FACTORS INFLUENCING CONSUMER BUYING BEHAVIOUR ON HOUSEHOLD PRODUCTS IN NIGERIA

CHAPTER TWO

LITERATURE REVIEW

2.1 Definition of Key Concepts

This section defines the key concepts used in the study. These concepts are consumers, consumer products, household, household consumer products and consumers buying behavior.

2.1.1 Consumers

Consumers (or the customers) are valuable assets for any organization. Consumer is an individual or group of individuals who select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires (Schiffman and Kanuk, 2007). In other words, consumers are the eventual destination of any products or services. Organizations are striving to satisfy these consumers to be profitable (ibid). The term consumer refers to two types of consuming units; final consumer and organizational consumer. The final consumer (an individual, a family or a household) differs from the organizational consumer (a business organization, a government agency and a non-profit-making organization) in terms of behavior and the factors affecting it. The final consumer is any individual that purchases goods or services for either his/her own personal use (e.g. clothes and dental treatment) or for his/her family use (food items and carpets or curtains for the house). In other words, the goal of his/her purchases is to satisfy his/her personal or his/her family members needs or wants. For the case of organizational consumer, they mostly purchase goods such as machinery, parts, stationery, furniture, and merchandise. The purpose of purchase is to enable them to perform their functions and to achieve their organizational objectives such as to produce products and deliver services to final consumers (Aaker, 1997 and Solomon, 2002). This study focused on consumers who bought household products.

2.2.2 Consumer Products

Consumers products are the goods and services that a consumer buys him/herself or through others in order to use (consume) them to satisfy personal own needs and wants as well as his/her family's, but not to re-sell them (Lamb et al., 2001). This study adopted the same definition.

2.2.3 Household

A household consists of one or more people who live in the same dwelling and also share a meal or living accommodation. This group of people may be members of the same family or may include others nonrelatives such as servants (Haviland, 2003).

The same context was used in this study.

2.2.4 Household Consumer Products

Household consumer products are products produced to sale to a consumer for use in the household or for the personal use, consumption or enjoyment of a consumer in a household. These household consumer products include durable and non-durable products. Durable goods have a significant lifespan usually more than one year such as kitchen utensils, air conditioners, and sofas. On the other hand, non-durable products are those purchased for either immediate use or to keep it for every short span of life. Examples of non-durable goods are food, beverages, clothing, shoes and gas (Schiffman and Kanuk, 2007).

2.2.5 Consumers' Buying Behaviour

One of the present fundamental presumptions for the consumer behaviour is the fact that people often buy products not because of their main functions but for their subjectively perceived value. It does not mean that products' basic function is not important, but that the today's role of product exceeds its service limits (Salomon, 2002). Consumer behaviour is the study of when, why, how, and where people do or do not buy a product. It blends elements from psychology, sociology, social anthropology and economics. It attempts to understand the buyer's decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioural variables in an attempt to understand people's wants. Such understanding is important to companies, especially in the eve of the competition. Factors affecting consumer buying behaviour are varied and not standardized (ibid).

Consumer buying behaviour is mostly limited by budgetary constraints and especially when buying seems to have a small impact on the daily life and one's lifestyle. During the sellers marketing situation, consumers had a smaller level of influence on the availability of household products and for the most part had to contend with what was on offer (Mbura, 2014). With increased disposable income, access to information and competition has empowered consumers to demand more and to have higher expectations, especially during the era of buyers marketing situation (ibid). Consumers are no longer driven by their needs for a product but are instead driven by their wants which is a typical characteristic of the household products market.

2.3 Theoretical Perspectives

This section presents the theoretical perspectives related to the study. Consumer behaviour theorists generally believe that consumer behaviourtheories can be applied globally but consumer preferences and tastes are influenced by their cultural background (Schutte and Ciarlante, 1998). Therefore, marketers and business practitioners have to recognize that consumers' attitudes and beliefs, preferences, needs and tastes towards certain products or services are greatly influenced by their culture and the society they belong to. For instance, consumers in other parts of the globe may consider price as the most important determinant in their decision to buy food items, whereas, in others, they may consider quality as the most important factor that may affect their choices. The psychological, situational and personal factors influencing consumers' decision making process and buying behaviour are hereby discussed.

