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MKTG1421 CONSUMER PSYCHOLOGY AND BEHAVIOUR Semester 2019-1 Title of Assignment Assignment 3: Sustainable Consumption Project Name and Student ID Nguyen Hoang Phuc Anh s3495669 & Signature Name and Student ID Nguyen Manh Dat - s3726130 & Signature Name and Student ID Nguyen Phuong Nhi - s3751359 & Signature Name and Student ID & Signature Name and Student ID & Signature Ngo Thai Phuong Phuong s3764392 Huynh Nguyen Bao Tran – s3751370 Name and Student ID Doan Cam Tu - s3703460 & Signature Location Saigon South Class Group G04 SGS Lecturer Nguyen Anh Thu Word Count (Main content without list of references, cover page, etc.) 3,597 words (Introduction: 481, Marketing Stimuli: 139, Internal: 1240, External: 1262, Recommendation: 475) IMPORTANT NOTICE: All students listed on this page with signatures declare that they have read and agree to the statement of authorship on the next page Declaration and Statement of Authorship I/we hold a soft copy of this assignment which can be produced if the original is lost/damaged This assignment is my/our original work and no part of it has been copied from any other student’s work or from any other source except where due acknowledgement is made No part of this assignment has been written for me/us by any other person except where such collaboration has been authorised by the academic/teacher concerned and as detailed in the assignment I/we have not previously submitted this work for any other course/unit I give permission for my assignment to be scanned for electronic checking of plagiarism I give permission for a copy of my/our marked work to be retained by the Department for review by external examiners I/we understand that: Plagiarism is the presentation of the work, idea or creation of another person as though it is one’s own It is a form of cheating and is a very serious academic offence which may lead to expulsion from the University Plagiarised material can be drawn from, and presented in, written, graphic and visual form, including electronic data, and oral presentations Plagiarism occurs when the origin of the material used is not appropriately cited Enabling Plagiarism is the act of assisting or allowing another person to plagiarise or to copy one’s work; this is not acceptable and is also subject to penalty Further information relating to the penalties for plagiarism, which range from a notation on your student file to expulsion from the University, is contained in RMIT Statute 6.1 Student Discipline (see Appendix in Student Guide or consult Turing.) Table of Contents Executive Summary Introduction 1.1 Company Information 1.1.1 Nature of The Company 1.1.2 Key Products 1.1.3 Major Rivals 1.1.4 Market Share 1.2 Primary Target Market 10 1.3 Positioning Map 12 Marketing Stimuli 13 Internal Influence 20 3.1 Learning 20 3.1.1 Cognitive Learning 20 3.1.1.1 Iconic Learning 20 3.1.1.2 Vicarious Learning 21 3.1.1.3 Reasoning 21 3.1.2 Conditioning 22 3.1.2.1 Operant Conditioning 22 3.2 Motivation 22 3.2.1 Safety Needs 23 3.2.2 Self-Esteem Needs 23 3.2.3 Self-Actualization Needs 24 3.3 Attitude 25 3.3.1 Cognitive 25 3.3.2 Affective 26 External Influence 27 4.1 Culture 27 4.1.1 Cleanliness 27 4.1.2 Nature 28 4.1.3 Traditional/Change 29 4.2 Demographic 30 4.2.1 Demographic 30 4.2.2 Lifestyle 31 4.3 Group Influence 32 4.3.1 Informational 32 4.3.2 Identification 33 Recommendations 34 5.1 Learning: Content Re-arrangement and Color Change 34 5.1.1 Content Re-arrangement 34 5.1.2 Change Color 35 5.2 Create Behaviourial Attitude 36 Appendix 37 References 40 Executive Summary Background: This report was commissioned to analyse Zero Waste Saigon (ZWS), a social-platform turned start-up, which is well-known for running environmental movement and deal with plastic-waste issues in HCMC, especially through producing eco-friendly packaging beauty products ZWS covers small part of beauty products market share in Vietnam, compete with other eco-friendly brands like The Craft House, Lai Day Refill Station,… and targets niche market with the young urban female, who are well-educated, have middle/high income and follow the trend of using eco-friendly products Marketing stimuli: We discovered 15 marketing stimuli in years recently, include key products, internal influence (learning, motivation, attitude) and external influence (culture, demographic, group influence) Key Findings: Internal Influence:  In terms of Learning, besides other tools (iconic, operant), celebrity endorsement, which is vicarious learning and reasoning are