The Traditional Family Life Cycle

The Traditional Family Life Cycle Traditional Family Life Cycle: Traditionally the life cycle, illustrated a progression of stages through which families passed; it comprised stages, starting from bachelorhood (single), to married (couple), to family growth (parenthood: birth of children), to family contraction (grown up children leaving home for studies or employment) to post parenthood (all children leaving home) to dissolution (single survivor: death of one of the spouses). Based on these, the traditional FLC can be synthesized into five basic stages, which may be mentioned as follows: Stage I: Bachelorhood: Young single adult (male/female) living apart from parents and into a livelihood. Stage II: Honeymooners: Young married couple. Stage III: Parenthood: Married couple with at least one child living with them at home. Stage IV: Postparenthood: An older married couple with no children living at home. Children have left home for studies or for employment. Stage V: Dissolution: One surviving spouse. These stages, consumption patterns and the product preferences are explained below: 1. Stage I: Bachelorhood: The stage comprises a young single adult (male/female) living apart from parents and into a livelihood. While incomes are low as they have just started a career, financial burdens and responsibilities are also low. As such bachelors have a high level of disposable income. Priorities and Preferences of Purchase: They tend to spend their money on house rent, basic furniture and kitchen equipment. They are recreation oriented and like to spend on purchase of automobiles (particularly motor bikes), travel (trekking and holidays), adventure sports (motor racing, bungee jumping etc.), health clubs, clothes and fashion accessories. Implications for Marketers: Marketers realize that bachelors possess large disposable income; they find in them an attractive segment for sports, travel, entertainment and fun. 2. Stage II: Honeymooners: The stage comprises a newly married couple and continues till the first child is born. One of the spouses may be working or both may be working. They are financially better off than they would be in the next stages. If both are working, income is higher. If both are working, the couple has discretionary income at hand that permits a good lifestyle, and provides for purchases or savings. Priorities and Preferences of Purchase: They tend to spend on creating a home for themselves. They spend on cars, furniture, curtains and upholstery, electronics, kitchen appliances and utensils, and vacations. Implications for Marketers: They form an attractive segment for the marketer as they form the highest purchase rate amongst segments. The highest average purchase of durables takes place in this stage. 3. Stage III: Parenthood: The stage comprises married couples with children. This stage extends for about a long 20-25 year period; and could be further broken up into three stages, viz., Full Nest I, Full Nest II and Full Nest III. Throughout these stages, the size and structure of the family gradually changes, so does income and expenses with varying priorities. The financial expenses increase rapidly with children being born in Full Nest I and gradually decrease as children become independent and self-supporting as one reaches Full Nest III. Full Nest I: The youngest child in the family is six or below. Priorities and Preferences of Purchase: While liquidity of cash is low, expenses are high. The family spends on baby food, diapers, medicines for cough and cold, doctor visits, child toys and games, school admissions and fees and insurance policies. There are increased expenses on child care. Implications for Marketers: At this stage, purchasing is at the peak, and so this is an attractive segment for the marketer. The children in the family begin to impact family purchases, and are a huge potential for future. Full Nest II: The youngest child in the family is six or above. Generally the stage comprises children aged 6-12 years. Priorities and Preferences of Purchase: Financial position gets better as one begins to rise up the ladder. If the wife is also working, children are à ¢Ã¢â€š ¬Ã…“latchkey kids.à ¢Ã¢â€š ¬Ã‚  The family spends on food, clothes for children, education of children, insurance policies and investments. They also pay for medical expenses and particularly, dental treatment. They go in for deals; buy larger-size packages, and economy packs. For example, junk food, fashion clothing and accessories, video games etc. are prime demands. Implications for Marketers: At this stage, purchasing is still at the peak, and so this is also an attractive segment for the marketer. The children, as also teenagers continue to impact family purchases. The latchkey kids are a potential for home delivered junk food like pizzas and burgers. Full nest III: They are older married couples with dependent and/or independent children but staying together at home. Children reach the higher educational level; one of them may start earning too. Priorities and Preferences of Purchase: The family income continues to increase and so do expenses. The family continues to spend on food, clothes for teenagers, higher education of children, and also repeat purchase of durables that were bought in honeymooning stage or Full Nest I. The family buys new furniture, electronic goods and appliances and cars. Thus there is high average purchase of durables. The family also invests in real estate and property and/or flats. They continue to spend on medical expenses, particularly dentists and visit general physicians for regular checkups. Implications for Marketers: At this stage, income begins to increase as one of the children begins to earn. As expenses see a rise, the stage offers a potential for marketers. 