Samsung Smartphone External Factors - Case Study Example

Abstract The Smartphone industry has emerged as an essential part of the business and personal life, notably Samsung is habitually favoured by a large number of consumers. As such, consumer behaviour towards Smartphone has increasingly gained momentum given the relative dynamism in the industry. In this respect, a number of external influences affect the consumer’s decision-making processes. The aim of this paper is twofold: to offer an in-depth analysis of external factors influencing the decision-making process in the Smartphone industry. This retrospect paper draws upon relevant theories and empirical research in support of its arguments. Contents 1.0 Introduction 4 2.0 External Factors 4 2.1 Reference Groups 4 2.1.1 Diffusion of Innovation 6 2.1.2 Opinion Leaders 6 2.2 Family 6 2.2.1 Dynamics of Husband-Wife Behaviour 7 2.2.2 Family Life Cycle 8 2.3 Social Status 8 2.4 Culture and Core Values 9 2.5 Sub Culture 9 2.6 Impact of Gift Giving Behaviours 10 2.6.1 Relationship Marketing 11 3.0 Conclusion 11 External Factors Affecting Smartphone Purchase 1.0 Introduction The increased usage of Samsung Smartphone among many consumers has amplified research on external factors influencing its purchase. Evidently, different consumers are typified by divergent characteristics which affect their buying behaviours. Social factor (groups, roles and status, family) and personal factors (personality, self-concept, age, and occupation) potentially influence the buyer’s decision in purchasing Smartphone. The product, Samsung Smartphone comes in various shapes, sizes, designs and functionality. Avid users are attuned to the product given its compatibility and functionality in various features. Some of the well-known models include Samsung Galaxy SIII and Samsung Note II, to name a few. Its growth has seen an increased usage in various parts of the globe. Various external factor influence the consumer purchase behaviours on this product. 2.0 External Factors 2.1 Reference Groups Reference groups are groups within the society that have indirect or direct influence regarding the attitude of consumer’s decision-making (Rani, 2014). Reference groups undoubtedly influences the consumers in three ways namely; informational, value experience and utilitarian. Normative referents have a stronger influence in comparison to comparative referents, in which the latter, is stronger at the information seeking stage, whereas comparative referents are weak in alternative evaluation stage (Rani, 2014). Simply put, normative groups consist of peers, colleagues, teachers and parents. Through direct interrelationship with the normative reference groups, individuals can develop attitudes and values (McDaniel et al., 2010; Boone, and Kurz, 2010). Comparative reference includes celebrities, entertainment stars and sports heroes. From these groups value, expressive influence is realised in which there is a psychological need to associate with a person or group and is often seen through the acceptance of positions showcased by others. Information seeking, complying with other people’s preference and adopting other values necessitates effective communication and observations of behaviours and options (Priest, 2013). Reference groups influence products decision based on two features of “conspicuousness”. Firstly, is that the product must be exclusive; a product may not be conspicuous in the event that everyone virtually owns similar products. Secondly, for a reference group to affect brand decision, the product should be seen or identified by others. Smartphone are thought to influences from reference group influence (Priest, 2013). With respect to theory of conspicuousness, four types of products are evidenced namely; privately consumed luxuries, publicly consumed luxuries, publicly consumed necessities and privately consumed necessities. Boone and Kurz, 2010) places Smartphone as public consumed luxury with respect to its consumption. He furthers by suggesting that individuals are more vulnerable to influences from publicly consumed products, in which luxury products are increasingly conspicuous that product necessities. 2.1.1 Diffusion of Innovation Various factors play an imperative role regarding the speed at which smartphones are purchased. Most consumers are willing to pay higher cost, with respect to the associated brand technology. The importance of style and design in Smartphone is highlighted since it increases the propensity of an individual lengthy purchase process. The importance of education attainment highlights the speed of adoption implying that individuals working in professional services are inclined to purchase Smartphone for business or personal use. Contrariwise, research plays a vital role in influencing the speed at which the smartphones are brought. Individuals who take longer to conduct research have a higher propensity of making purchase, as opposed to those that simply purchase the product on the basis of immediate needs. Therefore, individuals engaged in research are likely to pay a higher price for latest Smartphone since it is linked to high technological capabilities 2.1.2 Opinion Leaders Opinion leaders offer first-hand information to users given their divergent experiences on products. With a large group of followers, the potential of influencing consumers is significantly high. Opinion leadership assumes a two-way communication, where messages flow through the media to reach the opinion leaders, who then pass the information to consumers. Opinion leaders and their followers more or less belong to similar groups. 