EXECUTIVE SUMMARY
The Vietnam wine market is rapidly expanding, with an increasing number of producers, importers, and distributors vying for consumer attention While many focus on product attributes such as country of origin, grape varieties, taste, and packaging, this study aims to explore additional factors influencing consumer wine choices in Ho Chi Minh City.
A conceptual framework was established using the Input, Process, Output consumer behavior model, alongside qualitative research on wine quality perceptions and Vietnamese drinking habits This framework led to the development of four hypotheses examining the relationships between marketing efforts, utilitarian benefits, experiential benefits, and symbolic benefits with consumer spending on wine A questionnaire was created, yielding 386 valid responses from a total of 450, which were then analyzed using SPSS.
EFA was utilized to eliminate unsuitable variables and identify factors from the measurement scale, resulting in a revised conceptual framework that included the original Symbolic benefit and Marketing effort factor, along with two new factors: Utilitarian & Experiential benefit and Enjoyment benefit However, the multiple regression model did not yield statistically significant results regarding the relationship between these factors and the money spent on wine Consequently, discriminant analysis was employed to assess the contribution of these factors in differentiating consumer groups based on average monthly wine consumption Additional analyses examined the relationship between communication channels, drinking locations, and consumer groups The insights gained from these analyses offer valuable recommendations for wine marketers targeting the Ho Chi Minh City market.
The Symbolic benefit factor emerged as the most significant contributor to consumer group differentiation, with its importance increasing alongside wine consumption This insight offers valuable guidance for wine marketers, suggesting that they should emphasize symbolic values related to wine, such as self-image, lifestyle, and rituals, rather than focusing on common aspects like country of origin or grape varieties Additionally, while the Enjoyment and Utilitarian & Experiential factors also played a role in distinguishing consumer groups, their relationship with the average monthly wine consumption was not statistically supported.
INTRODUCTION
Chapter Overview
This chapter offers a comprehensive overview of the project, starting with the rationale behind its initiation It includes essential background information on the Vietnam wine market and presents the key concepts guiding the research The chapter concludes with an outline of the study, summarizing the main objectives and structure.
Rationale of the Project
Vin Attitude is a contemporary French wine producer located in the Côte du Rhone region, managing a 2,150 ha vineyard with 550 growers and an annual production of over 100,000 hl, generating a turnover exceeding €12 million The company seeks a long-term partnership with a partner who has a deep understanding of the local market and a systematic approach Unlike other wine producers and brokers entering the Vietnamese market, Vin Attitude is willing to take risks to better control its marketing activities by opting for a foreign-based agent rather than a traditional importer or distributor.
Solathien, a Vietnamese importer and distributor specializing in premium imported vodka, is expanding its product portfolio by partnering with a French wine producer to enter the Vietnamese market After reaching out to various companies, Solathien has successfully collaborated with Vin Attitude to serve as their foreign-based agent in Vietnam.
Both companies are entering a competitive market with significant potential To develop an effective marketing strategy, it is essential for them to understand consumer behavior regarding wine, particularly in key markets such as Ho Chi Minh City and Hanoi.
This project aims to analyze consumer preferences for wine in Ho Chi Minh City, driven by the needs of companies in the industry The insights gathered will inform marketing strategies for businesses and serve as a valuable reference for wine producers and importers seeking to enter the Vietnamese market.
Vietnam Wine Market
Wine consumption in Vietnam, along with other Asian nations like China and Hong Kong, is experiencing significant growth Over the past two years, demand has surged due to several factors Affluent consumers, despite higher wine prices compared to beer, are increasingly choosing wine for its perceived health benefits Additionally, rising living standards have led high-income Vietnamese to spend more on dining in restaurants and hotels, prompting businesses to cater to this stable consumer base Furthermore, as Vietnam integrates more with global culture, many individuals adopt Western lifestyles, viewing wine as a symbol of modernity and sophistication.
In Vietnam, wine quality is categorized into two types: low-quality wine, which is commonly available at street shops and supermarkets, and high-quality wine, primarily distributed through restaurants and hotels, targeted at consumers with a sophisticated understanding of wine and sold at premium prices.
In Vietnam, wine prices vary significantly, with a key price point around VND 100,000 Consumers generally perceive old world wines priced below this threshold as low quality, while new world wines are favored for their taste when priced at or above VND 100,000 This price segmentation is primarily influenced by producers and distributors Although imported wines remain a luxury for many, a diverse range of options is available to suit different budgets.
