Exploring the factors affecting laptop consumers brand loyalty in HOCHIMINH CITY

MINISTRY OF EDUCATIION AND TRAINING UNIVERSITY OF ECONOMICS HOCHIMINH CITY NGUYỄN THỊ HỒNG NGUYỆT EXPLORING THE FACTORS AFFECTING LAPTOP CONSUMER’S BRAND LOYALTY IN HOCHIMINH CITY Major : Business Administration Major Code : 60.34.05 ECONOMICS MASTER THESIS Supervisor: Dr Nguyễn Thị Mai Trang HOCHIMINH CITY - 2010 ACKNOWLEDGEMENTS The study about “Exploring the factors affecting Laptop consumer’s Brand Loyalty in Ho Chi Minh City” was not going to be completed without the assistance and support from different relevant sources First of all, I would like to express my whole-hearted appreciation to my supervisor, Dr Nguyen Thi Mai Trang, who has provided me with her strict comments and invaluable advices during the process of my study Besides, my special thank would be sent to my parent Without their warmly constant encouragement, my further pursuit and attendance in Master of Business Administration in order to then conduct this dissertation would not have been brought to life Profound gratitude was also extended to my cousin, Ms Nguyen Thi Bich Duyen, who has assisted me in the process of data collection and to my close friend, Ms Do Thuy, who has guided me to the usage of SPSS software An honorable mention goes to my dear husband, Mr Ly Son This study is the result of his encouragement, help and love Finally, I would like to send sincere thanks to my friends for their great contributions and motivation to the accomplishment of my dissertation ABSTRACT This study investigated and reported the effect elements and their affected level on brand loyalty for the laptop product in Ho Chi Minh market The important variables comprised Self-expressive value, Distinctiveness, Perceived Quality, Perceived Price The framework of in-depth - interview in form of the qualitative research based on the items of the previous research to discover new observed variables Then, the researcher would modify available observed variables of the previous researches in order to meet with laptop category and Ho Chi Minh market The 300 respondents in the quantitative research who were from the universities in Ho Chi Minh city were used to test reliability (Cronbach Alpha), Correlation (Exploring Factor Analysis) and test Multiple Regression Model After analyzing, the research’s results indicated that all of observed variables obtained reliability and correlation, except one variable (bl5) Besides, all of four factors have influenced on brand loyalty The different affected levels of the factors as well as the implications of the study were also represented in this paper i CONTENTS CHAPTER 1: INTRODUCTION 1.1 Research background 1.2 Problem definition 1.3 Research questions and objectives 1.4 Limitations and research methodology 1.5 Research implications 1.6 Thesis structure CHAPTER 2: LITERATURE REVIEW 2.1 Brand 2.2 Brand loyalty 2.2.1 Consumer’s loyalty and brand equity 2.2.2 Value strategy of brand loyalty 2.3 The factors affected on brand loyalty in Ho Chi Minh market 2.3.1 Self-expressive value of brand personality 2.3.2 Distinctiveness of brand personality 10 2.3.3 Perceived Quality 11 2.3.4 Perceived Price 12 2.4 Research model 12 2.5 Summary 13 CHAPTER 3: RESEARCH METHODOLOGY 3.1 Research design 15 3.1.1 Exploratory study 15 3.1.2 Main survey 16 3.1.2.1 Sample size 16 3.1.2.2 Research process 16 3.2 Measurement 17 3.2.1 Measure of Sef-expressive value 18 3.2.2 Measure of Distinctiveness 18 3.2.3 Measure of Perceived Quality 19 ii 3.2.4 Measure of Perceived Price 19 3.2.5 Measure of Brand Loyalty 19 3.3 Summary 20 CHAPTER 4: DATA ANALYSIS AND RESULTS 4.1 Descriptive data analysis 21 4.2 Measure Assessment 23 4.2.1 Cronbach Alpha Reliability Analysis 23 4.2.2 Exploring Factor Analysis (EFA) 24 4.2.2.1 EFA results of the independent variables 24 4.2.2.2 EFA results of the dependent variable 25 4.3 Hypotheses Testing 25 4.3.1 Testing Assumptions of Multiple Regression 25 4.3.2 Testing Hypotheses between Independent Variables and Brand Loyalty 26 4.4 The relationship among the quality variables and the quantitative variables 28 4.4.1 Testing the relationship between gender factor and SEV 28 4.4.2 Comparing the different influence levels of buyer factor on Brand Loyalty 29 4.4.3 Testing the different influence