Understanding consumer behaviour attitudes towards advertising

Understanding consumer behaviour attitudes towards advertising Total 2010 UK advertising expenditure amounted to 14.5 billion. Of this, more than 80 per cent was spent on display advertising in the press, broadcast, print and outdoor media. (Source: The Advertising Association) Under the current circumstances, advertising represents one of the major sectors in the economy with millions of workers worldwide. The efficiency of functioning of the economy in general, to a considerable degree, depends on that sector. Advertising accompanies competition between companies and is an essential attribute of the market economy. 1.2 Background Companies need to understand consumer behaviour in order to find the best way on how to shift demand of products in their favour. When companies are able to discover the reasons why consumers make particular purchasing decisions, they can adapt their marketing efforts to better suit the needs of the consumers. Understanding consumer behaviour may result in increased sale and improved profit performance of the organization. Classical microeconomic theories of consumer behaviour have focused on the principles of rational consumer behaviour, which suggests that consumers choice is primarily a matter of personal preferences, whereas utility theory of consumer behaviour maintains that consumer choices reflect their attempt to secure maximum usefulness from their financial resources. Citation! While classical theories still apply in contemporary western societies, the role of mass media, internet and various aspect of modern culture may have fundamentally changed many elements in the understanding of consumer behaviour. Also marketing opportunities available in the digital information age have altered the way how consumer choice is being shaped and used for profit. Advertising is perhaps the first thing that people think about when considering marketing. Companies must do more than make good products they must inform consumers about product benefits and carefully position products in consumers minds. To do this, they must skilfully use the mass-promotion tools of advertising. Advertising strategy consists of two major elements: creating advertising messages and selecting advertising media. Media planners consider many factors when making their media choices. The media habits of target consumers will affect media choice advertisers look for media that reach target consumers effectively. Target audiences are set to focus on different groups: adults, teens, pre-schoolers and other groups. It is essential to become familiar the target market, their habits, behaviours and attitude to advertising in general. It is known that student youth is less conservative in their views and decisions, comparing to others age and social groups. 1.3 Research Aims and Rationale Based on the above information, the main aim of the research is to investigate the extent to which the purchasing decisions of students in the UK are influenced by the advertisement campaigns. During the preparation of the current research paper a questionnaire was carried out among Queen Marys students, which aimed to study their attitude to advertising. Survey sample covered opinions of 20 young people between the ages of 21-24, that is students in their last years of studies. The choice of the audience was not random. The survey had a probing character and could not represent the aggregate of the student youth population or even more general adult audience with statistical precision. However it offers a clear representation of dominating tendencies in preferences and opinions of the chosen audience, which is the main aim of mass advertising. 1.4 Outline of the Project Chapter 2: Literature review Advertising is an important means by which economic enterprises communicate with both their current and potential customers. It is often said that to be effective an advertisement must be read, understood, believed, remembered and acted upon (Adcock, Halborg, Ross, 2001) There are five principal ways in which a company can communicate with its markets: Media advertising (commercial television and radio, the press, posters, cinema and direct mail/internet) Public relations activities Selling Merchandising Packaging (Chisnal, 2001) These promotional activities are at the heart of effective marketing strategies. According to Adcock, Halborg, Ross, (2001) advertising strategy consists of two major elements: creating advertising messages and selecting advertising media. The major steps in media selection are: deciding on reach, frequency and impact; choosing among major media types; selecting specific media vehicles; and deciding on media timing. The current research paper is concerned with determining an appropriate media type (medium) which better suits habits and preferences of the observed population. Media planners consider many factors when making their media choices. The media habits of target consumers will affect media choice advertisers look for media that reach target consumers effectively (Kotler, Armstrong, 1997). For example fashions are best advertised in colour magazines and daily newspapers are a first consideration in advertising real estate. Different types of messages may require different media. Cost is another major factor in media choice. Whereas television is very expensive, for example, newspaper advertising costs much less. Setting the advertising budget is a complex