An empirical study on the influence of
independent marketing variables on the purchasing decision of selected personal
care products
Dr. N. Srinivas
Kumar
Professor, SRTIST, Nalgonda
*Corresponding Author E-mail: karthick_narayana@yahoo.com
ABSTRACT:
In
the latest few decades, one of the most indispensable objectives of
manufacturing firms is to identify how the consumer will respond to various marketing
strategies for achieving their ultimate goal of selling. The study of consumer
behavior became a concern of marketers, as they may learn how consumers choose
their goods and services required to meet multiple needs and the factors that influence their choice. The present
study focuses on the influence of independent marketing variables such as advertising, sales
promotion schemes, attractive packaging, brand loyalty etc on purchasing
decision of selected personal care products. The primary data collected using a
structured questionnaire from 150 respondents of different age groups was
statically analyzed. The results revealed that the implementation of sales
promotion schemes and proper advertisement plays significant role in consumer
purchase decisions. However, majority of the respondents in the study
considered price to be the single most important and deciding factor in the
purchase of branded personal care products. This study necessitates the
application of suitable sales-promotion instruments, together with aggressive
advertising strategies that could results in increased brand loyalty of
personal care product manufacturers.
KEYWORDS: Advertisements, sales
promotion schemes, attractive packaging, brand loyalty, consumer purchase
decisions.
As the global transformation
from the seller’s market to the buyer’s market is captivating, competing firms
are placing their offerings strategically in order to attract potential
consumers. The modern day customers buy things to reward themselves, to satisfy
their psychological needs or to make themselves feel good. They buy things to
make a statement, to show off their personality or to boost their self-esteem.
Thus it is no longer sufficient to identify simple customer demand and try to satisfy
them.
In Indian context, owning to
the increase in income and sociological forces, the consumer’s expectations of
product quality in general have been steadily rising with high expectations of
a better lifestyle. Indian consumers today are looking for aesthetic and social
value instead of just focusing on the basic needs of warmth and the protective
function of products (Joshi, 2013). The primary objective of marketing is which
information regarding products or services is being communicated to customers
to change their attitude and behavior.
Sales promotion has been defined as ‘a direct inducement that offers an
extra value or incentive for the product to the sales force, distributors, or
the final consumer with the primary objective of creating an immediate sale.
The intense competition from imported products and diminishing sales as well as
increase in competition among firms calls for use of effective sales promotion
tools.
Today’s
consumer is habituated with sales promotional activities. So without such
activities, it has become difficult for companies to achieve their targets. Marketers are concerned with effective utilization of
promotion-mix to increase sales and market share. Methods of promotion include
advertising personal selling, offering promotion schemes and attractive
packaging. In order to develop a successful sales promotion strategy a clear
definition of the targeted market must be included. According to Low and Mohr
(2000), manufacturers continue to spend a large amount from their communication
budget on sales promotion. They allocate around 75 percent of their marketing
communication budgets to sales promotion.(Hellman, 2005) A better understanding of the different types
of consumer responses to promotions can help managers to develop effective
promotional programs as well as provide new insights on consumer behavior.
The Indian personal care
industry had an excellent growth rate during 2011-12. Since the past few years,
people have become more conscious about their appearance and look, leading to a
huge demand for these products. New brands of products to appeal various
population sectors are constantly being developed. Considering the modern day
consumer perceptions, most personal care products are increasingly regarded as
essential items for daily use, rather than as luxury products for indulgence (Shallu and Guptha, 2013). The Indian cosmetics industry can match
international standards when it comes to quality, price and range. The industry
holds promising growth prospects for both existing and new players. Sales
promotional activities are used to create brand awareness and thereby are
required by every field and personal care product industry is no exception. In
India, many sales promotion schemes are highly successful as the market is
price sensitive as well as highly competitive. Presently, the industry is
dominated by several large companies that market multiple brands on different
levels. Though many of their respective products are relatively similar, all of
these product lines must be packaged and advertised differently to reflect the
setting at which they are sold. In addition to attractive packaging, the
marketers have heavily relied on celebrity endorsements which are widely
considered to improve advertisement ratings and positive product evolutions.
REVIEW OF LITERATURE:
Although sales promotion has
become a ubiquitous element of consumer marketing, large portions of
ineffective promotional activities indicate a great need of refining and
redirecting the focus on the impact sources.
