Module 6

Opinion Leadership and

Consumer Behavior

PSY20
Marketing Psychology

to you sixth module!

This module is a combination ofsynchronous

& asynchronous learning
and will last for two weeks

COLLEGE OF ARTS AND

SCIENCES

MS. ALONDRA ARA A. MENA, RPm

Instructor

May, 2022
Date Initiated

May, 2022
Date of Completion

San Mateo Municipal College

Gen. Luna St. Guitnang Bayan I, San Mateo, Rizal
Tel. No. (02) 997-9070 No part of this module may be
www.smmc.edu.ph
reproduced, distributed, or transmitted in
any form or by any means without the
prior permission of the instructor.

MODULE 6 OUTLINE
San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 OPINION LEADERSHIP AND CONSUMER BEHAVIOR
UNIT 1: INTRO TO OPINION LEADERSHIP
UNIT 2: DIFFUSION OF INNOVATION

MODULE DURATION:
I. Two weeks

CONSULTATION HOURS:
If you have any clarifications or queries, you may reach me at my:
Gmail: [email protected] or message me at my messenger account:
Facebook: Alondra Ara Mena
I’ll make a concerted effort to entertain your questions within 24 hours. Provide only one account for regular
basis.

LEARNING OBJECTIVES:
After completing this module, you are expected to:
I. explain the measurement of opinion leadership;
II. analyze and understand the profile of opinion leader;
III. apply the lessons about promotional strategy (if applicable);
IV. demonstrate the roles, skills, and functions of consumer innovators.

COURSE MATERIALS:

Book/E-book:
• Understanding Consumer Behaviour, Rai Technology University 1. Cases in Marketing
Management, Brennan. R, Pitman; 2. Marketing Management: The Millennium Edition,
Kotler.P, Prentice – Hall 3. Consumer Behavior, Schiffman G.L and Kanuk L.L, PrenticeHall 4.
Consumer Behavior, Atul Kr Sharma, Global Vision Publishing House 5. Consumer Behavior,
Raju M.S , Vikas Publishing House Pvt. Ltd.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 UNIT 1 INTRO TO OPINION LEADERSHIP

Introduction to Opinion Leadership

In this lesson we deal with an issue of considerable importance to consumers and marketers alike- the informal influence that others have on consumers’
behaviour and the dynamic processes that impact consumers’ behaviour. We will examine the nature and dynamics of the influence that friends, neighbors, and the
acquaintances have on our-consumer related decisions. This influence is often called word-of-mouth communications or the opinion leadership process. We
also consider the personality and motivations of those who influence, i.e., opinion leaders and those who are influenced, i.e., opinion receivers. We will also bring out
a profile of Opinion leaders and also identify situations where there is overlap of opinion and also the frequency of overlap.

What is Opinion Leadership?

Opinion Leadership is the process by which one person (opinion leader)

informally influences the actions or attitudes of others, who may be opinion
seekers or merely opinion recipients.

The definition of opinion leadership emphasizes on informal influence.

This informal flow of opinion related influence between two or more
people is referred to as word-of-mouth
communication..

Opinion leadership is defined as the process in which one person influences the attitudes or actions of other person informally,
who is the opinion leader. They offer informal advice about the product or service. Opinion leaders are part of the social groups.
They have social communication networks
The most crucial thing for a marketer to understand is the importance of 'opinion leadership' in product and service marketing.
Opinion leadership, often known as word-of-mouth marketing, has a significant personal impact on consumers. Many people
are always available to friends, family, and business Opinion leaders provide advise or information about a product, service,
or how to use a specific product. Personal or face-to-face communication is how word of mouth spreads.
-----
During casual talk, a friend talks about the car he recently bought. He recommends buying it.

2. A person shows a friend photographs of his recent tour abroad. He suggests that by using a particular make of camera, better
pictures could be shot.

3. A family wants to have a swimming pool in their spacious house. The family head asks neighbors which pool construction
company they should call.