France and Chile are the leading countries in wine production, with Italy, Spain, Germany, Australia, New Zealand, South Africa, the United States, and Argentina also recognized for their wines Vietnamese consumers particularly favor French wine, viewing it as the top choice due to longstanding traditions Nevertheless, Chilean wine is gaining popularity among these consumers, indicating a shift in preferences.
Glass bottles dominate wine packaging, representing 95% of sales for both imported and local industrial wines This traditional format effectively preserves the wine's quality and flavor In Vietnam, glass-bottled wine is available through both on- and off-trade channels, while local wines may also be packaged in ceramic containers or PET bottles for homemade varieties.
Vietnamese consumers show a strong preference for foreign wines, particularly in the northern region where Chilean wine is gaining popularity French wine, known for its long-standing presence in Vietnam and high quality, also enjoys a favorable position In contrast, Dalat Red Wine leads the domestic market due to its extensive distribution, offering a distinct alternative to Hanoi wine While Hanoi wine and Thang Long wine are consumed in the north, Thang Long wine holds a significant 40% share of the regional demand, making it a notable player in the market.
Dalat wine has gained significant popularity among consumers, achieving impressive sales in 2008 Its steady growth has led to widespread availability across the country, with exports extending to Asian markets including Japan, Korea, Malaysia, and Cambodia.
Local producers generate approximately 50 million liters of alcohol, with sales volume tripling that of international producers The competitive edge of local wine stems from its significantly lower price, as it is exempt from import taxes Vietnam presents a promising market for wine, particularly VIN wine; however, local producers must enhance product quality, service, and brand image to thrive As import taxes decrease due to WTO integration, local producers will encounter intensified competition from major international brands.
Vietnam's wine market sees hundreds of new brands introduced annually, with New Zealand wines making their debut in Hanoi in 2008 Renowned varietals such as Merlot, Chardonnay, Pinot Noir, and Sauvignon Blanc from New Zealand have gained significant acclaim, alongside other popular varieties like Riesling, Cabernet Sauvignon, and Malbec The reputation and appealing taste of New Zealand wines have captured the interest of Vietnamese consumers, leading to an anticipated increase in market share from 2009 onwards, as these wines continue to establish their presence in the country.
Local producers, such as LamDong Foodstuffs JSC (Ladofoods), are increasingly proactive in introducing new products to consumers The company strategically launches new offerings during key events in Dalat City, including the Dalat Wine Festival and the Dalat Flower Festival As a major tourist destination for both international visitors and Vietnamese locals, Dalat presents an excellent opportunity for companies to enhance brand visibility and awareness.
New world wine is gaining traction due to its sweeter taste, often enhanced by added sugar, appealing particularly to Vietnamese consumers, especially women and those in the south Both new and old world wines enjoy a loyal customer base, with competitive pricing offering a range of options from affordable to premium products For instance, French Champagne prices vary significantly, from VND 60,000 to VND 6 million The competition between new and old world wines focuses more on brand and flavor rather than price.
Figure 2.1: Sales of Wine by Subsectors - Total Volume 2004 - 2009
Figure 2.2: Sales of Wine by Subsectors - Total Value 2004 - 2009
Aim of the Research
Vietnamese consumers encounter a diverse range of wines, from local non-grape varieties to expensive imported options, each differing in origin, packaging, and quality The complexity of wine as a product leads to varied perceptions of its quality among consumers.
Wine producers, importers, and distributors have largely underinvested in marketing and communication efforts, resulting in minimal visibility for wine advertising in television commercials and print media While wine is not prohibited from advertising, consumers infrequently encounter wine promotions Product information is primarily available on the websites of importers and distributors Despite the numerous wine fairs held annually in Vietnam, these events primarily cater to importers and distributors rather than targeting end consumers.
This study aims to investigate the wine selection process among Vietnamese consumers, particularly focusing on the Ho Chi Minh City market, one of Vietnam's largest wine markets Given the limited research available on this topic, the findings from this study will provide valuable insights that can be applicable to other regions in South Vietnam.