task. Some critics charge that large consumer packaged-goods firms tend to spend too much on advertising, and industrial companies generally underspend on advertising. They claim that the large consumer companies use lots of image advertising without really knowing its effects. They overspend as a form of insurance against not spending enough. (Kotler, Armstrong, 1997) For a long time, television and magazines have dominated in the media mixes of advertisers with other media being neglected (Jobber, 1995). Recently, however, costs of these media have gone up and audiences have dropped. Advertisers are now increasingly turning to alternative media, such as outdoor advertising or internet. The question that concerns companies remains the same: how much advertising spending really has on consumer buying and branding royalty? In order to answer it media impact must be re-examined regularly. As summarized in the table the major media types are newspapers, television, radio, magazines, and outdoor. It is important to list advantages and limitations of mediums, as they will prove to be guidelines in the interpretation of the observed results. Medium Advantages Limitations Newspapers Flexibility; timeliness; good local market coverage; high believability Short life; small pass-long audience Television Good mass market coverage; combines sight, sound, and motion; appealing to the senses High absolute costs; high clutter; fleeting exposure; Less audience selectivity Radio Good local; acceptance, high geographic and demographic selectivity; low cost Audio only, fleeting exposure; low attention; fragmented audiences Magazines High geographic and demographic selectivity; credibility and prestige; long life and good pass-along readership Long ad purchase lead time; high cost; no guarantee of position Outdoor Flexibility; High repeat exposure; low cost; low message competition; good positional selectivity Little audience selectivity; creative limitations Chapter 3: Research Method and Procedure 3.1 Introduction This chapter reviews the research methods which were used in this project. It is necessary for a researcher to choose a suitable method for the problem. To get a full picture a blend of qualitative and quantative research analysis is recommended. This research will take the following procedure: define the research objectives, develop research approach, analyse results and make a conclusion. 3.2 Research Objectives. This research takes into consideration three main objectives. Firstly, to determine respondents attitudes to advertising in general. Secondly, to identify students preferences among different types of media. The final objective of a survey is concerned with evaluating the influence of advertisement campaigns on the purchasing decisions of students in the UK. 3.3 Research Approach and Instruments. There are several methods of collecting data for research. In the current paper the primary data was collected for the first time using questionnaires. This method has proved to be efficient way in getting both quantative and qualitative data. The questionnaire (Appendix 1) incorporated both main types of questions which are commonly used in surveys: open-ended questions and closed questions. Open questions are interesting because of the spontaneity and individual flavour of the replies, but frequently it is difficult to compress free answers into limited number of codings. Findings in closed questions provided the research with statistical evidence, whereas open questions gave to the research depth and range of information. Interviewer was recording all answers verbatim because there is always a danger of interviewer bias through inaccurate recording. 3.4 Reasons for specific questions In giving an answer to the question 1: What is your attitude to advertising in general? respondents had a considerable freedom in phrasing an answer, which may be lengthy and detailed, and in his or her own words. In the question 3 respondents were able to choose from a range of possible answers. The simple follow up question invited to give a more detailed explanation on the subject. Questions 4 to 6 were closed type questions, which call strictly limited responses. The respondents were offered a choice of alternative replies from which he or she was expected to select an answer corresponding to his or her personal views on a particular subject. The research used simple alternative questions: YES/NO. 3.5 Summary The results of this process will appear in the next chapter. Chapter 4: Results 4.1 Introduction The project sought to examine media popularity among students and find out to what extent advertising influences their purchasing decisions. To achieve the research projects aim and rationale, a questionnaire was utilized as stated in the previous chapter. The following section will present and analyse results of this survey. 