Factors Influencing Consumer Purchasing Decisions 2
Factors Influencing Consumer Purchasing Decisions 2
Factors Influencing Consumer Purchasing Decisions 2
MARY’S UNIVERSITY
BY:
BETELIHEM MOGES
ADVISOR:
St.Mary’s University
December, 2021
FACTORS INFLUENCING MARKETING MIX STRATEGY ON
ID SGS/0081/2012B
St.Mary’s University
December, 2021
ST.MARY’S UNIVERSITY
ID SGS/0081/2012B
I Betelihem Moges, the undersigned declare that this thesis is my original work, prepared under
the guidance of Mohammed Mohammednur (Ass.Pro). All sources of materials used for the
thesis have been duly acknowledged. I further confirm that the thesis has not been submitted
either in part or full to any other higher learning institution for the purpose of earning any degree.
i
ENDORSEMENT
This thesis has been submitted to ST.MARY’S University School of graduate studies for the
examination with my approval as a University Advisor.
ii
ACKNOWLEDGMENTS
First of all, my hearty thanks go to Almighty God for His blessing-full knowledge, inspiration and
diligence required for the successful completion of this Thesis and for making my dream a reality.
(Ass.Pro), for his stimulating advice and constructive comments at every step of writing this
And I’m very grateful for my family and Ato Yohannes Negatu for their continuous support and
Lastly, I would also like to show my gratitude towards all my colleagues and friends, for creating
a supportive and interactive work environment. I would like to thank all those who took their time
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TABLE OF CONTENTS
DECLARATION ............................................................................................................................................. i
ENDORSEMENT .......................................................................................................................................... ii
ACKNOWLEDGMENTS ............................................................................................................................. iii
ACRONYMS ................................................................................................................................................ vi
ABSTRACT ................................................................................................................................................ viii
CHAPTER: ONE............................................................................................................................................ 1
INTRODUCTION .......................................................................................................................................... 1
1.1. Background to the Study ...................................................................................................................... 1
1.2. Statement of the Problem ..................................................................................................................... 3
1.2.1. General objective ................................................................................................................... 5
1.2.2. Specific objectives of the study ............................................................................................. 5
1.3. Research questions ............................................................................................................................... 5
1.4. Scope/ Delimitation of the Study.......................................................................................................... 5
1.5. Significance of the Study...................................................................................................................... 6
1.6. Organization of the Paper ..................................................................................................................... 6
CHAPTER: TWO ........................................................................................................................................... 7
2. LITERATURE REVIEW ....................................................................................................................... 7
2.1. Purchase Decision .................................................................................................................. 7
2.1.1. Purchase Decision Stages ...................................................................................................... 7
2.2. Empirical Literature............................................................................................................................ 15
2.3. Conceptual Framework ...................................................................................................................... 18
CHAPTER: THREE ..................................................................................................................................... 19
RESEARCH METHODOLOGY ................................................................................................................. 19
3.1. Research Approach ........................................................................................................................... 19
3.2. Research Design ................................................................................................................................. 19
3.3. Target Population, Sample Size and Sampling Techniques ............................................................... 20
3.3.2.Sampling Size ..................................................................................................................................... 20
3.3.3.Sampling Techniques ......................................................................................................................... 21
3.4. Data Collection Methods .................................................................................................................... 21
3.4.1. Secondary data ..................................................................................................................... 22
3.4.2. Primary Data Collection ...................................................................................................... 22
3.5. Data Collection Instrument and Procedure ......................................................................................... 22
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3.5.1.Questionnaire...................................................................................................................................... 22
3.6. Methods of Data Analysis .................................................................................................................. 23
3.7. Model Specification............................................................................................................................ 23
CHAPTER: FOUR ....................................................................................................................................... 26
RESULTS AND DISCUSSIONS ................................................................................................................ 26
4.1. Introduction ...................................................................................................................................... 26
4.2. Demographic profile of respondents ................................................................................................ 26
4.3. Descriptive Statistics Analysis ......................................................................................................... 27
4.4. Correlation Analysis ......................................................................................................................... 31
4.5. Correlation Matrix summary ............................................................................................................ 32
4.6. Regression analysis........................................................................................................................... 33
4.6.1. Normality test ............................................................................................................................... 33
4.6.2. Multi-collinearity Analysis ........................................................................................................... 34
4.7. Result of Multiple Regressions (Model Summary) .......................................................................... 35
Discussion..................................................................................................................................................... 37
CHAPTER FIVE .......................................................................................................................................... 39
Summary, Conclusion and Recommendation............................................................................................... 39
5.1. Summary of major finding ............................................................................................................... 39
5.2. Conclusion ........................................................................................................................................ 40
5.3. Recommendations ............................................................................................................................ 41
Reference ...................................................................................................................................................... 43
APPENDIX I .............................................................................................................................................. 45
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ACRONYMS
No Acronyms Description
1 PD Purchase Decision
vi
List of Table
Table 11 ANOVA............................................................................................................................. 36
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ABSTRACT
The purpose of this study was to factors influencing marketing mix strategy on customer purchase
decision The case of Aqua Addis bottling water in Addis Ababa. The target population includes
consumers of Aqua Addis bottling water in Addis Ababa (Ethiopia). The study used product,
price, place and promotion as independent variables and consumers’ purchase decision as a
dependent variable. This research was conducted using survey through a set of questionnaire
with 5-point likert scale items. The questionnaire was distributed to 384 respondents and the
responses from 90% of the respondents were analyzed using descriptive and inferential statistics
such as mean, correlation and multiple regression. The findings of the study show that product,
price and place significantly influence consumers’ purchase decision for Aqua Addis bottling
water. Promotion has no significant influence on consumers’ purchase decision. Therefore, Aqua
Addis bottling water marketers should give attention to enhancing its product attributes in terms
of quality, reliability and also create good packaging design which attracts consumers and easy
to hold.
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CHAPTER: ONE
INTRODUCTION
In the 18th and 19th century most, developed countries started producing goods at better quality
and quantity. The market started becoming very competitive making customers prior to their
decisions to purchase even though Africans were still making decisions on cheap and poor
branded products.
As it is with any other consumer product, bottled water demands thorough research with respect
to consumer buying behaviour to serve as a guide to which present and future marketing activities
should follow. This is more so, given the circumstances that the bottled water market is
considered as one of the fastest growing markets in the beverage category. The bottled water
industry is a huge business that involves many of the biggest food brands in the world and worth
billions. It has grown dramatically in the last decade and today millions of people around the
world, in developed and developing countries, consume bottled water regularly. More recently, in
2018 the global bottled water consumption grew 4.5% to 218 billion liters, according to a report
from drinks consultancy Zenith International (Palmer, 2009). If this increasing trend should
continue, the global water market was forecast to have a value of $286,421.2 million in 2025, an
increase of nearly 42% since 2018 (Wikipedia, 2021). The value of the global bottled water
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market increase obviously parallels the consumption. In recent times, bottled water consumption
has risen exponentially, globally and locally.
There are thirty three (33) bottled water brands which are produced in Ethiopia. 14 (fourteen) are
certified Ethiopian Conformity Assessment Enterprise (ECAE) (Wikipedia, 2019). The demand
for bottled water is high, notwithstanding the fact that there is limited statistics to back this
assertion; consumption rate and sales volume have increased over the years looking at the number
of bottled water companies now in Ethiopia. This no doubt reflects the global trend. In short,
these bottled water market are turning into a vital part of the beverage industry. This outstanding
increment elicit several questions and is therefore one of the reasons for the research.
But the reasons for bottled water consumption seem to vary; both by author and country (Durga,
2010). The factors influencing consumers buying decision of bottled water in Ethiopia have not
been fully understood.
