Reference Group

Posted in Marketing and Strategy Terms, Total Reads: 940
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Definition: Reference Group

A reference group is the group considered as the datum or standard. It is the preferences or opinions of this group that a person considers while making a judgement.


It may be a consumer who considers the views of the people around him before making a purchase decision. He uses this group to evaluate his own beliefs or choices. A reference group may serve as a positive or a negative standard. Reference groups are of two types – primary and secondary. Primary group includes members with whom the individual interacts frequently and whose views are of importance to him. Family, close friends, colleagues form a part of this group. Secondary group includes members with whom the individual doesn’t interact that frequently and their opinions don’t matter much to him. Distant relatives, shopkeepers, acquaintances, etc form a part of this group.

 

Eg–Suppose while buying a cell phone, an individual considers the opinions of his group of friends. He even takes into account the cell phone models that they have and then finally makes a choice.


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