enormously applied by ZWS The appearance of Giang Ơi! influencer and large effort from brand to provide deep knowledge about its products succesfully affect consumers’ adjustment toward eco-friendly products and natural ingredients  About Motivation, self-esteem needs in Maslow’s Hierarchy of Needs are the most relevant, as they are the main needs of ZWS’s targeted consumers about high prestige when become an environmentally responsible person and feelings of achieving desire beauty stage, which can significantly reflected their purchasing decision  In terms of Attitude, both cognitive and affective component of attitude effectively affect customers adjustment ZWS provides thorough information to construct consumers’ beliefs about eco-friendly packaging and natural products Besides, the brand also boosts positive moods through helping consumers to recognize their meaningful environmental actions and promote enjoying life messages External Influence:  In terms of Culture, ZWS is strongly affected by Vietnamese environment-oriented aspect of culture (cleanliness,  nature and traditional/change), especially traditional/change aspect is the most relevant since Vietnam’s existing patterns is considered to be superior to new patterns with eco-friendly products and move back to the tradition with natural products In terms of Demographic, both demographic and lifestyle sections of ZWS’s targeted consumers are advantages for this brand in current time and in future Since the targeted consumers is on the upward trend and belong to the largest consumers segments in Vietnam, ZWS has various opportunities to expand quickly However, in future, there will be a slight decrease in ZWS’s targeted segments, thus this brand should expand their product lines and develop more products for older female, male or children instead of just focusing on young female  For Group Influence, there are informational and identification influence ZWS’s consumers Consumers usually exchange their knowledge about ZWS’s products on social media and use the image of Giang as surrogate to make purchase, in order to have desirable life as her Recommendation: Firstly, ZWS should take immediate measures to launch and promote different content arrangement and brand colour, which can deeply convey informational message to customers, create familiarity affects to raise consumers affective attitude The other recommendation is creating behavioural attitude among consumers, by applying information of price, call-to-action sentence with sale promotions to gain actual actions from consumers regarding products, increase positive mood and engagement Introduction 1.1 Company Information 1.1.1 Nature-of-The-Company In 2007, Michael Burdge and Julia Mesner have established Zero Waste Saigon (ZWS), a social-platform turned start-up with a Facebook page (10,000 followers) ZWS has successfully launched an online store offering eco-friendly products and natural products with no-plastic packaging This brand intends to run the environmental movement mainly in HCMC, deal with the plastic-waste issue by finding alternative materials for single-used plastic Currently, ZWS receives strong attention from media and consumers about their meaningful actions to reduce plastic-waste and protect-environment 1.1.2 Key-Products ZWS has various product lines (groceries, beauty, bathroom, etc.) but the beauty product line, including cosmetics, skincare and toiletries, is the most well-known line boosted by greatest effort from this brand ZWS has many products for skin and hair such as lipstick, face-soap, body-soap, deodorant and so on For these products, ZWS has invited ‘Giang-Ơi!’, a famous Vietnamese influencer, to join in the production process and work as KOLs Therefore, Giang becomes a potential part of this firm to produce eco-friendly packaging beauty products 1.1.3 Major-Rivals Base on Facebook-followers of each eco-friendly brand, we can divide them into two types: direct and indirect competitors Brands with huge amount of followers likes The-Craft-House, Lại-Đây-Refill-Station and The-Organik-House are direct competitors to ZWS Although other brands likes Green-Around the Corner and Saigon-Suds have similar products, their small-scale businesses and less compelling value make them cannot be direct competitors of ZWS 1.1.4 Market-Share There is no credible report about market share of eco-friendly beauty brands in Vietnam However, when looking into Vietnam top-of-mind beauty brands, international brands like OHUI, Shiseido, TheFaceShop, Innisfree, etc have great