4. A parent wants admission for his child in a particular school. He contacts other parents sending their children to the same
school.

Opinion Leader

You would have observed that one of the parties in a word-of mouth encounter usually offers advice or information about aproduct or service, such as
which of several brands is best, or how a particular product may be used. This person is the opinion leader and may become an opinion receiver. Individuals who actively
seek information and advice about products are often called opinion seekers. These opinion leaders are very often a part of the social groups and also have social
communication networks.

The biggest advantage of the informal word -of-mouth communication is that it is informal and interpersonal in nature and this takes place between people who
are not directly associated with the commercial selling source or the firm. Very often, we can see thatthe formal word-of-mouth communication is more influential than
mass advertising in determining which product or brand is bought. The word-of-mouth communication can either be a face-to-face communication or over the
telephone communication.

Opinion leaders are people with expertise or influence in a specific area. Opinion leaders can be used by businesses to build trust with their
customers or grow their sales. Common examples of modern-day opinion leaders include social media "influencers," like Instagram celebrities and
YouTubers.
consumer decision-making has always been affected by opinion leaders. With the advancement of digital technologies
and social media, influencers have assumed the role of worldwide opinion leaders. Influencers are a real-life group of people
who use social media to share their thoughts, ideas, and observations. People sympathize with them because the stuff they
publish is personal to them and reminds them of events they have faced or hope to encounter in the future. Influencers have a
significant impact. This is also reflected by the fact that influencer marketing has emerged as a distinct field within global
marketing.
The practice of studying, identifying, and contacting influential people is known as influencer marketing locating,
assisting, and involving people in high-impact conversations

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 Hedonic- sensational and experiential.
Functional- practical, instrumentalwhereas the latter is sensational and experiential.
Cognitive dissonance- the state of having inconsistent thoughts, beliefs, or attitudes, especially as relating to
behavioral decisions and attitude change.

Fig. 1.1 Benefits of Word-Of-Mouth

Now, usually, in a word-of-mouth situation, we must have one party, which offers advice, or information about a product or service such as which of several brands is
best. This person is the opinion leader. But, this person may become an opinion receiver when another product or service is brought up as part of the discussion. So,
we can say that Individuals who seek information and advice about products sometimes are opinion seekers.
(mean ing to say, opinion leaders can be opinion seekers)

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
Opinion leaders in one product-related setting become opinion receivers in another, even if the products are the same. For example, a new
homeowner considering purchasing a furniture seeks information and suggestions from others on which brand to choose. He may be
satisfied with the furniture after purchasing it (in the post purchase experience). Now he feels encouraged to speak positively about the
purchase to others in order to validate his decision. He is an opinion receiver in the first case and an opinion leader in the second.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
OPINION LEADERS OPINION RECEIVERS

Fig 2.1 Motivations of Opinion Leaders and Opinion Receivers

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 Measurement of Opinion Leadership
What methods or techniques can we use to measure Opinion Leadership?

There are four popular methods to measure opinion leadership:

a) The self-designating method
b) The sociometric method
c) The key informant method
d) The objective method
Let me explain each of the methods in greater details:

In the self-designating method, respondents are asked to evaluate the extent to which they have provided others with information about a product
category or specific brand or have otherwise influenced the purchase decisions of others.

The self-designating technique is used more often than other methods for measuring opinion leadership because consumer researchers find it easy to include in
market research questionnaires. Because this method relies on the respondent’s self-evaluation, however, it may be open to bias.
Here, it is about how the opinion leader influenced the consumption of others. What role did they play in influencing the consumption of others.
Opinion leaders or the respondents are asked a series of questions to determine the degree to which he or she perceives himse lf or herself to be an
opinion leader.
Example question: In what extent do you influence other people in their selection of products?

The sociometric method measures the person-to-person informal communication of consumers concerning products or product categories.

In this method, respondents are asked to identify:

i) The specific individuals (if any) to whom they provided advice or information about the product or brand under study.

ii) The specific individuals (if any) who provided them with advice or information about the product or brand under study.

