The Buying Behavior of University Students - Research Paper Example

1. Executive summary This project is a research on the buying behaviour of while buying laptop products. In this study a survey was conducted to investigate the thoughts of male and female students regarding the importance and costs of laptop products. It was found that most university students own a laptop computer and that students tend to consider the following features as important in a laptop: battery life, price, product quality, storage memory, Bluetooth, design and elegance. It was also found that university students have a high knowledge of computer skills. Their focus while buying was not just on well known brands but also on comparing various laptop products. 2. Marketing research problem Aim The aim of this research is to define the university students’ laptop market, in order to get information about the buying behaviour of university students while buying a laptop. Product reviews possess critical information regarding customers’ concerns and their experience with the product. Objectives To give advice to laptop manufacturers about the market for their products among students and to ensure that the manufacturers know exactly what students want in a laptop, such as the fact that university students want a cheap but a high quality product as they are short of money. Research questions This research is interested in answering the following questions: Which brand is the most popular laptop computer brand in the customer group of university students? What percentage of university students own laptop computers? Does brand name affect students buying behaviour? Does budget affect students buying a laptop? What is the role of brand name in consumers’ decision making of a customization process? 3. Sector background Marketing of laptops worldwide In recent years, handheld devices have become one of the fastest growing communication gadgets. Mobile technology (laptop computer) is becoming widespread and there is an urgent need for research in this area. There are many laptop manufacturers worldwide producing a variety of laptops to offer to the customers. The students market is one of the major markets for laptop computers. The percentage of University students using laptop is increasing. Buying a laptop as a university student is far different from buying a computer for work or pleasure. Students’ concerns while buying a laptop is more about budget or price than any other factor. Most university students are on a tight budget. But since they are constantly on the move, a laptop is required. It helps students to keep their class notes and their project organized, allows them to work virtually anywhere and, in todays modern world, it is as essential as their course textbooks. The quality and performance of laptops is increasing Not only are the types of laptops increasing but the quality and performance of laptops are also increasing. University students today have more education, their knowledge is wider than people older or younger than them, and their choice of laptops is different from other customer groups. 4. Literature review Brand name effect Brand name effect is the consumer’s perception of the role that brand name plays in the decision making process of choosing the most preferred product (service). In order to attract new customers and retain the current ones low prices should be offered. This would enable the development of a critical mass. Also, incentives should be offered. Similarly, low prices would increase the usage per customer. Furthermore, simple and clear pricing and billing (e.g. flat rate) would encourage and stimulate the use of various services (Sismanidis and Economides, 2007). Statistical survey is a general approach widely applied to gather customer information and study customer behaviours (Bennekom, 2002; Fowler, 1995; Vavra, 1997). According to information integration theory proposed by Bettman et al. (1975), in the context of product evaluations, consumers assign importance weights and scale values (utilities) to product attributes for which information is available at the time of decision making, and then combine these weights and values according to some rule (e.g. adding, averaging) to come up with an overall evaluation. Consumers with low product knowledge might not be able to perform trade-off contrasts among brands because these comparisons are likely to require some minimal level of knowledge and familiarity about brands (Ratneshwar et al., 1987). Small brands in a product category face twin disadvantages against the big brands: fewer buyers and lower purchase frequencies among these buyers. McPhee (1963) Online shopping College students bring $200 billion a year in buying power to the US market, with the average college student’s available