ADMINISTRATIO
Social Influence as a Determinant of Conspicuous Consumption
among the South African Urban Township Youth
Hilda BONGAZANA1
Abstract. The South African urban townships play a significant role in the South African economy.
They contribute 41 percent in total consumer spending. This segment is characterised by a large
spending power with underserviced community needs that marketers are paying less attention to.
Such spending is often a way of displaying status within the community and society. Generally, this
pattern of consumption is observed among the youth, particularly among young urban township
youth. The purpose of this study is to examine social determinants of conspicuous consumption
behaviour among the South African urban township youth. Data were collected among the township
youth of Sebokeng, located in Vanderbijlpark, South Africa. A total of 300 questionnaires were
distributed, of which 238 were usable. The results showed that the township youth seems to buy
prestigious brands to show off to others, to display wealth, and to enhance their public image. The
social and lifestyle implications of the study are also provided.
Keywords: status consumption; social influence; conspicuous consumption; township youth; South
Africa
1. Introduction
Marketers view consumer segments as complex entities constituting multicultural
segments with diverse wants and needs. These differences influence the consumption
behaviour of each segment. For instance, marketers assess consumer consumption
behaviour through the meaning they attach and associate to their possessions
(Prendergast & Wong, 2003; Chernev, Hamilton & Gal, 2011; Mazzocco, Rucker,
Galinsky & Anderson, 2012; Goldsmith, Flynn & Clark, 2012; Dubois, Rucker &
Galinsky, 2012). Thus, such consumption behaviour is communicated through
symbolic meanings and thereby links together the members of a society (Piacentini
& Mailer, 2004) and builds their identity (O’Cass & Frost, 2002). In these cultures,
social determinants contribute to consumption patterns of individuals. Hence, these
determinants accounts for such observed behaviours as consuming prestige products
1
PhD, Military Technical Academy, Romania. Address: 39-49 G. Coşbuc Blvd., Sector 5, Bucharest,
Romania, Tel.:(+40) 21 335 46 60, fax: (+40) 21 335 57 63. Corresponding author:
[email protected]
AUDA, vol. 6, no. 1/2014, pp. 59-70
59
ACTA UNIVERSITATIS DANUBIUS
Vol. 6, no. 2/2014
and brands to reflect social standing and wealth (Alden, Steenkamp & Batra, 1999).
This situation holds true, especially in developing countries like South Africa where
there is an observed massive diversity in demographic profiles of segments. As such,
South African marketers are witnessing an increase in spending among Black
households (Kaus, 2013). Such spending is more prevalent in urban townships.
The South African urban townships are playing a significant role in the South
African economy. The urban townships contribute 41 percent in total consumer
spending (eProp, 2013). This segment is characterised by a large spending power
with underserved needs to which marketers are paying less attention. Township
spending is increasing with consumers spending more than R308 billion annually
(eProp, 2013) making them an attractive unexploited segment. The continued
increase in township spending generates opportunities for marketers and prospects
for future growth. South African’s urban townships are characterised by a
widespread spending on expensive products (Penman& McNeill, 2008).
Such spending is often a way of displaying one’s status within the community and
society. These consumers largely buy premium-branded clothing to express their
status (Goldsmith et al., 2012). For example, Kaus (2013) noted that those who
reside in South African townships spend more on clothing and personal care.
Therefore, consumers in townships are driven by conspicuous consumption and
represent a larger portion of buying power (TimesLive, 2014). According to O’Cass
& Frost (2002), individuals who seek status conspicuously consume status brands in
order to enhance their position in society. As such, spending could be used to
increase social standing (Dubois, Rucker & Galinsky, 2012) and acceptance within
the community (Kaus, 2013). Swartz, Harding & De Lannoy (2012) note that buying
expensive clothing projected a sense of belonging and respect among township
consumers. In fact, premium-branded clothing signals status (Howell & Vincent,
2014). This pattern of consumption is observed generally among the youth
(Piacentini & Mailer, 2004), particularly among young urban township youth (Kaus,
2013). Although the need for status is considered the core in such spending, there are
suggestions that the community members also influence such spending (Adlip,
2014).