positions and occupy large space in Vietnamese cosmetic market share Therefore, we can assume that eco-friendly beauty brands just cover the tiny part of “Others” field in the market share, which means instead of targeting the mass, they offer the niche consumers segments who have environmental concern Despite of the small part in market share, eco-friendly brands actually have high revenue due to the upward trend of total revenue in cosmetic industry, which is predicted to peak at $129.8 million in 2023 (Statista 2019) Thus, with small market share but high revenue and few direct competitors, ZWS still have advantages to succeed 1.2 Primary - Target -Market 10 However, recently, Vietnamese consumers have recognized the bad influence of chemical-products to health and have higher-awareness about benefit of natural-ingredients Therefore, they tend to come back to the natural-products Some shampoo or body-shower made with natural-ingredients are used by various Vietnamese day-by-day Generally, fast-movement of Vietnamese cosmetic-market from traditional-products to chemical-one, and then move back to the tradition, showing Vietnamese-consumers adapt to the change quickly, followed by more advantages for ZWS Furthermore, eco-friendly lifestyle is an emerging trend in the world It has approached Vietnam recently Despite of heavy tradition about protecting-environment, Vietnamese consumers, especially young generation, adapt this trend quickly and recognize their responsibilities in reducing plastic-waste As predicted by IPONRE Vietnam, this trend will increase in future, opening many opportunities for ZWS and other enterprises to expand their market 4.2 Demographic 4.2.1 Demographic People are becoming more cautious about environmental-problems, especially young-adults According to Nielsen, 70% of respondents admitted that organic-ingredients are crucial and more than 62% of them preferred products with environmental-friendly packaging (Hoang 2016) Besides, women, who often make purchases on behalf of men, are the main target of eco-friendly products (International Institute of Sustainable Development n.d.) Another study by Lutterman and Berkowitz stated that consumers with middle/high incomes and high-education are those would pay-more-attention to environmental-aspects Based on those terms, Vietnam is a potential market for eco-friendly products In 2018, Vietnamese 25-55 years old accounts for 45.67% of the total population where female over male ratio is 1:1 and 35.9% of 29 the population is urban (CIA 2018) By this way, ZWS has great advantages to develop quickly and generate high productivity Actually, pictures of products, which are made from woods or natural ingredients mostly be seen on the social network where almost 65% of population have access to (Internet World Stats 2019) Therefore, in term of segmentation, ZWS’s products can easily approach the largest customers segment in Vietnam Moreover, with the increase of young generation, it is easy for ZWS to use social media (fg.13&14) and influencer (fg.3&4) as promotion channel to target them Additionally, targeted consumers of ZWS are well-educated and have higher income, which is absolutely suitable to the demographic trend in Vietnam Actually, this brand understand clearly what its consumers concern and then provide information about its eco-friendly packaging to solve environmental-issue and outstanding effectiveness for health of natural ingredients (fg.10&11), which contribute to high position of ZWS in consumers’ minds Generally, ZWS relatively take full advantages of the growing demographic trends and adjust marketing stimuli to fit them Furthermore, over the past 10 years, Vietnam population has increased continuously from 86 million (2007) to 95.5 million people in 2017 (The World Bank 2017) According to appendix 4, the population is expected to keep rising in the future, especially female (appendix 5) However, the percentage of female belong to the age group from 25-55 years old has remained the same over the past 10 years and is likely to slowly decrease in the future (appendix 6) Therefore, to expand the future market, ZWS should expand its targeted segment, not only youngster who are cosmetic lovers but also develop more products for older female (kitchen-tools) and children (wooden-toys) because people will have children around 30 years old 30 4.2.2 Lifestyle 4.3 GROUP INFLUENCE 4.3.1 Informational Social factors have an important role in affecting consumers’ decision-making Because having zero-waste lifestyle and products