2.3.1 Bases for Consumer Decision-Making

According to Kotler (1998), all consumer buying decisions generally fall along the continuum of three broad categories. These are routine response behaviour or habitual decision making; limited-decision making; and extensive decision-making (Lamb et al., 2001). The common notion is, consumer tends to be highly involved when they purchase expensive items, and less involved when they purchase low involvement products that they purchase frequently and the price is less expensive (Blackwell et al., 2001).

Prior to choice decision or repurchase intention, consumers place a number of attributes in his or her choice sets, in order of importance and relevance. Among these attributes are price and quality. Consumers tend to use price as a proxy to quality (Lichtenstein et al., 2004). However, studies also reveal that, besides price and quality, other cues that are also considered as more important to assess the products worth, are attributes such as brand, store name, past experience, attitude and product information (Dodds et al., 1991). Brand name, for example, often signals as a cue or as a surrogate of product quality use by consumers in their evaluation of goods or services before they decide to purchase. Some scholars argue that the effect of price tends to be stronger when it is presented alone as compared to when it is combined together with brand name (ibid).

On the other hand, Bristow et al., (2002) suggest that if consumers believed that there are differences among brands, then the brand name becomes the centre piece of information in the purchase decision or repurchase intention and the dependence on the usage of brand name in the search information will likely increase. Another branch of consumer behaviour research related to brand is that, consumers use brands to create or communicate their self-image or status (Encalas and Betman, 2003). Consumers, sometimes, associate themselves to a given brand when they make brand choice, and also make their brand choice based on associations with manufacturer's brand name (Aaker, 1997). Besides, brand names contribute value to the consumers image, as well as the economic success of the businesses, and it also can affect preference, purchase intention and consequently, sales (Ataman and Ulengin, 2003).

2.3.2 Psychological Factors

According to Brown (2006), Hasslinger et al, (2007); Kotler and Armstrong, (2007) and Stávková et al., (2008), psychological factors include motivation, perception, skills and knowledge, personality, positions and style of life. These factors are commonly used in marketing field when describing, explaining and predicting consumers' behaviour.

The first factor used in marketing field is perception. Perception means the adaption of reality. The process of selection, processing and interpretation of input data from the environment to make them purposeful.Personality is the second factor used in marketing field. Personality is created by inner characteristics and by behaviour. This makes a person unique. Personal characteristics influence the way how people behave. It is, however, difficult to find a reliable connection between the individual personality and the behaviour type.

Skills and Knowledge are yet other factor used in marketing field. Skills and knowledge are connected to learning and predestinate changes of Consumers' behaviour. Therefore, to cause changes of consumer behaviour concerning the concrete product, it is necessary to give the adequate information. Learning process can come through a simple association between the impulse and the reaction to it, or through the complicated set of rational activities.The other important factor used in marketing field are motives. Motive means the inner driving force that orients human/consumers' activities towards meeting the needs or achievement of the definite aim.

In every decision-making process several motives plays role, not only one. In case of need of measuring or analyzing, there is one questionable thing that motives often work only on the subconscious level.Positions and style of life are also among the factors used in marketing field. Positions and style of life means knowledge and positive or negative feelings which influence humans' perception and consequently decision making and behaviour. People learn their bearings through experience and interaction with other people. The eventual changes of positions are conditioned by consumers' personality and his or her style of life. Consumer generally refuses information that is in conflict with his or her positions; eventually he or she modifies them to reach correspondence.

2.3.3 Situational Factors

Situational factors can notably influence purchase decision which social environment, physical environment of the purchase place, time influences and the previous states fall into this group (Vysekalová, 2004).

2.3.4 Personal Factors

Personal factors are referred to ones unique for each consumer. Above all data like age, sex, and place of domicile, occupational and economic conditions, personality and self - consciousness can be found here (Trommsdorf, 2002).

2.3.5 Economic Theory of Information

An economic theory of information was first proposed by Stigler (1961). Accordingly, this theory assumes that the markets are characterized by price dispersions and both seller and buyer have little information about this dispersion of prices. As such, consumer has to engage in search activity in order to obtain information about the products and price at cost.

According to Avery (1996), rational consumers are assumed to search for product information/price information to a point where the marginal benefits of search are equal to the marginal costs of search. The search for product information varies in accordance to price and quality perception on products or services to be purchased. If consumers perceive that there is a high level of price and higher quality variability in the market then they should be more willing to engage in search activities for price and quality information (Avery, 1996).

