FACTORS INFLUENCING PARENTS’ FORMULA MILK PURCHASING DECISION FOR THEIR 2 TO 3 YEAR OLD KIDS

BUSINESS SCHOOL ---RESEARCH PROPOSAL FACTORS INFLUENCING PARENTS’ FORMULA MILK PURCHASING DECISION FOR THEIR 2-TO 3-YEAR-OLD KIDS Instructor : PhD... 2 FACTORS INFLUENCING PARENT’S FORMU

BUSINESS SCHOOL

-RESEARCH PROPOSAL

FACTORS INFLUENCING PARENTS’

FORMULA MILK PURCHASING DECISION

FOR THEIR 2-TO 3-YEAR-OLD KIDS

Instructor : PhD Le Thi My Linh

Group member : Vu Hoang Anh – 11190596

: Do Minh Khanh – 11192557: Tran Doan Hai Linh – 11196153: Hoang Duc Hiep – 11191904

Hanoi, 11/2020

2 FACTORS INFLUENCING PARENT’S FORMULA MILK PURCHASING DECISION FOR

THEIR 2-TO 3-YEAR-OLD KIDS

CONTENTS

1 Rationale 3

2 Research objectives 3

2.1 Objectives 4

2.2 Research questions 4

3 Literature review 4

3.1 Review oversea research 5

3.1.1 The five stages model in consumer behaviors and the four factors that influence it (Philip Kotler, Marketing Management, 2001) 5

3.1.2.Factors Influencing on the Mothers’ Brand Choice in Baby Milk Formula: A Study in Vavuniya District, Sri Lanka (Pavithra.S, 2018) 8

3.2 Review Vietnamese research 9

3.2.1 Nghiên cứu các yếu tố ảnh hưởng đến quyết định chọn mua sữa bột cho trẻ em của người tiêu dùng tại thành phố Đà Nẵng (La Thị Tuyết Nhung, 2016) 9

Research on factors affecting consumers’ decision in purchasing powdered milk products for children in Danang city (La Thi Tuyet Nhung, 2016) 9

3.2.2 Nghiên cứu hành vi tiêu dùng sữa bột cho trẻ em dưới 6 tuổi tại thành phố Cần Thơ (Lê Thị Thu Trang và Trần Nguyễn Toàn Trung, 2014) 10

Research on formula milk consumption behaviour for children under 6 years old in Can Tho city (Lê Thị Thu Trang và Trần Nguyễn Toàn Trung, 2014) 10

3.2.3 Factors Influencing on Purchasing Formula Milk for Babies: An Empirical Research in Hanoi (Pham Thi Thanh Hong, 2015) 11

4 Theoretical Framework 18

5 Research Methodology 24

5.1 Research design 25

5.2 Data collection 25

5.2.1 Secondary data 25

5.2.2 Primary data 26

5.3 Data analysis 28

6 Scope of study 28

8 References 31

1 Rationale

Alongside with the expeditious development of the society, the

formula milk market in Vietnam mushroomed parents

about that is important to their

As we all know, can an enormous

, suitable for many different age groups Powdered milknutriment

products are extremely diverse with many brands, flavors, forms,origins, prices for consumers to choose from, it’s a highly competitivemarket which is strongly developed due to growing numbers of

participating firms, from both domestic and foreign Above all,formula milk for toddlers (especially from 2 to 3 years old) are themost expensive and well-consumed With that high developmentprospects, understanding the psychological, demand and behaviors ofthe consumer, especially parents, is the essential key factor for formulamilk domestic enterprises to expand and boost the demand of localproducts Currently, in our country, there are many outstanding localbrands such as: Nutifood, Vinamilk, etc they produce a wide range ofproducts that are developed and innovated constantly to be suitablewith the customers’ taste However, the number of customers who puttheir loyalty in foreign products are still outnumber those whochoose to use local brands In order to address the problems and findout a reasonable strategic orientation, this research is carried out toidentify the factors affecting consumers’ purchasing decisions andinvestigate the actual state of 2 to 3 years old toddlers’ formula milkconsuming

2 Research objectives

4 FACTORS INFLUENCING PARENT’S FORMULA MILK PURCHASING DECISION FOR

THEIR 2-TO 3-YEAR-OLD KIDS

2.1 Objectives

+ Identify the factors that have influences on parents’ formula milk

purchase decisions for their toddlers

+ Overview the perspectives of each parent on the formula milk that they are using for their children at the moment

+ Drawing a reasonable strategic orientation to boost demand of formula milk made by domestic businesses

+ How do these factors affect the customer's buying decision?