is a new trend in Vietnam, consumers usually read feedbacks to get more information From our observation, the comment section of Giang’s video become a “bustling forum” with more than 1.314 comments, where consumers exchange-their-knowledge and feelings with other followers Additionally, this video receives massive-attention from society, which reached 480K views, showing that Vietnamese consumers actually use social-media to get information 31 Evaluation: Understanding that consumers usually find objective reviews or sharing of others for new products with lots of special features likes ZWS Therefore, besides encouraging followers to purchase products, Giang also stimulate them to use and then share their feelings about products and environment in the comment section (fg.4) By this way, ZWS can enhance consumers’ engagement, affect them by informational-influence, and know its weaknesses to improve 4.3.2 Identification From our observation about consumers’ response, we find out the strong identification-group-influence to consumers’ decision Specifically, consumers want to be recognized as eco-friendly people who have great concern about environmental-issue by buying ZWS’ products Absolutely, the appearance of Giang is the reason why consumers have this behavior Consumers are influenced by the image of Giang and they respectfully assume Giang is a model for environmental protection Therefore, most of them shared that they have bought the product because they want to be like Giang and have a great life as she has 32 Evaluation: Previously, Giang has posted many YouTube videos about environment, that’s why consumers consider Giang as a person who love environment and try to reduce plastic-waste Besides the meaningful actions of Giang towards environmental issues, consumers actually admire Giang because of her successful career and active lifestyle, which is the model for youngsters to follow By the strong influence of Giang, ZWS want its consumers to think that when they consume products from ZWS, they will belong to the group having high responsibility for environment and active life, which is leading by Giang – who is considered as self-concept and identity about environmental protection for consumers (Appendix 7) 33 Recommendations 5.1 Learning: Content -Re-arrangement - and - Color - Change 5.1.1 Content-Re-arrangement Although ZWS is relatively creative in the way conveying the message and providing interesting information about products to consumers, the messy arrangement makes customers confused and cannot spend time to read the whole (fg.5,10&11), which is difficult for customers to learn what main products or messages that this brand want to promote Consequently, the value of information is wasted Hence, the brand should re-organize the information provided on social media by separate it into small parts with bullet points, headings, icons to make the information become more appealing to consumers and gain their interested (McCarthy, 2011) 34 5.1.2 Change-Color Generally, customers usually recognize “green” is the signature color of environment Moreover, customers who use eco-friendly products will generally expect to see green color appear as the main theme and signal that presents environmental friendliness meaning, which is also easier for customer to remember the brand (Pancer, McShane & Noseworthy 2017) However, based on classical-conditioning analysis, ZWS choose pink as theme color (fg.1,12,13&14) without any explanation Pink is not a good color to describe ecofriendly-related products, and can reduce customers’ attention and ability to remember the brand Hence, ZWS should change its theme color into green to create eco-friendly feelings Furthermore, if ZWS use green as its main color, this brand can utilize the strong supporting from community towards eco-friendly brands through creating familiarity-affects to encourage consumers give positive affective-attitude to its products For-instance, Lại-Đây-Refill-Station, competitor of ZWS, uses green as main-color on their website, social media, packaging, store-decoration, etc With that color, this brand has succeeded in influent customer learning about the brand and it’s also in awareness-list of consumers when searching for sustainable products Hence, this is an interesting-example for ZWS to follow and make changes 35 5.2 Create - Behaviourial -Attitude ZWS had successfully influenced customers’ cognitive and affective attitude by providing consumers with thorough knowledge about eco-friendly packaging and health benefits of natural