discretionary spending totalling $287 each month (Gardyn, 2002) Because of their power in the marketplace, it is important for retailers and consumer behaviour educators to better understand this population’s attitudes toward shopping through traditional formats, such as local stores, and new, emerging formats, such as the internet. Furthermore, 90 per cent of college students access the internet daily (Gardyn, 2002). Electronic retailing continues to grow in size and importance as increasing numbers of consumers buy online, and apparel purchases represent a significant portion of online purchasing. Young men have also been regarded as the typical profile of the early adopters of online shopping. However, as the internet has become more ubiquitous, the profile of the online shopper has come to resemble that of the general population (Stores, 2001). Bhatnagar et al. (2000) found that customers’ perceived convenience of shopping on the internet had a positive impact on online purchase behaviour. However, Ramaswami et al. (2000-2001) found that for those who use online information sources for buying financial products, time availability was not associated with the propensity to conduct an online search for or purchase of these products. Bhatnagar et al. (2000) examined perceived risk as it influences consumer internet shopping behaviour. They defined two types of risk: product category risk and financial risk. High product risk was defined as situations where the product was technologically complex, satisfied ego needs of the purchaser, was high priced, and was sold based on its feel or touch. High financial risk was defined by fears about the safety of consumers’ financial information online. Uses According to Falba, Grove, Anderson and Putney (2001, p. 2), “laptops are powerful instructional tools for student learning”. Students’ use of laptop computers is becoming more prevalent in today’s universities. This more ubiquitous use of technology has caused several universities to uncover and manage new perceptual issues in addition to some of the more familiar issues from the era of computers found only in university labs. According to Shelly, Cashman, Gunter, and Gunter (2004), the use of technologies in the classroom can motivate the learners, encourage them to be problem solvers, and also create new ways to explore information. According to Silvernail and Lane (2004), educators use portable computers in a variety of ways, and most frequently in developing instructional materials; conducting study which are related to instruction; and communicating with colleagues. Marketing Strategy Kenichi ohmae(2001) , stresses that a strategist should focus on three key factors for success. In the construction of any business strategy, three main players must be taken into account: 1. the corporation itself, 2. the customer, 3 the competition. The business strategy of laptop companies’ is to produce a product which focuses on a student’s using habits. For example, the products should have good performance but must be priced low. Hypotheses This study analyzes the university students’ choice of laptops. It covers areas such as budget issues, loyalty of a brand and good design or high performance products but at lower prices. The following hypotheses were developed to guide this study: H1: students who are interested in laptop products will consider hardware more than the design of a product. H2: students who are not constrained by budget will consider the hardware of laptop. H3: students who are using laptop for entertainment more than study will pay more attention to the performance of a laptop. H4: male students give more importance to a laptop’s performance than female students H5: female students show more loyalty to a brand than male students H6: students belonging to the above 22 age group tend to buy laptop more than the 18-21 age groups. 5. Methodology In this research, quantitative and qualitative methods have been used for find out the answers. A one-page questionnaire was constructed with a mixture of open-ended questions about experiences of respondents. Sample The sampled population was from 50 students of a university in Liverpool. 40 of the respondents were asked to fill it in campus, and 10 of them were asked to send it via e-mails. The response rate was 100 percent (50 questionnaires were returned.) 5.1 Qualitative Interview The interviewees were chosen from 50 respondents. Two students answered this interview. Interview questions focused on the literature review and were linked to the questionnaire. A total 7 questions were designed for these interviews. 1. Do you have a laptop? What is your knowledge of using a laptop? This question is related to laptop market, to get information about how many of college students have a laptop and to define their knowledge of computer skills. 