Although it is generally understood by consumers of bottle water that the product is better in
some or all aspects than tap water, (Ruth Kassaye, 2008) concluded in her study that, this is not
always the case. Several studies have emphasized several factors which determine the choice for
bottled water. Theoretically, Kotler et al. (2008) argue that consumers’ purchases are strongly
influenced by cultural, social, personal, and psychological factors. In her study about Suriname
markets, Durga, (2010) asserted that demographic and psychological factors affect bottled water
buying decision.
Bottled water competes with soft drinks and tap water in general public perception, bottled water
is better than tap water in many terms, e.g. Taste, safety, portability, etc. ( Diuch et al.,
2013;saylor et al., 2011).
It is against this background that, this research seeks to determine the influence factors of
customer purchase decision: in perspective of Aqua Addis bottling water, Addis Ababa, Ethiopia.
As bottling water consumption is growing in importance in the Ethiopia, especially in the capital
city, Addis Ababa, knowledge of consumers is pivotal because knowing your customer makes it
easy for you to serve them. The main focus of this study is to find out if there are any positive and
significant relationship between the four marketing mix elements; (by splitting product in to two
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dimension) namely product, price, promotion and place and bottling water consumption
consumers buying decision in perspective of Aqua Addis bottling water.
ASKU PLC/AQUADDIS is a company that produces bottling water products; their main aim is to
meet their expectations by providing their consumer with good and quality products so that they
can become the best choices. This is made possible through proper marketing as a competitive
tool and advantage over the other producers and basically understanding what your customer
needs and wants is the key thus the way consumer purchases your product can be communicated
to the company.
Therefore the main focus should be what influences a consumer to buy a certain product or to
make your product their choice is it the product quality, price, place, product and promotion or
more because this will enable the organization to meet the desires for this customer over
understanding their motive and leading to satisfaction and delight to the consumer since according
to Kotler (2008) the case of understanding the factor to why, when, how, where the customer buys
a product is the focal point of the Marketing effort in any company.
Some organizations just basically believe in their marketing campaigns to influence customers to
buy their products but sometimes what pushes a customer to buy could be the quality, social class
or even the perception towards the product. Thus without a serious study on what influences a
customer to purchase, then it is not easy to win a customer because their perceptions should
always meet their expectations and most importantly there are a variety of brands and choices to
win the same customers i.e. bottling water products competition is very stiff because their goods
are substitute and a customer can switch from consuming origin brand bottling water products to
one-one, Yes to Arki, Aden bottling water to fiker very easily, if they don’t get what influenced
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them to purchase the first drink over the other simply because the company did not understand the
consumers particular need.
Therefore, purchase decision is very essential and most of the organizations focus on giving
information about their products and fall short of understanding why this customer made a
particular decision after getting the information of the particular products.
Therefore, after accepting the importance of understanding the choices and decisions made by
customers and aiming to make the best choice in the local and neighborhood brands the scientist
chose to initially distinguish the factors that influence most of our customers to purchase and
consume your products. Basically, the factors could help us to understand our customers more
and meet or even exceed their expectations by providing them according to their perception,
therefore making it a competitive tool over the other companies because eventually we win
loyalty from our customers and enable correspondence between the organization and its clients
stronger also the company is able to know where the efforts are required in order to satisfy our
customer.
The main and underlying concept of most researchers was on the factors influencing consumer
purchase decision meaning that customers make the decision to buy a particular product. The
reason for this state of affairs would basically be necessities, satisfaction that push customers to
make that particular decision. The main concern of this particular research was to determine the
factors influencing customer purchase decision and the research focused on what pushes a
consumer to purchase a product after a decision to purchase has already been made. Therefore,
this was concerned with purchasing decision as well as the cognitive dissonance that is the post-
purchase behavior, the way a customer behaves after purchasing the product. Thus, the researcher
was interested to determine the purchase concept before and after making the decision.
Several studies on the factors that influence customer purchase decision have been conducted by
different researchers, but mostly were based on their case study areas and environment. Most of
the influences on purchasing decision focused on food products, luxury products, and
alcoholic/beer products or on different locations and coverage. This making it different from the
current researchers’ interest on factors influencing customer purchase decision, specifically on
bottling water products and a case study of Aqua Addis;
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Research Objectives
1. To examine the influence of product related factors on consumers’ purchase decision of Aqua
Addis bottling water.
2. To assess the influence of price related factors on consumers’ purchase decision of Aqua
Addis bottling water.
3. To investigate the influence of distribution related factors on consumers’ purchase decision of
Aqua Addis bottling water.
4. To examine the influence of promotion related factors on consumers’ purchase decision of
Aqua Addis bottling water.
1. product related factor influence customers’ purchase decision of Aqua Addis bottling
water
2. Price related factor influence customers’ purchasing decision of Aqua Addis bottling
water
3. distribution related factor influence customers’ purchase decision of Aqua Addis bottling
water
4. Promotion related factor influence customers’ purchasing decision of Aqua Addis
bottling water
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Secondly, theoretical scope of this study was limited to only one model of marketing that is the
marketing mix; 4Ps of Marketing by Kotler (2008). The study utilized all the four variables in the
model that determine marketing decisions i.e. Product, Price, Place and Promotion.
Thirdly, the scope of this study is limited to customers who consume Aqua Addis bottling water
in Hotel, Bar & restaurant, supermarket and Groceries due to it is hard to define consumers who
use bottling water in their home.
Second, this study some value in narrowing the unfilled gap in the existing literature and
encourage further studies in this area serving as a reference and motivate other researchers to go
for further study
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CHAPTER: TWO
2. LITERATURE REVIEW
I. Problem/need recognition
The initial step is the most important of all means in the basic leadership progression in light of
the fact that a buy exchange can't be complete except if a need of a thing is earliest wanted model;
a need of a vehicle, likely there was an outside improvement of a vehicle stalling set off his
requirement for another vehicle. Abraham Harold Maslow illustrated a progressive system of
desires then confirmed that solitary when an individual has fulfilled the necessities at a particular
stage that they can move to the accompanying stage.
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given that despite everything he needs to establish a decent connection at the organization, his
procedure of assessing should be snappy however will likewise be executed to guarantee he finds
a solid vehicle.
IV. Purchase decision
After evaluating all the alternatives and all the options then he/she could have two alternativeness
that could change the choice of the customer of purchasing the item that is the thing that different
companions of the purchaser think about the item and any unexpected conditions, these are, for
example, money related misfortunes which prompted not to purchase the item but here the choice
to purchase the car is already made and, in our case, customer has decided to purchase.
V. Post-purchase decision
After the buy the buyer may experience post-buy discord feeling that purchasing another item
would have been exceptional tending to a post-buy cacophony which spreads great word for the
item and builds the opportunity of continuous repurchase, Kotler examinedthe decision whether a
client is fulfilled or disappointed with the buy. The appropriate response lies between clients'
desire and items purchased.
Figure 2.1: Stages in Purchase Decision
Problem Recognition
Information Search
Evaluation of Alternative
Product Choice
Out Come
The figure above explains the obtaining choices process that costumer they are used. A couple of
models are made with the ultimate objective of offering explanations to the acquiring decisions of
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the client. Disregarding the way that they vacillate in kind of presentation, most of them are made
out of stages, for instance, pre-purchase, purchase and post-purchase (Hoyer, 2001; Jaworski,
2003). In light of this stipulation, Jaworski, (2003) further propose the drift of use that sees
gaining shapes as a circle, including verifying of items and undertakings, use, similarly as
exchange of used product. Stage one needs affirmation which happens when a customer thinks
about different product between their perception and the genuine satisfaction level (Solomon et
al., 2006). Besides, it's separated into two sorts of necessities, for instance, down to earth
prerequisites and mental needs. Valuable needs are related to the introduction of the thing
however mental needs. Stagetwo is the journey for information. The length and significance of
mission change for different customers.