Since there has been an observed growth in township expenditure, marketers have
discovered that a township segment is very attractive, and have started establishing
shopping malls to take advantage of this emerging township segment whose
composition and behaviour still perplexes them. Although the study of township
60
ADMINISTRATIO
consumption habits has been of interest and central to economists, marketers know
little about consumption habits in the townships, especially the factors behind
consumers’ preference of visible consumption in townships. Thus, the township
consumer segment has high potential yet is understudied. Therefore, the purpose of
this study is to examine social influence as a determinant of conspicuous
consumption behaviour among the South African urban township youth.
2. Conceptual Framework and Research Hypotheses
2.1. Conspicuous Consumption
O’Cass and Frost (2002) observe that acquiring and consuming luxury products is
one of the ways consumers enhance their position in society and demonstrate
affluence to others. The acquisition of these luxury products is nothing but an
ostentatious display of wealth (Prendergast & Wong, 2003; Chernev, Hamilton &
Gal, 2011; Mazzocco et al., 2012) to enhance one’s public image (Truong, Simmons,
McColl & Kitchen, 2008). Thus, a significant proportion of consumers buy these
products to signify their wealth and to demonstrate their standing within their
communities. This type of consumption is referred to often as conspicuous
consumption. According to Chernev, Hamilton & Gal (2011) conspicuous
consumption is described as a phenomenon whereby individuals acquire expensive
status-related products with the purpose of expressing the self and to show their
ranking in the society.
Studies on conspicuous consumption identified the influence of others and status
consumption as important determinants of conspicuous consumption. Thus,
conspicuous consumption entails a focus on socioeconomic differences among
individuals within the community (Wong & Ahuvia, 1998), and how these
individuals demonstrate ownership of luxury products (Podoshen, Li & Zhang,
2011). According to Shukla (2008), conspicuous consumption has two aspects,
namely social influence and status consumption. Ger and Belk (1996) note that
conspicuous consumption is more prevalent in less affluent societies, where it acts as
a vehicle to establish social identity.
61
ACTA UNIVERSITATIS DANUBIUS
Vol. 6, no. 2/2014
2.2. Social influence
Social influence refers to “perceived pressures from social networks to make or not
to make a certain behavioral decision” (Lu, Yaob & Yu, 2005:249). It is viewed
generally as a need to conform to one’s social group (Amaldoss & Jain, 2005) and to
get approval from the others (Wong, 1997). Marketers acknowledge that consumers
purchase certain products with the intention to make others within the society aware
of their purchase. The effect of the others in shaping one’s consumption behaviour
plays an important role in consumption habits of consumers. For example, as O’Cass
and McEwen (2004:28) observe, individuals “spend their income on products that
display status and success to significant others”. Clearly, the spending is influenced
by social status and the need to show off ones possessions and wealth (Podoshen et
al., 2011).
2.3. Status Consumption
There are several factors underpinning the choice made by consumers when buying
certain products. Perhaps the main reason why consumers buy products is that they
provide them with some identity, are a way of expressing an individual’s income,
wealth, and his or her rank in society (Heaney, Goldsmith & Jusoh, 2005), and are
often expensive in nature. For example, Kastanakis & Balabanis (2012) suggest that
individuals have a tendency to seek self-recognition and others’ recognition through
buying products that have luxury appeal. This type of consumption is referred to as
status consumption. Therefore, Eastman, Goldsmith, & Flynn (1999, p. 42) describe
status consumption as “the motivational process by which individuals strive to
improve their social standing through the conspicuous consumption of consumer
products that confer and symbolise status both for the individual and surrounding
significant others”. According to O’Cass and McEwen (2004), the more statusrelated meanings a brand conveys, the more consumers will consume it visibly. This
is especially the case with prestige brands (Prendergast & Wong, 2003).
2.4. Brand Prestige
Consumption of brands normally has been characterised by what the brand represents
in the minds of consumers. According to Laforet (2010), a decision to buy a
particular brand is based on whether the brand is going to project power, wealth and
sophistication. These decisions are then followed by judgements of whether the
62
ADMINISTRATIO
brands will offer the consumer symbolic meanings such as social status, and whether
they project wealth and power (Alden et al., 1999). Furthermore, the purchase of
such brands is driven by a need to enhance self-concept (Dubois & Czellar, 2002).
