(Luận văn thạc sĩ) 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 TVC is the duration of time, usually in second, of which the advertisement was broadcasted on TV Two typical length for commercial are 15 seconds and 30 seconds (these two are popular since they can be easily distributed via other channels like YouTube, radio) At present time, there are more various lengths possible to one commercial: 5-second (YouTube), from 3-5 minutes (via a music video) or even longer (in the means of a short story-movie) It is obvious that a too short commercial may be insufficient to retain itself in the audiences’ or consumers’ mind; however, if the ad is too long, people would become bored and switch channels to skip the commercial According to Fabian’s (1986) research, there was a noticeable positive relationship between the length of a commercial and its advertising effectiveness The audience can be allowed with more change to attend to the TVC given a suitable ad length, which means consumers can learn and understand advertising message as well as the product information in the most effective manners A suitable length of the commercial is also believed to have better ad recall efficiency since it partly eliminates the wear-out phenomenon which is often experienced when the ad is too long and the audiences get tired of the ad In other the words, consumers need to see a commercial made with a fine length Therefore, depending on the purpose of the advertising campaign and the target customers, advertisers should choose the appropriate length 2.6 Endorsers One of the well-known strategies to promote a product is to use advertising endorsers An endorser can be defined as an individual that supports and recommends to the audiences some certain products, services, brands and behaviors (Stafford, Stafford and Day, 2002; Roozen, 2008) Endorsers are classified into three principal categories: celebrities, experts and typical consumers (Wang, Tokarz & Savage-Dunn, 2002) The term ‘celebrity endorser’ refers to a person who enjoys public recognition and utilize that recognition to appear in an advertisement with a product on behalf of it Using celebrities yields a potential benefit of catching attention of the audiences; however, it also has a higher risk of negative reputation or unwanted scandals related to the personal life of the celebrity (McCracken, 1989; Phan, 2013) Meanwhile, an expertise endorser can be described as a person who possesses superior and professional knowledge about the product (Friedman & Friedman, 1979) They are believed to have credible information 436 which is truly helpful to solve the consumer’s problem (Ohanian, 1990) Finally, a typical consumer endorser can be understood as an ordinary person with no prior knowledge of the product This type of endorsement is meant to reflect the typical experiences and feelings of consumers (Friedman & Friedman, 1979) Each type is believed to play an effective role in various product segments (Wang, Tokarz & Savage-Dunn, 2002) For instance, celebrities can often be found to promote products bearing high social risk such as jewelry or cars Experts, on the other hand, are suitable for introducing high-performance products such as medicine and professional appliances And typical consumers are effective in advertising daily use products such food, beverage or FMCG (Khuong & Nguyen, 2014) To examine the relative effectiveness of an endorser, CATLEF model is used, which includes variables: Credibility (C), Attractiveness (A), Trustworthiness (T), Likeability (L), Expertise (E) and Familiarity (F) (Roozen, 2008) 2.7 Advertising Message The advertising message can be simply understood as ‘anything’ the brand, the product or the company is trying to convey through the advertisement to the consumers, namely the name, logo, slogan, the features of the product, etc It can also be a brief and simple yet catchy slogan, or the touching and meaningful long-whole story that reflects the identity of the product of the brand A good message can easily lead to a good advertisement In other words, advertising message can be defined “as a dominating theme of an ad that motivates consumers to remember the advertisement and purchase the product in the advertisement” (Mueller, 1987) Past research proposed two types of message: positively framed message and negatively framed message (Grewal, Gotlieb & Marmorstein, 1994) Positively framed messages are defined as communications that emphasize a brand’s advantages or the potential gains to consumers in a situation In contrast, the reversed definition is true for negatively framed messages Advertisers would often prefer if their advertisement conveys positively framed messages According to the research of Sofi and Nika (2013), the messages of ads have an impact on customer purchase behavior For example, logo can easily be remembered by customers if it is really impressive while slogan can attract customers and can make the product differentiate from others 2.8 Repetition Repetition of advertising is an act of displaying of the ad and letting the audiences watch it more than once (Khuong & Nguyen, 2014) Various attempts to understand the effectiveness of repetition have been made in marketing One can simply understand, that increasing exposure to advertisement can result in increasing memory; however, seeing advertisement for too many times would affect negatively to consumer as they may feel irritating and intrusive Thus, decision on the repetition of the adverts, accompanied by other decisions like the scheduling of advertisements, the number of different advertisements to produce and customer’s pretesting of advertisements, should be carefully evaluated Research showed that the advertisement