Buying behaviour of Mobile Phone

Chapter One: Introduction

1.1 Research background to the research problem:

Research and studies regarding consumer buying behaviour are a common approach in post-war marketing contexts in order to establish or acquire insight knowledge to guide marketing activities regarding the consumption behaviours of particular groups of individuals (Bettman, 1979). Kotler et al. (2002) stress that understanding consumer buying behaviour is central to marketing management; moreover, marketing management must begin with insightful understanding of consumers.

Consumer behaviour is about people and there perception. For making marketing strategy marketer need to understand the consumer to segment the market.

With the advent of new technology the way of communication is also changed. In very early days of history, pigeons were used as means of communication. Later, written messages are sent through letters by post. As the time passed, telephone came into existence and today is the era of wireless communication which gives rise to mobile phones. Mobiles are the latest invention and common way to communicate now-a-days. (Vats)

Mobile Phone, like any other consumer product also requires thorough studies regarding consumer attitude and buying behaviour to guide present and future marketing activities. The mobile phone is the first truly personal communication medium. The home landline phone is shared by the family. The office phone system is used by the whole office.

However, the mobile phone subscription has reached 4 billion in the world and the total number of actual mobile phone handsets is 3.4 billion. The industry sold 1.15 billion new mobile phones in 2008 and of those, 15% were smartphones. The mobile telecoms industry became one of only a handful industries on the planet to generate one Trillion dollars last year and out of that, roughly speaking 800 B is in service revenues (voice and data) and the remaining 200 B in hardware (phone handsets and network infrastructure). For contrast, mobile is twice the size of the global TV industry or the total worldwide advertising industry or the total PCIT/internet industry; as well as twice the size of its former big brother but now little brother, the fixed landline telecoms industry. (Almanac, 2009)

This is especially so, given the circumstances that Mobile Phone market is considered as one of the fastest growing market. The UK Mobile Phone Market, which notably has one of the highest market growth rates in the world, certainly presents itself as a focused also viable area for research project. In brief, both the global Mobile Phone market and the UK Mobile Phone market are becoming largest. However, consumer attitude towards such ‘phenomena’ and consumer behaviour regarding Mobile Phone uses not fully understood.

1.2 Research Problem and Research Proposition:

For the above reasons, this proposed research develops and tests a framework for the research problem to formulate consumer attitude and buying behaviour toward Mobile Phone.

Is Psychological and Personal factors directly related to buying behaviour of Mobile Phone?

Essentially, from this research with a college setting, the author argues that both psychological and Personal factors are related to the buying behaviour of mobile phone. In order to develop research objectives to focus data collection and analysis for the research problem stated above, the available literature on consumer attitude toward objects and consumer buying behaviour reviewed in Chapter 2 (Literature Review), and a preliminary theoretical framework, along with three research objectives and associated research hypothesis has developed for testing in a field survey.

Research Objective 1:

How do psychological factors affect Mobile Phone buying behaviour?

Research Objective 2:

How do Personal factors affect Mobile Phone buying behaviour?

Research Objective 3:

Will university students be an effective segment for Mobile Phone marketers?

Little disagreement about the meaning of the terms proposition and hypothesis was found during the literature review, in which a proposition was defined as a statement about concepts that may be judged as true or false if it refers to observable phenomena. When a proposition is formulated for empirical testing, it is called a hypothesis, which has a tentative and conjectural nature (Cooper and Emory, 1995).

According to Gay (1996, page 61, 62), ‘a hypothesis is a tentative explanation for certain behaviours, phenomena, or events that have occurred or will occur. A good hypothesis states as clearly and concisely as possible the expected relationship (or difference) between two variables and defines those variables in operational, measurable terms.’ The hypotheses for this research are given below:

Research objective 1:

Hypothesis of psychological factors and mobile phone buying behaviours:

H1.1: Perception

Perceived quality variation between mobile phone and land line phone is positively related to mobile phone buying behaviour;

H1.2: Attitude

Attitude toward mobile phone is positively related to mobile phone buying behaviour.