2. Does brand name affect you while making a decision? How important do you think is “brand name” for you to decide on your most preferred product? This question is related to the effect of brand name. The aim of this question is to get the answer of how a brand can affect a university students buying behaviour. 3. Have you ever been bothered by budget when you decided to buy a laptop? This question is designed to get details about budget of university students. 4. Do you like online shopping? Would you like to buy a computer online? This question is related with online shopping literature review. The aim of this question is to get information about the attitude of university students on online shopping. 5. Which factor will influence you to by a laptop? Is it design of a laptop or performance of a laptop? This question is related to the buying behaviour of customers. 6. What is the main reason for your using of a laptop? Is it study or entertainment? This question is designed to find the main purpose of students using a laptop. It will help us to understand whether students like to buy a good looking laptop or a high performance laptop. 7. Will you upgrade your laptop in the next year? This question is related to further marketing and marketing strategy. The figures obtained from the answers will help laptop manufacturers to know how many students will change their laptop next year. 5.2 Qualitative A direct survey was used to collect the data for this study. The students’ choice of laptop computers and their attitudes were measured on the following statements where respondents were asked to rate their level of agreement with each statement on a five-point scale. (1) I am interested in laptop computer products (2) The cost of a laptop will not bother me (3) I am loyal to one brand of computer (4) I would prefer to purchase a well designed product (5) I would like to compare the hardware of laptops before I purchase one (6) I will consider the performance of the laptop rather than price (7) I prefer to buy a laptop online (8) I own a laptop, but I will upgrade it next year (9) I use laptop mainly for my studies (email, research) (10) I use laptop mainly for entertainment (gaming, music) 6. Results In this study, 4 respondents said they do not have a laptop. That means 92% of university students own laptops. There were no significant differences in age levels or gender. Brand name did not affect them when they bought a laptop product. These are some of the other results: Budget is not the main issue for university students while buying a laptop. Students like to compare hardware of laptops. Most students did not want to buy a new laptop or upgrade their laptop. Students who took part in this study did not like shopping online. 6.1 Qualitative In this qualitative research, two interviews were conducted to gather the information. The results are shown as below. Budget doest affect university students. Most university students have high computer skills. Brand name does not have a significant effect on university students. They prefer to compare products using their knowledge but not brand names. University students use laptops more for studies than for the purpose of entertainment. This means that in students markets, the lower priced products are more popular than others. 6.2 Quantitative An analysis of variance (ANOVA) was conducted to determine the hypotheses H 1 Students who are interested in laptop products will consider hardware more than the products’ design ANOVA Sum of Squares df Mean Square F Sig. Q7 Between Groups 8.569 4 2.142 1.907 .126 Within Groups 50.551 45 1.123 Total 59.120 49 Q8 Between Groups 11.609 4 2.902 1.794 .147 Within Groups 72.811 45 1.618 Total 84.420 49 The means for question 7 (purchase a good design product) and question 8 (compare the hardware) were 3.760 (SD=1.09) and 3.540 (1.31). With a non-significant P = 0.126 and P= 0.147, the result of our H 1 is that for students who are interested in laptop products, their buying behaviour is not affected by good design or good hardware. H 2 Students who are not bothered by budget will consider hardware of laptop. Descriptive Statistics Mean Std. Deviation N Q5 3.1800 1.28873 50 Q9 3.4600 1.23239 50 The means for question 9 and 5 were 3.460 (SD=1.23) and 3.180 (1.28). With a significant P = 0.017 and P= 0.033, the result for our H 2 is that students who are not bothered by budget will consider buying a high performance laptop. H 3 Students who use laptop more for entertainment than studies will pay more attention to the performance of a laptop The means for question 12 (using laptop for studies) and question 13 (using laptop for entertainment) were 3.1 (SD=1.27) and 3.560 (1.33). With a non-significant P = 0.366 and a significant P= 0.050, the