The effects of television advertisement on consumer purchasing decision a case of washing powder industry in ho chi minh city, vietnam

The effects of television advertisement on consumer purchasing decision: A case of washing powder industry in Ho Chi Minh city, Vietnam Mai Ngoc Khuong Pham Ngoc Thanh Nha International University - VNU-HCMC, Vietnam ABSTRACT This research attempted to examine the effect of television commercials, as known as TVCs, on customer purchase decision so as to enhance the effectiveness of advertising via this potential channel and eventually boost sales for washing powder businesses in Ho Chi Minh city, Vietnam The research procedure of quantitative approach was carried out with 314 respondents who purchased washing powder products and watched TVCs of washing powder products such as OMO, Ariel, Aba, Attack, Tide, Surf, Vi Dan and My Hao The outcomes showed that factors of TVCs can positively correlate to customer purchase decision Interestingly, customer purchase decision was also found to be affected by customer positive attitudes As a result, this study suggested that in order to achieve greater customer purchase decision, TVC producers or marketers should focus on a) creating a meaningful advertising message b) designing suitable timeline for TVCs’ repetition c) selecting endorsers who are familiar and trustworthy to the consumers In addition, marketers should also pay attention to the factors of interest, credibility and length of TVCs in order to maximize the indirect effects on purchase decision through customer positive attitudes Keywords: Purchase decision, customer positive attitude, TVCs, television commercials Introduction For ages, brands of the same product that share the same market must always compete severely to get customers to their side And television commercials, or TVCs, or broadcasted advertisements via television, have been one of the most powerful and popular tools to so In fact, television watching dominates today’s leisure activities, with a daily average of to hours reported by past studies (Frey, Benesch & Stutzer, 2007); hence, advertisements on TV seem to be worthy of investment TVCs also differentiate over other types of advertising due to its ability to reach a great number of audiences, make product promotions through sounds and images, influence customers’ preferences, remind customers about the products or brands, and eventually increase demand of the goods or services which makes profits for the firm Moreover, TVC is one of the reliable and convenient sources for customers to gain information about products and make decisions when shopping In particular, 74.3% of the audiences want to buy the new brand introduced in the market after watching TVCs and 66.3% of them claimed that TVCs help them make a better choice while shopping (Ashaduzzaman & AsifUr-Rahman, 2011) It is also true for Vietnam, especially Ho Chi Minh city – one of the most populous and active city in the country With a population of 8.6 million people (December, 2017) and high proportion of household 433 television, Ho Chi Minh city makes a substantially potential market for TVCs Knowing that, advertisers in Vietnam allocated 45% of advertising expenditure on TV advertising, compared to 33% on print ads and the rest on outdoor and radio ads And the amount of funding for this channel accounted for $800 billion in 2013 and is expected to increase significantly over years up to 2018 (Nguyen, 2018) According to the Consumer Buying Process (Jones, 2014), ‘Purchasing decision’ is the last stage prior ‘Purchase’ Purchasing decision, on the other hand, is claimed to be influenced by external factors such as advertisements during the stage of Gathering information (Nguyen, 2018) Therefore, companies must gain as much purchase decision from customers as possible to gain success in sale and to maximize their profits This once again emphasizes the importance of companies advertising effectively via television Literature Review 2.1 Customer Purchase Decision The term consumer decision generates an image of an individual who is evaluating all the attributes of the products or brands and rationally choosing one to satisfy their need for the minimum cost Many internal and external factors affect consumers’ purchase decisions, which makes consumer purchase process a complicated matter There are stages in the process of decision making of customers: needs or problems recognition, information search, evaluation of alternatives, decision making, and evaluation of the decision made (Solomon, Dahl, White, Zaichkowsky & Polegato, 2014) In other words, to make purchase