Product Features Influencing Purchase Decision for Smartphone Handsets in Australia - Case Study Example

Product features influencing purchase decision for smartphone handsets in Australia Name: Tutor: Course: Date: Executive Summary This report investigated the influence of product features on purchase decision of smartphone consumers in Australia. The exploratory study involved a random sample of 76 university students in Australia who responded to questionnaires. The rationale of the study was that Australian consumers are active in acquiring product and brand information; some prefer brand popularity while others are cognizant of brand connotation. The study objectives were to examine product attributes, effect of brands and current customer satisfaction levels on future intention to purchase a smartphone product. Descriptive (crosstabs) and correlation statistics were used in the study. Using SPSS 20.0 to capture, code and analyze data, the findings of the report showed that found that screen size, design, apps, user friendliness and privacy and security were the most sought after product attributes that influenced customer purchase decisions in Australia. It found that brands were highly recognized and had significant influence of customers’ decision to purchase a smartphone. Besides, the study found that customer satisfaction from current purchase had a lot of influence on the future purchase. The study layout began with an introduction part which also included problem definitions and outline of the study objectives. The study then provided a methodology of how to approach the study by looking at research design, sample and sampling techniques, data collection instruments and analysis. The study later posted the results and discussions. Finally, recommendations were listed and conclusion made. Table of Contents Executive Summary 1 List of Tables 3 1.0 Introduction 4 1.1 Statement of problem 4 1.2 Objectives of the study 5 1.3 Significance of the study 5 2.0 Methodology 5 2.1 Research design 6 2.2 Sample size and sampling technique 6 2.3 Data collection instrument 6 2.4 Data analysis 8 3.0 Results 8 3.1 Product attributes analysis 8 Table 1: Rotated component matrix for smartphone features 8 3.2 Influence of brands on customer purchase decision 9 Table 2: Crosstabs on brand popularity among respondents 9 3.3 Customer satisfaction on Smartphone use 10 Table 3: Crosstabs on current phone usage and recommendation to friends 10 Table 4: Crosstabs on current phone usage and future improvements 11 Table 5: Correlation matrix of customer satisfaction elements 11 4.0 Discussion 12 5.0 Limitation and Caveats 15 6.0 Recommendations 15 7.0 Conclusion 16 References 17 Statista, (2015). Share of mobile phone users that use a smartphone in Australia from 2010 to 2017. 18 APPENDICES 19 Appendix I: Ownership or use of smartphone 19 Appendix II: Brand of phone used or owned at the moment 19 Appendix III: Age group of respondents 20 Appendix IV: Occupation of respondents 20 Appendix V: Nationality of respondents 21 Appendix VI: Frequency of product features usage 21 List of Tables Executive Summary 1 List of Tables 3 1.0 Introduction 5 1.1 Statement of problem 5 1.2 Objectives of the study 6 1.3 Significance of the study 6 2.0 Methodology 6 2.1 Research design 7 2.2 Sample size and sampling technique 7 2.3 Data collection instrument 7 2.4 Data analysis 9 3.0 Results 9 3.1 Product attributes analysis 9 Table 1: Rotated component matrix for smartphone features 9 3.2 Influence of brands on customer purchase decision 10 Table 2: Crosstabs on brand popularity among respondents 10 3.3 Customer satisfaction on Smartphone use 11 Table 3: Crosstabs on current phone usage and recommendation to friends 11 Table 4: Crosstabs on current phone usage and future improvements 12 Table 5: Correlation matrix of customer satisfaction elements 12 4.0 Discussion 13 5.0 Limitation and Caveats 16 6.0 Recommendations 16 7.0 Conclusion 17 References 18 Statista, (2015). Share of mobile phone users that use a smartphone in Australia from 2010 to 2017. 19 APPENDICES 20 Appendix I: Ownership or use of smartphone 20 Appendix II: Brand of phone used or owned at the moment 20 Appendix III: Age group of respondents 21 Appendix IV: Occupation of respondents 21 Appendix V: Nationality of respondents 22 Appendix VI: Frequency of product features usage 22 1.0 Introduction In today’s global village, people are able advancing in their tastes and preferences with regard to technology products. On the other hand, firms are involved in continuous research and development by integrating knowledge of employees to produce products that meet the changing needs of consumers. Mobile phones are one such technology products that have experienced intense competition for quality and features that match the needs of consumers. Consumers have the freedom to choose alternatives and they do so by valuing features or attributes of a product before the actual purchase. The young generation is the leading consumers of mobile phone products not only for communication but as a fashion label. Dzimornu (2012) observed that advanced technology such as quality and durability of mobile handsets and internet browsing are key factors that significantly influence purchase decision of mobile phones. Moreover, Siddique (2013) agreed that mobile phone handset features has immense influence on the purchase decision by consumers. Although