychological mechanisms underlying group influence to drive behaviors that benefit the firm—appeals to marketers because of the strong and pervasive effects of groups on the decision making and behaviors of their members as well as the ubiquity of grous in modern life.

Strategically disclosing or limiting group relevant information in customer-to-customer communication, marketing communication, or even group member recruitment can guide a customer’s affiliation to the firm’s desired group.


Research Question

Enabled by technology, more and more customers are organizing into groups in ways the increase the firm's ability to identify and access these groups. Groups alter how people make decisions about which products to purchase and in response marketers invest billions of dollars into strategies such as consumer-to-consumer platforms, brand communities, or fan clubs in an attempt to guide this influence. Our research seeks to provide a theoretical foundation for group marketing, identify the factors that determine its effectiveness, and show how it evolves over time.

Methods

Through three studies, we examine the conditions that enable a group to influence purchase behavior. An experiment tests the necessary conditions for group marketing and demonstrates the effect of group affiliation on information and identity appraisals used in purchase decisions. A large scale longitudinal field study of more than 11,000 particpants investigates how these effects change as a person's time in a domain increase. A third longitudinal experiment confirms these effects with customers who have spend an extended time in the purchase domain.

Findings

Across three studies, we identify multiple ways in which a firm can guide a person's affiliation to a group and exposure to group norms to drive purchase behaviors. Group affiliation can be arbitrarily assigned, assumed through self-selected group membership, or primed in marketing communication. Group norms can be communcated by a single group member, inferred from observation of group member's behaviors, or presented through a third-party. Counter to prior research that suggests group influence diminishes over time, when identity appraisal dominates group influence increases over time.

Implications

Our findings suggest that firms can strategically disclose or limit group relevant information to customers at the time of decision making to trigger group processes that influence purchase behavior. These findings are applicable to a wide variety of firms in contexts such as managing customer-to-customer communication, designing marketing communication, and developing firm-managed groups. Firms should also adjust group marketing strategies based on the time a customer has spent in the purchase domain shifting from informational to identity based benefits as time in the domain increases.

Questions for the Classroom

  • How does a customer's group membership influence purchase behavior and how does this change over time?

  • What are the process steps for implementing group marketing strategies?

  • Describe three different group marketing strategies firms can use to guide customer behaviors.


Article Citation: Colleen M. Harmeling, Robert W. Palmatier, Eric (Er) Fang, and Dainwen Wang (2017) Group Marketing: Theory, Mechanisms, and Dynamics. Journal of Marketing: July 2017, Vol. 81, No. 4, pp. 1-24.

doi: https://doi.org/10.1509/jm.15.0495



Author Bio:

 
Colleen M. Harmeling, Robert W. Palmatier, Eric (Er) Fang, & Dainwen Wang
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