levels of used time factor on PQ 30 4.4.4 Testing the different influence levels of using brand name factor on D 32 4.5 Consumer’s evaluation on Brand Loyalty following using brand names 33 4.6 Summary 34 CHAPTER 5: CONCLUSIONS 5.1 Overview 35 5.2 Main findings 35 5.2.1 Antecedents of Brand Loyalty 35 5.2.2 Outcome of qualitative variables affected on quantitative variables 36 5.3 Theoretical Implications 36 5.4 Managerial Implications 37 5.4.1 Perceived Price 37 5.4.2 Distinctiveness 38 5.4.3 Perceived Quality 39 5.4.4 Self – expressive value 39 iii 5.5 Further research 40 References 41 Appendice 45 Appendix 1: Questionnaire 45 Appendix 2: EFA results of independent variables 47 Appendix 3: EFA results of dependent variable (Step 1) 49 Appendix 4: EFA results of dependent variable (Step 2) 50 Appendix 5: Testing assumptions of multiple regression 51 Appendix 6: Multiple Regression Line results 53 iv LIST OF FIGURES Figure 2.1 : Two models about the relationship between product with brand Figure 2.2 : Research Model 13 Figure 3.1 : Research process 17 Figure 4.4 : Histogram, Normal P – P Plot and Scatter Plot of Brand Loyalty 51 Figure 4.5 : Mean of each using brand name on Brand Loyalty 34 v LIST OF TABLES Table 3.1 : Scale of Self – expressive value 18 Table 3.2 : Scale of Distinctiveness 18 Table 3.3 : Scale of Perceived Quality 19 Table 3.4 : Scale of Perceived Price 19 Table 3.5 : Scale of Brand Loyalty 20 Table 4.1 : Sample characteristics 21 Table 4.2 : Cronbach Alpha of observed variables of independent variables 23 Table 4.3 : Correlations between Self – expressive value, Distinctiveness, Perceived Quality, Perceived Price and Brand Loyaly 51 Table 4.4 : The results of Regression Coefficients analysis 28 Table 4.5 : Independent samples t – test results of gender factor and Self-expressive value 28 Table 4.6 : The analysis results of the different influence levels of buyer factor on Brand Loyalty 30 Table 4.7 : The analysis results of the different influence levels of used time factor on Perceived Quality 31 Table 4.8 : The analysis results of the different influence levels of using brand name factor on Distinctiveness 32 Table 4.9 : Mean of each using brand name on Brand Loyalty 33 CHAPTER 1: INTRODUCTION The introduction chapter identify the research background, present the problem statement, the research questions, and introduce the research methodology, the objectives as well as limitation of the study Furthermore, the significance of the research problem and thesis structure are also outlined 1.1 Research background Meeting human’s the various complicated demands is an extremely harsh problem for a firm, especially a new firm which has just penetrated in a market Moreover, to survive in the high competitive globalized and integrated environment in the recent years, the firm must be hardworking not only for producing high quality products, but also for understanding its consumer’s all requirements and desires In particular, it is critical for the survival of a firm to retain its current customers and to make them loyal to the brand (Mellens, Dekimpe, Steenkamp, 1996) For these reasons, the success of a firm depends largely on its capability to attract customers towards its brands and maintain them loyal Aaker (1996) argue that if we can maintain consumer loyal with our brand, we have many benefits which are come from reducing the marketing cost, trade leverage, attracting new consumers as well as having time to respond to competitive threats Therefore, it is necessary to study Brand Loyalty and explore the factors affected on it, then we have a suitable branding strategy In fact, Vietnam is a dynamic and developing economy with higher and higher economic growth rate year by year, and it is industrialized and modernized towards an integration into global economy This means consumption demand about technology and high-technology product is dramatically being increased, especially with the laptop product – a product has various functions can be used for various working goals Therefore, the imported laptop which is estimated will be increased significantly in the future That also means the competition is quite fierce in this field; and this can be proved through the appearance of most prestigious laptop brands around the world in Vietnam Furthermore, Hochiminh