brand related factors may influence purchase intention, poor perception of price and quality may ruin expectation and lead to negative purchase decision (Nguyen & Gizaw, 2009). While Malasi (2009) argues that a product that diffuses rapidly and captures immediate acceptance of consumers, there is little understanding of smartphone penetration in many markets as the latest innovation. Furthermore, Owusu (2013) opines that price and quality are leading factors that determine consumer purchase behavior while, in reality, other factors could have emerged. Forbes (2008) observes that most Australians especially first time buyers of products are sensitive to price rather than the brand. Although a number of older Australians still use fixed communication connections, a greater portion are opting for smarphones for internet access, messaging and voice applications. By 2017, the smartphone penetration rate is anticipated to reach 80 percent in the country (Statista, 2015). Despite the preference for larger screens more Australians are using the smartphones to access social media. This study investigated the influence of product features on purchase decision of smartphone customers in Australia. 1.1 Statement of problem Australian consumers have become more selective due to increased product range and availability, there is need to understand the product features that draw the attention of consumers towards a product. Despite a higher-than-average growth rates of smartphones, its penetration and usage remains low among older adults in Australia. Most consumers are willing to buy a smartphone instead of a television set or a laptop. In the country, sales of smartphones accounted for 86 percent of all smart phones sold in 2014. The smartphones had 73 percent penetration followed by feature phones at 25 percent and multimedia phones at 9 percent. Apple is the leader of smartphones in Australia at 49 percent market share followed by Samsung at 25 percent and Nokia at 7 percent (Rogers, 2015). Although product quality is a key factor that influence purchase decision, many Australian consumers have higher regard to product brands and their physical location. Few studies have examined the product features that influence Australian consumers of mobile phones to make purchase decisions. Therefore, this study sought to investigate product features that influenced consumer purchase decision of Australian mobile phone buyers. 1.2 Objectives of the study 1. To examine product attributes that influence purchase decision of mobile phone consumers in Australia 2. To assess the influence of brands on consumer purchase decision of mobile phone consumers in Australia 3. To investigate the influence of customer satisfaction from current buy on future decision to purchase a smartphone in Australia 1.3 Significance of the study Consumption of mobile phones in Australia is growing steadily due to increased penetration and brand preference. Smartphone companies will find this study relevant not only to increase their sales volume but also to command a greater market share. With stiff competition, these firms require extensive consumer behavior research to understand the current tastes and preferences of buyers. As incomes and internet penetration increases in the country, firms will be keen to work on specific product features and attributes that appeal to all segments of the population. By studying product features, this study will be critical not only for mobile phone companies but also retailers and stores. 2.0 Methodology This study investigated the influence of product features on purchase decision of smartphone consumers in Australia. The study involved smartphone consumers in a university in Australia. Australia has five states and border New Zealand and a number of Asian nations. Major cities are Melbourne, Canberra and Sydney. Majority of the city residents even in universities speak English but it also has a growing list of migrant population from India, China, Africa, India and Indonesia. 2.1 Research design This was an exploratory research on consumer purchase decisions. This kind of research enables a researcher to posit explanatory relationships or make conceptual relationships for a problem that is not clearly defined (Cooper & Schindler, 2008). The study involved a survey of smartphone consumers. In this survey research, a quantitative study, standardized structured questionnaires were administered to a sample of respondents. A questionnaire is a written document that can be completed by target respondent in actual paper or online. Commonly used in business and social research, survey assesses the thoughts, opinions and thoughts of respondents. Although surveys have greater objectivity and thoroughly study a problem, they are prone to sampling errors and non-uniformity of data (Cooper & Schindler, 2008). In this study, a paper and online surveys were administered to random respondents in a university in Australia. This enabled the problematic situation to be studied by having close contact with the local people as well as full knowledge and solutions to the problem. 2.2 Sample size and sampling technique The population of interest was university students from a university in Australia with a student population of 16,334 in the School of Business Studies. Sample size is determined by the equation below (Charan & Biswas, 2013); Sample size = [Z1-α/22p (1-p)]/d2 Where; p Read More