products; and creating positive moods about the brand (fg.7,8,10&11) However, ZWS is lack of creating behavioral-attitude, which is tendency that consumers will act specifically regarding a product Clearly, this brand is not calling consumers to actions such as making purchases or suggesting the brand to their friends ZWS has launched a online contest (operant conditioning), which is an effective way to encourage consumers’ engagement Nevertheless, this is a small activity Therefore, we recommend for ZWS that in every post on social media, besides giving information about products and creating happiness attitude, this brand should attach some information about price and call-to-action sentence with some sale-promotions such as “Buy now to get 5% discount”, “Buy get free only today”, “Share this post to join in lucky-draw” or “Tag your-friends to win give-away” By this way, ZWS not only call its consumers to make-purchase or recommend to their-friends, but also increase page’s engagement and create interesting moods for consumers 36 Appendix Appendix 1: Example of Reasoning Learning When promote its toiletries, ZWS firstly helps consumers recognize the serious level of plastic they release from bathroom every day, whether it comes from shampoo, body shower or toothpaste Then, ZWS emphasized that ‘our beauty plastic waste is responsible for 30 to 40 per cent of landfill waste’, according to WWF After that, they give consumers great solutions about using solid shampoo instead of buying shampoo bottles and throwing them away after empty, using menstrual cup instead of tampons or pads, using deodorant contained in tin-box instead of a plastic one, etc (fg.5) Appendix 2: Example of Reasoning Learning ZWS has posted many information about natural and effective ingredients of their coffee ground scrubs such as virgin coconut oil for hydrating, sunflower oil with rich Vitamin C to moisturize and help fight acne, peppermint essential oil for brighter skin and so on (fg.10) 37 Appendix 3: Example of Cleanliness For peppermint hair-soap, the brand not only promote the cleanliness ability of its products but also introduce other benefits for hair such as effective hair tonic, hair growing, dandruff reducing and high hydration (fg.7) Appendix 4: Vietnam Total Population, [https://data.worldbank.org/indicator/SP.POP.TOTL?end=2017&locations=VN&start=2007], viewed May 2019 Appendix 5: Vietnamese female Total Population, [https://data.worldbank.org/indicator/SP.POP.TOTL.FE.IN?end=2017&locations=VN&start=2007], viewed May 2019 38 Appendix 6: Vietnamese Female Population ages from 25 to 29 years old [https://data.worldbank.org/indicator/SP.POP.2529.FE.5Y?end=2017&locations=VN&start=2007 ], viewed May 2019 Appendix 7: Other influence of Giang to consumers’ decisions Furthermore, Giang shared that she has tested the products quality and adjusted every single detail to have the best version that satisfies her demands From consumers’ knowledge about Giang, she is a careful person and have strict criteria to select products Basically, consumers want to be recognized as a member of exclusive group including Giang and only few products can satisfy their high demands Therefore, when Giang said she is satisfied with these products, consumers will assume that there is no reason why they are not satisfied, and then they will make purchases 39 References  Berkowitz, L and Lutterman, K 1968, 'The traditional socially responsible personality', Public Opinion Quarterly, vol.32, p.169–185  Central Intelligence Agency 2019, The World Factbook: East Asia/Southeast Asia: Vietnam, CIA, United States of America, , viewed May 2019  Dung, T 2018, Lại Đây Refill Station - Cửa hàng sản phẩm thân thiện với môi trường, photograph, viewed 30 April 2019,  Ertemel, A & Ammoura, A 2017, The Role of Social Media Advertising in Consumer Buying Behavior International Journal of Commerce and Finance, 2(1), 81-90, 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also subject to penalty Further information relating to the penalties for plagiarism, which range from a notation on your student file to expulsion from the University, is contained in RMIT. .. of information is wasted Hence, the brand should re-organize the information provided on social media by separate it into small parts with bullet points, headings, icons to make the information. .. which can deeply convey informational message to customers, create familiarity affects to raise consumers affective attitude The other recommendation is creating behavioural attitude among consumers,