Appraisal and depend upon elements like character, social class, pay, size of acquisition, past
experiences, prior brand perceptions similarly as purchaser devotion. As cited by Solomon et al.
(2006), Information search is the method by which the purchaser diagrams his or her condition for
appropriate data to settle on a reasonable decision, and it confined into pre-acquiring search and
ceaseless interest, even in coca cola customer they seek after this strategy in order to purchase.
Pre-purchase search is begun when clients see a need and hereafter scan for more information
from the business focus.
Stage three goes to the pre-purchase evaluation that clients differentiate different things and
brands with settle on a getting decision. In this stage, purchasers give explicit thought to the
properties which are most huge to their needs (Kotler et al.2005). According to Porter (2004)
firms can make a motivator by giving a lower cost or extraordinary plans to the customers to
surpass desires their high grounds over the others.
Stage four implies the purchase decisions made by the customers in the wake of evaluating the
thoughts from different retailers. As communicated by Blackwell et al. (2006), there are two In
stage five, customers begin eating up the things while, in stage six, customers evaluate the use
system. The associations need to consider the probability of remarketing. This stage is basic since
customers could be possible to make repeat purchases outfitted that they are content with the
recently referenced stages (Jaworski, 2003). A large amount researches about purchasing
decisions making put the focus on the cognitive process. Consumer’s decision-making process
was described as complicated with many factors generate problem recognition before a series of
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actions was initiated to reach a result (Erasmus et al., 2001). hoses adding to the fundamental
administration shapes, fusing retailer and instore assurance.
Buyer fundamental initiative system portrays the methods for a client's essential authority.
Customers at first perceive their needs and after that assemble information and that looked like in
purchasing decisions process, survey the choices finally settle on the purchase decision. All of
these exercises are managed by both mental and monetary factors and are affected by
characteristic segments like social, get-together, and social characteristics (Klein, 1989). In the
psychological perspective, clients are viewed as absurd, rash and uninvolved when settling on a
decision (Zaichkowsky,1991). A couple of clinicians accept buyers would use objective simple
courses to choose. They feel that customers are not immaculate pioneers and their minds are
obliged to manage and audit the information.
The following are the factors that influence customers to purchase something and that is how that
make business to be more successful.
2.1.2.1.Marketing Mix
Peter and Olson (1994) stated that the marketing mix consists of product, price, promotion, and
channels of distribution. These are the primary elements marketing managers can control to serve
consumers. The aim is to develop a consistent mix where all elements work together to serve the
target market or markets the company has selected.
Each component of the marketing mix has a direct or indirect effect on the buying process of the
consumers. The four-marketing mix has different ideas in terms of consumers perspective. The
4Ps will be 4Cs by the side of consumers. Price will be the cost for the consumer to attain the
product. The product viewed by the customer as the value that satisfies the consumer need or
want. The consumer requires easy and convenient situations to acquire the product which is place
by marketer’s perspective and mutual communication to be well informed about the product
(ShahramGilaninia, 2013).
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I. Product
According to Stanton, Etzel and Walker (2014), a product is a set of attributes assembled in an
identifiable form. However, consumers are not really buying a set of attributes but rather benefits
that satisfy their needs. Kotler and Armstrong (2013) stated that product is anything that can be
offered to a market for attention, acquisition, use, or consumption hence satisfying customers
want or need. Ferrell (2015) assert that product is a marketing mix strategy in which organizations
offers consumers symbolic and experiential attributes to differentiate products from competitors.
Perceived product quality is defined as an assessment that customers have about the product
excellence (Poh, Ghazali&Mohayidin, 2013). Flynn, Schroeder and Sakakibara (2014) noted that
quality is an important element in the design and manufacture of products which are considered
superior to those of competitors. According to Hitt and Hoskisson (2015), customers increasingly
expect products to be of high quality. Therefore, product quality is often considered to be a major
contributor to the development of a firm’s competitive advantage. Product quality is extent to
which a product succeeds to meet the needs of its customer. Product quality shapes reputation of
the retailer and influences consumer purchase decision at stores (Fetscherin, Boulanger,
Gonçalves, & Quiroga, 2014). Chaudhuri and Ligas (2015) suggest that product value is
positively correlated to both purchase behavior and customer loyalty in the retail industry. Ferrell
and Hartline (2013) described the qualities of a good product and emphasized that, product
characteristics that customers associate with quality include reliability, durability, ease of use, a
trusted brand name and ease of maintenance.
Gbolagade, Adesol and Oyewale (2013) researched on impact of marketing strategy on business
performance a study of selected small and medium enterprises (SME’s) in Oluyole local
government, Ibadan, Nigeria. It was established that there was a significant influence between
product and business performance. This is supported by Owomoyela, Oyeniyi and Ola (2013) in
their study on the impact of marketing mix elements on consumer loyalty where the findings
revealed that product has an influence on customer loyalty hence increase in performance.
Since consumers buy satisfaction in form of the benefits they expect to receive from the product,
to design effective marketing programmers, organizations need to know what kinds of products
they are offering consumers. The idea of product as potential customer satisfaction or benefits is
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very important. Baker (2014) argues that the basic point about any product is that it is a bundle of
attributes. Producers assume that small differentiating features will be perceived when they won't,
with the result that greater emphasis is given to creating subjective differences between
competitive products through service and promotional efforts.
Mahmood and Fatimah Hajjat (2014) did a research on the effect of product quality on business
performance in some Arab Companies. A model was developed to illustrate the product
development stages from conception to distribution. The research analyzed data using structural
equation modeling techniques. Findings revealed that product extrinsic value influences external
performance while product intrinsic value influences internal performance. Nirusa (2017)
conducted a research on the mediating role of perceived product quality. Survey was used to 105
firms. Findings revealed that there is a relationship between organizational capability and
perceived product quality. Gnanapragasam, Cole, Singh and Cooper (2018) did a study on
Consumer perspectives on longevity and reliability: a national study of purchasing factors across
eighteen product categories. The research established that most consumers consistently place
emphasis on the importance of longevity and reliability when purchasing new products.
II. Price
Price is a flexible and influential element, which determines the revenue/profitability/ market
share for the organization. On the customer’s point price is a determinant factor since they
consider the price of a product according to their income level before they buy the product. The
concept of price constitutes two different types: the monetary price a payment of certain sum by
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the consumer and social price which is the additional effort that the customer must make in order
to obtain access to a product (Arachchige, 2002).
Price differs from the other three marketing mix; Product, distribution and promotion are all part
of the process of providing something satisfying to the customer which contributes to the product
being value to customers. Value refers to the benefits or satisfactions of needs and wants. Price
mix includes retail/wholesale price, discounts, trade-in allowances, quantity discounts, credit
terms, sales and payment periods (Londre, 2009). Other competitive factors being equal the
further the price is above the industry average, is the harder for a company to use non price
enticements such as quality and style of footwear to overcome consumer resistance to higher
prices. On the other side companies should take due consideration on the effect of the lower price
not to be negated by the other factors, since low price alone will not attract buyers (Arthur A.
Thompson, 2010).
According to Kotler (2003), no matter how a product is, some people will be unable to pay more
than a certain price. Others may be able to afford it but believe that another way of that spending
sum of money would give them greater satisfaction. Conversely, simple being cheap is not
enough; the product must come up to some level of expected performance. In some situations,
(luxury goods), a high price may even make the product more desirable than a lower price. Price
is only one of the several costs faced by consumers. Other purchase related costs include the time
spent, displacement cost and emotional costs. However, price is the cost that consumer can best
determine, and thus plays an important role in their decision.
