Advertisement On Consumer Purchase Intention

Published Date: 02 Nov 2017

Hammad Naveed

09U0483

Section D

Ms. Amina Talat

Research Methods

26/11/2012

Lahore School of Economics

Table of Content

Serial Number

Title

Page Number

1

Chapter 1: Introduction

3

2

Chapter 2: Literature Review

7

3

Chapter 3: Methodology and Framework

20

4

Bibliography

24

5

Questionnaire

23

CHAPTER 1

INTRODUCTION

Overview of the study:

Advertising is an outline of messages that normally attempts to manipulate possible customers to buy or to use more of a particular type of product or service. A lot of advertisements are intended to manufacture enhanced using up of those products and services during the organization of "brand image" and "brand loyalty". Every probable standard is used to put across these communications together with "radio, television, cinema, magazines, newspapers, video games, the Internet and billboards". Marketing is normally done by an advertising group on behalf of an organization. Another definition of advertisements is that "Advertising is a type of message for marketing and worn to hearten or influence viewers to carry on or obtain a few new procedures.

Consumer purchase intention on the other hand is a consumers’ willingness to buy a certain product, service or an idea due to different sources of motivation that position the product in a consumers mind for example by motivation through advertisement.

There are different applications of "consumer purchase intention" but its major employment is on the marketing strategy for creation of superior marketing campaign for example by accepting that customers are extra amenable to food promotion while they are hungry, we study to sketch snack advertisements in the afternoon.

So, advertising and consumer purchase intention are both closely related to each other hence having a direct relationship with each other. Further in the paper different types of advertisements for example humorous, serious etc would be discussed and also the mediums used by the companies for advertising and their effects on consumer purchase intention would be discussed to prove this relationship.

Background of the study:

Advertising is not a new concept and has been going on from a long time back and its importance can be realized from the fact that a course of ‘product marketing’ was offered by the University of Pennsylvania in 1905 so the phenomenon of the effects of advertisement on consumer behavior was known to people from about more than 100 years back and the first print ad was printed in 1631 further supporting the statement.

Many scientists have focused on motivation for centuries and come up with many motivation theories like Freud, Maslow etc and here we can account advertising also as a tool for motivating the consumers to buy different products. Some motivate through psychological advertising and some by looking at the celebrities who endorse different brands so all the big companies now leaders in their markets give great importance to marketing through ads and have been doing it from many years in order to target their customers or in other word influence the consumers purchase intention. However in the recent years focus on ‘consumer purchase intention’ has got a boost and all the large companies have realized its importance hence it has become a vital part of social sciences today.

Importance of the study with respect to the world:

The major aim of this study is to discover the effect of advertisements on consumer purchase intention and so it would be of great importance to almost all the companies who have advertisement as an integral part of their marketing strategy as every firm want to attract as many people as it can and make them buy their products through mainly influencing their buying intentions in different ways. Businesses that cannot recognize how a customer’s brain functions will have a more demanding time figuring out how to aim a promotion that will grasp the interest of customers. Trying to determine what drives, attracts and motivates consumers is very precious information. Marketers who can effectively find out what makes potentially concerned customers tick will have gained a great prospect to apply the information in array to build up a well-built campaign.

The study will facilitate firms and organizations develop their promotion strategies by accepting issues similar to psychology of how consumers "imagine, sense, reason and choose between diverse alternatives".

Other benefits would include making better marketing Strategies that include grasping expert timing, efficient advertising techniques and satisfying consumers. Also another benefit would be that the study would tell about Social Marketing, to ensure thoughts are conceded to customers rather than forceful sales.

Importance of study with respect to Pakistan:

Having a population of 180 million in addition to per capita expenditure of $836.3, Pakistan surely justifies the potential for a raise in consumer expenditure, according to a global resource on retail; per capita consumer expenditure in Pakistan has gone up by 37% between 2006 and 2011. Advertising in print and electronic media, mushrooming of billboards discount offers and in store promotional campaigns all prove that consumer spending is definitely going up, so with all this happening this study would be very useful for the businesses in Pakistan as more and more new firms are entering are Pakistani markets and for them to be successful they need to know the consumers very well in order to influence them to buy their products.