result of our H 3 is that if students are more interested in entertainment they will be interested in a high performance laptop. If they are using a laptop for studies, they will consider buying a budget laptop. ANOVA Sum of Squares df Mean Square F Sig. Q12 Between Groups 7.018 4 1.754 1.104 .366 Within Groups 71.482 45 1.588 Total 78.500 49 Q13 Between Groups 16.107 4 4.027 2.581 .050 Within Groups 70.213 45 1.560 Total 86.320 49 H4 Male students consider a laptop’s performance more than female students Group Statistics GENDER N Mean Std. Deviation Std. Error Mean Q8 MALE 30 3.6000 1.37966 .25189 FEMALE 20 3.4500 1.23438 .27601 The means for male and female were 3.6 (SD=1.38) and 3.45 (1.23). With a non-significant P = 0.424 the result for H4 is that male students are not more interested in a laptop’s performance than females. H5 Female students show more loyalty to a brand than male students Group Statistics GENDER N Mean Std. Deviation Std. Error Mean Q6 MALE 30 2.6000 1.10172 .20115 FEMALE 20 2.5500 .99868 .22331 The means for male and female were 2.6 (SD=1.10) and 2.55 (0.998). With a non-significant P = 0.612. H5 states that between two groups of females and males, the female group would be loyal to one brand of computer. According to our results, the female is not more loyal to one brand of computer than male. H 6 The above 22 age group of students prefer to buy laptop more than the 18-21 age groups Group Statistics AGE N Mean Std. Deviation Std. Error Mean Q10 18-21 22 2.5000 1.14434 .24398 22+ 28 2.7143 1.32936 .25123 The means for 18-21 and 22+ were 2.5 (SD=1.14) and 2.71 (1.33). With a non-significant P = 0.101, the result is that there is no difference in preferences. And when means are compared, the 22+ age group students prefer online shopping than the students of the 18-21 age group. 7. Further marketing research projects and conclusion In this study, it was found that university students’ market is different from other customer groups. In their further marketing research projects, the laptop companies can focus on the following areas: Students group is their main customer group Companies should pay more attention to student markets To offer lower price laptops to students who have budget issues Costing for students depends on their purpose of using a laptop, so laptop companies should focus on these different areas. This study shows that students do not like to purchase online, so maybe laptop companies should focus more on store sales. To sum up, students are willing to purchase laptop products, and that a laptop is very important in their life and in their studies. The potential market for laptop is very huge as most new college students will buy new laptops when they enter university or college in September. If laptop companies can offer different kinds of products to different types of students (customers), it is certainn that laptop companies will be benefited by student customers. 9. References Bennekom, F. C. V. (2002). Customer surveying: A guidebook for service managers, Customer Service Press. Bettman,J.R., Capon, N. and Lutz, R.L. (1975), “Cognitive algebra in multi-attribute attitude models”, Journal of Marketing Research, Vol. 12, pp. 151-64. Ratneshwar, S., Shocker, A.D. and Stewart, D.W. (1987), “Toward understanding the attraction effect: the implications of product stimuli meaningfulness and familiarity”, Journal of Consumer Research, Vol. 13, March, pp. 520-33. Bhatnagar, A., Misra, S.and Rao, H.R. (2000),“On risk, convenience and internet shopping behavior”, Communications of the ACM, Vol. 43 No. 11, pp. 98-105. Ramaswami, S., Strader, T. and Brett, K. (2000-2001), “Determinants of online channel use for purchasing financial products”, International Journal of Electronic Commerce, Vol. 5 No. 2, pp. 95-118, Winter. Kenichi Ohmae (2001),The Invisible Continent: Four Strategic Imperatives of the New Economy, HarperCollins, first edition McPhee, W.N. (1963), Formal Theories of Mass Behavior, Free Press, Glencoe, IL. Falba,C.,Grove, K., Anderson, D., & Putney, L. (2001), Benefits of laptop computers for elementary teachers, Journal of Research on Technology in Education, 33 (5). R Stores (2001),“Consumer trends in online shopping”, Vol. 83 No. 1, pp. 5-9. Sismanidis, E., Economides, A.A., 2007, User friendly congestion pricing in 3G., Ubiquitous Computing and Communication Journal 2 (2), 27–36. Shelly, G. B.,Cashman, T. J., Gunter, R. E., & Gunter, G. A. (2004), Teachers discovery computers: Integrating technology in the classroom, Third Edition. Boston, USA. Silvernail, D. L., & Lane, D. M. M. (2004), The impact of Maine’s one-to-one laptop program on middle school teachers and student: Phase one summay evidence, Research report 1, Maine Education Policy Research Institute University of Southern Maine Office. Read More