There are two main objectives in this research:
Define and measure the factors influencing the consumer behaviors of wine in Ho Chi Minh City
Provide recommendations for host companies and other wine producers and importers who want to penetrate the Vietnam market
As per mentioned above, the research will explore and measure the factors influencing consumer’s wine selection There are two main stages of the research:
Secondary research: study the consumer behavior theory and model; Vietnam consumer demographic and lifestyles; wine marketing concepts and consuming behavior to define the factors influencing the consumer behaviors
Primary research: conduct quantitative research to measure the relationship between these factors and study the findings to infer the recommendations
The research process can be described as following:
Preliminary information gathering & literature survey
Research design Quantitative data collection
Source: Developed for this project
Research Outline
Chapter Three presents a comprehensive review of previous research and literature pertinent to this study, highlighting relevant theories, key concepts, and the development of the research problem Following this literature review, Chapter Four details the research methods, including the research models, design, and methodologies employed Chapter Five then summarizes the results and findings of the research, while Chapter Six concludes by synthesizing these findings and offering recommendations for the target audience and future research endeavors.
LITERATURE REVIEW
Chapter Overview
This chapter builds on the previous discussion by exploring essential theories and research related to consumer behavior models and the decision-making process It examines literature on wine drinking motivations and highlights the lifestyle factors influencing Vietnamese consumers' choices regarding alcoholic beverages and wine consumption.
Consumer Behavior Models
Consumer behavior encompasses the entire journey of buyers, including their thoughts and actions before, during, and after a purchase It begins with recognizing a need, followed by researching and assessing options to fulfill that need, leading to the actual purchase The evaluation of the product after use significantly influences the likelihood of repurchasing.
Consumer behavior is primarily viewed as a cognitive process involving a series of intellectual steps—thinking, evaluating, and deciding This process influences key aspects of choice, such as gathering information from advertisements or salespeople, placing orders, and using selected products Consumers receive inputs from their environment, including marketing messages and discussions with friends or family They mentally process this information by storing it, connecting it to existing knowledge, and assessing its relevance to their personal goals The outcomes of this process include the attitudes formed towards a brand, intentions to purchase or delay a purchase, and ultimately, the decision to buy if the attitude and intention are favorable Additionally, the evaluation continues with the use of the product, leading to decisions regarding its suitability for future purchases.
There are various consumers’ models which help in the understanding of consumer behavior Some of them are listed below:
Input, Process, Output Model—Gandhi: Philip Kotler
The Economic Model posits that consumers aim to maximize their utility while adhering to the law of diminishing marginal utility, seeking to minimize their spending for optimal gains.
The Psychological Model, as articulated by A.H Maslow's hierarchy of needs, elucidates the motivations behind purchasing decisions and behavior It posits that an individual's actions are influenced by their most pressing need at any given moment, indicating a prioritization of needs where basic necessities are fulfilled before addressing secondary desires.
The Sociological Model emphasizes the impact of society on consumer behavior, highlighting that individuals are members of various social groups These groups, particularly primary ones like family, friends, and close associates, significantly influence a consumer's purchasing decisions.
Figure 3.1: A.H Maslow’s hierarchy of needs
The Pavlovian Learning Model posits that human behavior is influenced by key concepts such as drives, stimuli, cues, responses, and reinforcements that shape needs and behavior A drive serves as a powerful internal motivator, while stimuli are external inputs that can trigger these drives Cues provide specific signals that activate particular drives, leading to a response from the individual When a response to a stimulus is rewarding, it reinforces the likelihood of a similar reaction in future encounters with the same cue.
The Howarth Sheth Model illustrates the complexity of consumer behavior, highlighting how learning, perception, and attitudes significantly influence decision-making processes This model is particularly relevant for understanding individual consumer choices.
Source: C.N Krishna Naik, L Venugopal Reddy, 1999 (Consumer Behavior – Discovery
The Engel-Blackwell-Kollat Model consists of four components: Information processing, Central control unit, Decision process, Environmental influences (Figure 6: Engel-Blackwell-Kollat Model)
Figure 3.3: Engel-Blackwell-Kollat Model
Source: C.N Krishna Naik, L Venugopal Reddy, 1999 (Consumer Behavior – Discovery
The Nicosia Model explains the consumer behavior on the basis of four fields shown in the diagram (Figure 7: Nicosia Model)
Source: C.N Krishna Naik, L Venugopal Reddy, 1999 (Consumer Behavior – Discovery
The Input, Process, Output Model outlines the consumer decision-making journey through three interconnected stages: input, process, and output This framework is visually represented in the simplified model of consumer behavior, highlighting how each stage influences the overall decision-making experience.
Figure 3.5: Input, Process, Output Model
Source: L.G Schiffman, L.L Kanuk, 2004 (Consumer Behavior – Prentice Hall)
The input stage is crucial in shaping a consumer's recognition of product needs and is driven by two primary sources of information: the marketing strategies employed by the firm, including product details, pricing, availability, and promotional tactics, as well as external sociological influences such as family, friends, neighbors, and societal norms The combined effects of a firm's marketing initiatives and the insights from personal and social networks significantly impact consumer purchasing decisions and the subsequent use of those products.