+ How to gain customer attention and increase the demand for

domestic products in Hanoi?

In contemplation of improving child health, feeding practices are the mosteffective and critical intercession Under-nutrition is one of the major aspectsthat can cause infantile mortality, it is also the reason that prevents childrenfrom reaching their full growing up potential Breastfeeding is considered thebest method of feeding that a mother can provide for the babies from birth,around two months, it’s possible to choose powdered milk as a substitute toadd to children’s daily meals in addition to breast milk and by six months, themain beverages that babies can consume are formula milk In 2016, anestimated 4299 children were born each day in Vietnam, this led to more and

more attractions for many foreign and domestic firms to put investments intogrowing-up milk production.

The dairy industry is growing at a high rate as the Vietnamese incomes arecontinuously increasing In general, the demand for growing formula milk isburgeoning, but the domestic products still cannot gain more favors fromconsumers than the products that come from foreign brands Accordingly,our research team decided to take the topic “Researching the factors that haveinfluences on parents’ formula milk purchase decisions for their two to threeyears old toddlers in Hanoi city” as a scientific research topic This studyaims to identify and analyze the factors that influence the decision inchoosing formula milk brands of parents, thereby offering recommendations

to boost the demand and promote domestic milk products’ purchase

To indicate the aspects that directly affect the parents’ preference, members

of our research teams reviewed a total of 16 studies including 12 foreignmodels, 3 domestic models and 1 mix model

Of the above, the research team selected 5 models for detailed analysisincluding 2 models from abroad and 3 models from Vietnam

3.1 Review oversea research

3.1.1 The five stages model in consumer behaviors and the four factors that influence it (Philip Kotler, Marketing Management, 2001)

According to Kotler, decision making process is consisted of 5 stages:

6 FACTORS INFLUENCING PARENT’S FORMULA MILK PURCHASING DECISION FOR

THEIR 2-TO 3-YEAR-OLD KIDS

Figure 1: Five stages of consumer buying decision

The five stages model of consumer behaviors is the norms that most consumershave to go through in their process of making decisions for their purchasing Itcan be described as follows: firstly, customers will recognize the demand theyhave for a product, after that they will search for the products’ information andalternatives items that are available and suitable with their needs from a widerange of sources In the third stage, customers will compare alternatives andconsider which is the best option that they can choose, and the payment will bemade In the last stage, the customer will evaluate the usage, whether theproduct meets their expectation or not, this will decide the option to keep usingthe product they have previously experienced or choosing another brand

As explained by Kotler, in the third stage, Evaluation of alternatives, customers’decision making can be determined by 4 main factors: (1) Cultural factor, (2)Social factor, (3) Psychological factor and (4) Personal factor They can be

divided into two categories: cultural and social are the factors that are externallymotivated while psychological and personal are more internally motivated.

Figure 2: Four factors influence the buying decision of customers

Using these 4 factors for practical application, we can understand the norms thatVietnamese consumers have in their purchasing habits, they can be listed asfollow:

+ Parents may take advice, both directly and indirectly, from their acquaintancesand other family members, also, the advertisements that have professional backgrounds(giving advice from doctors or nutritional specialists) tend to gain more trust and attention.+ One of the preeminent concerns that parents have on the process of raising thechildren are how to provide the nutritional that their children need in order to grow uphealthily Products that are fortified with extra ingredients to support children’ brain andphysical development are more likely to be chosen

+ In most Vietnamese opinions, imported goods and products are alwayspreferred due to their better quality and design This opinion hasn’t changed throughout manyVietnamese generations, even though domestic producers have made many efforts inmodernizing the manufacturing lines as well as improving the products’ quality