Koekemoer, (2005) differentiates between three
different types of sales promotions, namely: consumer-oriented sales
promotions, retail promotions and trade promotions. Consumer-oriented sales
promotions refer to incentives that are offered directly to a firm’s customers
or potential customers, and are used to accelerate the decision-processes of
consumers (Moriarty et al.,2012). Earlier studies have made on consumer
attitudinal and behavioral responses to price promotion and its utilitarian
benefits (Smith and Sinha,
2000; Gilbert and Jackaria, 2002). According to
Blackwell et al., (2001), price
discounts played a significant role in influencing consumer product trial
behavior and indirectly attract new consumers. The consumer would be easily
persuaded by promotion techniques which offer an additional product free of
cost or as bonus packs (Smith and Sinha, 2000),.
Besides, this the technique would beneficial to retailers in speed up the stock
clearance compared to price promotions (Li and Wang, 2007). This type of gift promotions are widely used
in marketing, however, academic research into this subject is limited
(Prendergast et al., 2008). Laroche et al.,
(2003) explained sales promotion in the context of a
cognitive-affective-behavioral model and suggested that compared to other tools
in the marketing mix, sales promotion has the strongest effect on the
consumers. Previous research has shown that sales promotion can encourage
behavioral responses such as brand switching, stockpiling, purchase
acceleration, product trial and spending larger amounts (Laroche
et al., 2003, Gilbert and Jackaria, 2002).
Numerous studies have examined
the effectiveness of advertising in the past decade. (Kumar and Raju, 2013; Adelaar et al., 2013; Goldsmith and Lafferty,
2002). Promoting the advertisements on mass media like television, internet,
radio and newspaper are the paid and formal sources of promotional on
convincing of consumer towards purchase of a particular goods or services (Carl
et al., 1998). Here it can be added
that the consumer is not only sensitive to price but also to the firm,s advertising efforts. Continuous improvement of an
advertised brand may generate long-term effect in consumer’s minds that can
lead to a further sales outcome which can be very beneficial (Huang et al., 2012). According to Vani et al.,
(2010), brand awareness precedes all other steps in the buying process. A brand
attitude cannot be performed, unless a consumer is aware of the brand. Del Rio et
al., (2001) explained
that customers recognize the value of any brand with respect to its different
functional trustworthiness like guarantee, value for money, social and status
symbol etc. Packaging communicates the marketing objective a specific product
to the consumer. Sauvage (1996) examined the
importance of shape in creating an image about the product and the brand. He
also mentioned that the material of a package affected consumer thought buying
process. According to Rundh (2005), packaging has a
great impact as far as brand is concerned, and people are more attracted
because of the brand and they got a perception about a product in advance.
OBJECTIVES OF THE STUDY:
The present empirical study highlights
consumer behavior and purchase decisions made in response to various sales
promotion schemes. The study was carried out with the objective to investigate
the influence of various sales-promotion schemes, advertisement strategies,
packaging and brand loyalty on consumer purchase decision and to identify
statistically significant differences between the various age groups with
regard to their buying behavior patterns.
RESEARCH METHODOLOGY:
The study was carried in
Hyderabad city during July 2011 to February 2012. As the study is related to
personal care products, the primary data was collected by interviewing visitors
of supermarkets, provision stores and pharmaceutical outlets. A sample of 150
respondents was considered for the present study. A structured questionnaire
with each question contributing to research objectives of the study was used
for the collection of primary data. The questions covered were double checked
with two store managers to assess their relevance. The data collection was done
by convenience sampling method. Five different areas of Hyderabad city were
covered to collect the data. The survey was done during different time periods
of the day in order to cover the customers of all demographic profiles. The
respondents were initially classified as the age groups of 20-30 years (42%),
30-40 years (34%), 30-40 years (12%) and 40-50 years (12%). The data gathered through questionnaires have
been analyzed interpreted by descriptive statistics instruments such as
frequency relationships and graphs. The following hypotheses were placed
corresponding to each question area which was tested one by one by with
chi-square test.