Individuals designated by the primary respondent are tentatively classified as opinion leaders.
Any intact community provides an opportunity to measure and evaluate the flow of word-of-mouth communications concerning a new product and its subsequent
impact on product trials.
Here, a self-contained population is examined to verify consumer related conversations. Members of a group are asked to identify to whom they give
advice and to whom they go for advice and information about a product category.

Example:
Whom do you ask? Who asks you for information about that product

A key informant is a person who is keenly aware or knowledgeable about the nature of social communications among members of a specific group.

The key informant is asked to identify those individuals in the group who are most likely to be opinion leaders. The key informant does not have to be a
member of the group under study.

This research method is relatively inexpensive, because it requires that only one individual or at most several individuals
be intensively interviewed, whereas the self-designating and sociometric methods require that a consumer sample or entire community be interviewed.

The key informant method, however, is generally not used by marketers because of the difficulties inherent in identifying an individual who can objectively
identify opinion leaders in a relevant consumer group. Instead of studying a sample or whole self-contained community, we can identify a key informant who will name the
opinion leaders in a particular group.

The key informant method would seem to be of greatest potential use in the study of industrial or institutional opinion leadership.

The objective method is much like a “controlled experiment”—it involves placing new products or new product information with selected individuals
and then tracing the resulting “Web” of interpersonal communication concerning the relevant product(s).

it artificially places individuals in a position to act as opinion leaders and measures the results of their efforts (controlled
experiment.

Characteristics of Opinion Leaders

Let us now take a look at the main characteristics of opinion leaders. Some of the main features that all opinion leaders have are:

1. Opinion leaders are perceived to be highly credible sources of product related information. Opinion leaders are persons who are
considered to be knowledgeable. They often voice their opinion based on first hand information.( must be knowledgeable about the product. Disseminates
information. Involved with the product and keep himself updated. Opinion leaders are knowledgeable. Their recommendation on a product or service is regarded
as reliable. Opinion leaders are considered to give advise in the best interests of opinion seekers since they are informal sources of knowledge. Firsthand
knowledge from opinion leaders helps in the reduction of perceived risks. Because the opinion is based on firsthand experience, it effectively addresses the
anxiety associated with buying new things.

2. Opinion leaders are gregarious people and also have a lot of experience: Their experience as a shopper and user sets them apart from
other people. Since most of their advice is based on first hand experience, opinion receivers have a lot of confidence in their advice. Besides, because of their
gregarious nature, people enjoy interacting with them.

Opinion leaders provide both information and expertise. They simply offer their views on a product or service. Their discussion is about
what they know about a product. They advise others to buy or avoid a specific product in their more aggressive conversations. They base
their recommendations on rational arguments.
San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 3. Opinion leaders usually provide unbiased information, that is they provide both favourable and unfavorable information to the
opinion seekers: This adds credibility to them and opinion seekers have faith that they are receiving correct information.
Marketers always give information that is favorable to the products they are promoting. However, opinion leaders are
not always associated with marketers. They provide both positive and negative information on the product. As a result,
opinion seekers trust opinion leaders. They are convinced that they are obtaining accurate positive and negative
information.

4. Opinion leaders are both sources of information and advice.- OFFER AN ADVICE REGARDINF BUYING OR NOT BUYING., THE CHOICE OF
BRAND, USAGE OF PRODUCT, THE PLACE WHERE WE CAN BUY, AND SERVICE LEVEL OF SERVICE PROVIDER.

5. Opinion leaders have got greater exposure to the media, especially in their area of leadership.

6. Opinion leaders tend to be consumer innovators.

7. Opinion leaders have got some personal product specific characteristics like personality traits, social status and demographic
characteristics.

A Profile of Opinion Leaders

Now who can be an opinion leader. So we need to study the profile of the opinion leader so that we can identify them. As you can understand, it would be a very
difficult job to exactly identify a profile for that matter, but we have tried to have a generalized profile as shown in figure 3.1.