8 FACTORS INFLUENCING PARENT’S FORMULA MILK PURCHASING DECISION FOR

THEIR 2-TO 3-YEAR-OLD KIDSFor conclusion, the customers will choose the product that provides the highestvalue and if that product meets their needs, they will decide to consume it for along period of time This will lead to a strong loyalty relationship, customers’buying frequency occurs more often and the customers themselves will become

a valuable source of advertisement by giving their advice and recommendations

to other people Hence, the most important method to reach out for morecustomers is to strengthen the trust of familiar ones and in order to achieve it,businesses need to understand very well the factors that orientate customers’choices

3.1.2 Factors Influencing on the Mothers’ Brand Choice in Baby Milk Formula: A Study in Vavuniya District, Sri Lanka (Pavithra.S, 2018)

The research was held in 2018 to clarify factors influencing the mother’s brandchoice in baby formula milk in Vavuniya District Sri Lanka The paper waswritten by Pavithra.S to point out the above topic; and in study, authorsmentioned several factors affecting to purchasing behavior: (1) price, (2) quality,(3) features, (4) family and friends’ recommendations, (5) brand image, (6)innovative features, (7) promotion effectiveness, (8) celebrity endorsement, (9)user friendliness, (10) stylish appearance, (11) post-purchase services

The research model uses qualitative and quantitative methodology The formerwas conducted by in-depth interviews and the latter was conducted through asurvey with a sample size of 50 mothers who purchase milk formula brands inJaffna market and would give insights on the phenomenon Besides, the

Grounded Theory (GT) approach was also used to explore the 10 most importantfactors influencing brand choice of baby milk formula products and those areNutritional Content, Forms, Cost, Birth Weight, Ingredients, Age, Label,Allergies, Iron Fortified and Availability

Conclusion: Sri Lankan parents traditionally want to provide the best conditionfor their children That is why they chose the best milk formula according totheir considerations for their children Via 10 key factors listed, we could know

that the local mothers are especially more concerned on brand benefits, whichmatch the needs of the society Moreover, the nutritional needs seem to be ahigh-ranking factor that mothers would consider when choosing formula milkfor their toddlers.

Limitation: The research has not gone into specified factors yet but analyzingthem generally In addition, one interviewee for the in-depth interview is notenough to give necessary information supporting the analysis of influencingfactors

Recommendation: Understand the relationship between impact of securityincidents, income or regulatory satisfaction and other factors influencingpurchasing behavior so that formula milk brands can offer other appropriatemilk lines and carry out some specific promotion campaigns

3.2 Review Vietnamese research

3.2.1 Nghiên cứu các yếu tố ảnh hưởng đến quyết định chọn mua sữa bột cho trẻ em của người tiêu dùng tại thành phố Đà Nẵng (La Thị Tuyết Nhung, 2016)

Research on factors affecting consumers’ decision in purchasing powdered milk products for children in Danang city (La Thi Tuyet Nhung, 2016)

Research on factors affecting consumers’ decision in purchasing powdered milkproducts for children in Danang city, La Thi Tuyet Nhung, 2016 In order to findout the current situation of consuming formula milk for children under 6 yearsold, then propose solutions and recommendations for formula milk tradingenterprises in Viet Nam

The research had point out a number of factors that affect consumers' behaviorincluding Reference (asking for opinion of friends, expert or family whilepurchase formula milk product); Product (quality, nutritional ingredients, brand,

…); Price (competitive price, affordable,…); Marketing (advertising,promotion); Distribution (availability in stock, easy to find, customer care,…)

10 FACTORS INFLUENCING PARENT’S FORMULA MILK PURCHASING DECISION FOR

THEIR 2-TO 3-YEAR-OLD KIDSThe research sample collected with the size of 200 Researchers proceed tocollect data through answering questionnaires in two forms: media and internet.The data was analyzed through SPSS 16.0 Other data analyzing methods used

in the research: Descriptive statistics, Cronbach’s Alpha, EFA, SEM

Result: the research has shown the positive effects on consumers from Productand Marketing factors Customers access information from TV, internet and thenregularly search for the use and origin of the product Especially the productquality as well as the nutritional ingredients and benefits that the product brings

to their kids is one of the top factors Besides, price is also a concern factor toparents That is why in our research we want to go deeper into product quality.Limitation: lack of factors, the level of explanation of the model is 65.4%, whichonly explains 65.4% of consumers' decision to buy formula milk for children.Recommendation: improve product quality, develop high-class formula milk,develop more advertising channels