4.2 Findings. Part 1 As shown in Diagram 1, the vast majority of respondents prefer television, whereas magazines took the second place. The results indicate that the Internet is the third popular media, while newspaper and outdoor advertising share the fourth place. Percentages indicate the proportion of votes students gave to a specific media out of total votes. For instance out of total 37 only 1 vote was given to advertising on the radio. Popularity of television was not a surprise as it combines sight, sound and motion. It was described by respondents as the most effective and the best medium for advertising. It advantage lies in broad mass market coverage. Magazines appeal to students for its credibility and prestige; long life and good pass-along readership. Students explained that it is good for fashion, and pictures of movie stars make it attracting. Outdoor media was described the most creative and eye catching. It is interesting to note that on the contrary (Author) mentioned little creativity as a negative side of this type of media. Newspapers appeal for its timeliness and high believability. It is popular among those respondents who spend a lot of time travelling. Internet advertising is relatively new media type however number of its admirers grows. It can be explained with growing popularity of online shopping. Another advantage is that it has no time limitation and can be viewed day and night. However spam is often mentioned as its negative point. Radio came last, probably due to its disadvantages: audio only, fleeting exposure and low attention. Not the least of the factors was that most of the students live in halls of residence, which lack radio equipment. 4.2 Finding. Part 2 Bar Chart 1 shows responses to questions. The bar chart clearly shows students opinions on specific subjects. Majority of students have positive attitude to advertising and commonly cite its informative function, in other words in creates awareness. Some students see the artistic value in some commercials. Advertising creates awareness, so no wonder that majority prefers advertised product over unadvertised. However there is a strong opinion that quality products do not need advertising. There have been quite a few commercials that state that product of their company is better than competitors product. The results show that vast majority do not believe those commercials. It might be a good idea for companies not to employ such advertising strategies. Just more than a half of respondent believe that commercials help them to make a better purchase. Consumers are better off when exposed to some information about the product before buying it. However 45% prefer to do their own research about the product. Answers to the question 7 clearly show the power of advertising. 85% of students wanted to try something just because they saw its commercial. Most respondents were curious and wanted try it to see whether it was as good as commercial said it to be. It is important to note that 70% respondents sing songs from commercials. This may prove as an indicator for companies adding a catchy tune to a commercial can increase sales. Chapter 5: Conclusion 5.1 Introduction This chapter will summarize findings of this research project, highlight some of the interesting findings, offer practical implications, cite limitations of this project and give suggestions for further research. Summary of Findings and Interesting Findings The purpose of the current study was to identify an advertising media with a largest exposure and find out the effect it has on its target audience. Results were analysed in the previous chapter. Practical implications of this research were also considered. Identifying and understanding target audience is important. The evidence from this study suggests that the television as an advertising medium appealed to the majority of respondents. Magazines and the Internet took the second and the third place respectively. It may help companies to better allocate their advertising space. Students have positive attitude towards advertising in general because it carries an informative function and creates awareness. The results indicate that majority of students prefer advertised products over unadvertised products and believe that commercials help them to make a better purchase. Vast majority wanted to try something just because they saw it in a commercial. Some interesting results were found. An advertising strategy when a company positions their products superior to competitors products proved ineffective as only few students trusted such commercials. Another implication possibility from this study is that commercials with songs appeal to consumers. Companies may consider using this strategy to their advantage. Limitations of the Research The current study was limited for the size of the sample and imbalance concerning the students country of origin. Because all of the respondents who responded within this project were international students, the findings do not necessarily reflect the habits and opinions of all students. This is important since an advertising usually targets the values of the western societies and different cultures may have different attitudes towards advertising. Therefore, it would be important to conduct further research in this area of media influence and involve more respondents from western-culture countries. Recommendations for further studies This research has raised many questions in need of investigation. The designed questions were not perfect so some other aspects may be needed to investigate what contributes to making a purchase decision. Some factors examined in this research influence consumers but not necessarily mean that they will make an actual purchase. For example, further research may investigate what advertising strategies such as verbal or visual elements appeal to consumers. Endnote This project has been concerned with advertisings influence on students purchasing decisions and the research indicates that choosing the correct advertising strategy is a crucial element in an effective marketing strategy.