Groups are units composed of two or more people who interact for a purpose. There are several types of groups including formal groups created by an organization, informal groups formed without a specific purpose, primary groups with close regular interaction, and secondary groups with less interaction. Group dynamics refer to the behaviors and psychological processes within and between groups. Norms are established beliefs and behaviors groups enforce on members. Cohesiveness is the degree group members are attracted to each other and motivated to remain part of the group, determined by factors like similarity, time spent together, isolation, threats, size, and rewards. Reference groups are people or groups used for comparison to form values, attitudes or behaviors. Consumer-related reference groups include friendship

1. Groups
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What is a group?
To put it simply they are units composed of two or more persons who come into contact for a purpose and who
consider the contact meaningful.
Types of group:
Within many organizations different groups are formed at different levels, formal groups, informal groups,
primary groups and secondary groups. Some groups maybe deliberately formed, some groups are formed
through an informal setting. Below we discuss briefly four forms of groups which are found within a company.
Formal Group
A formal group is created within an organization to complete a specific role or task. This may be a one off
objective such as the launch of a particular product or service or a permanent/ongoing objective such as the
provision of Information Technology (IT).
Informal Group
Informal groups are established by individuals who decide they want to interact with each other. Informal
groups usually do not have a specific purpose; often the group forms because the group members regularly
happen to be in the same location or because they enjoy each other's company. For example people may
form a group because they sit close together in an office or live together in a house.
Primary Group
A primary group is made up of a small group of people who interact regularly. A small team with a leader is an
example of a primary group. A family can also be called a primary group. Within the primary group, values,
beliefs and culture are all very important.
Secondary Group
When a large number of people get together (who do not normally get together) it is called a secondary
group. Secondary group members do not get the opportunity to get to know each other as well as primary
group members because the interaction with each other is less than in a primary group. When a secondary
group is formed, individuals usually have their own agenda and goals. The relationship they form is not long
term and social interaction within a secondary group is likely to be low.

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Co-acting Group
It’s the level of independence experience by group members.In co-acting groups, the work of individual group
members is independent, such as job-shop operations.
Counteracting Group
Counter-acting groups are those that interact to reconcile mutual differences such as labor-management
negotiating techniques.
Reference Group
Reference groups is the one with which one identifies or would like to belong. (A reference group can influence
a person’s outlook without that person being member of it)
Characteristics of groups
Norms
Group norms are a set of beliefs, feelings and attitudes commonly shared by group members. These are also
referred to as rules & standards of behavior that apply to group members.
Why are norm enforced?
Once norms are established, they are enforced on members particularly when these help groups meet their
twin aims of performing successfully and keeping morale high.
- Group success
- Reflect preferences of supervisor
- Predict behavior expected
- Avoid embarrassing interpersonal
Group Cohesiveness
A characteristic feature of groups which is particularly important for the behavior of their members is
COHESIVENESS Extent to which the members are attracted to each other.
It is the degree to which members are attached to and motivated to remain a part of a group.
Determining factors of group cohesion:
1. Similarity attitudes and goals.
People with similar attitudes and objectives will find each other’s company a source of satisfaction.
2. Time spent together.
As people spend more time together they are given the opportunity to explore common interest and
experience greater inter personal attraction.
3. Isolation.
Groups are groups that are isolated from other groups may perceive themselves as special.

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4. Threats.
One would expect the cohesiveness of the group to solidify in the face of external competition or
threats. Cohesiveness could be dented where the group feels it is unable to withstand the external
threat, here members feel that the group is now less important as a source of security.
5. Size.
With increasing size come fewer opportunities for interactions by contrast, smaller groups tend to create
conditions for the advancement of cohesiveness because of the greater opportunities for interaction
among members.
6. Stringent entry requirements.
The more difficult it is to get into a group, the greater the likelihood that the group is cohesive.
Groups with the record of success can specify exacting entry requirements on their endeavor to attract
the most talented people.
7. Rewards.
It is sometimes that incentives are based on group performance cultivated a group centered
perspective where cooperation rather than internal competition prevails.
Group Dynamics
Refers to a system of behaviors and psychological processes occurring within a social group (intragroup
dynamics), or between social groups (intergroup dynamics).Group dynamics are at the core of understanding
racism, sexism, and other forms of social prejudice and discrimination.
- Pooled
Members make separate, independent contributions to group such that group performance is the sum
of each member’s contributions
- Sequential
Members perform tasks in a sequential order making it difficult to determine individual performance
since one member depends on another.
- Reciprocal
Work performed by one group member is mutually dependent on work done by other members.

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Reasons for joining groups
People join groups and teams for a variety of reasons.
- Learning - User Group’s provide a unique opportunity for people to learn from their peers.
- Networking – The opportunity to network and make new connections with industry peers, make new
friends is endless.
- Sharing Experiences – Most human beings love to share and highlight their expertise and knowledge.
During most community meetings, members share their challenges and experiences with each other.
- Job Opportunities – Many a door has opened up due to new contacts made via the community.
- Meeting Experts - Typical user group meetings feature an expert speaker who shares knowledge among
the community members.
Reference groups
A reference group is any person or group that serves as a point of comparison (or reference) for an individual in
forming either general or specific values, attitudes, or a specific guide for behavior.
- They help us understand the impact of other people on an individual's consumption beliefs, attitudes,
and behavior.
- It helps marketers choose their methodology to affect desired changes in consumer behavior.
Consumer-Related Reference Groups
- Friendship Groups
Friendship groups are classified as informal groups because they are usually unstructured and lack
specific authority levels.
- Shopping Groups
Two or more people who shop together can be called a shopping group.
a) The motivations range from primarily social to reducing risk.
b) A special form of a shopping group is the in-home shopping party.
- Work Groups
a) Both the formal work group and the informal friendship/work group have potential for influencing
consumer behavior.
b) The formal work group consists of individuals who work together as part of a team and, thus, have the
opportunity to influence each other’s consumption-related attitudes and actions.

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- Virtual Groups or Communities
a) Thanks to computers and the Internet, we are witnessing the beginnings of a new type of group—virtual
groups or communities.
b) While fifty years ago the definition of a community stressed the notion of geographic proximity and
face-to-face relationships, today's communities are much more broadly defined as sets of ―social
relations among people.‖
- Consumer-Action Groups
A consumer-action group—has emerged in response to the consumerist movement.
They can be divided into two broad categories.
a) Those that organize to correct a specific consumer abuse and then disband.
b) And, those that organize to address broader, more pervasive, problem areas and operate over
an extended or indefinite period of time.