Since 2002, the Pakistani media has develop into a powerful and an independent one and the figure of private television channels has developed from three state-owned channels in 2000 to 89 in 2012, according to the Authority, Radio channels are plentiful and are considered a very central source of information specially in the rural areas so this study would useful as the study consists of articles regarding the impact of television and radio on the consumer behavior.

Advertisements play an important role in influencing consumer purchase intentions in Pakistan, an example of this can be seen from Ufone’s advertising campaign, which used humor in its ads and was very successful to attract customers and influencing them into buying their products.

Research Question:

What are the effects of advertisement on the consumers purchase intention?

CHAPTER 2

LITERATURE REVIEW

Narbutas and Susnienė (2008) conducted the research to examine as well as to discover the psychological impact of advertising on the consumer buying behavior. On the base of theoretical investigation three aspects "cognitive, emotional and behavioral" were recognized and evaluated during the survey. The researcher also attempted to find out the theoretical study and review of "psychological impact of the advertising on the customer behavior to empirically test the psychological impact of the advertising on the customer behavior (based on the example of companies)". The objective of the survey was to establish the impact of advertising on the customer behavior, the process of the research worn was a quantitative survey and it was accomplished that advertising influences the consumer through the cognitive aspects. The survey results discovered customer’s knowledge, as one of the psychological cognitive aspects, the paper also emphasized that the second psychological feature which was (emotional) influenced the respondents further since it caused optimistic thoughts for the prime part of respondents. It was also accomplished that the absolute endeavor of advertising was achieved that ads do create a psychological vigor on the consumers.

Hashmi (2010) conducted a study to see the impact and accessibility of electronic advertisement on college students and expose the approachability of advertisement allocated to plea worn, search the effect of character worn in advertisements on customer behavior and set up the brunt of advertisement on purchase behavior of customer. "Psychometric properties of scale" property of advertisement´ was also recognized on the sample of the learning. Self-explanatory questionnaires were used to gauge the effect of commercials. The sample consisted of "university students (NMIMS) and six brands were determined to be used as FMCGs unit". To examine the efficiency of advertisements on the college students of NMIMS the researcher used a "self-explanatory questionnaire consisting of 25 fixed item responses that were adopted beside with the instructions". The paper accomplished that advertisement appeal along with its success were optimistically related and it was also established that natives shape attitudes towards items on the foundation of their "attitude, awareness and acquaintance" concerning these objects. Results of the paper also exposed that the captions used in commercials in addition had immense sway on customers as they are used in commercials as a dominant and interest gaining factor. The researcher also concluded that there was a considerable relationship connecting persuasion and title of commercials.

Sukran and Gulmez (2002) they conducted the research to find out that whether the "amount of outdoor advertisements influences consumers who are existing in Sivas region and to gauge the effect on participants' purchasing manners". The research also attempted to position the diverse personality of outdoor advertisements in evaluation to additional advertising instruments along with its outcome on consumers buying behaviors, in addition the researcher also aimed to find the designation given to the "position of outdoor advertisements amongst the advertisement instruments which be thought to have an consequence on the purchasing manners of customers and determines the effect plus size of outdoor advertisements on customers’ purchase behaviors in addition to to point out the differences connected with those dimensions in admiration of various demographics". The paper also put attention on customers breathing in the city center of Sivas. A face-to-face interview survey was conducted on 400 people who live in Sivas city and who are selected with non-random sampling". The results of analysis indicated so as to the respondents with stumpy income do not observe the outdoor advertisements extraordinarily much and that they discover outdoor advertisements unproductive when they are compared to respondents by means of high incomes. The end result of the study also showed that public usually has positive opinions regarding outdoor advertisement and they believe that outdoor advertisements be extra striking and imaginative when compared to other advertisement types and their material amount lends them a useful visual brunt. The paper in addition proposed so as to outdoor advertisements created dissimilar thoughts, which are successful in informing and persuading public and also between customers with superior instructive and income levels, outside advertisements are more prominent and their visibility is mounting.