Generally, the wealthy are the ones who identify with such brands, and these brands
often command premium prices (Zhou & Wong, 2008 ) and are often purchased to
fulfil the need for exclusivity (Amaldoss & Jain, 2005).
3. Hypotheses
Figure 1 presents a proposed conceptual model that focuses on the relationship
between conspicuous consumption and its determinants, status consumption, social
influence, and brand community involvement of South African urban township
youth. Based on the above discussions, the following hypotheses were formulated:
H1: Status consumption will have a significant positive effect on township youth’s
tendencies toward conspicuous consumption
H2: Social influence will have a significant positive effect on township youth’s
tendencies toward status consumption
H3: Prestige brand connotations will significantly influence status consumption
tendencies of the township youth
H4: Social influence will have a significant positive effect on the township youth’s
conspicuous consumption tendencies
H5: Prestige brand connotations will have a significant positive effect on township
youth’s tendencies toward conspicuous consumption:
Status
consumption
H3
H
H
1+
2
Social
influence
Brand
prestige
H
Conspicuous
consumption
4
H5+
Figure 1: Proposed research model
63
ACTA UNIVERSITATIS DANUBIUS
Vol. 6, no. 2/2014
4. Methodology
4.1. Sample
To assess social influence of conspicuous consumption behaviour, data were
collected among the township youth of Sebokeng, located in Vanderbijlpark, South
Africa. Mall-intercept method was used where respondents were selected randomly
among South African urban townships of Sebokeng and Sharpeville. South African
urban townships are seeing a rise in visible spending, especially among the youth
(Swartz et al., 2012). Questionnaires were distributed at Thabang mall located in
Sebokeng and Evaton shopping mall located in Sharpeville. A total of 300
questionnaires were distributed, of which 238 were usable. Respondents consisted of
107 males and 131 females. Forty percent were between the ages of 21-23 years, 35
percent were between the ages of 18-20 years, 12 percent were 24 years, 10 percent
above 24 years and only 3 percent were under 18. This shows that the respondents of
this study fall within the legal definition of youth. The United Nations Educational
Scientific and Cultural Organisation (UNESCO, 2014) define the youth as those
individuals between the ages of 15 and 24 years.
5. Results
A structural equation modelling (SEM) technique using the maximum likelihood
estimation method was used to test the relationship among the theoretical constructs.
Table 2 displays descriptive statistics indicating that on average the respondents of
this study responded positively to social determinants of conspicuous consumption
behaviour with means greater than three.
5.1. The Measurement Model
To assess the measurement model, a confirmatory factor analysis was performed.
The initial assessment indicated that item SC4 (0.101) representing status
consumption was far below the recommended 0.50 value and was removed. After the
model was re-specified, the remaining items had loadings ranging from 0.559 to
0.886, and thus demonstrated convergent validity.
64
ADMINISTRATIO
Table 1. Confirmatory Factor Analysis
Construct and items
Social influence
SI1
SI2
SI3
SI4
SI5
SI6
SI7
Brand prestige
BP1
BP2
Status consumption
SC1
SC2
SC3
SC4
SC5
Conspicuous consumption
CC1
CC2
CC3
CC4
CC5
CC6
Standardised
loadings
0.745
0.711
0.829
0.861
0.825
0.843
0.559
0.683
0.886
0.875
0.848
0.851
0.101
0.665
0.671
0.841
0.920
0.857
0.872
0.834
Evidence further suggested the existence of convergent validity as the values of
average variance extracted (AVE) demonstrated in Table 2 were higher than Bagozzi
& Yi (1988) recommended value of 0.50. Discriminant validity was evaluated by
comparing correlation coefficients with the square root of AVE (Malhotra, 2010).
Therefore, the square root of the constructs’ AVE shown in bold on the diagonal of
Table 2 exceeded the construct correlation coefficients, thereby exhibiting
discriminant validity. Furthermore, reliability was assessed by computing composite
reliabilities as shown in Table 2. All constructs retained a composite reliability (CR)
greater than the 0.60 threshold level (Bagozzi & Yi, 1988).