The model's process stage examines consumer decision-making, highlighting how psychological factors such as motivation, perception, learning, personality, and attitudes shape the influence of external inputs on need recognition, information search, and alternative evaluation This evaluation experience subsequently impacts the consumer's psychological attributes.
The output stage of the consumer decision-making model encompasses two key post-decision activities: purchase behavior and post-purchase evaluation Purchase behavior for low-cost, nondurable products is often influenced by manufacturer's coupons, leading to trial purchases that may result in repeat purchases if the consumer is satisfied, ultimately signifying product adoption In contrast, relatively durable products, such as laptops, tend to signify adoption upon initial purchase due to their longer lifespan despite rapid obsolescence.
Given the lack of existing research in this area, this study adopts the Input, Process, Output model, which is both comprehensive and straightforward The model's elements will be analyzed in relation to the motivations for wine consumption and the lifestyle of Vietnamese consumers, forming the conceptual framework for the research.
The Motivation to Drink Wine
This article delves into consumer motivation by examining a research project centered on wine drinkers' perspectives on their drinking habits It investigates various symbolic and experiential influences, such as historical traditions, situational contexts—especially the role of food—cultural elements, self-image, and the desires for enjoyment and relaxation.
Consumer behavior has evolved to emphasize the utilitarian aspects of consumption, focusing on the tangible benefits a product offers Research in this field often examines the cognitive processes of consumers, particularly how they gather and process information, which influences their purchasing decisions A notable framework in this area is Fishbein and Ajzen’s theory of reasoned action, which has been applied to various products, including wine This perspective portrays consumers as rational evaluators, meticulously analyzing the functional advantages of different options to choose the most cost-effective product available.
The unidimensional approach faced two significant challenges, the first of which emerged from a psychological perspective highlighted by Dichter (1964) and further developed by Levy (1981; 1986) and others This perspective emphasizes the symbolic meaning of consumer goods, illustrating how products are utilized to communicate messages about our identities.
Symbolic consumption has generated significant research focused on understanding consumption behavior According to Richins (1994), this concept can be divided into two main aspects: one that emphasizes interpersonal relationships, reflecting an outward focus, and another that highlights identity and self-expression, representing an inward focus.
In the early 1980s, a new paradigm emerged that distinguished between utilitarian and experiential or hedonic consumption, as explored by Hirschman and Holbrook Research indicated that experiential processes, such as fun, sensory stimulation, and enjoyment, are closely tied to consumer engagement with products It was also proposed that sensory cues are predominantly non-verbal and affective, which is especially pertinent in the context of wine consumption, where sensory experiences often shape a drinker's connection to the product more than verbal descriptions.
The triadic approach to consumption—utilitarian, symbolic, and experiential—plays a significant role in contemporary consumer research, highlighting cultural differences in the importance of these consumption purposes (Wong & Ahuvia, 1998) For example, in Chinese societies, the symbolism of close family ties may hold greater significance compared to European cultures This framework is widely accepted and provides a valuable lens for analyzing consumption motives It's important to recognize that no single consumption act fits neatly into one category, and the motivations behind repeated consumption can vary For instance, enjoying wine alone may emphasize sensory pleasure, while drinking in public often focuses on social messaging (Groves et al., 2000).
The tripartite analysis of wine consumption reveals that it is primarily driven by experiential and symbolic factors rather than utilitarian ones Depending on the specific context of consumption, individuals may lean more towards either the experiential or symbolic aspects, highlighting the complexity of wine's role in social and personal experiences.
Figure 3.6: A purposive analysis of wine consumption
Source: Steve Charters, 2006 (Wine & Society – Elsevier Butterworth-Heinemann)
The growing interest in the social and consumption aspects of food and drinks has become a focal point in marketing research A qualitative study revealed that enjoyment, situational factors, personal history, and lifestyle play vital roles in consumer behavior Furthermore, cognitive aspects, aesthetics, and memory-related factors, which have been overlooked in previous studies, also significantly influence wine consumption Key themes emerged when participants were asked about their motivations for drinking wine.
Figure 3.7: Why do people drink wines?