Ayanwale and Ayanbimipe (2005) conducted a study to determine and look at the control of advertising on customer buying behaviors, conclude the influence of age on advertising and construct suggestion for added enhancement in advertising as well as brand management so as to help out Cadbury Nigeria PLC particularly and other firms in their marketing efforts to boost their market shares. The article weathered the hypothesis that the age group of customers does not decide the treatment of advertising efforts by Cadbury Nigeria PLC. This study, which was based on an examination of 315 randomly chosen customers of food, drinks in "Lagos, Ibadan and Ile-Ife, cities in Southwestern Nigeria", examined the task played by advertising in influencing customers liking for Bourn vita, which is "one of the most important food drinks in the Food along with Beverage manufacturing in Nigeria". In the study both expressive and inferential figures were used in analyzing the information composed. Percentage analysis was used in groping variables such as customer brand preference, media preference awareness sources. It was determined that brand liking does continue living in the food drink industry and various customers do not buy whatever is offered or inexpensive, if a merchandise is good value for its price it will command brand loyalty. Nonetheless, the study also anticipated that advertising helps in foretelling product quality and price before the consumers. The paper concluded that advertising has the foremost influence on consumers’ liking for Bourn vita and it has in no minute measure, contributed to its accomplishment.

Ashraf and Alkubise(2102) conducted a study to discover the factors that add towards the effectiveness of online advertisements and influence on customer purchasing intention as of the viewpoint of developing countries. The research was based on a five dimensions theoretical model; the article empirically analyzed the outcome of online advertisement on purchasing intention by means of information composed from 339 students. The findings showed that Income, Internet skills, Internet usage per day, advertisement content and advertisement location are important factors that influence the effectiveness of online advertisement.

Also in their research two distinguished results emerged foremost was the key important part of website language additionally second and perhaps the most prominent was the impact of rest of the public’s opinions on the effectiveness of online advertisement.

Bishnoi and Sharma (2009) conducted a study that aims to set up whether the "residential background of consumers has a varying influence on their buying decisions due to the influence of TV advertising". This research was conducted with an outlook to learn the impact of TV advertising on the buying manners of teenagers in India. The study was focused on the school/college going teenagers of Haryana to know the influence of TV advertising on their buying behavior. For this purpose the paper used a multistage sampling method and the study comprised of four districts of Haryana which were selected at random from all the administrative divisions. The study recommended that rural teenagers like television advertising more than their urban counterparts and television advertising has improved their participation in product assortment and purchase. It can also conclude that there is a considerable variation in the perception of both rural and urban teenagers on the issue that demand for product purchase is influenced by TV advertisements. Further, the study also revealed that the buying behavior of male teenagers is more influenced by television advertisements than their female counterparts.

KHIM YONG et al. (2006) the article focused on whether banner advertising affects purchase patterns on the Internet. The authors calculated the impact of banner advertising on present customers’ probability of repurchase, at the same time as accounting for length dependence. Definite spotlight in this paper was the function of banner advertising in digital surroundings, for example Internet. The study also discusses the association connecting this study with previous studies. The outcome showed that the number of exposures, number of Web sites, and number of pages all contain an optimistic consequence on repeat purchase probability, while the figure of unique creative’s has a downbeat outcome. The conclusion also added to the general advertising literature by viewing so as to advertising affects the purchase manners of recent customers.