65
ACTA UNIVERSITATIS DANUBIUS
Vol. 6, no. 2/2014
Table 2. Descriptive Statistics, Correlations and Reliabilities
Variables
Mean
SD
CR
AVE
1
3.65
3.69
3.73
3.32
1.72
1.51
1.34
1.62
0.9
5
0.9
8
0.9
8
0.9
8
0.91
0.90
0.93
0.89
0.95
0.787
0.666
0.847
1.Brand Prestige
2.Social Influence
3.Status Consumption
4.Conspicuous
consumption
2
0.95
0.734
0.811
3
0.96
0.73
8
4
0.94
5.2. Hypotheses Testing
Hypotheses were tested by developing a structural equation model. The overall
model was tested and indicates an acceptable fit to the data with chi-square/df =2.34,
CFI=0.94, TLI=0.93, SRMR=0.05, NFI=0.90 and RMSEA=0.07. The results show
that all of the paths were significant except the path between status consumption and
conspicuous consumption, as indicated in Table 3. Thus, the path between status
consumption -0.08 (p>0.05) and township youth’s tendencies toward conspicuous
consumption was not significant and had an unexpected sign. Therefore, hypothesis 1
was rejected. It is surprising that status was not the reason why respondents of this
study, who happen to live in impoverished societies, consume certain products and
brands visibly. Research indicates significant relationships between status
consumption, conspicuous consumption and one’s socioeconomic status. According
to Ger and Belk (1996), conspicuous consumption is more prevalent in less affluent
societies where it acts as a vehicle to establish social identity. This holds true, even in
South African’s urban townships where conspicuous consumption was found to drive
consumers’ buying (TimesLive, 2014).
Hypothesis 2 proposes that social influence will have a significant positive effect on
township youth’s tendencies toward status consumption. The results indicate that the
path between social influence and status consumption was 0.69 (p<0.05) and
significant. Therefore, hypothesis 2 was supported.
66
ADMINISTRATIO
Hypothesis 3 proposes that prestige brand connotations will significantly influence
status consumption tendencies of the township youth. The path between brand
prestige 0.93 (p<0.05) and status consumption was significant, supporting hypothesis
3.
Hypothesis 4 proposes that social influence will have a significant positive effect on
the township youth’s conspicuous consumption tendencies. The results indicate that
the path between social influence and conspicuous consumption was 0.60 (p<0.05)
and significant; therefore, accepting hypothesis 4.
Hypothesis 5 proposes that prestige brand connotations will have a significant
positive effect on township youth’s tendencies toward conspicuous consumption.
The results indicate that the path between brand prestige and conspicuous
consumption was 0.57 (p<0.05) and significant; therefore, accepting hypothesis 4.
Table 3. Structural Model Results
Hypothesis
H1: Status consumption will have a significant positive effect on township
youth’s tendencies toward conspicuous consumption
H2: Social influence will have a significant positive effect on township
youth’s tendencies toward status consumption
H3: Prestige brand connotations will significantly influence status
consumption tendencies of the township youth
H4: Social influence will have a significant positive effect on the township
youth’s conspicuous consumption tendencies
H5: Prestige brand connotations will have a significant positive effect on
township youth’s tendencies toward conspicuous consumption
Results
Rejected
Supported
Supported
Supported
Supported
6. Discussion and Conclusion
The purpose of this study was to investigate social determinants of conspicuous
consumption behaviour among the South African urban township youth. Studies on
conspicuous consumption suggests that status consumption (Alden et al., 1999),
social influence (O’Cass & McEwen, 2004), and brand prestige (Amaldoss & Jain,
2005; Zhou & Wong, 2008; Laforet, 2010). The results showed that social influence
predicted township youth’s tendencies toward status consumption. This is consistent
with the O’Cass and McEwen (2004) study who observed that individuals purchase
products that projects status to impress others. Prestige brand connotations had a
significant and positive effect on status consumption tendencies of township youth.