city is the best dynamic area in Vietnam It is known as the central economic of Vietnam with the highest economic growth rate in both commercial industry and agriculture The rapid growth in economic together with the particular advantage conditions, Hochiminh city is a place that concentrates the largest population in nationwide So, Hochiminh city is considered a place that has the best numerous laptop user in Vietnam 1.2 Problem statement Customer loyalty plays more and more important role in business field This matter attracts not only businessman but also researcher Previous research suggest that loyal customers spend more than non-loyal customers, act as advocates for a brand by engaging in positive word of mouth, and are therefore “at the heart of a company’s most valuable customer group” (Zeithaml et al., 1996) Besides, it can cost as much as six times more to win a new customer than it does keep an existing one (Rosenberg et al., 1983: 45) Hence, the increase and retention of loyal customer become a key factor for the long-term success of the companies However, how to maintain and increase loyal consumer to a brand or what factors affect on Brand Loyalty, and what influence level of the factors on Brand Loyalty are an outstanding problem Another problem is that most of the brand loyalty models are conceptualized by researchers and validate in the developed countries This poses the question of whether or not those models will work well in a developing country as Vietnam 1.3 Research questions and objectives To solve the problems defined above, this research aims at answering the following question: ► What are the key determinants affect on Brand Loyalty? By evaluating the influence level of the factors on Brand Loyalty, the importance of increasing loyal customer shall be highlighted to eventually help the managers identify the right direction of their investment and keep their customers under a tough competitive environment 39 communication strategies will concentrate on light weight, beautiful colors and nice design 5.4.3 Perceived Quality To stress on the factor of the Perceived Quality brought to consumers, laptop distributors should build up a good warranty policy in accompany with warrantors’ polite attitudes and behaviors Besides, brand manager should build up a marketing strategy focuses on the laptop’s quality through creating a link between laptop and quality factor such as a public test about the laptop battery’s durability or the search of technology iformation in student test 5.4.4 Self-expressive value Brand managers should take their interest in the factor of Self-expressive value, and building consumers’ brand loyalty strategy Besides, in order to meet consumers’ requirements about Self-expressive value, the brand managers should consider the following:  Building suitable and specific self-expressive values are another area that brand managers should focus Brand managers can build a successful self-expression though the effective use of brand personality which can help consumers enhance their self-expression Furthermore, the analysis result from compared between male and female in self-expression: male had an extroversive expression tendency and female had an introversive expression tendency will help the brand managers to have a view in self-expression tendency between men and women in order to have a proper actions in building a suitable expression strategy to their target consumers  Considering increasing the psychological factor and giving selfexpressive values to consumers is necessary to put into the expression strategy All of the above suggestions should be taken into action frequently and strictly to improve consumers’ brand loyalty In addition, another recommendation is that the 40 Brand Loyalty should be measured and reviewed on a regular basis for continuous improvement To measure consumer’s loyalty, a report for each buying time of consumer should be done Besides, the researcher also suggests that laptop brands should be measured by the percentage of new consumers introduced by their friends, colleges, and so on 5.5 Further Research The research makes an important linkage between the concept of the effective factors and the Brand Loyalty However, it has some limitations Firstly, the research is only studied one product