1. Advertisement
|
Ho: Not have any
significant impact on the buying behavior of all age groups. |
H1 : Have significant impact
on the buying behavior of all age groups. |
|
2. Sales Promotion Schemes |
|
|
Ho: Not have any significant
impact on the buying behavior of all age groups. |
H1 : Have significant impact
on the buying behavior of all age groups. |
|
3. Attractive Packing |
|
|
Ho: Not have any
significant impact on the buying behavior of all age groups. |
H1 : Have significant impact
on the buying behavior of all age groups. |
|
4. Brand Loyalty |
|
|
Ho: Not have any
significant impact on the buying behavior of all age groups. |
H1 : Have significant impact
on the buying behavior of all age groups. |
RESULTS AND DISCUSSION:
The primary data collected on
the impact on influence of advertisement, sales promotion schemes, attractive
packaging and brand loyalty on the purchasing decisions was tested one by one
against the hypotheses stated above using chi-square test. The calculated chi-square values for each
variables were 63.001 (advertisement), 60.178 (sales promotion schemes), 30.177
(attractive packaging) and 38.545 (brand loyalty). The table value was taken as
16.919 with degrees of freedom 9 at a level of significance of 5%. Since all
the calculated chi-square values was greater than the tabulated value the null
hypothesis (Ho) i.e
‘the tested variables does not have any significant impact on the buying
behavior of all age groups’ was summarily rejected. By accepting the
alternative hypothesis (H1), it can
be concluded that advertisement,
sales promotion schemes, attractive packaging and brand loyalty are the most
important marketing tools which have significant impact on the buying behavior
of customers irrespective of the age group.
The data presented in the table
1 below shows the overall customer response towards the influence of
advertisement, sales promotion schemes, attractive packaging and brand loyalty
on their purchasing decisions. In order to obtain a conclusive outcome in the present study,
the ‘most important’ and ‘important’ responses were considered as
significantly influencing factors while ‘neutral’
and ‘unimportant’ responses were
considered as least significant factors. Among the 63 respondents in the age
group of 20-30 years, 76.19% believed that the sales promotion schemes offered
by the manufacturer significantly influence their purchasing decision followed
by advertisement (38.10%), brand loyalty (26.67%) and attractive packaging
(23.81%). However, 76.19% of the respondents felt that attractive packaging is
the least influenced factor as expressed by their neutral or unimportant view
points. The brand name created little influence (73.33% neutral or unimportant
responses) in this particular age group.
Table 1: Overall Customer response towards the influence of
Advertisement, Sales Promotion Schemes, Attractive Packaging and Brand Loyalty
on their purchasing decisions.
|
|
20-30 yrs (N=63) |
30-40 yrs (N=51) |
40-50yrs (N=18) |
50-60 yrs (N=18) |
Most Important |
Advertisement |
14.29% |
- |
50.00% |
50.00% |
Sales
Promotion Schemes |
9.52% |
- |
- |
40.00% |
|
Attractive
Packaging |
9.52% |
23.53% |
33.33% |
50.00% |
|
Brand
Loyalty |
13.33% |
23.53% |
28.57% |
27.27% |
|
Important |
Advertisement |
23.81% |
70.59% |
33.33% |
33.33% |
Sales
Promotion Schemes |
66.67% |
30.77% |
83.33% |
50.00% |
|
Attractive
Packaging |
14.29% |
11.76% |
- |
- |
|
Brand
Loyalty |
13.33% |
11.76% |
- |
36.36% |
|
Neutral |
Advertisement |
52.38% |
29.41% |
16.67% |
16.67% |
Sales
Promotion Schemes |
19.05% |
61.54% |
16.67% |
10.00% |
|
Attractive
Packaging |
71.43% |
64.71% |
66.67% |
33.33% |
|
Brand
Loyalty |
66.67% |
64.71% |
71.43% |
18.18% |
|
Unimportant |
Advertisement |
9.52% |
- |
- |
- |
Sales
Promotion Schemes |
4.76% |
7.69% |
- |
- |
|
Attractive
Packaging |
4.76% |
- |
- |
16.67% |
|
Brand
Loyalty |
6.67% |
- |
- |
18.18% |
A total of 51 responses were
taken from the age group of 30-40years. The subjects were mainly influenced by
advertisements (70.59%). Nevertheless the influence of other variables on the
purchasing decisions of the age group was least significant as revealed by the
high proportion of neutral or unimportant responses for sales promotion schemes
(69.23%), attractive packaging (64.71%) and brand loyalty (64.71%). In the
third age group of 40-50yers, we collected data from 18 respondents. As per the
results, advertisement (83.33%) and sale promotion schemes (83.33%) was the
most important factors that influenced the purchasing decisions of the
subjects. However, 71.43% of the respondents endorsed that they are least
influenced by brand name or attractive packaging (66.67%) of the product. The
last age group of 50-60 years consisted of 18 respondents. Of this 90% of the
respondents agreed that sales promotion schemes offered by the manufacturer of
retailer can significantly influence their purchasing decisions. Other factors
such as the influence of advertisements (83.33%), attractive packaging (50%)
and brand loyalty (63.63%) also received significant endorsements from this
particular age group. The graphical representations of the data collected in
the present study on the influence of
advertisements, sales promotion schemes, attractive packaging of the product,
brand loyalty on the purchasing decisions of customers belonging to different
age groups is given in Fig. 1, 2, 3 and 4 respectively.