Research objective 2:

Hypothesis of demographic factors and mobile phone buying behaviours:

H2.1: Gender

There is relationship between gender and Mobile Phone buying behaviour;

H2.2: Age

There is relationship between age and Mobile Phone buying behaviour;

H2.3: Education

There is relationship between education and Mobile Phone buying behaviour;

H2.4: Residential Status

There is relationship between residential status and Mobile Phone buying behaviour;

H2.5: Personal Income

There is relationship between personal income and Mobile Phone buying behaviour;

Research objective 3:

Effectiveness of university students as a segment for mobile phone:

H3.1: Male university students

Male university students will be an effective market for Mobile Phone;

H3.2: Female university students

Female university students will be an effective market for Mobile Phone.

1.3 Justification for the research: (Edit Needed)

The proposed study was justified on the following grounds:

v Rapid growth of Mobile phone market

v Gaps in academic research

v Anticipated benefits to provide guidance for mobile phone marketing activities

The first justification has partly explained in Section 1.1, the continuing rapid growth of Mobile Phone market in global and UK contexts. The growth has created numerous commercial opportunities, especially when it combines with growing communication awareness of the public, brand owners and retailers.

The second justification for this research was the lack of academic research in this area. That is even though the need to initiate the relationships between psychological, Personal factors and buying behaviour toward Mobile Phone is becoming more apparent to marketing practitioners, academic research about this issue is sparse. Some previous research will be reviewed in Chapter 2. Apparently, no academic work with a UK setting in this area can be found.

The final justification for this research was the potential benefits that it can offer to marketing practitioners though this research is not for commercial use but it could be helpful for marker. It could have some degree of practical implications for organisations in the form of guiding marketing communication programmes. For example, help marketer findings of consumer attitude and beliefs toward Mobile Phone. Hence, benefits could be improved marketing communication effectiveness and reduced wastage of scare organisational resources. Moreover, it can help to identify specific market segments in the market for new Mobile Phone Company, such as, for example, young females age from 18 to 24 with university education backgrounds, if research findings support that there is significant difference in attitude and buying behaviour toward Mobile Phone.

1.4 Methodology

This following section introduces the methodology used in data collection and analysis for this research, with full details provided in Chapters 3 and 4. This survey is focused on testing existing theory and uses quantitative methodology: field survey. This methodology will be discussed in detail in Chapter 3.

Primary data was collected from students at London School of Commerce, after the initial exploratory research stage. The target population for this survey was students who have bought mobile phone at least the last one year in the UK. Quota sampling was used to select sample. A complete description of this method is provided in Chapter 3. Descriptive analysis was performed for transformation of raw data to a form that would produce information to describe a set of factors in a situation (Sekaran, 2000) using SPSS version 15. Details of data analysis will be discussed in Chapter 4.

1.5 Delimitation of scope

The major drawback for this research is that the setting of this research will confined to university students in the UK and concerning only the consumer behaviour of Mobile Phone because their consumption pattern may differ from other domestic market segments. Although the Mobile Phone market is global, generalisation of the findings of this research beyond UK and to other market segments or product categories are not recommended. Additionally, this research will focus on consumer attitude and buying behaviour toward Mobile Phone rather than any particular brand.

1.6 Outline of the dissertation

This dissertation has five chapters (adapted from Perry, 2002). This Chapter 1 provides an overview of the thesis and provides background for the research such as research problems and objectives, justification for the research and methodology.

Chapter 2 reviews the historical background of the Mobile Phone market (Section 2.1); parent theories of market segmentation (Section 2.2), as well as parent theories of buying behaviour (Section 2.3) and It concludes by outlining research objectives or principle research question that emerge from existing literature.

Chapter 3 covers and discusses hypothesis of the research as well as the methodology of this research, in which differences between quantitative and qualitative research will be identified, and the choice of survey method is justified. It will also discuss the steps taken to collect and process survey data as well as research limitations and ethical considerations for this research.

Chapter 4 analyses data from the survey and responses to the hypotheses.

The final chapter presents findings and provides answers to each research issue raised in Chapter 2, which emerged from the literature. Conclusions are made for the research. Finally, recommendations for future research are discussed.

This dissertation follows the style and referencing standards of Bibliographic references, Harvard format – APA style (The Publication Manual of the American Psychological Association, 5th ed., 2001). Spelling follows Microsoft Word’s Tools/Language/English (UK) format.

1.7 Conclusion

The first chapter provided a brief overview of this research. Initially, a brief overview of the research topic was offered which leads to summarising the research problem and objectives that are to be investigated. Then the methodology adopted for this research was briefly discussed, following by the structure of this dissertation.

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