which is the laptop so it limits itself on the further implication to propose the measurement scale of this study on Brand Loyalty for other categories in general However, this limitation can be a foundation for leading to the future research about the affected elements and its affected level on brand loyalty for other products Secondly, the target object of this study is the laptop using consumers Consequently, it has not yet mentioned the perception of potential customers as well as the reason why consumers change into other brands Furthermore, due to the limitation of time and capacity, the research is only executed in Ho Chi Minh area and sample is selected randomly in the universities Thus, the data can not be illustrated entirely the current situation about the relationship between affected factors such as Self-expressive value, Distinctiveness, Perceived Quality, Perceived Price and Brand Loyalty Finally, this research is only considered four factors, including Self-expressive value, Distinctiveness, Perceived Price, and Perceived Quality But in fact, there are many other factors affecting on brand loyalty such as brand awareness, advertising, promotion, distribution channel system, and so on Therefore, any replacement of the other factors also will affect more or less the survey findings and the researcher’s conclusions 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Lenovo Hp Toshiba Khác…… Xin cho biết mức độ đồng ý anh/ chị phát biểu cách khoanh tròn vào MỘT số theo qui ước sau cho dòng phát biểu 1: Hoàn toàn không đồng ý 2: Không đồng ý 3: Hơi không đồng ý 4: Bình thường 5: Hơi đồng ý 6: Đồng ý 7: Hoàn toàn đồng ý Phát biểu Ký Mức độ hiệu đồng ý X giúp thể phong cách S1 X phản ánh tính cách S2 X làm tăng giá trị S3 X giúp bậc S4 X thể nam tính S5 X khẳng định vị trí, đẳng cấp S6 X giúp thể chuyên nghiệp (sự hiểu biết công nghệ, sản phẩm,…) S7 X giúp thể khả thẩm mỹ (về tính thời trang,…) S8 X mang phong cách riêng so với thương hiệu khác D1 X hoàn toàn khác biệt so với thương hiệu khác D2 46 X có số tính vượt trội thương hiệu khác D3 X có nhiều màu sắc, kiểu dáng để chọn lựa PQ1 Màu sắc, kiểu dáng X ấn tượng PQ2 X dễ sửa chữa thay linh kiện PQ3 X có khả tản nhiệt tốt PQ4 Giá X tương xứng với chất lượng lợi ích mang lại P1 Giá X có tính cạnh tranh cao P2 Nhìn chung, hài lòng với giá X P3 X lựa chọn hàng đầu BL1 Tôi nghĩ khách hàng trung thành X BL2 Tôi tiếp tục sử dụng X hài lòng quen thuộc với X BL3 Tôi sử dụng X thương hiệu khác có nhiều lợi ích BL4 X thương hiệu để giới thiệu với người khác BL5 Tôi thích X thương hiệu khác BL6 MỘT SỐ THÔNG TIN CÁ NHÂN  Xin vui lòng cho biết giới tính bạn □ Nam  □ Nữ Tình trạng gia đình bạn □ Độc thân - riêng □ Độc thân - chung cha mẹ □ Đã lập gia đình  Máy vi tính (laptop) bạn sử dụng là: □ Tự mua □ Nhờ người thân mua □ Được cho, tặng  Bạn thường sử dụng máy tính (laptop) tuần: □ < □ □ 15 – 21  □ □ 23 – 30 tuổi □ 30 – 40 tuổi □ >= 40 tuổi Xin vui lòng cho biết mức thu nhập hàng tháng bạn (triệu đồng): □ 21 Xin vui lòng cho biết bạn thuộc nhóm tuổi □ < 22 tuổi  – 14 3,1 – triệu □ >7 triệu □ Doanh nghiệp Nhà nước Cơ quan mà bạn công tác □ Chưa làm □ Doanh nghiệp tư nhân □ Cơ quan quản lý Nhà nước □ Khác CHÂN THÀNH CẢM ƠN SỰ HỢP TÁC CỦA CÁC ANH/ CHỊ 47 Appendix 2: EFA results of independent variables KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Bartlett's Test of 846 Approx Chi-Square 1684.025 Sphericity Df 136 Sig .000 Total Variance Explained Extraction Component Initial Eigenvalues Sums of Squared Loadings % of Cumulative Total Variance % 5.141 30.242 2.277 Rotation Sums of Squared Loadings % of Cumulative Total Variance % 30.242 5.141 30.242 13.397 43.639 2.277 1.396 8.209 51.848 1.055 6.204 58.053 957 5.632 63.684 825 4.854 68.538 712 4.190 72.728 672 3.955 76.683 648 3.813 80.496 10 525 3.089 83.585 11 510 2.998 86.584 12 454 2.668 89.251 13 449 2.644 91.895 14 400 2.355 94.250 15 361 2.121 96.371 16 324 1.906 98.277 17 293 1.723 100.000 Extraction Method: Principal Component Analysis % of Cumulative Total Variance % 30.242 3.706 21.800 21.800 13.397 43.639 2.518 14.812 36.612 1.396 8.209 51.848 2.035 11.970 48.582 1.055 6.204 58.053 1.610 9.470 58.053 48 Rotated Component Matrix(a) Component S1 607 148 120 136 S2 653 089 123 200 S3 764 176 023 -.056 S4 835 094 053 -.080 S5 606 -.014 -.019 258 