decision, customers may undertake various forms of search and obtain information from many sources including internal sources and external sources Internal sources refer to the mental process of researching by memory and experience, which may serve as a basis for the decision process External sources refer to references such as personal family, friends or acquaintances; advertising such as commercials, sales persons, dealers, displays; mass media; and experiential such as handling, examining, trying goods or services (Munthiu, 2009) Knowing this, companies spend billions of dollar every year investigating various influences and understanding how consumers make decisions to buy products (Solomon, Dahl, White, Zaichkowsky, & Polegato, 2014) There are actually many factors which affect customer purchase decision, generalized into three categories namely Cultural factors, Social factors, Personal factors, Psychological factors (Hussain, 2017) It is impossible to take control of all these factors; however, marketers have taken into account several of them For example, up to now, firms have been trying several methods to so, from deeply scientific research such as looking at people’s brains to practical practices such as gathering customers’ information, tracking Web patterns, tracking positions and studying people’s habits to develop and send them suitable ads (Solomon, Dahl, White, Zaichkowsky, & Polegato, 2014) 2.2 Customer Positive Attitude Attitude is simply referred as any knowledge or feelings, either positive or negative, about an object or an activity Attitude can also be, in a more academic definition, ‘an enduring organization of motivational, emotional, perceptual and cognitive processes with respect to some aspect of our environment’ (Carvalho, 2013) Attitude can be used as a measurement, or an overall evaluation of how a person like or dislike an object, an issue, a person or an action Meanwhile, attitude toward the behavior can be seen as ‘a person’s general feeling of favorableness or unfavorable-ness for that behavior’ (Carvalho, 2013) Many past research has tried to look into the formation of attitude, where they found consumer attitude consists of cognitive component (knowledge and leering) and affective component (feelings and emotions) 434 These two components are found to link with conative component (tendency, intention or inclination) Specifically, conative component is defined as the intent or action component This intent refers to the likelihood of brand purchase with measures of behavioral intent, such as intention to search for information or purchase intention This component also refers to the consumer’s action toward the brand: trial, purchase, adoption, or rejection (Carvalho, 2013) With these three components, attitudes of consumers can be positive in many cases For example, Internet advertising seems to generate positive consumer attitudes because Internet advertising is often thought to be informative and entertaining (Tsang, Ho, & Liang, 2004) At the same time, attitudes can also be negative In fact, studies after 1970 provided evidences of the unfavorable public attitude toward advertising In particular, one study found that a majority of viewers regarded TV advertising to be seriously misleading (Schlosser, Shavitt, & Kanfer, 1999) In addition, attitudes tend to be enduring and not likely to change since they are based on people’s values and beliefs However, regardless of that characteristic, companies would want their consumers to have positive attitudes rather than negative ones about their offerings (Solomon, Dahl, White, Zaichkowsky & Polegato, 2014) According to the findings of Isen (1993), consumers who are having positive feelings such as: happiness, joy, delight, relaxation, inspiration, etc tend to perceive the television advertisements with pleasure and to have better recall of the advertising message as well as the product feature Yielding similar results, the author of Schwarz (2001) found that people would send a positive recommendation back if they have comfortable feelings about the target object Good feelings also partly push consumers’ persuasion as they boost positive thinking, which makes consumer make more impulsive decisions (Schwarz, 2001; Gardner, 1985) In contrast, customers who are having negative emotions tend to engage themselves in the behaviors of switching brands (Roos, 1999) From all the above, customer positive attitude can be seen as a considerably crucial factor in the process of purchase decision making of customers Advertisers should take it into account in order to create such TVCs which can receive positive attitudes