repetition also has a significant effect on purchase decision of consumers (Majeed & Razzak, 2011) Specifically, the first display of television advertisement raises the curiosity, the second time leads to an evaluation and in the third time customer decide whether to purchase product or not (Krugman, 2000) It was also found the one to three times of repetition are enough for purchasing (Vakratsas & Ambler, 1999) According to all the dependent and independent factors above, this study proposes the following Hypotheses: H1: Factors of TVCs positively affect Customer Positive Attitudes 437 H2: Factors of TVCs and Customer Positive Attitude positively affect Customer Purchase Decision H3: The effects of Factors of TVCs on Customer Purchase Decision are mediated by Customer Positive Attitude Methodology 3.1 Research Design and Data Collection The focus of this study is to determine which factors have an impact on customer purchase decision The main method employed to collect data and examine the effects between variables is the Quantitative approach Questionnaire was built for the survey, which was designed in the form of print handouts to distribute offline and Google Form to distribute online Most of the questions included were based on five-point Likert scale which require respondents to rate the given items on the scale of five points from ‘1’ indicating ‘strongly disagree’ and ‘5’ indicating ‘strongly agree’ Target audiences of this survey are the target customers of washing powder products namely OMO, Ariel, Aba, Attack, Tide, Surf, Vi Dan and My Hao In this case, the respondents chosen will be female customers, aged from 18 to 60+, living in Ho Chi Minh city Convenience sampling was applied and carried out at private households where housewives were interviewed and public places such as universities, offices and coffee shops where female adults were surveyed In the end, the sample population collected was 314 respondents, which is a suitable size according to Comrey & Lee (1992) 3.2 Factor Analysis and Reliability Test Two Exploratory Factor Analyses (EFA) were carried out for two groups of variables, one group of independent variables and one group of dependent variables The principal component extraction method and varimax rotation were conducted to determine the relationship among variables Descriptive Statistics were also used to illustrate the demographic data as well as other variables in the research model Moreover, Multiple Regressions were utilized to find out the impacts of the independent variables (music, credibility, endorsers, interest, advertising message, repetition, length) on the dependent variables (customer positive attitude, customer purchase decision) The results of EFAs indicate that the Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy was 0.857 for the independent variables and 0.855 for the dependent variables According to Tababachnick & Fidell, the KMO index ranges from to and the minimum value for an acceptable factor analysis is 0.6, which means the data collected was suitable for further analysis At the same time, the Bartlett’s Test was conducted and the factor analysis was considered appropriate when significant ≤ 0.05 (Tababachnick & Fidell) TABLE I: SUMMARY OF INDEPENDENT VARIABLES Given Names Number of Items Cronbach’s Alpha Credibility (CR) 850 Interest (INT) 826 Length (LEN) 763 Endorsers (ENDO) 777 Advertising Message (MES) 811 Repetition (REP) 749 Music (MU) 802 438 As provided by the study, there were components extracted and all the Eigenvalues are greater than (the minimum value is 1.207) Furthermore, the extraction sums of squared loadings equal to 63.502 which is greater than 50% This means these factors account for 63.502% of data variance indicating good reliability of these variables Additionally, the Cronbach’s coefficients range from 0.749 to 0.850 illustrating the internal consistency of these variables as shown in ‘Table I’ TABLE II: SUMMARY OF DEPENDENT VARIABLES Given Names Number of Items Cronbach’s Alpha Customer Positive Attitude (CUPOAT) 820 Customer Purchase Decision (CUPUDE) 808 Similarly, two dependent factors make up 57.911% of the total variance and both Eigenvalues values are also greater than (with smallest is 1.034) Their Cronbach’s alphas are also demonstrated in ‘Table II’ Results and Discussions 4.1 Profile of Consumers involved in the study TABLE III: DEMOGRAPHICS OF PARTICIPANTS Gender - Female - Male Total Age - 18-25 - 25-35 - 35-45 - 45-60 - Over 60 Total Relationship Status - Single - Married Total Education Level - High School - College - University - Vocational Education - Post-graduate Total Monthly Income - Below million VND - 2-6 million VND - 6-10 million VND - 10-20 million VND - Over 20 million VND Total 439 Frequency Percent 314 314 100.0 0.0 100.0 106 110 48 21 29 314 33.8 35.0 15.3 6.7 9.2 100.0 147 167 314 46.8 53.2 100.0 83 22 191 11 314 26.4 7.0 60.8 2.2 3.5 100.0 58 128 99 24 314 18.5 40.8 31.5 7.6 1.6 100.0 4.2 Correlations between Factors of TVC and Customer Purchase Decision Pearson Product-moment Correlation Coefficients (R) are applied to illustrate the relationship between Factors of TVC and Customer Purchase Decision TABLE IV: CORRELATION AMONG VARIABLES MES ENDO CRE MUS INT LEN REP 8.CUPOAT Mean SD CUPUDE 522* 504* 358* 132* 510* 287* 517* 642* 3.37 68 499* 513* 287* 482* 342* 406* 582* 3.67 62 501* 251* 542* 236* 405* 517* 3.17 64 289* 388* 248* 285* 492* 3.33 71 256* 243* 168* 210* 4.05 64 297* 432* 598* 3.02 74 342* 373* 3.70 62 471* 3.43 72 3.29 66 * Correlation is significant at 0.005 level (one-tailed) As can be seen in ‘Table IV’, there are positive and significant relationships between all independent variables and the dependent CUPUDE, where: MES (R= 522, p