67
ACTA UNIVERSITATIS DANUBIUS
Vol. 6, no. 2/2014
Generally, consumers who want to display status to friends and their community buy
prestigious brands. The results showed that social influence has a significant positive
effect on the township youth’s conspicuous consumption tendencies. This implies
that the youth seems to buy prestigious brands to demonstrate to others (O’Cass &
Frost, 2002) to display wealth (Prendergast & Wong, 2003; Chernev, Hamilton &
Gal, 2011; Mazzocco et al., 2012) and to enhance one’s public image (Truong et al.,
2008). Prestige brand connotations had a significant positive effect on township
youth’s tendencies toward conspicuous consumption. This finding supports
observations by Alden et al. (1999), who noted that purchasing prestigious brands is
based on the judgements whether the brands exhibit wealth and power. Despite the
theoretical support of the relationship between status consumption and consumption,
and contrary to what was expected, the results of this study showed no significant
relationship between these constructs. Thus, the respondents of this study were not
likely to consume luxury products or prestige brands to enhance their position in
society and demonstrate affluence to others.
Marketers who are interested in segmenting the township youth should take
cognisance of the findings of this study. This segment is an important one, given
their taste for premium brands and their ability to spend on goods such as apparel,
CDs, movies and so forth. Therefore, this study suggests that, marketers who want to
target the township youth should understand that this segment value the views of
others and are more willing to pay for premium brands.
7. Limitations and Future Research
There are limitations associated with this study; there were only two townships
chosen for this study. The youth in other South African townships may have different
responses, especially those who reside in the East Rand area, where conspicuous
consumption is rampant (CityPress, 2012). Future research should be more
representative of the South African township youth. Therefore, the results of this
study cannot be generalised to other South African urban townships.
68
ADMINISTRATIO
8. References
Alden, D. L.; Steenkamp, J. B. E. & Batra, R. (1999). Brand positioning through advertising in Asia,
North America, and Europe: the role of global consumer culture. The Journal of Marketing, pp. 75-87.
Adlip.
(2014).
Brand
of
mouth
marketing
in
townships.
http://www.adlip.com/brand-mouth-marketing-townships/ (October 31, 2014).
[Online]
Available:
Amaldoss, W. & Jain, S. (2005). Conspicuous consumption and sophisticated thinking. Management
Science, 51(10), pp. 1449-1466.
Bagozzi, R. P. & Yi, Y. (1988). On the evaluation of structural equation models. Journal of the Academy
of Marketing Science, 16(1), pp. 74-94.
Chernev, A.; Hamilton, R. & Gal, D. (2011). Competing for consumer identity: Limits to self-expression
and the perils of lifestyle branding. Journal of Marketing,75(3), pp. 66-82.
CityPress.
2012.
Brash
bling
and
ghetto
fabulous.
[Online]
Available:
http://www.citypress.co.za/lifestyle/brash-bling-and-ghetto-fabulous-20121006/ (September 19, 2014).
Dubois, B. & Czellar, S. (2002). Prestige brands or luxury brands? An exploratory inquiry on consumer
perceptions.
Dubois, D.; Rucker, D. D. & Galinsky, A. D. (2012). Super size me: Product size as a signal of
status. Journal of Consumer Research, 38(6), pp. 1047-1062.
Eastman, J. K.; Goldsmith, R. E. & Flynn, L. R. (1999). Status consumption in consumer behavior:
Scale development and validation. Journal of Marketing Theory and Practice, pp. 41-52.
eProp. 2013. Shopping centre opportunity knocks in rural and township areas. [Online] Available:
http://www.eprop.co.za/upgrade/index.php/test/item/14872-shopping-centre-opportunity-knocks-inrural-and-township-areas (October 31, 2014).
Ger, G. & Belk, R. W. (1996). Cross-cultural differences in materialism. Journal of economic
psychology, 17(1), pp. 55-77.
Goldsmith, R. E.; Flynn, L. R. & Clark, R. A. (2012). Materialistic, brand engaged and status consuming
consumers and clothing behaviors. Journal of Fashion Marketing and Management, 16(1), pp. 102-119.
Heaney, J. G.; Goldsmith, R. E. & Jusoh, W. J. W. (2005). Status consumption among Malaysian
consumers: Exploring its relationships with materialism and attention-to-social-comparisoninformation. Journal of International Consumer Marketing, 17(4), pp. 83-98.