Consumers purchase/repurchase intention or purchase decision for a product and/or service is driven by various reasons, which can be triggered by rational or emotional arousal (Schffmann and Kanuk, 2007). For example, consumers use brands to communicate their self-image or status, and the brand images chosen must be congruent to their own and match to groups they aspire to establish an association with (Encalas and Bettmann, 2003).

Similarly, consumers will seek for others who are significant to them for information or wish to associate or bond with, that is, the group social norms with whom consumers aspire to establish a psychological association or bonding, such as friends, neighbours, and the like (Mourali et al, 2005). Besides, other factors, such as price,

income, education, and other attributes also contribute to purchase

decision/repurchase intention (Andaleeb and Conway, 2006).

2.3.6 Stochastic Models

Jones and Zufrydens (1980) model used demographic variables (household income and the number of children in a household) and marketing mix (price dimension) as explanatory variables to predict brand choice or purchase (criterion variable). Jones and Zufrydens model was tested using logit model estimation. The explanatory variables were categorical data and the criterion variable was metric data. Their modified model was adapted due to its flexibility.

It was suggested by the authors who developed the model that, in terms of its use, the model involves relatively straightforward parameter estimation procedure and one that is adaptable to exploratory model building (ibid). In other words, their intention was to develop a general model which can be used to aid in marketing decision process. Hence, it was also suggested that the model is very flexible in which the explanatory variables can be added and dropped as required by the researchers who wish to replicate or adapt the model.

However, in the current research framework, besides household income, number of children and price, additional explanatory variables of product attributes importance such as quality, brand name, product information and interpersonal influence variables were added to the model.

2.3.7 The Buying Decision Process

The consumer buying process for household consumer goods is often regarded as similar to that for other products and services. The assumption is that a consumer moves through a number of stages leading up to a purchase.

The process begins with awareness, a stage that may be initiated by promotional efforts or by word of mouth which makes the buyer becomes aware of existence of a product that can reduce his/her drive. The next stage involves the buyer obtaining more information, and as suggested previously, there are likely to be various levels of commitment depending on the nature of the purchase. This information search will result in the formation of an attitude, perhaps reinforcing an existing attitude or bringing about a change on the part of the buyer.

At the evaluation stage, the buyer will make more detailed comparisons. For example, a consumer may consider a number of destinations and will choose based on criteria such as price, recommendation, convenience or convention. Subject to time and financial constraints, the consumer will then make the purchase of most preferred product.

The purchase is followed by the final stage of the buying process, post-purchase behaviour , where a consumer is either satisfied or dissatisfied. A satisfied consumer will most probably repeat the purchase and say good things about the product to others. While, dissatisfied consumer will reduce dissonance by abandon the product or seek more confirmation information about the product (Zeithaml et al., 2009 and Mbura, 2014).

2.4 Empirical Studies

This section presents the empirical studies related to this topic. These include world and Nigeria related studies.

2.4.1 World Related Studies

Kim (2009) conducted a study on factors which influence Chinese consumer behaviour when buying innovative food products. The study conceptualizes a model of Chinese consumers' purchase decision for the GM foods by empirically testing the interrelationship among the GM food purchase decision determinants with a multiattribute model. The purpose of this study was to explore the lying factors which affect the Chinese consumer choice behaviour for the GM food. The assumption was that a clear understanding of the determinants of consumers' GM food choice may enable policy makers and marketers to build effective policies and marketing strategies and to establish market position of the GM food. The findings revealed that consumers' perceived concern toward the subjects such as limited information availability and environmental issues. This study was conducted in China a place where differ with Nigerian culture. The study was also concerned with consumers choice behaviour to GM food. These findings cannot be directly applicable in Nigeria. This study based on consumers buying behaviour on household products in Nigeria.

Young et al. (2008) conducted a study on sustainable consumption, the case being green consumer behaviour when purchasing products. The study investigated the purchasing process for green consumers in relation to consumer technology products in the UK. Data was collected from 81 self-declared green consumers through in depth interviews on recent purchases of technology products. The study found out that a green consumer purchasing model is developed and success criteria for closing the gap between green consumer's values and their behaviour.

The study concluded that incentives and single issue labels (like the current energy rating label) would help consumers concentrate their limited efforts. More fundamentally the study revealed that "being green" needs time and space in peoples' lives that is not available in increasingly busy lifestyles. The implications for policy and business were proposed. This study concentrated on green consumer behaviour only in the UK which is very different to Nigeria. Thus, there was a need to conduct a study in Nigeria to determine factors influencing consumers buying behaviourin Nigeria.