In retail markets, consumers are value driven, where value is considered a tradeoff among price
and value. Price can serve as an indicator of quality for consumers. (Walters and Bergile, 1989)
states that price serves as an indicator of product quality, identifies the good buy and determines
the affordability for consumers. Price is the most important criteria consumers’ use however there
is a variation in the importance as an evaluation criterion across both consumers and products
(Engle et’ al., 1993).
Place is a mechanism through which goods and services are moved from the service provider and
manufacturer to consumer. Place mix includes distribution channels, warehousing facilities, mode
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of transportation and inventory control management. Place generally referred as distribution
channel. Place can be physical stores or virtual stores. The process involved to transfer products
from manufacturer to the consumers is physical distribution (Singh, 2012). It is necessary to have
a clear understanding of what, how, why, where, and when customers purchase, the waiting time
to purchase, the convenience that facilitates the customer’ s buying, product variety and the
service backup to design the distribution channel. Distribution can be performed by single
supplier or multiple intermediaries (Arachchige, 2002). Typical supply chain consists of four
links in the chain: Producer/factory/manufacturer, distributor, wholesaler, and retailer (Londre,
2009).
IV. Promotion
Promotion is the component of the marketing mix that communicates information to potential
customers. Decision regarding advertising, personal selling, publicity, public relations, and
special promotional activities such as trade shows and product displays are part of this quarter of
the marketing mix (Kinnear et al., 1995).
Promotion refers to the variety of ways marketers communicate with consumers about products to
Marketer needs to plan strategies to attract the present and potential customers to the product.
Product awareness with wholesalers, retailers, suppliers and others is made through various
communication tools. The customer awareness is mostly done through company image and
publicity. The message for the promotion is designed to get attention, hold the interest, arouse
desires, and to perform action to buy. An appropriate tool must be designed for promotion, the
most popular tools are advertising, sales promotion, public relation and publicity, sales force and
direct marketing (Arachchige, 2002).
Retailer dealers can be an important information sources, advertising on the part of footwear
producers strengthens brand awareness, inform people about the features and prices of their latest
styles and models. Footwear companies can enhance the brand image of a company through
endorsement from appealing celebrities and appear in a company advertising (Arthur A.
Thompson, 2010). Influence their affect, cognitions, and behaviors (Peter and Olson, 1994)
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2.2. Empirical Literature
This part of the literature reviews studies that are closely related to the study in order to
understand and obtain their views before undertaking this study.
Factors that affects consumer to making decision when purchasing is always an interesting topic
among the researcher. Theories and fact have been created to prove how consumer act and behave
when making decision in purchasing goods. Utility theory which state that consumer make
decision based on the expected outcomes of their decision is the first formal explanation of
consumer decision making developed by Bernoulli. (Michael R, 2005). Based on consumer with
rational act but not all consumer was rational and even one has no consistent rational. This is
heavily influenced by other factors such as environment factors.
Phend (2009) took the study of driving factors in bottled water consumption further. She admits
that earlier studies indicated the perceived purity, safety and taste as the main drivers for
consumers to use bottled water. However, on the basis of a more recent survey conducted in
England, she argued that health is not a driving factor in bottled water consumption. It is
convenience and taste which drive the use of bottled water. Due to Phend (2009), the municipal
water systems are improving the last years and prices of bottled water are very high in
comparison to tap water. Overall, the reasons for bottled water consumption seem to vary; both
by author and country. Health/risk concerns and taste seem to be the most frequently mentioned
causes. The main conclusion is that consumers generally value bottled water and are prepared to
pay several times more to consume what they perceive to be a “safe”, “healthy”, “tasty” or
“convenient” product
Product quality shapes retailers‟ reputation and influences consumer buying decision at stores
Pan and Zinkhan (2006). Chaudhuri and Ligas (2009) suggest that product value is positively
correlated to purchase behavior and customer loyalty in the retail sector. Consumers evaluate
various dimensions of food products to make their purchase decision. Nevin and Suzan Seren
(2010) reveal that Turkish consumers are concerned about food nutrition and safety when
shopping at supermarket. Spinks and Bose (2002), in a study of seafood purchasing in New
Zealand, find that consumer decision is influenced by product characteristics of nutrition, taste,
health benefit and ease of preparation. Additionally, Maruyama and Trung (2007) demonstrate
that the underlying reasons for buying fresh food in Vietnamese supermarkets include factors
15
such as brand names, ranges of size and volume, the freshness and the origin of goods. Recently,
scholars typically identify food label and package as important determinants of consumer
purchasing decision (Akbay & Jones, 2005; Andreas, Panagiotis, & Rodolfo, 2007; Jabir,
Sanjeev, & Janakiraman, 2010; Jean & Louis, 2011; Kempen, Bosman, Bouwer, Klein, & van der
Merwe, 2011).
The influence of the price factor on the customer’s choice of bottled water brand is the key
rational factor influencing the brand choice and building trust in customers through fair pricing
has a positive long-term effect. In fact, for some customers, the price is the main factor when
choosing the bottled water brand. For most, however, there is a direct trade-off between price and
quality. According to Mullarkey (2001), if the brand is of sufficient quality, customers will pay a
higher price, some customers’ sense value if the price is low, whereas others perceive value if
there is a balance between quality and price. Moreover, According to Du Plessis & Rousseau,
(2007); Monroe, (2012) consumers evaluate the price with the expected value from the product to
enhance the intention to purchasing decision process (Du Plessis & Rousseau, 2007; Monroe,
2012). The level of the perceived price is varying between customers because it based on social
and economic factors (Maxwell, 1995).
French (2003) indicates that food pricing is an essential factor that shapes individual choice.
Given the importance of cost saving consumers evaluate and compare price during the process of
food purchasing (Nevin & Suzan Seren, 2010). Conventional wisdom indicates that, a high retail
price which reflects immediate monetary costs are likely to hinder consumer purchase behavior
while a low price or competitive price leads to an increase in store traffic and product sales
(Barbara, Lois, & Bobby, 1996; Pan & Zinkhan, 2006). Interestingly, some authors challenge this
view and argue that consumers who seek to maximize expected quality are willing to pay for the
highest-priced products (Dodds, Monroe, & Grewal, 1991; Kerin, Jain, & Howard, 1992). That is,
consumers are interested in the ratio between price and quality when making purchase decision.
Figuie and Moustier (2009) find that most of Vietnamese supermarket consumers perceive high
price as an indicator of product quality. In general, empirical studies find that competitive and
reduced prices promote the purchase of food in retail stores (e.g., French et al., 1997; Hansen,
2003; Jeffery, French, Raether, & Baxter, 1994).
16
Dr. Tahir Ali (2013) on the study made on impact of Integrated marketing communication on
consumers purchase decision confirms the importance of IMC activities and concludes that IMC
is the best to target the consumers, because the consumers are strongly influenced by IMC
implementations
Zheng and Kaiser (2008), have researched about beverages in relation to their Promotion in USA
under the title “Promotion and US nonalcoholic Beverage Demand”. The aim of the research was
to see the effect of Promotion on different nonalcoholic beverages. Bottled water was one of the
beverages evaluated in the research. The research comes up with a conclusion about bottled water
that, advertising do not positively affect the demand of it. They have found that consumption of
bottled water is not affected by the advertisement bottled water producers make.
The research of Raula, Liviu and Madalina (2005), under the title “The Role of Promotion in the
Purchase Decision Process”, showed that buyers are responsive to information in advertisements.
It was explained in the research that needs and motivations are the beginning points for purchase
decision to take place. Buyers must experience sufficiently positive attitudes towards the product
and the brand to make the purchase decision. This comes to the consumer mind after the
consumers get information about the product that they purchase. According to the research,
buyers seek special information on the products which they purchase and it directly affects their
purchase decision.