2.2 Family Family is considered as a vital consumption consumer organisation in the society, wherein members of the family constitute the most influential reference groups. Two families are evidenced in a consumer’s life. From the parents, the individuals acquire orientation toward personal ambition, economics and self-worth. The nature of family decision-making is typified by distinct role perception, role performances and role definition by various members of the family (Atul and Anant, 2014). Members of a family serve dissimilar roles in decision-making which eventually influences the family’s resources. Some of the family members are information holders, whereas others have a great deal of power since they are selective in information transmission. During the purchase of a Smartphone, a great deal of conflicts may arise (Atul and Anant, 2014). Smartphone are relatively expensive hence; they may use considerable resource when acquiring the devices. In the event that the disagreement arises, suitable resolution tactics can be developed in this respect. Conflicting pressure can be witnessed in families with children, or when one spouse works out of home. Atul and Anant (2014) assert that the occurrence of a disagreement within the family members suggests that the family members attempt to resolve conflicts prior to making joint purchase decisions. 2.2.1 Dynamics of Husband-Wife Behaviour A spousal sense of fairness is strategies for contemporary couples in solve conflict when making family decisions (Atul and Anant, 2014). This implies that a spouses’ apparent fairness connects the relationship between spouse’s prior effects and subsequent decision making in various scenarios. Spouses consider their partner’s perception regarding fairness when undertaking various actions in restoration of fairness, which are moderated by spousal traits such as egalitarianism, empathy, empowerment through a gendered structure. In a husband dominated classification, the husband is highly likely to affect the decisions on the purchase of a specific product, such as a Smartphone. This could be attuned to the availability of resources that could potentially impact the family’s spending. Contrariwise, a wife dominated structure implies that the wife controls the decision-making strategies in the family. Nevertheless, joint decision-making could be realised in the syncretic relationships, where all factors are considered hence facilitating a combined approach to purchasing products. Tentatively, decisions based on past purchases may influence subsequent purchases. 2.2.2 Family Life Cycle In a continuous life cycle, people tend to change buying patterns on services and goods that are bought over time, where buying is dictated by family life cycle stage (Kotler et al., 2008). The consumption patterns of people of the same age differ considerably due to dissimilarities in life cycle stage (Lamb et al., 2010, p. 266). Consumers that are typified as young singles are inclined to use social media and other social platforms hence are inclined to purchase smartphones with greater processing powers. The older age classifications are compelled to purchase smart phones that have basic functions. 2.3 Social Status Social class plays an important role in affecting the consumer purchase intention (Priest et al., 2013). An individual’s social status affects the consumption behaviour. Simply put, highly priced Smartphone are used among the high class and middle-class individuals. Evidently, high price is relative since user can acquire customised smartphones. Arguably, class plays a vital role in influencing the buyer’s decision regarding a subsequent purchase. Nevertheless, working class consumers tend to evaluate Smartphone in a more utilitarian manner, as opposed to the fashion and style. As such, they are less likely to experiment in the new products or styles. 2.4 Culture and Core Values Culture is conceptualised as ideas, artefacts and symbols that influence an individual’s communication, interpretation and evaluation of the society (Kotler et al., 2008). Culture dictates an individual’s wants and behaviours, which are shaped by the society they belong to (Durmaz et al., 2011; Santosh and Pankaj, 2011). Culture influences the way an individual views the world, which is equated to a collective programming in the consumer’s which differentiate the members of one group. Through the effects culture has on values, idea and attitudes; it might influence the behaviour of a given society, as well as, the type of product to purchase. 