Fig. 3.1 Profile of Opinion Leader CATEGORY SPRCIALIST IN

CERTAIN PRODUCT CATEGORIES

INNOVATIVENESS- Tries new products always first, and passes on his experience to others.
Opinion leaders tend to have certain similar personality traits and other personal characteristics such as
social status, demographics and are often linked to the product they which specialize.
Interest and Knowledge- It makes him knowledgeable about the product, and he spreads this
knowledge.
Special Interest Media Exposure- an opinion leader reads the print media and listens to and views the
electronic media much more. He is more tuned to subject specific magazines and commercial programs

Self-confidence- confident about his knowledge and opinion that he has built. Gregarious- sociable.
Same social status- he belongs to the same social class as that of the consumer to engage in the
horizontal interpersonal communication.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 The Interpersonal Flow of Communication

You might have observed that ideas often flow from radio and print media to opinion leaders and from them to the general public. This is the concept behind the two-
step flow of communication. This so-called two-step flow of communication theory portrays opinion leaders as direct receivers of information from impersonal mass-
media sources, which in turn transmit (and interpret) this information to the masses. This theory views the opinion leader as a middleman between the impersonal mass
media and the majority of society. The illustration can be as seen below:

Fig. 4.1 Two Step Flow of Communication

It is proven that an opinion leader is an important link in the transmission of information and
influence. they transmit information provided by mass media in which you have release
information, and influence the opinion/receiver population.

Two steps flow of communications model’s major contribution is its emphasis on social
interaction between people. It is a method of conveying information, whereby, attitudes are
developed and behavior is stimulated.

UNIT 2 DIFFUSION OF INNOVATION

We as consumers always find a new innovation-idea or product or even new service attractive. However, for the firm which is trying its hand at the new
innovation, there is always a question hanging around ‘How fast will the diffusion of the innovation take place?” This is to say that any innovation has got an
element of risk involved.

The firm will introduce a new concept or a new product after an intensive research is carried out by it. Thus we see that the process of diffusion of
innovation is very critical to a firm. In this lesson we will study the concept of diffusion and the process of diffusion in details.

Intro to Diffusion

The first question here is what is diffusion? Thus let us try to define diffusion.

Diffusion is a macro process concerned with the spread of a new product and innovation from its source to the consuming
public.

Adoption is a micro process that focuses on the stages through which an individual consumer passes when deciding to accept or reject a new product.

Diffusion of innovations is the process by which acceptance of an innovation (new products or new service or new idea) is spread by communication (mass
media, sales people, informal conversation) to members of the target market over a period of time.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 Fig. 5.1 Examples of New Products/Service Easily Accepted by Consumers

The Diffusion Process

Now let us try to understand how the diffusion process takes place. The diffusion process –Spreading of an innovation’s acceptanceand use through a population.
Diffusion is the process by which the acceptance of an innovation (a new product, a new service, new

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
idea or new practice) is spread by communication (mass media, salespeople, or informal conversations) to members of a social system (a target market) over a
period of time.

The Four Basic Elements of Innovation Process

The four basic elements of this process are:

1. Innovation

2. The Channels of Communication

3. The Social System

4. Time

1. The Innovation: Various approaches which have been taken to define a new product or a new service include

a. Firm-oriented definitions: A firm oriented approach treats the newness of a product from the perspective of the company producing or marketing
it. When the product is “new” to the firm it is considered to be new.

b. Product oriented definitions: Product-oriented approach focuses on the features inherent in the product itself and on the effects these features are
likely to have on consumers’ established usage patterns.

Three types of product innovations could be:

● Continuous innovation having the least disruptive influence on established patterns involving theintroduction of a modified
product, rather than a totally new product. E.g., latest version of Microsoft Office;

● Dynamically continuous innovation which may involve the creation of a new product or the modification of an existing product
e.g., disposable diapers;

● Discontinuous innovations requiring consumers to adopt new behavior patterns e.g., TV, fax machines

c. Market oriented definitions: Judges the newness of a product in terms of how much exposure consumers have to the new product. The definitions could
be: (a). A product is considered new if it has been purchased by a relatively small (fixed) percentage of the potential market. (b). A product is considered new if it has
been on the market for a relatively short (specified) period of time.

d. Consumer oriented definitions: A new product is any product that a potential consumer judges to be new.