As such, it aims to provide shopping convenience sought by consumers in modern retail channels
Pan and Zinkhan (2006). Most researchers agree that a convenient location increase store
patronage via reduced transaction costs (Berry, Seiders, & Grewal, 2002; Huddleston, Whipple, &
VanAuken, 2004; Jabir et al., 2010). The central place theory (Craig, Ghosh, & McLafferty,
1984) posits that retail stores at central locations may attract consumers from long distances.
Alongside location, results of an India study (Jabir et al., 2010) show that food consumers prefer
supermarkets which have longer opening hours, sufficient parking, product availability and
accessibility. One interpretation could be that these elements altogether create consumers‟
perception of service quality provided by retailers (Berry et al., 2002; Chaudhuri & Ligas, 2009;
Pan & Zinkhan, 2006). Empirical evidence confirms that convenience significantly affects
consumer purchase of food products (Jaravaza & Chitando, 2013; Maruyama & Trung, 2007).
17
2.3. Conceptual Framework
Figure 2.3: Conceptual Model
Product
Consumer
Price Purchase
Decision
Place
Promotion
Source: conceptual framework adopted from Singh (2012) and Aaker (2003)
18
CHAPTER: THREE
RESEARCH METHODOLOGY
This chapter highlights the research methodology of the study. It reviews the research design,
population, sampling method used in collecting, analyzing and reporting data. It also provides
details on the data collection methods, research procedures and data analysis method applied in
this research.
The researcher used quantitative research by organized questionnaire for the selecting
respondents. Adams, et al., (2007) stated that quantitative research method is defined as numeric
collection of data that analyze using different types of statistical tools and largely independent of
the researcher ideas. In this study review of basic statistical outputs are summarized through
descriptive frequency, numerical measures and tables.
Accordingly, the researcher was employed mixed (descriptive and explanatory) research design
with which to describe and explain the four factors influencing elements and consumer purchase
decisions. Moreover, the contribution of the four factors influencing elements towards the
dependent variable, which is consumer purchase decision, has clearly examined. As the aim of the
study is to describe the characteristics of sample population in connection with the effect of these
factors influencing elements on consumer purchase decision and the researcher uses quantitative
research approach, descriptive research design is suitable and appropriate. Moreover explanatory
research design has been used and helps the researcher to find out the relationship between the
independent variables, namely (product, price, promotion and place) and the dependent variable,
consumer purchase decision.
19
3.3. Target Population, Sample Size and Sampling Techniques
3.3.1. Population
Sekeran (1990) reported that population refers to the entire group of people, events or things of
interest that the researcher wishes to investigate. The target population for this study was
consisting of all the customers of Aqua Addis bottling water in Addis Ababa city. Quite often we
select only a few items from the population for our study purposes.
The rationale behind choosing Addis Ababa as a target population of the study is that the people
of the city are combination of different part of the country; they can represent different culture,
religion, and more trading activates performed in the area. Thus, Purposive sampling was used to
select those customers based on the flow of the customers. Thus, Customers found in Meskle
Flower, Megnagna, Bole, and Stadium was selected. The reason behind targeting on such areas is
that the selected places are assumed to be highly congested with Cafeteria, hotels, café and similar
service centers. Since the type of customers across the city is assumed to be homogenous the
researcher didn’t consider customers difference in geographically different areas.
The sample size for this study was determined by using the formula developed by Cochran
(1963:75)
Where:
n0 = sample size,
Z = value of the normal curve that cuts off an area α at the tails (1 – α equals the desired confidence level,
e.g., 95%),
20
e = the desired level of precision,
q = 1-p.
Therefore, the customer’s sample size for the study at 95% confidence level and 1% precision is denoted
by; Z = 1.96, p = (0.5 maximum variability assumed) since actual variability in the proportion is not
known), q = 0.5. e = (0.05)2.
(0.05)2
The sampling technique used in this research is convenience method of sampling. According to
Schofield (2006), convenient sampling is a technique of sampling which enables to collect data
according to the availability and willingness of participants in thepopulation, but with sufficient
number of participants to imply representativeness. Teddlie and Yu (2007) argued that convenient
sampling a technique that has two broad characteristics that is, sampling used to achieve
representative and comparative data in dimension of interest. This indicates that the participants
of the research were mainly individual consumers and the units of analysis for this research are
individuals. Then, Convenience sampling technique use to select customers in the selected areas.
This is for the purpose of suitability of contacting, interviewing and collecting sufficient data
from customers who are using aquaddis bottling water products and need to buy the product. This
technique is important in order to overcome the practical difficulties for obtaining sufficient data
more quickly and effectively.
21
3.4.1. Secondary data
Secondary data is the collected and assembled data before by many researchers for many
purposes. Secondary data is used to help researchers in solving their problems, and to develop an
approach for answering certain research problems, (Kent, 2007). Secondary data collection has
many advantages such as low-cost collection and time saving. In contrast, it has some
disadvantages such as its generality and it may be outdated and less accurate (Bradley, 2007). The
resources of secondary data for this research are books, periodicals, journals, references and the
Internet.
3.5.1. Questionnaire
According to White (2002), surveys are arrangement to questions every one giving various choice
answers from which the respondents can utilize. Only one set of questionnaires were designed for
customers of the aquaddis bottling water. The questionnaire was divided into two main sections.
Section one talked on the demographic variables of the respondents while section two solicited on
the two main constructs making up the framework. The questionnaire was made up of both open-
ended and close-ended questions and it sought to establish the influence factors of customer
purchase decision: The Perspective of aqua addis bottling water.
22
3.6. Methods of Data Analysis
The research was conducted on a three-tiered basis using statistical package for Social Science
(SPSS) version 20. In the first tier of analysis, descriptive statistics such as proportions is used to
summarize categorical variables, mostly the demographical data. Then on the second tier of
analysis, the relationship between each independent variable with the dependent assessed using
cross tabulation method. Finally, after all independent variables identified to associate with
customer purchase decision using the above method, their collective effect on customer purchase
decision has analyzed using regression. All exposure variables (independent variables) will have
associated with the dependent variable (customer purchase decision) to determine which ones had
significant and positive association.
Were
Substituting both dependent and independent variables in equation 1 above, we have the
following equation specifically, for this study the expression is appropriate:
〖PD=〗α+β1X1+β2X2+β3X3+β4X4+εi……………….... (2)
Were,
β1 is the partial slope for x1 on y and indicates the change in y for one unit change in x1,
23
X1- Product
X2 – Price
X3 – Place
X4 – Promotion
εI - Error term
Validity is the ability of an instrument to measure what it is designed to measure. It is the degree
to which the researcher has measured what is supposed to be measured, (Kumar (2011), and the
extent to which the measurement is done and the data obtained is free from error (Njoka, 2013). It
also examines whether or not the item actually elicits intended information by way of
conceptualizing the idea and the data collected to support the idea. The factor influence customer
purchase decision books and previous studies related to the study variables. The questionnaire
contained items that measured objectives in the research study. Pre-testing was done to examine
each question and its meaning as understood by the respondents.
3.8.2 Reliability
Reliability is the degree of accuracy in the measurements made by a research instrument.
According to Shanghversy (2003), reliability is the consistency of measurement which is
frequently assessed using test-retest method. It is increased by including many similar items on a
measure by testing a diverse sample of individuals and by using uniform testing procedures (as
cited in Mogaka 2014). The study was used Cronbach’s alpha methodology to check internal
consistency.
24
Table 3.1: Reliability Statistics
The necessary precaution was taken to make the study ethical. Respondents were informed ahead
about the purpose of the data they were providing. All the information given by customers via the
questionnaire is going to be used only for the purpose of academic study and remain confidential.