Burhan Ali Shah (2012) This research investigated the association linking the variables drawn in, by captivating the 200 responses in twin cities of Pakistan, and conclude the relationship connecting emotional response & environmental response with dependent variable consumer buying behavior. The article tells that customers who use diverse type of telecom services along with who shop pioneering services from their franchises in Islamabad and Rawalpindi were taken as the population of this cram. 200 questionnaires were circulated to customers and questionnaires were adopted from preceding research and responses. This was a relational study so several regressions were used. The outcome showed that independent variable that was emotional response creates discrepancy in the customer buying behavior which is dependent variable. The outcome of this reading showed that there was a affirmative bond of expressive response with customer buying behavior and no relationship connecting environmental response with customer buying behavior. Consequently, it was accomplished that customers buy products by emotional response, rather than environmental response

Ripon Kumar et al. (2012) conducted a research concerning the impact of sales promotion and advertising concurrently on consumer’s purchasing behavior. The article showed that sales promotion is mainly effectual on the customers who travel through the secondary path and it can lead the customers psyche to brand switching. The study also establishes that sales promotion along with advertising is a lot more effective in low involvement group products where a simple promotional indication can guide the customers to obtain merchandise. The paper also suggested to the marketers to be responsive of new or unfamiliar products because sales promotion may well have well-built negative effects on customer’s internal price orientation and supposed quality. It also highlighted the significance of integrating the advertising among different promotional actions to improve the increase of sales of a good.

Abideen and Rashid (2009) they conducted a research to premeditate upon the impact of television advertising on children and to recognize those serious impacts which escort to behavioral and eating turmoil in children. Impacts of TV advertising were recognized as needless purchasing, little nutritional food and covetousness. The reason of the learning was to conscious upon the impact of TV promotion on children, to classify these serious impacts, and empirically check a few of the significant factors that how these factors impinge on children. Samples were strained through convenience sampling approach as of four cities of Pakistan that is "Islamabad, Rawalpindi, Bahawalpur & Multan".Revelation to TV Advertising will be independent variable and dependent variable is "low nutritional food, unnecessary purchasing, and materialism". Television advertising on children could sway determinants such as needless purchasing, little nutritional food, and materialism. Research proof recommended that TV advertising consequences in obesity, shaped by taking food that is bad for you, low in nourishment, and high in SSF. It is also recommended that over an extensive time, serious watching of atrocious advertisements and programs increases the probability of a temperament towards violent behavior among children. The study also showed that children’s consciousness of TV advertising and manipulates on parents’ purchase choice are significant predictors of children’s attitudes to TV advertising even though the sway of television advertising is not the single consequence on children’s purchase behavior.

Ursula Grandcolas et al.(2002) the study talks about SMS proving to be a successful innovative instrument in marketing communications, worn either on its own or incorporated interactively with TV, print as well as poster advertising. Purpose of this study was to inspect customer reaction to SMS advertising, as well as branding plus purchase intention effect. The research paper tells that although the growth of Internet based m-commerce has been unsatisfactory, commercial applications intended for text messages have developed speedily. The paper also explored the function of SMS or text message advertising. An investigation of text marketing campaigns demonstrates the startling usefulness of this latest type of telemarketing. It was concluded that SMS advertising is useful mutually in invigorating response as well as as a branding vehicle, as established by important improvements in brand position and purchase.

Zoubi and Bataineh (2010) the purpose of their study was to discover the association among the celebrities in advertising and the buying result of customers. This study was based on a field work, of which population incorporated "economic faculty student in Jarash University who were enrolled in all BA programs". Additional student Categories were not integrated in the learning. The three major questions incorporated whilst the companies employ celebrity endorser in their advertising, how companies choose the famous person endorser and how companies grip the risks of using celebrity endorser within their advertising. The outcome of the cram intended to discover the use of celebrities in advertising along with their consequence on the buying pronouncement. The fallout showed that television advertising, which uses celebrities, is eye-catching. There was no end product found of using the celebrities on the buying decision.