Howell, S. & Vincent, L. (2014). ‘Lic ing the sna e’–the i'khothane and contemporary township youth
identities in South Africa. South African Review of Sociology, 45(2), pp. 60-77.
Kastanakis, M. N. & Balabanis, G. (2012). Between the mass and the class: Antecedents of the
“bandwagon” luxury consumption behavior. Journal of Business Research, 65(10), pp. 1399-1407.
Kaus, W. (2013). Conspicuous consumption and “race”: Evidence from South Africa. Journal of
Development Economics, 100(1), pp. 63-73.
Laforet, S. (2010). Managing brands: a contemporary perspective. London: McGraw-Hill.
Lu, J.; Yaob, J. E. & Yu, C. S. (2005). Personal innovativeness, social influences and adoption of
wireless internet services via mobile technology. Journal of Strategic Information Systems, 14(3), pp.
245–268.
69
ACTA UNIVERSITATIS DANUBIUS
Vol. 6, no. 2/2014
Malhotra, N.K. (2010). Marketing research: an applied orientation. 6th ed. Upper Saddle River, N.J.:
Pearson/Prentice Hall.
Mazzocco, P. J.; Rucker, D. D.; Galinsky, A. D. & Anderson, E. T. (2012). Direct and vicarious
conspicuous consumption: Identification with low-status groups increases the desire for high-status
goods. Journal of Consumer Psychology, 22(4), pp. 520-528.
O’Cass, A. & Frost, H. (2002). Status brands: Examining the effects of non-product-related brand
associations on status and conspicuous consumption. Journal of Product & Brand Management, 11(2),
pp. 67-88.
O'Cass, A., & McEwen, H. (2004). Exploring consumer status and conspicuous consumption. Journal of
Consumer Behaviour, 4(1), pp. 25-39.
Penman, S. & McNeill, L. S. (2008). Spending their way to adulthood: consumption outside the
nest. Young Consumers: Insight and Ideas for Responsible Marketers, 9(3), 155-169.
Piacentini, M. & Mailer, G. (2004). Symbolic consumption in teenagers' clothing choices. Journal of
Consumer Behaviour, 3(3), pp. 251-262.
Podoshen, J. S.; Li, L. & Zhang, J. (2011). Materialism and conspicuous consumption in China: A
cross‐cultural examination. International Journal of Consumer Studies, 35(1), pp. 17-25.
Prendergast, G. & Wong, C. (2003). Parental influence on the purchase of luxury brands of infant
apparel: an exploratory study in Hong Kong. Journal of Consumer Marketing, 20(2), pp. 157-169.
Shukla, P. (2008). Conspicuous consumption among middle age consumers: psychological and brand
antecedents. Journal of Product & Brand Management, 17(1), pp. 25-36.
Swartz, S.; Harding, J. H. & De Lannoy, A. (2012). Ikasi style and the quiet violence of dreams: A
critique of youth belonging in post-Apartheid South Africa. Comparative Education, 48(1), pp. 27-40.
TimesLive.
2014.
Soweto,
from
bullets
to
BMWs.
http://www.timeslive.co.za/local/article11516481.ece (October 31, 2014).
[Online]
Available:
Truong, Y.; Simmons, G.; McColl, R. & Kitchen, P. J. (2008). Status and conspicuousness–are they
related? Strategic marketing implications for luxury brands. Journal of Strategic Marketing, 16(3), pp.
189-203.
UNESCO.
(2014).
What
do
we
mean
by
“youth”?
[Online]
http://www.unesco.org/new/en/social-and-human-sciences/themes/youth/youth-definition/
03, 2014).
Available:
(September
Wong, N. Y. (1997). Suppose you own the world and no one knows? Conspicuous consumption,
materialism and self. Advances in Consumer Research, 24(1), pp. 197-203.
Wong, N. Y. & Ahuvia, A. C. (1998). Personal taste and family face: Luxury consumption in Confucian
and Western societies. Psychology and Marketing,15(5), pp. 423-441.
Zhou, L. & Wong, A. (2008). Exploring the influence of product conspicuousness and social compliance
on purchasing motives of young Chinese consumers for foreign brands. Journal of Consumer
Behaviour, 7(6), pp. 470-483.
70