They are also assured that their identity would be anonymous for a research. As it is promised,
their privacy and identity will not disclose.
25
CHAPTER: FOUR
This chapter presents a discussion of the results and the process through which the results were
obtained. First, the background information of respondents presented and discussed. The chapter
also deals with the presentation and an analysis of data collected and discusses it in relation to
factors affecting customer purchase decision. The statistical methods used for analysis by using
SPSS. From the total 384 questionnaires that were dispatched, 345 were returned, which makes
the response rate 90%.
Valid Cumulative
Frequency Percent
Percent Percent
26
were females. This implies that the number of male respondents were greater than female who
were participated in this study.
The education level of the participants varied widely from a total of 345 respondents 101 or 29 %
of respondents have basic education, diploma 52 or 15 %, and respondent 190 or 55% have
University graduate or more, the remaining No formal schooling 2 (1%). The findings indicated
that the study used people with good knowledge of reading and writing hence good
comprehension of the survey questions thereby provided accurate answers that improved
reliability.
In terms of occupation of the participants; the higher number of the respondents was employed
who represented 191 or 55 % of the total response followed by retired 77 or 22 %,and students 52
(15%), unemployed customers 25 (7%). From the survey we can say that most of the customers
are employed.
According to Al-Sayaad, Rabea, and Samrah (2006) the calculated mean score of an item were
classified in ranges to fit the five-scaled Likert’s measure of responses (strongly disagree,
disagree, neutral, agree, and strongly agree) as shown in the Table 4.2 below. In this case the
researcher classified in ranges to fit the five-scaled Likert‟s measure of responses as (definitely
not, probably not, possibly, probably yes and definitely yes). Hence, in this study consumers
purchasing decision on each factor affecting items for all variables were labeled according to its
calculated mean score result and the classification presented in the following table.
27
Table 4.2: Mean Score Range for Five-Scale Likert’s Response
4.3.1. Product
28
4.3.2. price
Std.
Mean
Dev
Aqua Addis bottling water price is reasonable. 3.47826 1.146388
The price of Aqua Addis bottling water is uniform and relatively similar
across the various outlets in the Addis Ababa.
3.57971 1.163967
Aqua Addis bottling water price is acceptable and justifiable
3.47826 1.198457
Aqua Addis bottling water price is very economical 3.6029 1.177054
the price of Aqua Addis bottling water is lower than other bottled water
3.48696 1.229709
The pricing of Aqua Addis bottling water is imposing quantity discount
system. 3.36522 1.219968
The price of Aqua Addis bottling water is offers value for money
3.4029 1.223554
Overall 3.484886 1.194157
Source; result of this survey study 2021
As shown in Table 4.4 above, price was assessed by seven measurement items. According to the
mean score of the items that describes the effect of product on Aqua Addis bottling water
consumers purchasing decision, on analysis, it was revealed that majority of the respondents
agreed with a price’s reasonable (mean=3.478, sd=1.146), economically price (mean=3.602,
sd=1.177), lower price than other bottled water (mean=3.486, sd=1.229) and uniform of price
various distribution outlets (mean=3.478, sd=1.146), however, respondents neutral that the
imposing of quantity discount system(mean=3.365, sd=1.219) and that offering value for money
(mean=3.402, sd=1.223).
29
4.3.3. Distribution
4.3.4. Promotion
30
The Aqua Addis promotion is attractive. 3.301449 1.246681
The Aqua Addis bottling water advertise the true nature and quality of its
product 3.35942 1.247593
Advertisement of Aqua Addis bottling water creates some kind of good
image in mind 3.15507 1.126388
Overall 3.21852 1.22259
Source; result of this survey study 2021
As shown in Table 4.6 above, promotion was assessed by nine measurement items. According to
the mean value of the respondents concerning about promotion dimensions, except the messages
of clarity and understandable (mean=3.473, sd=1.184) for almost for all remaining dimensions
scored less than a mean value of 3.40 (neutral score). Meaning that majority of the respondents
disagrees for all promotion items with mean score ranging from 2.859 to 3.389 which
disagreement on creation advertisement of good image in mind, advertisement show the true
nature and quality of the product, promotion attractiveness, promotion creativeness, ethicality of
promotion, using Issuing flyers, posters and business cards, promotion by using social media like
face book, and twitter and promotion by using traditional media like radio, television,
newspapers, and magazines.
Correlation measures the strength of the linear relationship between two variables. Thus,
Pearson‗s correlation is used to identify whether there are relationships between the variables and
to describe the strength and the direction of the relationship between two variables (Mohammad,
n.d). So, the correlation analysis was done to analyze the relationship between purchase decision
and product, price, place and promotion. To examine the relationship among these variables,
Pearson correlation coefficients were calculated. In this section of the study, the analysis and
interpretations of the correlation results between dependent and independent variables are
presented.
31
4.5. Correlation Matrix summary
consumer 1.000
purchase
decision
Product .6213** 1.000
(0.0004)***
For these variables test was also conducted, consumers’ purchase decision and price of Aqua
Addis bottling water positively correlate (r = 0.5069 with p < 0.05). There is moderate relation
between these two variables, which is significant. The result clearly indicates that the reasonable,
justifiable and very economical price of Aqua Addis bottling water influence the consumers’
purchase decision. Therefore, marketers should give attention to the price of bottled Aqua Addis
bottling water. In addition the two variables i.e. distribution and customer purchase decision are
positively correlated (r = 0.4214 with p < 0.05). There is moderate relation between these two
32
variables, which is significant. The result is clear. The consumer evaluates the distribution on the
basis of good available, convenient and easy to consume on purpose of purchase decision making.
Test was conducted to know the degree of relationship between consumers’ purchase decision and
promotion are positively correlate (r = 0.3315 with p < 0.05). There is weak relation between
these two variables, which is not significant. The result shows that the promotion activity on
traditional media, social media and flyers of bottled water is not that much liked by consumers.
Consumers do not seem to use the information/advertisement of Aqua Addis bottling water which
is promoted on the media for the purpose of purchase decision making.
This assumption can best be checked by kurtosis and skewness and p- p plot below. Normality
can be checked with a goodness of fit test. normality test is used to determine whether sample
data has been drawn from a normally distributed population or the population from which the data
came is normally distributed. Normality was checked by two terms i.e. kurtosis and skewness and
p- p plot using SPSS. For kurtosis, the normal value is less than 3 whereas for skewness the
normal value is supposed to be less than 6 (Asghar andSaleh 2012). Therefore, in this research,
the data has been drawn from a normally distributed population or the population from which the
data come is normally distributed because the value for both kurtosis and skewness is found to be
normal. This can be shown below in table 11.
33
Skewness/Kurtosis tests for Normality
Kurtosis
Variable Obs
Pr(Skewness) Std. Error Pr(Kurtosis) Std. Error
product 345 -0.3519 0.1006 1.003 0.035
price 345 -0.1328 0.1006 -0.7812 0.035
place 345 0.0085 0.1006 0.5047 0.034
promotion 345 0.0129 0.1006 -1.603 0.035
Valid N (list wise) 345
Source; result of this survey study 2021
Before running regression, one should check for the problem of multi-collinearity which is
present if there is high correlation between some of the independent variables. The study checks
this with the variance Inflation Factor (VIF) which calculates the influence of correlation among
the independent variables on the precision of regression estimates. The VIF should not exceed 10.
Tolerance is an indicator of how much of the variability of the specified independent variable is
not explained by the other independent variable in the model and is calculated using the formula
1-R2 for each variable. If this value is less than 0.1 it indicates that there is possibility of multi
collinearity, but if it is greater than 0.1 it means that there is no multi-collinearity problem with in
the model.
