Status (luxury) consumption among British and Indian consumers

by Paurav Shukla

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Recently one of my research papers got published in the ‘International Marketing Review’. It focused on comparing the status consumption tendencies of British and Indian consumers. In this post, I shall focus on the findings of this study.

Firstly, let me define what status consumption is and how it affects our behaviour? Researchers define status consumption as the consumers’ behaviour of seeking to purchase goods and services for the status they confer, regardless of consumer’s objective income or social class. Status consumption generally involved high-end expensive luxury products. They are not consumed by most people regularly but only at the social events of importance. Many consumers use such products to satisfy material needs but also the social needs. In simple words, using status consumption many consumers try to impress the significant others who may include their superiors, social connections, or possibly a future spouse. Status consumption is suggested to be increasing the brand value of the consumer too.

While the importance of status consumption is known historically world-over, earlier studies in the domain of status consumption have looked at a single nation and industry context with regard to status consumption. For example, earlier studies have looked at status consumption from the context of clothing in Australia, woman’s cosmetics in the US, automobiles in the US and the UK. However, status consumption does not have such national boundaries and is found to be prevalent across the globe.

Therefore, to observe the similarities and differences relating to status consumption, I conducted a study focusing on the status consumption practices among the British and Indian consumers. The countries were chosen for their historic association, product category association with status consumption and commonalities of brands available. For example, India was a British colony for a long time (more than 3 centuries) and Indians are one the largest ethnic minorities in the present day Britain. Similarly, India happens to have the second largest English speaking population across the world. While both countries share great economic and cultural ties, they are significantly different from each other on many macro and micro parameters.

The study focused on three important antecedents of status consumption: (a) socio-psychological antecedents; (b) brand antecedents and (c) situational antecedents. The socio-psychological antecedents were further broken into three different categories namely: (a1) social gains; (a2) esteem indication and (a3) ostentation. The brand antecedents were also broken into two categories namely: (b1) management controlled brand features and (b2) market controlled brand features. The figure below represents the model.

Status consumption

Status consumption model

Instead of discussing the methodology and scale equivalence and such other statistical issues, I will now focus on the status consumption tendencies among the British and Indian consumers. If you wish to read more about it, you can surely visit the source provided below or get in touch with me for further details.

It was observed that British consumers utilized status consumption to achieve social gains, indicate esteem and ostentation behaviour. However, in the Indian context consumers engaged in status consumption with mostly ostentation in mind. This demonstrates the differences between Western and Eastern consumers and the impact of culture and markets in their consumption practices. The British consumers, who belong to  individualistic  culture,  focus  on  their  actual  self-concept  (how  the  consumer  views him/herself). However, in comparison with the Indian consumers, from a collectivist culture, focus  on  others  self-concept  (how  a  consumer  thinks  others  see  him/her)  as  they  wish  to signal ostentatious behaviour via status consumption.

With regard to Brand antecedents, it was observed that both, management controlled and market controlled brand features have a significant impact on status consumption. However, British consumers were significantly affected by brand antecedents than the Indian consumers. This can be attributed to the nature of the market and competition. The UK is a highly developed and mature luxury market wherein the masses have been exposed  to  the status (luxury) goods  for  longer  in comparison  to India which opened  its economy  in  the  late 1980s. The longer exposure and higher availability to global brands as well as the higher competition makes the consumer in the UK increasingly aware of the brands and their symbolic association. Impact of these contextual factors make the British consumers use strong brand cues in building social presence.

The findings also suggest that status consumption among Indian consumers is highly dependent on occasions. The result demonstrates the significant differences among collectivist and individualistic consumers and their status consumption practices. Prior research has highlighted that spending money on status consumption in festivities and occasions of importance brings many tangible and intangible rewards in the Indian market include elevated social status for the consumers. However, no such social advantages of occasions exist in the British marketplace. Therefore, in a collectivist society like India, consuming ostentatious products at special occasions can elevate an individual’s intra-group and inter-group social identity and overall presence.

In the next post, I shall focus on the managerial implications of the study findings.

Source: Shukla, Paurav (2010), “Status Consumption in Cross-national Context: Socio-psychological, Brand and Situational Antecedents”, International Marketing Review, 27 (1), forthcoming.

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{ 11 comments… read them below or add one }

Carol January 13, 2010 at 6:07 pm

Enjoyed reading the post. You have developed the point quite well and got interesting conclusion. I however think that calling all British as Individualist and all Indians as collectivists would be a mistake. I may be wrong but what do you think?

Dr. Paurav Shukla January 13, 2010 at 10:29 pm

Very good observation Carol. It certainly would be a mistake to call all British consumers as individualistic and all Indian consumers as collectivist. However, looking at the available research Britain as a market has been defined as an individualistic market and India as collectivist. So, what we can infer is one market tends towards higher levels of individualism in comparison to the other and vice versa.

The other thing I would also mention here is that like a lot of precaution was taken with regard sampling as well as measurement equivalence (Refer to Steenkamp and Baumgartner 1998). Moreover, in the original paper under the limitations the issue you have cited here has been mentioned clearly. Looking at the employment of representative sample and measurement equivalence we can say that the findings provide a higher predictability of consumption practices. I would request you to have a look at the paper and see if you find the rigour employed in developing the paper satisfies you and in turn answers your query further.

Martinn February 6, 2010 at 10:32 pm

yes. no reasearc is perfect. but these imperfections help us learn more. though generalizations has its own problems too. I generally recommend avoiding generalizations. would like to know more about the paper you refer to. Give a full reference please.

Glenda Lennis February 8, 2010 at 8:30 am

The idea you explored is quite practical Paurav. The practical implications are clear that the management can control these factors and improve their brand’s position substantially in consumers minds. Though, the point made on generalizing is quite pertinent. But, after living in SE Asia for a while I can say that most people there are still collective in comparison to the people from western world.

Vy Tran March 8, 2010 at 4:11 pm

Dear Sir,
I intend to conduct a survey as you did for Vietnam in the motorcycle context for my MBA thesis. Would you please help send me the questionnaire that you had built ?
I really need this for reference.
Look forward to hearing from you.
Tks in advance.
An Vy

Lynn Aston March 30, 2010 at 6:00 am

It appears that you’ve put a solid amount of effort into your article and I want to see a lot more of these on the Internet these days. It is hard to find true quality content and yours is par excellence. I do not have a bunch to to say in reply, I only wanted to register to say fantastic work.

Andy Naville April 4, 2010 at 3:43 pm

I can so clearly see us Brits to be brand conscious in comparison to Indians. We are one of the most brand conscious consumerist societies across the world. Where I work in the city, if you are not wearing a high-end brand you cannot be a part of that social club. It’s just so amazing to see that the person is defined by the brand he or she is wearing rather than what he or she is.

Greg April 15, 2010 at 5:15 am

WOW! When I started this post and that expression remains so after finishing reading the whole. Cross-national research in luxury business is unheard of and you have taken that task on is highly commendeable. Keep working on it. Best, Greg

Parag Shah April 17, 2010 at 8:31 am

It is easy to assume that Britishers are more brand conscious however I believe that Indians are no less so. It depends in what part of India r u in. In Mumbai u find global consumers and just 100 miles away in a small village u may find someone who hardly understand brands. So, it depends. I guess it will be hard to generalize here.

jacks June 3, 2010 at 12:42 am

well, wheres the references?

Dr. Paurav Shukla June 5, 2010 at 8:54 pm

Hi Jacks,

It seems you haven’t looked at the bottom of the article where it states my paper published in ‘international marketing review’ from which the excerpts have been taken. Have a look.

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