Fig 1: Influence of advertisements on the purchasing decisions of
customers belonging to different age groups.
Fig 2:
Influence of sales promotion schemes on the purchasing decisions of customers
belonging to different age groups.
Fig 3:
Influence of attractive packaging of the product on the purchasing decisions of
customers belonging to different age groups.
Fig 4: Influence of brand loyalty on the
purchasing decisions of customers belonging to different age groups.
Majority of the respondents in
the present study were of the age group of 20-30 (42%) and 30-40 years (34%)
which holds ample purchasing supremacy. The sales promotion schemes offered by
the manufacturer as well as advertisements significantly influenced the
purchasing decisions of this age group. Sales promotion means any activity that
is utilized by the producer to encourage the trade as well as make customers to
purchase a brand and boost sales force to aggressively sell it. The term sale
promotion refers to several types of selling incentives and methods indented to
yield immediate sales effects (Totten and Block, 1994). It was previously reported that
sales promotion schemes could make strongest impact on short-term consumption
behavior. (Laroche
et al., 2003). Throughout the world,
sales promotion offered to consumers are an integral part of the marketing mix
for many consumer products (Huff and Alden. 1998; Chandon
and Laurent, 2000). Advertising provides a major tool in
creating product awareness and stimulate the mind of a potential consumer to
take final purchase decision. As advertiser’s primary mission is to reach
potential customers and influence their awareness, attitudes and buying
behavior (Kumar and Raju, 2013). Marketers have
relied heavily on different forms of advertisement strategies like celebrity
endorsement, because they believe in its positive impact of assisting in
improvement of brand awareness in young customers particularly in the age group
go 20-30 years.(Shallu and Guptha, 2013).
Based on the present empirical study, it was found that the sales
promotion and advertising place a product strongly in the mind of the consumer
in order to encourage repeated purchase of the product. This also necessitates
the application of suitable sales-promotion instruments, together with
aggressive advertising strategies that can actually result in increased brand
loyalty when targeting consumers below 40 years.
The influence of other
marketing variables such as brand image and attractive packaging in the present
study revealed mixed responses. Over the last decade, firms have markedly
increased their investments in the creation and development of brands. The
creation of a brand implies communicating a certain brand image in such a way
that all the firm's target groups link a brand with a set of associations. People
prefer the branded products with lower prices because they consider that
branded items have more quality then non branded products. However, there
exists a class of customers who still consider quality and brand as the
deciding factor, but their number is comparatively less. Majority of the
respondents in the study, consider price to be the most important and deciding
factor in the purchase of personal care products. Consumer buying behavior is
based on the concept and idea that he/she simply decided to purchase a product
or service at the spot. (Adelaar et al.,
2003). A product’s packaging is something which all buyers experience and which
has strong potential to engage the majority of the target market. This makes it
an extremely powerful and unique tool in the modern marketing environment. Due
to increasing self-service practices in supermarkets and changing consumer lifestyles, the
interest in attractive packages as a tool of sales promotion and stimulator of impulsive
buying behavior is growing constantly (Mitul and Parmar; 2012). For products with limited advertising
support, packaging makes a significant role as the key medium for communicating
the brand positioning.
CONCLUSION:
The study was carried out to
understand the influence of independent marketing variables such as
advertising, sales promotion schemes, attractive packaging, brand loyalty etc
on the dependent variable i.e consumer buying behavior. On the basis of the present
findings it can be concluded that implementation of sales promotion schemes and
advertisement plays significant role in consumer purchase decisions. Sales promotions schemes proved highly
effective in exposing consumers to products for the first time and can serve as
key promotional components for a new product. However the marketers need to be regularly
updated with the customers demand in this perspective. For this regular
customer satisfaction surveys should be conducted regarding effectiveness of
the promotional schemes. The marketers should focus on reframing of the other
marketing variables such as attractive packaging, brand image etc. for
stimulating purchase decision of the potential consumers of personal care
products. By offering the right promotional incentives, proper marketing
strategies in place, the manufacturer
can increase sales by creating repeat buying behavior to their product.
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Received on 09.03.2015 Modified on 25.03.2015
Accepted on 22.04.2015 © A&V Publication all right reserved
Asian J. Management; 6(2):
April-June, 2015 page 128-134
DOI: 10.5958/2321-5763.2015.00019.0