34
Table 4.9: Collinearity statistics
Variable VIF 1/VIF
product 1.97 0.507614
price 1.81 0.552486
place 1.25 0.80000
promotion 1.22 0.819672
Mean VIF 1.5625
Source; result of this survey study 2021
Model Summary
35
sig=0.000. F-test is used to find out overall probability of the relationship between the dependent
variable and all the independent variables occurring by chance. The F-test result of the study is
73.0628 with a significance of 0.000 meaning that the probability of these results occurring by
chance is less than 0.05 i.e. the variation that is explained by the model is not simply by chance.
coefficients
Unstandardized coefficients Standardized coefficients
Model
B Std. Error Beta t Sig.
Constant .03721 .03112 1.216 .2251
X1=product .96532 .01694 .97415 59.698 .0000
X2=price .50141 .02478 .50653 31.023 .0100
X3=place .73301 .01932 .50473 1.937 .0069
X4=promotion .38622 .02218 .51524 2.142 .0886
Source: Survey, 2021 At 5% level of significance
In next step for indicate of consumer purchase decision explanation and prediction by four factor
influencing components, I used Multiple Regression method .In table 4.13 , According to Beta
coefficient can be said that product has maximum effect (.974) and promotion has minimum
effect (.515) on promotion. Then regression model can be written as follows in a significant at
95% confidence interval. (x1, x2, x3, and x4)
Ŷ=0.037+0.965X1+0.501X2+0.733X3+0.386X4
Interpretation of the model, as per the finding, product has a positive effect on consumer purchase
decision. This means that, as product quality increases or decreases by 1%, consumer purchase
decision increases or decreases at the time by 96.5% controlling for (x2, x3, and x4). Similarly
price influences positively consumer purchase decision. When price is raised or fall by 1%, the
dependent variable consumer purchase decision raised or fall by 50.1% controlling for(x1, x3, and
x4) .As distribution/place increased or decreased by 1% consumer purchase decision also
increased or decreased by 73.3% controlling for (x1, x2,and x4). With regard to promotion
increased or decreased by 1%, the dependent variable customer purchase decision is increased or
decreased by 38.6% controlling for (x1, x2, and x3 As result product and price have strong effect
on consumer purchase decision with regarding the Aqua Addis bottling water.
36
Discussion
The first objective of the research was “To examine the influence of product related factors on
consumers’ purchase decision of Aqua Addis bottling water”. The research has asked whether the
product related factor influence customers’ purchase decision of Aqua Addis bottling water”
Based on the results of correlation test product quality has positive and strongest relationship with
consumer buying decision (r = 0.6213). In other words if the company improves its product
quality, consumers buying decision will be influenced in favor of its products. Therefore, product
quality has power to determine consumers purchasing decision. Chaudhuri and Ligas (2009)
suggest that product value/quality is positively correlated to purchase behavior and customer
loyalty in the retail sector. So, the finding of this research in this aspect is in line with Chaudhuri
and Ligas (2009) states. The regression analysis of product quality dimensions and consumer
buying decision indicates that 96.5% of the variance R square in consumer buying decision has
been significantly explained by product quality. The finding of Pan and Zinkhan (2006) showed
that Product quality shapes retailers‟ reputation and influences consumer purchasing decision at
stores. And also the finding of Spinks and Bose (2002) concluded that consumer decision is
influenced by product characteristics of nutrition, taste, health benefit and ease of preparation.
Therefore, the result of this study on product quality dimension is similar to the above findings
that product quality has the power to influence consumers buying decision.
The second objective of the research was “To assess the influence of price related factors on
consumers’ purchase decision of Aqua Addis bottling water”. The research had a question of
“Does Price related factor influence customers’ purchasing decision of Aqua Addis bottling
water?” On the influence of price, the study established that majority of the respondents review
the prices influence deciding on purchase purchasing decision. It was found to have positive and
strong relationship with consumer purchasing decision. The correlation coefficient between these
variables is 0.5069. Price is one of the important factors to influences consumers in their
purchasing decision. If this is the case, companies shall charge a competitive and affordable price
so as to influence their customers purchasing decision in favor of them. As a result, price has
power to influence consumers purchasing decision in purchasing Aqua Addis bottling water.
With regard to the regression analysis of price and consumer purchasing decision, 50.1% of the
variance R square in consumer purchasing decision is significantly explained by price. According
37
to Majumdar (1996), companies need to include strategies that will serve specific areas in the
market by offering price-quality trade off to choose their consumers. The findings also showed
that the majority of the respondents use the prices to determine which purchase decision and that
price differentiations are key determinants of their purchase decision. Therefore, the result of this
study on product price dimension is similar to the above findings that product price has the power
to influence consumers purchasing decision.
Third objective of the research says “To investigate the influence of distribution related factors on
consumers’ purchase decision of Aqua Addis bottling water”. The research had a question of
“Does distribution related factor influence customers’ purchase decision of Aqua Addis bottling
water?” It was found to have positive and strong relationship with consumer purchasing decision.
The correlation coefficient between these variables is 0.4214. With regard to the regression
analysis of place and consumer purchasing decision, 73.3% of the variance R square in consumer
purchasing is significantly explained by place. According to the research consumers have replied
that Products and places/distribution partially had a positive and significant influence on
purchasing decisions with Aqua Addis bottling water in Addis Ababa. The highest average
respondents in this study set purchase decisions with consideration because the easy access made
consumers accustomed to shopping at the convenience store. This study results are in accordance
with the study (Noskova & Romanova, 2015) (Rondonuwu & Tamengkel, 2016) (Said &
Prihatini, 2016), which showed that the place/distribution had a positive and significant effect on
purchasing decisions.
The last objective of the research is “To examine the influence of promotion related factors on
consumers’ purchase decision of Aqua Addis bottling water”. The research question was “Does
Promotion related factor influence customers’ purchasing decision of Aqua Addis bottling
water?” Based on the correlation test result, promotion has a positive and moderate correlation
with consumer purchasing decision. The correlation coefficient between promotion and consumer
purchasing decision is 0.3315. Generally the finding suggests that, there is a positive and
moderate relationship between promotion and consumer purchasing decision in purchasing Aqua
Addis bottling water.
38
CHAPTER FIVE
This chapter presents the Summary, conclusions and recommendation derived from the data
analysis carried out in the previous section.
The findings revealed that four components of factors influence: product, price, place and
promotion are well correlated with consumer purchasing decision of Aqua Addis bottling water.
Correlation coefficient shows that there is strong relationship with two of the independent
variables which is product and price with dependent variable (consumer purchasing decision) i.e.
0.6213 and 0.5069 respectively .The correlation between the rest of two independent variables (:
place, and promotion) variable and dependent variable (consumer purchasing decision is
moderate) .i.e. 0.4214 and 0.3315 respectively.
The result of multiple regression analysis between dependent variable (consumer purchasing
decision) and independent variables (product, price, place and promotion) among the four
independent variables the multiple regression analysis revealed that product, price, and place were
a significant predictor of consumers Aqua Addis bottling water purchasing decision.
The regression analysis by the same token shows that there is a positive and significant
relationship between independent variables and consumer purchasing decision. The adjusted
RSquare (R square = 0.944) shows the explanatory power of all independent variables involved in
39
the study. Hence product, price, promotion and distribution jointly determine (explain) 94.4% of
the variance in consumer purchasing decision
Among variables those have a significance relationship with Aqua Addis bottling water consumer
purchasing decision and (product, price, place and promotion). Product and place have the highest
standardized regression coefficient and the lowest significance (β=.96532, p=0.000) and
(β=.73301, p=0.0100), which means product and place are the most important predicator of
consumer Aqua Addis bottling water purchasing decision followed by price (β=.50141,
p=.00691). Promotion was found to be the list insignificance variable that influences (β=.38622,
p=0886) the Aqua Addis bottling water consumer purchasing decision.