Source: Steve Charters; Simone Pettigrew 2008
The study categorizes responses regarding wine consumption into three main groups: physical or utilitarian reasons, experiential or hedonic factors, and symbolic influences While utilitarian reasons are the least mentioned and important for most consumers, experiential factors relate to the feelings associated with drinking Symbolic reasons pertain to the messages conveyed through drinking, impacting how others perceive us and shaping our self-image It's essential to recognize that these categories are not strictly defined, as the significance of alcohol can vary greatly among individuals, affecting both utilitarian needs and self-perception.
Wine producers prioritize marketing efforts by focusing on key attributes such as country of origin and grape varieties, as highlighted by Charles S Areni (1999) In consumer purchase decisions, price per bottle emerges as the most critical factor, followed closely by grape varietal and brand name Notably, women place greater importance on brand name compared to men, while men tend to value the country of origin more significantly, according to research by Nelson Barber (2009).
Vietnamese Consumer Lifestyle
In Vietnam, a longstanding preference for foreign brands persists despite government efforts to promote local products This inclination is driven by two main factors: the rise in incomes due to economic growth, allowing more consumers to afford premium goods, and the desire of the emerging affluent class to showcase their wealth and status through the ownership of luxury foreign brands As the trend towards importing more products continues, Vietnamese shoppers enjoy an expanding array of foreign options, indicating that this preference is unlikely to shift in the near future.
A 2007 survey by the Grey Group across 16 Pacific countries revealed that 77% of Vietnamese consumers prefer foreign brands, significantly higher than the Asian average of approximately 30% (Euromonitor, 2008).
Alcohol plays a crucial role in Vietnamese social culture, serving as a key component in discussions and relationship-building It is commonly present at celebrations and significant events like birthdays, weddings, and opening ceremonies In Vietnam, people consume alcohol during both joyful and sorrowful moments, highlighting its importance in various aspects of life.
In Vietnam, it is common for men to unwind after work by enjoying beer or wine with friends and business partners, fostering relationships and discussing work matters The increasing number of foreigners visiting and residing in the country has led to a diverse range of pubs and bars catering to all drinkers, regardless of income level, appealing to both locals and expatriates alike.
Traditionally, Vietnamese women were prohibited from consuming alcohol, but the influence of Western lifestyles has led to a shift in this cultural norm Today, younger generations in Vietnam increasingly enjoy drinking beer and wine, reflecting changing social attitudes Additionally, media portrayals of Vietnamese women drinking have contributed to a more relaxed perception of women's alcohol consumption in the country.
Vietnam is known for its traditional alcoholic beverages like Ruou Chuoi Hot, Ruou Nep, and Ruou De, but these are not typically purchased as gifts due to their low cost Instead, with rising incomes, Vietnamese people are increasingly favoring imported wines for special occasions and celebrations This shift in preference has led to a growing trend of consuming imported wines at home, prompting the emergence of specialized shops in urban areas dedicated to selling these products.
The Vietnamese alcohol market is a profitable one because most Vietnamese men drink after work An estimated VND11,529.9 billion was spent on alcohol in 2007, an increase of 40% from 2000 (Euromonitor, 2008)
In Vietnam, social drinking is common among friends after work at bars, pubs, or restaurants during the weekdays, while weekends often see gatherings at home However, a growing trend indicates that Vietnamese women are reluctant to host drinking sessions at home due to the expectation that they handle the cleanup afterward, highlighting a shift in social dynamics and preferences for going out instead.
Younger generations, particularly young women, are increasingly embracing alcohol consumption as a social activity Their growing independence and financial stability have made drinking a common aspect of their social lives.
Chapter Summary
This chapter reviews previous research and theories relevant to key concepts in consumer behavior, particularly in wine consumption It examines various models of consumer behavior and identifies the primary motivations for wine consumption, including utilitarian, experiential, and symbolic benefits Additionally, it addresses lifestyle factors of Vietnamese consumers that influence their wine consumption The insights gained from this literature will inform the development of the research problem in the subsequent chapter.
RESEARCH DESIGN
Chapter Overview
Chapter Four builds upon the literature review from Chapter Three by presenting the research conceptual framework and outlining its key concepts It details the research hypotheses and operationalizes the concepts to inform the survey design Additionally, the chapter provides an in-depth description of the survey design, including the questionnaires, sampling method, and sample size.