3.2.2 Nghiên cứu hành vi tiêu dùng sữa bột cho trẻ em dưới 6 tuổi tại thành phố Cần Thơ (Lê Thị Thu Trang và Trần Nguyễn Toàn Trung, 2014)

Research on formula milk consumption behaviour for children under 6 years old in Can Tho city (Lê Thị Thu Trang và Trần Nguyễn Toàn Trung, 2014)

Research on formula milk consumption behaviour for children under 6 years old

in Can Tho city, Le Thi Thu Trang and Tran Nguyen Toan Trung, 2014conducted on 200 people who are parents having kids under 6 years old in order

to point out factors that impact on consumers' decision in choosing babyformula

The research used a Descriptive Analytics method to analyze primary data andsecondary data combined with Cronbach’s Alpha, EFA, CFA and SEM analysis

to measure and analyze the impact level of each scale to the main dependentvariable Primary data was collected by interviewing 200 parents who hadchildren under 6 years old using formula milk at Can Tho city, sampling

method: select non-probability convenience sample For secondary data, theresearch team used data collected in Statistical yearbook Vietnam 2012,magazine, website dairyvietnam.vn related to dairy field These methods aredesigned to analyze and evaluate changes in consumer behavior, and at the sametime find out factors that have a strong impact on people's behavior to haveaccurate customer perceptions and offer the most effective solution for thisindustry and for each enterprise in Vietnam.

Result: In terms of awareness, customers utility and know a lot of differentproducts On average, each customer knows about 4-5 famous dairy brands likeDielac Alpha; Dumex Gold; Abbott Grow; Friso Gold, Enfagrow A +; Interms of behavior, there are 5 main factors affecting consumers' decisions onchoosing formula milk: Product use (gain weight, increase creativity, boostimmune system); Product price and quality; Influencing group (products withdiverse designs); Brand and packaging (well-known brands such as Abott,Vinamilk, Nutifood, products with eye-catching designs) and Marketing Inwhich, the strongest factor is the influencing group and the use of the productand these are the positive effects

Limitations: This research is based only on 200 people who are parents living inCan Tho city and only using the interview method, so there may be some otherfactors missing

3.2.3 Factors Influencing on Purchasing Formula Milk for Babies: An Empirical Research in Hanoi (Pham Thi Thanh Hong, 2015)

In the article published on September 4, 2015, the author, Pham Thi ThanhHong, makes deep research into factors that affect the decision of customers tobuy powdered milk for children in Hanoi

In Vietnam, the powdered milk market is a market full of potential, so it isextremely important to be able to understand the customers’ tastes and needs Inthis study, the author points out that parents’ decision to buy powdered milk fortheir children are influenced by 4 main factors, which include: (1) culturalfactor, (2) social factor, (3) psychological factor, and (4) personal factor

12 FACTORS INFLUENCING PARENT’S FORMULA MILK PURCHASING DECISION FOR

THEIR 2-TO 3-YEAR-OLD KIDSThe research collected data by sending questionnaires via social network such aslamchame.com, webtretho.com, chamsocbe.com, nhatkybe.vn… These socialnetworks are deserved for parents to share information about taking care andraising their children During the time of May and June 2015, the researchreceived above 120 feedbacks and only 97 are qualified to analyze, which wasanalyzed by SPSS

According to Pham Thi Thanh Hong, today parents pay more attention tonutritional needs and the healthy growth of their children They understand theimportance of diet in growing the height, weight, and body proportion of thechildren However, most parents agree that “income influences their buyingdecision by choosing formula milk for their children'' At the same time, inpsychological factors, most people agreed that their expectation for health,physical and brain development of the children greatly influenced their buyingdecision The results also show that prices of imported milk are higher thandomestic ones However, the number of people who chose imported milk fortheir children is significantly bigger Parents tend to prefer expensive milk thancheap ones because they worry about the quality of products By this way, allother indicators including quality, origin, brand and price of products have a bigimpact on purchasing decisions