from viewers; in other words, they may have succeeded half-way in enhancing customer purchase decision 2.3 Credibility Credibility depicts a person’s perception of how true a piece of information or news is It serves as a means for the information receiver to rate the source or transmitter of the communication involved In the case of marketing communication, a company or its representatives are the sources while the consumers are the receivers (Eisend, 2006) Credibility has been of particular interest of plenty of marketers because it is believed to have impact on the attitudes, intentions and behaviors of the information receivers Given the knowledge of a robust relationship between attitudes and upcoming behaviors, it is noticeably important for source credibility to be as persuasive as possible (Eisend, 2006) In initial source credibility research, dimensions of credibility were highlighted, namely competence (‘competence’, ‘expertise’, ‘expertness’, ‘knowledge ability’, ‘qualification’, ‘smart dimension’) and trustworthiness ('trustworthiness', 'character', 'personal integrity') (Hovland, Janis & Kelley, 1953; Hovland & Weiss, 1951) Moreover, the study of Soh, Reid and King (2009) concluded the combination of ‘consumer perception of reliability and usefulness of advertising’, ‘consumer affect toward advertising’, and ‘consumer willingness to rely on advertising for decision making’ Therefore, the advertisement will be able to introduce the products to consumers only when it can generate trustworthiness in their mind 435 2.4 Interest Interest refers to one’s personal feelings towards a certain brand or a certain type of product advertised (Hosein, 2012) In other word, interest can be a person’s favorite objects like a book or a movie; and activities like playing a certain sport or listening to a certain genre of music Past studies also showed that consumers might become interested in acquiring more information after they have become aware of the brand, products or services offered by a company which appear attractive to them (De Bruyn & Lilien, 2008) However, whether customer would purchase the product or not, interest simply illustrates that person’s liking, or positive feeling, about that brand or product (Hosein, 2012) On the basis of daily life, several studies have found a direct relationship between customers’ interest and their purchase behavior Specifically, most customers would have limited budget for purchasing goods and services, which makes them majorly depend on their interest to buy and consume the products Furthermore, customers’ interest can be used as an effective predictor of customer purchase behaviors (Yildiz & Dempski, 2012) One past survey studying 425 people also showed that the factor of interest was the most influential one that can lead to intention and purchase (Karthikeyan & Balamurugan, 2012) 2.5 Length The length of T be observed through the unstandardized regression coefficient (β) and illustrated in the path model Meanwhile, indirect impacts of independent factors on CUPUDE can be calculated by the product of the effects of independent variables on the mediating variable and the effect of the mediating variable on the dependent variable 4.3 Direct Effects on Customer Purchase Decision The first multiple regression, which tested Hypothesis (H2), revealed that 51.5% of the variance in CUPUDE could be explained by MES, ENDO, CRE, MUS, INT, LEN, REP and CUPOAT as independent variables of the model In particular, CUPUDE is majorly predicted and affected by four critical predictors: MES (β = 172, p < 05); ENDO (β =.160, p < 05); and REP (β =.205, p < 05) Additionally, CUPUDE is also noticeably affected by CUPOAT (β =.379; p < 05), which means Advertising Message, Credibility, Interest, Length, and Repetition of the TVCs can provide indirect effects on Customer Purchase Decision through the mediating of Customer Positive Attitude 4.4 Indirect Effects of TVC on Customer Purchase Decision The indirect effect of an independent variable on a dependent one mediated by a mediating variable can be calculated by multiplying the effect of the independent variable on the mediating variable with the effect of the mediating variable on the dependent variable [40] The second multiple regression that tested Hypothesis (H1) showed that 53.3% of the variance of CUPOAT could be explained by MES, ENDO, CRE, MUS, INT, LEN and REP as independent variables of the model In particular, CUPOAT was mainly influenced by five predictors: MES (β = 249, p < 05); CRE (β =.150, p < 05); INT (β =.262, p < 05); LEN (β =.118, p < 05); and REP (β =.126, p < 05) Therefore, through the 