Influence of Product Characteristics on Diffusion

What are the product characteristics that influence diffusion? The most important of them are:

A. Relative Advantage: The degree to which potential customers perceive a new product as superior to existing substitutes is its relative advantage.

B. Compatibility: The degree to which potential consumers feel a new product is consistent with their persistence with their present needs, values,
and practices is a measure of its compatibility.

C. Complexity: The degree to which a new product is difficult to understand or use, affects product acceptance.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 D. Trialability: The degree to which a new product is capable of being on a limited basis.

E. Operability or Communicability: is the ease with which product’s benefits or attributes can be observed, imagined, or described to potential
consumers.

2. The Channels of Communication: How quickly an innovation spreads through a market depends to a great extent on communications between the
marketer and consumers, as well as communication among consumers i.e., word-of-mouth communication. Thus this communication will include two
types of communication:

a. Communication between marketers and consumers

b. Communication among consumers i.e word of mouth.

Consumer information sources fall into four categories:

• Personal sources: Family, friends, neighbors, and acquaintances.

• Commercial sources: sales people, advertising, sales promotion techniques.
• Public sources: Mass media, consumer rating organisations
• Experimental sources: Demonstration, handling samples.

Depending on the innovation or new product, and the prospective customers, the firms try to adopt a cost effective way of communicating with them.

3. The Social System: The diffusion of a new product usually takes place in a social setting frequently referred to as a social system. In our case, the terms market
segment and target segment may be more relevant than the term social system used in diffusion research. A social system is a physical, social, or cultural
environment to which people belong and within which they function. For example, for new hybrid seed rice, the social system might consist of all farmers in a
number of local villages.

The key point to remember is that a social system’s orientation is the climate in which marketers must operate to gain acceptance for their new products.
For example, in recent years, the World has experienced a decline in the demand for red meat.

The growing interest in health and fitness throughout the nation has created a climate in which red meat is considered too high in fat and calorie content. At
the same time, the consumption of chicken and fish has increased, because these foods satisfy the prevailing nutritional values of a great number of consumers.

4. Time: Time pervades the study of diffusion in three distinct but interrelated ways:

a. The amount of purchase time: Purchase time refers to the amount of time that elapses between consumers’ initial awareness of a new
product or service and the point at which they purchase or reject it.

For instance, when the concept of “HomeLand” supermarket was introduced by Asha Chavan in Pune, apart from offering a variety of quality products, it
also gave an unconditional guarantee of replacement or refund, home delivery of all, even single item telephonic orders at no extra cost. And beyond business,
Homeland also offers free services like phone, electricity, credit card and cell phone bill payments.

b. The identification of adopter categories: The concept of adopter categories involves a classification scheme that indicates where a
consumer stands in relation to other consumers in terms of time.

Five Adopter Categories

● Innovators
● Early adopters
● Early majority
● Late majority
● Laggards.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA
 Fig. 6.1 Adopter Categories

REFERENCES

Book/E-book:
o Understanding Consumer Behaviour, Rai Technology University 1. Cases in Marketing Management, Brennan. R, Pitman;
2. Marketing Management: The Millennium Edition, Kotler.P, Prentice – Hall 3. Consumer Behavior, Schiffman G.L and Kanuk L.L, PrenticeHall 4.
Consumer Behavior, Atul Kr Sharma, Global Vision Publishing House 5. Consumer Behavior, Raju M.S , Vikas Publishing House Pvt. Ltd.

San Mateo Municipal College Module 6 / PSY20

College of Arts and Sciences Prepared by: MS. ALONDRA ARA A. MENA