S6 761 109 004 057 S7 611 292 254 -.185 D1 304 641 205 -.040 D2 337 607 275 -.050 D3 136 615 360 -.046 PQ1 -.068 689 -.006 380 PQ2 121 777 062 154 PQ3 217 089 162 735 PQ4 014 109 274 801 P1 027 239 743 163 P2 089 063 734 225 P3 104 184 702 073 Extraction Method: Principal Component Analysis Rotation Method: Varimax with Kaiser Normalization a Rotation converged in iterations 49 Appendix 3: EFA results of dependent variable (step 1) KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy .867 Bartlett's Test of Approx Chi-Square 718.455 Sphericity Df 15 Sig .000 Total Variance Explained Initial Eigenvalues Extraction Sums of Squared Loadings Component Total % of Variance Cumulative % Total % of Variance Cumulative % 3.418 56.971 56.971 3.418 56.971 56.971 851 14.190 71.161 591 9.856 81.018 477 7.950 88.967 374 6.235 95.202 288 4.798 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Component BL1 792 BL2 860 BL3 831 BL4 723 BL5 BL6 795 Extraction Method: Principal Component Analysis a components extracted 50 Appendix 4: EFA results of BL (step 2) KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy Bartlett's Test of Approx Chi-Square 856 681.775 Sphericity Df 10 Sig .000 Total Variance Explained Initial Eigenvalues Extraction Sums of Squared Loadings Component Total % of Variance Cumulative % Total % of Variance Cumulative % 3.263 65.255 65.255 3.263 65.255 65.255 598 11.958 77.213 477 9.544 86.757 374 7.482 94.239 288 5.761 100.000 Extraction Method: Principal Component Analysis Component Matrix(a) Component BL1 802 BL2 870 BL3 837 BL4 723 BL6 800 Method: Principal Component Analysis a components extracted 51 Appendix 5: Testing Assumptions of Multiple Regression Table 4.3: Correlations between SEV, D, PQ, PP and BL SEV SEV D BL 000 000 000 133(*) Sig (2-tailed) 1.000 1.000 1.000 021 N 300 300 300 300 300 Pearson Correlation 000 000 000 305(**) 1.000 1.000 1.000 000 N 300 300 300 300 300 Pearson Correlation 000 000 000 402(**) 1.000 1.000 1.000 000 N 300 300 300 300 300 Pearson Correlation 000 000 000 230(**) 1.000 1.000 1.000 000 300 300 300 300 300 133(*) 305(**) 402(**) 230(**) Sig (2-tailed) 021 000 000 000 N 300 300 300 300 300 Sig (2-tailed) N BL PQ Sig (2-tailed) PQ P Pearson Correlation Sig (2-tailed) P D Pearson Correlation * Correlation is significant at the 0.05 level (2-tailed) ** Correlation is significant at the 0.01 level (2-tailed) Figure 4.4 Histogram, Normal P – P plot and Scatter plot of Dependent Variable - BL Histogram Dependent Variable: BL 40 30 20 10 Std Dev = 1.00 Mean = 0.00 N = 300.00 25 75 25 5 -.2 -.7 -1 -1 -2 -2 -3 -3 Standardized Predicted Value 52 Normal P-P Plot of Standardized Predicted Value 1.00 75 Expected Cum Prob 50 25 0.00 0.00 25 50 75 1.00 Observed Cum Prob Scatterplot Dependent Variable: BL -1 -2 -3 -4 -3 -2 -1 Standardized Predicted Value 53 Appendix 6: Multiple Regression results Variables Entered/Removed(b) Model Variables Entered Variables Removed Method PQ, P, D, SEV(a) Enter a All requested variables entered b Dependent Variable: BL Model Summary(b) Model R R Square 571(a) 326 Adjusted R Std Error of the Change Statistics Square Estimate R 316 82676213 Square Change F Change df1 df2 Sig F Change 326 35.608 295 000 a Predictors: (Constant), PQ, P, D, SEV b Dependent Variable: BL ANOVA(b) Sum of Model Squares df Mean Square F Sig Regression 97.357 24.339 35.608 000(a) Residual 201.643 295 684 Total 299.000 299 a Predictors: (Constant), PQ, P, D, SEV b Dependent Variable: BL Coefficients(a) Model Unstandardized Standardized Coefficients Coefficients t Sig .000 1.000 B Std Error (Constant) 1.636E-16 048 SEV 133 048 133 2.784 006 D 305 048 305 6.378 000 P 402 048 402 8.416 000 PQ 230 048 230 4.814 000 a Dependent Variable: BL Beta ...ACKNOWLEDGEMENTS The study about Exploring the factors affecting Laptop consumer’s Brand Loyalty in Ho Chi Minh City was not going to be completed without the assistance and support... students in the marketing, branding and management fields but also other people in the society as well 1.6 Thesis structure This research is organized in five chapters The beginning is the introduction... Laptop brands in Ho Chi Minh city market, the chapter will provide a theoretical background about brand, Brand Loyalty as well as the factors affected on Brand Loyalty Based on these, the conceptual