In this research, due to limitation of time, the survey was only carried out inHanoi Thus, the research results did not reflect all customers’ characteristics.Another limitation is that email was the only channel to collect data Thus, theresults of the research could not be adequate

Recommendation: the research should take place with another channel ofcollecting data to cover more various types of respondents

We have reviewed 14 studies in total, here is the summary:

ST LITERATURE REVIEWED FACTORST

1 Factors Influencing Maternal Decision- 1.Individual maternalMaking on Infant Feeding Practices (Whitney characteristics

N Hamilton, 2020)

2.Organizational factors3.Hospital/providerrecommendations4.Systematic/policyfactors

2 Factors affecting mothers’ choice of 1.Self decisionbreastfeeding vs formula feeding in the

lower Umfolozi district war memorial 2 Hospital/providerhospital, KwaZulu-Natal Health SA (Susan, recommendationsSwarts & Kruger, Herculina & Dolman,

3.Full-time work/studyRobin, 2010)

4 Mother’s Beliefs, Attitudes, and Decision 1.Infant nutritionalMaking Related to Infant Feeding Choices benefits

(Sharon Radzyminski, Lynn Clark

2.Maternal benefitsCallister,2016)

3.Knowledge about infantfeeding

4 Personal andprofessional support

5 Formula Feeding and Associated Factors 1.Breast milk insufficiencyamong a Group of Egyptian Mothers

2 Weak babies(Tawfik, S., Saied, D., Mostafa, O., Salem,

6 Factors influencing high socio-economic 1.Personal factorsclass mothers’ decision regarding formula-

2.Economic factorsfeeding practices in the Cape Metropole

(Sowden, Marwyn & Marais, Debbi & 3.Social factorsMarais, R 2009.)

4.Facility andenvironmental factors5.Hospital and clinic6.Cultural factors7.Family dynamics8.Other influences

7 The Basics: Planning for Formative Research 1.Children’s health/

for Infant and Young Child Feeding Practices nutrition status(IYCN, 2011)

2.Mother’s perception3.Perceptions aboutspecific child feedingpractices and its possiblechanges

4.Advice –seeking

5 Aspiration for children

8 Review of the effectiveness of the controls 1.Doctors/ health visitor

on infant formula and follow-on formula advices(Lee, Ellie & Furedi, Frank 2009)

2.Nutrients3.Friend/relative advice4.Attractive advertisement

9 Research on factors affecting consumers’ 1.Recommendations from

decision in purchasing powdered milk othersproducts for children in Danang city (La Thi

2 ProductsTuyet Nhung, 2016)

3.Price4.Promotion effectiveness5.Product distribution

10 Research on formula milk 1.Products’ utilization

consumption behaviour for children under 6

years old in Can Tho city (Lê Thị Thu

2 Products’ originsTrang và Trần Nguyễn Toàn Trung, 2014)

3.Products’ appearances4.Products’ quality5.Products’ price6.Promotion effectiveness7.Products’ availability

11 Factors Influencing on the Mothers’ Brand 1.PriceChoice in Baby Milk Formula: A Study in

2 QualityVavuniya District, Sri Lanka (Pavithra.S,

4.Family and friends’recommendations5.Brand image6.Innovative features7.Promotion effectiveness8.Celebrity endorsement9.User friendliness10.Stylish appearance

11 Post-purchase services

12 Factors Influencing on Purchasing Formula 1 Cultural factor

THEIR 2-TO 3-YEAR-OLD KIDSMilk for Babies: An Empirical Research in 2 Social factor

Hanoi (Pham Thi Thanh Hong,2015)

3 Psychological factor4.Personal factor

13 Survey on the parental exposure to marketing 1.Products Advertisement

of formula milk and formula milk related

2 Participation in infant’sproducts for infants and young children aged

4 Contact by personnelfrom formula milkmanufacturers or retailers5.Products’ samples andpromotional gifts

14 Factors Affecting Infant Formula Feeding in 1.Mother's IntentionInfants Aged 0-6 Months in Sukoharjo,

2 Perception of Mother’sCentral Java (Ayunda Yonik Nuralita,

Behavioral ControlBhisma Murti, Eti Poncorini Pamungkasari,

4 Maternal Job Status

5 Maternal Norms