A Strategic Household Purchase: Consumer House Buying Behaviour was a study conducted by Koklic and Vida (2009) in Slovenia. The aim of the study was to examine consumer house-buying behaviour from the consumers' perspective. In view of the existing literature exploring consumer decision making, the purpose of this research was threefold to propose a conceptual model of consumer decision making within the frame of consumer behaviour; to gain knowledge of factors impacting this process from the empirical standpoint with the focus on prefabricated house purchases; and to offer implications for beneficial purchases of prefabricated houses.

The findings from their in-depth interviews with recent owners and potential buyers of a custom-made prefabricated house suggested that cognitive and rational factors do not offer sufficient explanation of consumer behaviour in the case of a highinvolvement product such as a house. In addition to the idiosyncratic characteristics of the customer, his/her personal situation and environmental factors, the study suggested that the role of feelings, experience, subconscious factors, needs and goals should to be taken into account to better understand this kind of decision making.

The study offers knowledge of consumers' behaviour while buying houses which high involvement products and are very different to household products which are low involvement products. Consumers may indicate different behaviour s on each of these products. Thus, it was thought that, there was a need to study consumers' buying behaviour to household products in Nigeria.

Stávková et al. (2008) conducted a study on the factors which influence consumer behaviour. The main aim of the study was to understand the influence of factors biasing purchase decisions connected with measurement of consumers' involvement. Consumption expenditures were purposefully subdivided according to the classification made by the Statistical Office of the European Communities. The performed survey showed that the most important factors biasing purchases of all commodity groups are products' characteristics and the perceived quality.

Together with these goes the factor of price, nevertheless for example for the commodity group health price did not appear in the scale of the perceived importance at all. In the study, factor necessity of need proved to be significant for decision making about the purchase of all commodities with the exception of alcoholic drinks, tobacco and recreation. The study further revealed that, former experience compared to that is not crucial for clothing and footwear and housing equipment and contents. For alcoholic drinks and tobacco, there has notably approved also the factor brand. These analysis enable disclosure of rules of consumer decision making and thereby definition which factors for individual commodities should be targeted by the help of the marketing doyens or where the gradual changes should be achieved. This study was conducted outside. It was therefore thought necessary to conducted a study in Nigeria.

Prameela and Husain (2007) conducted a survey on short communication consumer choice of branded agro-processed products in Kannur municipality of Kerala state. A survey was conducted among 150 household consumers of Kannur municipality in northern Kerala to identify the factors which influence purchase decision/consumer choice of Branded Agro-processed Products (BAPs) manufactured by private and cooperative sector organizations.

The findings revealed that product features (taste, freshness, and shelf life) and advertisement determine the consumer choice of BAPs such as sambar powder, meat masala, rasam powder, pickle, and jam. There was, however, no significant difference between the brands made by the cooperatives and private sector organizations in this regard. This study does not explain the effects of consumer personal factors on their buying behaviour especially for household products, a gap which this study intended to fill.

Haque et al (2009) conducted a study on factors which influence buying behaviour of piracy products and its impact to Malaysian market. The primary attempt in this study was to explore the influencing factors of the Malaysian consumers toward the pirated products. To explore these factors, this study conducted a survey among the Malaysian consumers. The findings of the study revealed that there is significant relationship between the consumers' perception and the social influence, personality or believe, pricing and the economy toward the piracy. The findings also revealed that society has strong influence on the consumers' personality and believes, that leads to grow consumers' perception.

On the other hand, it revealed that most of the respondents are willing to buy pirated product because of cost effective. Since, price plays a key role to convey individuals toward price sensitive, therefore it is important for the marketers or producers to be attentive of pricing. More importantly marketer can decrease the production cost and secondly, they show intention to reduce their profit margin. To perform all those necessary steps need to set up the price by considering the all income groups. This will help to reduce the consumers' consumption of pirated goods. Though, there is no doubt about the quality of original products but they should look at the price. This study does not explain how consumers' personal factors influence their buying behaviour on pirated goods, a gap which this study intended to fill.