2.5 Sub Culture The influences of subcultures are spread across relevant unit of analysis. They essentially help market research conduct analysis on sizable and natural market segment. Four types of subcultures are distinguished, namely; nationality groups, racial groups, religious groups and geographical areas (Durmaz et al., 2011). For instance, French speaking Canadians are inclined to focus on the message sources, whereas English speaking Canadians are more concerned with advertisement content. Generation X This group is not drawn to traditional advertisement forms given their balance between leisure and work. Evidently, they are inclined to purchase products that are more practical and the need to control their communication equipments such as, mobile phones, email and fax machines (Perner, 2013). These attributes affect their decision when evaluating the type of Smartphone to purchase. Generation Y This generation consists of the employed and unemployed, wherein, the employed financially active, hence possess a higher purchasing power in a country’s economy. Tentatively, they are well informed about fashion and appear to be independent buyers. Pickren and Roy (2007) describe generation Y as diverse, optimistic, multi-taskers and the techno-savvy. They spend most of the time on computers, online resources and internet. As such, they garner significant knowledge that pertains to their research on Smartphone (Perner, 2013). Therefore, post from opinions leaders has considerable effects on their purchasing behaviours. Baby Boomers With a relatively high education level, baby boomers tend to influence their purchase decision through conventional knowledge on the products. Consequently, they tend to maintain high senses of fashion hence are inclined to purchase latest Smartphone products available in the market. However, they are less materialistic and are more concerned with the environment and quality of life, therefore; hence consideration of manufacture’s environmental conformance is imperative. Elderly Consumer Given that they are an ageing population their needs on purchase is limited hence, they do not considered many aspects when purchasing products (Perner, 2013). Surprisingly, such groups stick to analogous forms of communication such as landlines connections. Most importantly, this population enjoys the marketplace. 2.6 Impact of Gift Giving Behaviours Whether a product is purchased in fulfilment of personal consumption or gift giving, it affects the consumer’s purchase decisions. Consumers are more likely to be involved in the purchasing gifts, as opposed to purchasing the same item for personal consumption. Boone and Kurz (2010) affirm that consumers use divergent strategies when purchasing gifts, as opposed to other forms of shopping strategies since they show feelings and love. Consumers are keen on communicating the correct messages to the receiver of the gift which may result in anxiety, given the symbolism carried in the gift. Finding and selecting a preferred gift takes more time where consumer’s participation takes more time. Thus, consumers are likely to restrict their product choice to a few well-known brands, in this case, a highly priced Smartphone model. Extended decision-making is realised through certain emotional decisions such as the selection of birthday presents. Some of these attributes are linked to cognitive effort. Nevertheless, the needs being met and the criteria being addressed is based on emotions, as opposed to product service (Boone and Kurz, 2010). 2.6.1 Relationship Marketing Relationship marketing is imperative since it creates a long-term bond with the customers making them appreciate how the firm relates to consumers by offering some form of personal connection. This aspect is based on the principles that the present consumers are instrumental to long-term business success. Some of its benefits are judged along the following aspects; i. Acquiring new customers can be increasingly expensive that satisfying and maintaining existing customers ii. Profits tend to increase when consumers are retained. 3.0 Conclusion To this end, it is imperative for marketers to learn and use relationship marketing when using opinion leaders in various marketing strategies, in order to reach its consumers effectively. This approach builds a customer relationship which retains customer loyalty. It is evident that external factors influence decision making to a certain degree. Culture dictates an individual’s perception of values and norms, which shapes the consumers perception regarding a product. Opinion leaders, on the other hand, impart significant effects to the followers regarding products reviews and critiques. Contrariwise, subcultures not only influence the way marketing messages are received but also influence buying patterns. Family influences are significant on behaviours and continuous even when the buyers do not often interact with the parents. Reference groups, on the other hand, present conspicuousness as underlying principles in influencing decisions. References Atul, D., and Anant, A. (2014). Dynamics and Conflict of spousal purchase decision: A Review Study. Impact Journals, 2 (6), 27-38. Boone, L., Kurz, D. (2010). Contemporary Marketing. South-Western Cengage Learning, Mason. Durmaz, Y., Mücahit, C., and Oruc, R. (2011). 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