Qun and Lun (2004) they conducted a research and intended at gyrating down the off-putting effects brought by sexual plea by adding together humorous factor in the advertising communication. Challenging sexual appeals have been pervasively worn in advertising in all countries for a lot of products in the history. There were three variables used in the research: "Gender, perceived humor and likability to the advertisement". The two independent variables mentioned in the article were gender and perceived humor to the advertisement and the independent variable was the amiability to the advertisement. The learning productively tested that apparent hilarity of an advertisement is completely connected with the niceness to the advertisement, even despite the fact that the direction of the casual flow is indefinite. The research completed that there was no major disparity on the likability among the groups uncovered to advertisement and with no humorous rudiments, even though the treatment check had ensured the two advertisements were professed in a different way in humor and similarly in sexiness.

Allan (2001) in his study concluded the effects of well-liked music in advertising to conclude together the "theoretical (the effect of popular music on the processing of advertising messages) and practical (the design of more effective advertisements using popular music) implications". A pilot test was conducted (Philadelphia) to select the popular music and brands to be used in this experiment. A test was reported that experienced the effects of three integrations of admired music in advertising that were "original lyrics, altered lyrics, and instrumentals (plus a control treatment with no music) on attention and memory". The outcome of this study clearly indicated that admired music can be personally considerable to some persons, and when used in advertising can have an effect on attention and reminiscence. And in conclusion, original vocals emerge to be more effectual when an individual finds personal implication in the well-liked music used in advertising, at the same time as altered vocals prove to be more successful when the contradictory is true.

Rajagopal (2010) this article aimed at analyzing the impact of radio advertisements on urban commuters towards buying routine in retail supplies and attempts to lay down the purpose of radio advertising on distribution of information on the sales promotions. The impact of radio advertisements on the store fondness and buying preferences are analyzed based on experimental assessment. This study was been conducted in 4 business offices of international business companies in Mexico City with a total potency of 3492 employees, of which 1422 employees were enclosed beneath this study. The study uncovered that shopping manners of urban customer at retail stores in reply to radio advertisements is exceedingly inclined by the "physical, cognitive and economic variables".

CHAPTER 3

METHODOLOGY

Research type

The study is quantitative in nature and the plan of quantitative research is to hit upon the association connecting the dependent variable and the independent variable. The study will be based on measuring the sample on the area under discussion, which is "effect of advertising on consumer purchase intention", and then to end with the connection between the variables is to be built by means of statistical tools.

Data type and research period

Secondary data would be used for this research mainly the data for the literature reviews will be taken from the internet. The sample size mainly consists of samples from 2 universities; Lahore University of Management Sciences and Lahore School of Economics. Next the data relating to the variable will be found and then it would be analyzed and evaluated by studying the overall trends around the world. The time frame under consideration for this research would be the period from 2000 to 2012.

Sources of data

The data was collected from different web-based sources mainly including online libraries of different countries and other published articles.

Population, Working population and planned sample

The total population consists of generally all the consumers but the working population consists of 40 students from 2 universities i.e. LSE and LUMS will be considered

Research hypothesis

Ho: There is a significant relationship between means of advertisement and consumer purchase intention.

H1: There is no significant relationship between means of advertisement and consumer purchase intention.

Ho: There is a significant relationship between music and consumer purchase intention.

H1: There is no significant relationship between music and consumer purchase intention.

Ho: There is a significant relationship between celebrity endorsement and consumer purchase intention.

H1: There is no significant relationship between celebrity endorsement and consumer purchase intention.

Ho: There is a significant relationship between age and consumer purchase intention.

H1: There is no significant relationship between age and consumer purchase intention.

Ho: There is a significant relationship between emotions and consumer purchase intention.

H1: There is no significant relationship between emotions and consumer purchase intention.

Techniques

Regression would be used in order to examine the results. Our study would have combined effects of time series and cross sectional data.

Data analysis

The statistical package SPSS will be used to investigate the data. Regression will be conducted to verify the connection involving the variable over the time. Graphs and tables would be used to correspond to the results.

Data interpretation

The outcome generated from the statistical software will be compiled. Graphs and tables will be used to come across out the trends over the years.

Theoretical framework and variables under consideration