4. Stage IV: Postparenthood: This is a stage that occurs once children have left home. They leave home first for education, and then for employment. As they complete their education, and find employment, they gradually leave home one by one, thus, leaving the nest. Thus, this stage has also been broken into two stages, viz., Empty Nest I and Empty Nest II. As one moves across Empty Nest I and II, the size and structure of the family changes (quite similar to the Parenthood stage and the Full Nest I, II and III). Empty Nest I: This is a stage that occurs when at least one of the children has left home. He/she has completed education, taken up a job and has left home to start his/her home. He/she is independent and can manage on own. While children are managing to start up on their own, parents are still working. Priorities and Preferences of Purchase: The family size gradually begins to shrink. Parents are still earning; expenses gradually reduce, and so there is highest level of savings and disposable income at hand. The family spends on food, instalments for real estate/house, higher education of the dependent children, and, medical expenses on dentist, physiotherapy and heart. They have leisure time in hand, and watch television, movies, and may even go on a vacation. Implications for Marketers: At this stage, the couple beings to again have disposable income in hand. Financial responsibilities towards children begin to decrease. This stage offers potential for marketers who are involved in providing services like leisure, travel and holiday. Empty Nest II: In this stage, all the children have left home, and the couple has retired from occupation. They live on pension and other social security investments. If health permits, they take up part-time jobs. Priorities and Preferences of Purchase: The couple has higher disposable incomes because of savings and investments, and they have fewer expenses. They decide to spend on all that they had been thinking to spend on but had not been able to because of familial responsibilities. They spend money on food, travel and holidays, watch TV and form hobby clubs. They refurnish their home or may even move to newer homes after retirement. Medical expenses also see a rise. However, for those older retired couples who do not have much income from adequate savings and investments, the situation is much different. There is a sharp drop in their income. Implications for Marketers: The stage is lucrative for those involved in the entertainment industry. Many industries provide special discounts in travel and stay as à ¢Ã¢â€š ¬Ã…“Senior Citizen benefits, for example, hotels, airlines and railways. Banks and financial institutions also have special facilities for those above 60, especially higher rates of interest on deposits. 5. Stage V: Dissolution: This stage in the FLC occurs when one of the couple dies, and leaves behind the other surviving spouse. Priorities and Preferences of Purchase: When one of the spouses is still earning, or earns money from savings and investments, things are little easier. However, if he/she is not earning, he/she follows a lifestyle that is economical. The primary expenditure is on medicines, checkups with doctors and restrictive diet. Implications for Marketers: The stage is characteristic of a widow/widower with lower income and least shopping and expenses. Modifications to the FLC: With changes in our society, a change in the traditional Family Life Cycle and the various stages through which it progressed earlier. There are various forms like single; late marriages; divorced (with/without children); dual income, no kids, live-ins etc. Consumer researchers have thus brought about changes in the traditional FLC, so as to reflect changes in the family and lifestyle arrangements. Broadly speaking households may be classified as family households and non-family households (single individual or live-ins). Each of these family types has varying features and characteristics, which also get exhibited in their buying patterns and consumption expenditure. Family life cycle of Dominos Pizza Bachelorhood: Dominos pizza does not come under this stage because the income a person is very low and have to spend their money on house rent, basic furniture and kitchen equipment. Honeymooners: Dominos pizza comes under this stage because they tend to spend their money more. Parenthood: Dominos pizza also comes into this stage because in this the family income increases and then family continues to spend on food, clothes etc. Post parenthood: Dominos pizza comes under this stage because family is small but wants doing expenses. Dissolution: Dominos pizza does not come under this stage because their primary expenditure is on medicines, checkups and doctors. Family life cycle of Mobile Phones Bachelorhood: Mobile phones come under this stage because the income a person is very low but they have to spend their money on automobiles, clothes etc. Honeymooners: Mobile phones come under this stage because they tend to spend their money more. Parenthood: Mobile Phones also come into this stage because in this the family income increases and then family continues to spend on food, clothes, accessories etc. Post parenthood: Mobile phones come under this stage because family is small but wants doing expenses. Dissolution: Mobile Phone does not come under this stage because their primary expenditure is on medicines, checkups and doctors. Family life cycle of Mutual Funds Bachelorhood: Mutual Funds does not come under this stage because the income a person is very low but they have to spend their money on automobiles, clothes etc. Honeymooners: Mutual Funds come under this stage because they tend to spend their money more. Parenthood: Mutual Funds also come into this stage because in this the family income increases and then family continues to spend on food, clothes, accessories etc. Post parenthood: Mutual Funds come under this stage because family is small but wants doing expenses. Dissolution: Mutual Funds come under this stage because their primary expenditure is on medicines, checkups and doctors and spend for future stability.