440 intervening of Customer Positive Attitude, the result indicated that Customer Purchase Decision can be indirectly affected by Advertising Message, Credibility, Interest, Length and Repetition of the TVCs 4.5 Path diagram of Customer Purchase Decision Figure 1: Path diagram of customer purchase decision Note: All coefficients were significant at 05 level 4.6 Significance of Indirect Effects TABLE V: DIRECT AND INDIRECT EFFECTS Variables Casual Effects LL UL Direct Indirect Total MES 172 094 266 0542 1389 CRE INT - 057 099 057 099 0265 0631 0910 1396 LEN 045 045 0147 0783 REP ENDO 205 160 048 253 160 0204 0784 CUPOAT 379 379 916 343 1.259 The study utilized the bootstrapping method in order to test the significance of the indirect effects or mediations, as recommended by Preacher and Hayes (2008), and the bootstrapped confidence intervals are at the 95% If there is a zero (0) within the interval range between the lower level for confidence interval (LL) and the upper level for confidence interval (UL), with 95% confidence, there is no mediation or indirect effect In contrast, if zero does not lie in the range of LL and UL, we can conclude that, with 95% confidence, the mediation or indirect effect is significant (Preacher & Hayes, 2004) 441 The outcomes are shown in “Table V”: The indirect effect of MES through the mediation of CUPOAT is between 0542 (LL) and 1389 (UL); that for CRE is from 0265 to 0910, for INT is from 0631 to 1396, for LEN is from 0147 to 0783, and for is from 0204 to 0784 Therefore, we can conclude that the indirect effects of MES, CRE, INT, LEN and REP on CUPUDE are obviously different from zero at p < 05 (two tailed) and the mediation of CUPOAT of this study is true The total effects of independent variables on customer purchase decision are 1.219; in particular, the direct effects by CUPOAT, MES, REP and ENDO account for 72.8% while the indirect effects by MES, CRE, INT, LEN and REP account for 27.2% 4.7 Discussion and Recommendation The study aimed to determine which factors of TVCs can have an impact on Customer Positive Attitude (CUPOAT) and Customer Purchase Decision (CUPUDE) in order to provide efficient recommendations on how to produce effective TVCs In particular, seven independent factors of TVC which are Advertising Message (MES), Credibility (CRE), Interest (INT), Length (LEN), Repetition (REP), Endorsers (ENDO) were analyzed, which revealed both similar and distinct results compared to several past studies On the one hand, the results showed that only three of these factors which are REP, MES and ENDO (in accordance of more significant effect) were proven to have direct impacts on CUPUDE Firstly, REP directly affects CUPUDE, quite similar the outcome of Majeed and Razzak (2011) and Turley and Shannon (2000) Thus, TVCs should be broadcasted with an appropriate number of times, recommended to be shown in prime time during the day so as to gain more views as well as to avoid “wear out” effects (Khuong & Nguyen, 2014), and Pechmann and Stewart (1988) recommended) Secondly, the significant direct effects of MES on CUPUDE are quite similar to the proven results of Sofi and Nika (2013), as well as of Maheswaran and Meyers-Levy (1990) Therefore, TVC producers should carefully take MES into account, which means creating a meaningful, unique, attractive, understandable and truthful one, in order to influence more customers in deciding what to buy Finally, ENDO can also place certain impacts on CUPUDE, much the same results proven by past researches namely Sallam and Wahid (2012), and Chi, Yeh and Tsai (2011) but opposite to that of Khuong and Nguyen, (2014) TVC producers, hence, should choose Endorsers, whether they are celebrities or not, while considering their familiarity, trustworthiness, expertise, loveliness and credibility At the same time, the indirect effects of five factors of TVC which are MES, CRE, INT, LEN and REP through CUPOAT on CUPUDE were also confirmed in this study In particular, CUPOAT was quite similarly proven in previous studies to have direct impacts on CUPUDE such as in the studies of Sallam and Wahid (2012), Anh (2014), Yang, Al-Shaaban (2014), Khuong and Nguyen (2014) which was more clearly verified in this study Following that, this study also showed that CUPOAT turned out to have the strongest association among factors affecting CUPUDE Subsequently in this study, INT does not have direct effect on CUPUDE, in contrast to Fabian’s (1986), but have indirect effects mediated by CUPOAT, quite similar to Khuong and Nguyen’s (2014) As this factor asserts the most indirect effect, TVC producers should conduct market research on