2.4.2 Nigeria Related Studies

Barakaeli (2008) conducted a study on factors which influence consumer buying decisions in mobile phones market in Nigeria. The aim of the study was to find out how do different markets strategies e.g. pricing, promotion, presence of reliable supplier (distribution) and product attributes influence the consumer buying decision in the mobile phones markets. In this study the questionnaire survey was used as the method of data collection where by a total of 90 respondents were surveyed in the three municipals of Lagos city; Kinondoni, Temeke, and Ilala. The data obtained were analyzed using Statistical Packages for Social Science (SPSS) and both descriptive and hypothesis testing through the data obtained was carried out. From the data analysis, the findings revealed that pricing, some product attributes, price and presence of reliable supplier influence the consumer buying decision in mobile phone markets. From the findings of this study promotion/advertisement contributes less to consumer buying decision due to poor techniques used during promotion that discourage customers.

The study recommended to manufacturers and marketers that the product attributes like quality and size as well as price and presence of reliable supplier influenced consumer buying decision. Therefore, they need to improve and put more efforts on them by introducing mobile phones of higher quality offered at low price and increase availability of the phones. They also need to take into consideration other factors which can influence consumer buying decision like the nature of the customers, buying classes, social class and other environmental and economic

factors.

The policy implication of this study is that; the government and other stakeholders like Fair Competition Commission should ensure that the manufactures or importers of mobile phones from abroad offer/import phones of good quality so as to meet customers' satisfaction and enhance their buying decisions. However, the study does not explain the effects of consumers' personal factors on buying behaviour of mobile phones.

Sanga (2007) conducted a study on the factors which influence consumer brand choice and purchasing decision making process, the case being bottled drinking water in Nigeria. The overall objective of this study was to assess the attributes that influence the customers in buying bottled drinking water in Nigeria.

Rather than trying to understand all the various decision-making criteria involved in brand choice and the buying decision process, the study focused solely on seven attributes and examined what percentage of each attribute contributed to the final decision. These included, price, brand, corporate image and packaging elements (package colour, package shape, further usage package and package size). The study findings suggest that price as well brand have got strong influence towards customers brand choice and purchasing decision process making. This implies that bottled water manufacturer and marketer should put more weight on these factors when designing their brands product.

The findings also revealed that price and brand attributes do not stand alone on influencing customer of bottled water in their buying decision process. Packaging elements (i.e. package colour, package shape, further usage package and package size) and corporate image attribute go hand on hand in influencing customer brand choice and purchasing decision-making process. The study found that, bottled companies should understand consumer needs and wants and all market efforts toward bottled water consumer by considering the above attributes. The study also revealed that customer characteristics in terms of sex, education level, occupation, and location develop different consumer attitudes towards brand choice. Thus, all marketing programs should address its customer need by considering of the above customer characteristics. This study was confined to consumers' behaviour on drinking waters only thus, the findings cannot be applied for other products such as household consumer goods.

Mkanda (2009) assessed some products, price, quality, package, label and promotional factors that affect consumer choice of brand the case being carbonated soft drink brands in Nigerian market. This study analyzed the consumer buying behaviours of carbonated soft drinks in the Nigerian market. It investigated critical product attributes that influence consumer preference for a particular brand of carbonated soft drink. It examined consumer buying behaviour and assessed some product, price, quality, packages, label and promotional issues that affect the choice of brand by consumers.

The aim of the study was to contribute to theoretical knowledge and at the same time guide market practitioners in deciding on which of the best market tactics to adopt. The research methodology consisted of a survey of 167 carbonated soft drinks consumers from five regions, through the use of a standard questionnaire. Chi-square statistical method and technique was used to measure the indicators while multiple regression method was used for testing the hypotheses.

Five hypotheses were empirically tested and the findings revealed that there is a significant negative relationship between the price of the pack and the choice of brand of carbonated soft drinks. Regarding quality the findings revealed that the perceived quality of the product negatively influenced the decision to purchase a carbonated soft drinks brand. The negative correlation might result from the fact that consumers often judge the quality of the products on the basis of variety of information cues that they associate with products. Generally, the study found out that the explanatory variables greatly influence the decision to purchase carbonated soft drink brands on the Nigerian market.

The study recommended that carbonated soft drinks companies should redirect their resources to fund projects that will address marketing issues that are relevant to consumer so as to sustain loyalty. Also, the study strongly advised the government to create a sustainable business environment by revising its taxation, import and export polices to safeguard the local soft drinks industry. This study failed to determine the factors which affect consumer behaviour as it focused on products critical attributes.