5.2. Conclusion
According to chapter four analyses, Aqua Addis bottling water consumers have given their
response about the effect of purchasing decision on Aqua Addis bottling water. As seen on
chapter four data results and discussion, it can be concluded that the objectives of the research
have been completely met.
The study concluded that there was a significant relationship between product and consumer
purchasing decision. In order for Aqua Addis bottling water to gain competitive advantage against
the competition, and also its product has to meet the needs of the consumers. The product
characteristics that were investigated in this research were quality and packaging. It was
concluded that consumer purchasing decision is influenced by product features such as perceived
product quality, product reliability, perceived product value, and the kind of information on the
packaging label.
The findings lead to a conclusion there was a significant relationship between price and consumer
purchasing decision. It was concluded that price is a critical factor as it is one of the major
attribute of a product that consumers look at Aqua Addis bottling water purchases decision. The
price attributes investigated in this study included, value based pricing and price discounts. The
40
study concluded that price discounts for quantity influence purchase decision, value based pricing
has a positive effect on consumer purchasing decision.
The study concludes that distribution channels are essential in influencing consumer purchasing
decision and that Aqua Addis bottling water should use strategic distribution channels to increase
product availability. The study also concluded that the convenience and accessibility have a
significant influence on a consumer purchase decision. The Aqua Addis bottling water must be
easily accessible, must be convenient to the consumer.
Findings of the study lead to a conclusion that promotion and the choice of advertising media has
no effect on the consumer’s purchase decision. This is because Promotion was insignificance
variable that influences (β=.38622, p=0886) the Aqua Addis bottling water consumer purchasing
decision.
5.3. Recommendations
Based on the major findings of the study and the conclusions drawn above, the following
recommendations are made.
From the findings, it is recommended that due to the tough competition in the Bottled Water
industry in Ethiopia, Aqua Addis bottling water should enhance its product attributes in terms of
quality, and reliability in order to compete effectively in the market. In addition to this Aqua
Addis bottling water marketers should also create good packaging design, which attracts
customers and for easy to hold.
It is recommended that Aqua Addis bottling water should always remember that customers are
price sensitive and that price is a reflection of value and therefore should price their products
reasonably. The prices of products should not be increased if there is no increase in benefits or
value from the products as this would make consumers to shift brands. It is recommended to use
price promotion strategies from time to time which include price discounts, and bonus packs to
attract customers and increase their decision to purchase the Addis bottling water product.
41
It is recommended that Addis bottling water should expand its distribution strategy in order to
make its product easily available to customers in order to influence consumers purchasing
decision in favor of Addis bottling water. The study also recommends that product variables and
places/locations are maintained and improved by applying zero stockless.
42
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APPENDIX I
Dear Respondents,
Feel free to contact me if you have any question by the following address
E-mail:- [email protected]
45
Part I. Demographic Profile
Please respond to each item by putting a tick (√) mark in the box & fill in the blank
2. Employment
3. Educational Background
[ ] diploma others [ ]
Please specify……………………………………………………….
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Part II- Question on Customers Purchase Decision
Please encircle the number and the word which expresses your opinion towards Aqua Addis
bottling water. The numbers indicate the following statement.
S.N Product
47
channels
17 Aqua Addis bottling water is convenient and easy to 5 4 3 2 1
consume
18 Aqua Addis bottling water is good available in Addis Ababa 5 4 3 2 1
19 I obtained all Aqua Addis bottling water when I need 5 4 3 2 1
20 Aqua Addis bottling water has trusted distribution channel 5 4 3 2 1
21 Aqua Addis bottling water distribution channel is 5 4 3 2 1
satisfactory
22 Aqua Addis bottling water is widely distributed all over in 5 4 3 2 1
Addis Ababa
23 The Aqua Addis bottling water distribution system is 5 4 3 2 1
reachable
24 The Aqua Addis bottling water product is accessible in time 5 4 3 2 1
and space.
Promotion
25 The Aqua Addis use promotional activities on traditional 5 4 3 2 1
media like radio, television, newspapers, and magazines.
26 The Aqua Addis use promotional activities on social media 5 4 3 2 1
like face book, and twitter.
27 The Aqua Addis bottling water use promotional activities 5 4 3 2 1
like Issuing flyers, posters and business cards.
28 The promotional messages of Aqua Addis bottling are clear 5 4 3 2 1
and understandable.
29 The promotional activities of Aqua Addis bottling water are 5 4 3 2 1
ethical
30 The Aqua Addis bottling water promotion is creative 5 4 3 2 1
31 The Aqua Addis promotion is attractive. 5 4 3 2 1
32 The Aqua Addis bottling water advertise the true nature and 5 4 3 2 1
quality of its product
33 Advertisement of Aqua Addis bottling water creates some 5 4 3 2 1
kind of good image in mind
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ቅድስት ማርያም ዩንቨርስቲ
የቢዝነስና ኢኮኖሚክስ ትምህርት ክፍሌ
ድህረ ምረቃ ፕሮግራም
በአኳ አዲስ የታሸገ ውሃ ኃ/የተ/የግ/ማህበር ዯንበኞች የሚሞሊ መጠይቅ
ውድ መጠይቁን የምትሞለ ዯንበኞች፡-
እኔ የቅድስት ማርያም ተማሪ ነኝ፤ በድህረ ምረቃ ፕሮግራም የማስተርስ የገበያ አመራር
የማሙያ ጥናቴ የዯንበኞች አራቱ ማርኬቲንግ ተጽዕኖ የሚያሳድሩ ምክንያቶች በዯንበኞች ግዢ
ውሳኔ ሊይ በሚሌ ርዕስ በአኳ አዲስ የታሸገ ውሃ እያካሄድኩ ነው፡፡ ስሇዚህም ከዚህ ጋር
የተያያዘውን መጠይቅ በሀቀኝነት በመሙሊት በዚህ ምርምር ውስጥ እንዲሳተፉ ተጋብዘዋሌ፡፡
የዚህ ጥናት ምስጥራዊነት ሊረጋግጥ እፈሌጋሇሁ ምክንያቱም ሇአካዳሚ ዓሊማ ብቻ ጥቅም ሊይ
የሚውሌ ስሇሆነ እና ሁለም ምሊሽ ሰጪዎች ምስጢራዊነታቸውን በመጠበቅ የማይታወቁ
ይሆናለ፡፡ የእርስዎም ምሊሾች ጥናቱን ሳቢ በተጨማሪም ውጤቶቹ በጣም አስፈሊጊ እንዯሆን
ያዯርጉታሌ፡፡ ይህንን መጠየቅ ሇመሙሊት ፈቃዯኛ ስሇሆኑ በቅድሚያ አመሰግናሇሁ፡፡
ጥያቄ ካሇዎት በሚከተሇው አድራሻ ነፃነት ተሰምትዎት ያገኙኝ፡፡
ኢሜሌ፡- [email protected]
በጣም አመሰግናሇሁ፡፡
1. ፆታ ወንድ [ ] ሴት [ ]
2. ስራ ሰራተኛ [ ] ስራ አጥ [ ] ተማሪ [ ] ጡረታ [ ] ላሊ
[ ] እባክዎ ይግሇጹ…………………………….
ይግሇጹ…………………………….
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ክፍሌ ሁሇት፡- አራቱ ተጽዕኖ የሚያሳድሩ ምክንያቶች የተመሇከቱ ጥያቄዎች
50
20 አኳ አዲስ የታሸገ ውሃ የታመነ የማከፋፈያ መስመሮች አለት። 5 4 3 2 1
51