what type of TVC customers love watching so that they can have positive attitude and their purchase decision can be influenced This is also true for the factors of CRE and LEN which only have influences on CUPUDE via CUPOAT Previous researches recommended in more details that long advertisement which lasts 30 seconds had greater impacts than short advertisement that is only 15 seconds (Khuong & Nguyen, 2014; Jeong, 2007) Credibility of TVC should also be enhanced in terms of honesty, credibility, reliability and dependability so that customer attitude can become positive towards the advertised products and eventually decide to buy the product, similarly to Kim, Ferrin and Rao (2009) Other than the three indirect effects of INT, CRE and LEN, two factors of MES and REP have both direct effect (as stated above) and quite significant indirect effect on CUPUDE, with Anh (2014) yielding quite similar 442 outcomes Thus, to “kill two birds with one stone”, TVCs should be made with strong advertising messages and broadcasted with appropriate frequency Conclusion The main purpose of this study is to find out which factors of a television advertisement can affect Customer Purchase Decision The research applied multivariate statistical methods including Factor Analysis, Standard Multiple Regression and Path Analysis to analyze the positive relationships among variables in the model of Customer Purchase Decision proposed Explanations and recommendations were based closely on empirical findings of the study Regarding correlations among variables, bivariate correlations and Pearson product-moment correlation coefficients were utilized to test the significance of the relationships between each independent variable and dependent ones These were also applied for the relation of mediating variable with other variables In the end, results acquired show that there are four independent variables have direct effects on purchase decision: Customer Positive Attitude towards TVCs, Advertising Message of TVCs, Repetition of TVCs and Endorsers in TVCs Meanwhile, there are five variables having direct effects on Customer Positive Attitude: Advertising Message of TVCs, Credibility of TVCs, Interest in TVCs, Length of TVCs and Repetition of TVCs And as mentioned above, Customer Positive Attitude has a significant direct effects on Customer Purchase Decision which eventually results in indirect effects of the five variables above on purchase decision Based on these results, TVCs can be looked closely at and, as a result, TVC producers can acknowledge which factors to focus on to gain their final goal of purchase decision, which also helps them to save costs in TVC production In terms of limitations, firstly, factors of TVCs examined in this study were limited to only a list of seven There are many other factors of TVCs in need of researching to provide a full perspective of customer decision and attitude Secondly, this study was conducted over a quite short period of time In other words, it was difficult to take into new and current trends and quite likely to become obsolete over time Finally, the procedure of data collection was carefully controlled and involved the sample of 314 respondents who are target customer of washing powder products and live in Ho Chi Minh city, Vietnam In other words, this study should be applied mainly for Vietnam market, specifically the washing powder industry Therefore, future research need to take into account of all three limitations above as a stepping stone so as to avoid common pitfalls in researching or to expand research in a wider and more interesting direction to provide a more generalized outcome that can be applied in all markets and in any circumstances References Anh, V D L (2014) The impacts of television advertisement of TH true milk on consumer buying behavior (Master thesis, International University HCMC, Vietnam) Ashaduzzaman, M., & Asif-Ur-Rahman, S M (2011) Impact of Television Advertisements on buying pattern of Women in Dhaka City European Journal of Business and management, 3(3), 16-22 Carvalho, C A (2013) Impact of consumer attitude in predicting purchasing behaviour A paper available at< http://iaso com br/pdf/Impact% 20of% 20Consumer% 20Attitude% 20in% 20Predicting% 20Purchase% 20Behaviour pdf>, accessed on 18th of December Chi, H., Yeh, H R., & Tsai, Y C (2011) The influences of perceived value on consumer purchase intention: the moderating effect of advertising endorser Journal of International Management Studies, 6(1), 1-6 Comrey, A L., & Lee, H B (1992) A first course in factor analysis (2nd ed.) 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