Conceptual framework
Using the Input, Process, Output consumer behavior model, adapting the research of Steve Charters and taking into accounts Vietnamese consumer lifestyle, this study proposes a conceptual framework as follows:
Source: Developed for this project
Wine marketing strategies involve the 4Ps of the marketing mix: Product, Price, Place, and Promotion The physical benefits of wine include its health and refreshing qualities, while the emotional aspects are captured through experiential and symbolic benefits Experiential benefits highlight the enjoyment and social contexts of wine consumption, whereas symbolic benefits reflect the rituals, historical significance, and identity associated with wine drinkers These dimensions will be utilized to analyze the relationship between these benefits and wine consumption, specifically through the amount of money spent on wine.
Hypotheses Development
This section gives an outline of the developments of the four research hypotheses that were carried out to discover the factors and their impacts on consumer consumption of wine
H1: The marketing efforts have impact on money spent on wine
Hypothesis 1 aims to find out the relationships between each of the four company marketing efforts and consumers’ purchasing behavior It can discover whether the product features and price affects consumers’ wine spending behavior as well as the impact of the place and promotion Here we are not sure about the impact of price on wine; it might be both positive and negative
H2: The utilitarian benefits have positive impact on money spent on wine
Hypothesis 2 focuses on discovering the relationship between wine purchasing decisions and utilitarian benefits based on the money to spend on wine It can provide evidence as to whether physical benefits of wine influence consumers’ purchasing decisions It will also verify the trend of consuming wine because consumers think that it’s healthier than other alcoholic drinks
H3: The experiential benefits have positive impact on money spent on wine
Hypothesis 3 attempts to find out if there is any relationship between experiential benefits of wine drinking and wine consumption The result of this hypothesis can indicate the level of experience that the consumers would expect when consuming wine
H4: The symbolic benefits have positive impact on money spent on wine
Hypothesis 4 aims to know whether the symbolic benefits have effect on wine purchasing decision By knowing this, it can provide insight for marketers to produce differentiated concepts to convince the consumer on purchasing the product This hypothesis also verifies the status-oriented characteristic of Vietnamese consumer, especially on luxury product.
Concept Operationalization
This section analyzes the concepts and dimensions of the conceptual framework, breaking them down into measurable elements assessed by various scales These elements will serve as variables for the survey and data analysis.
In marketing wine products, key dimensions include the country of origin and grape varieties, which significantly influence consumer attention and will be evaluated using a 5-point Likert scale Additionally, the impact of price on purchasing decisions will also be assessed through this scale The preferred locations for wine consumption will be examined using a nominal scale The promotional aspects of wine will focus on communication channels and packaging elements, with preferred communication methods identified through a nominal scale, while the importance of packaging will be measured on a 5-point Likert scale.
Charters (2003) proposed that the concepts of utilitarian, experiential, and symbolic benefits can be represented by distinct elements The utilitarian benefits of wine can be characterized by its health benefits and refreshing qualities In contrast, the experiential and symbolic benefits are more complex and multifaceted.
The concept of experiential benefits in wine drinking encompasses both enjoyment and situational dimensions Enjoyment is derived from the effects of alcohol, the diversity of wine options, the intellectual challenge of wine selection, and the rich taste experience Conversely, the situational aspects include social drinking, the harmonious pairing of wine with food, and the relaxation that comes from savoring a glass of wine.
The concept of symbolic benefits can be evaluated through the significance of rituals, historical context, and image dimensions Rituals play a crucial role, while the historical perspective encompasses family traditions and memories associated with wine drinking Additionally, the image dimension reflects lifestyle choices, self-perception, and social status.
The study utilizes a 5-level Likert scale to measure the elements of utilitarian, experiential, and symbolic benefits These elements, along with aspects of marketing efforts, serve as the independent variables for the research.
The study's dependent variable, money spent on wine, is assessed through two key components: the average number of bottles consumed monthly and the average purchase price per bottle, both measured on a nominal scale.
Tables 1: Concept operationalization & Measurement Scale summarizes the concepts, dimensions and elements Figure 12: Detail conceptual framework describes the conceptual framework with all the details
Concept Dimension Element Measurement Scale Coding
Product Country of Origin Inteval (5-level Likert) ME_COU
Grape Varieties Inteval (5-level Likert) ME_GRA
Price Inteval (5-level Likert) ME_PRI
Communication channel Nominal ME_COM
Packaging Inteval (5-level Likert) ME_PAC
Healthy Inteval (5-level Likert) UB_HEA
Refreshness Inteval (5-level Likert) UB_REF
Alcohol effect Inteval (5-level Likert) EB_ALC
Diversity & intellectual challenge Inteval (5-level Likert) EB_DIV Taste Inteval (5-level Likert) EB_TAS
Social drinking Inteval (5-level Likert) EB_SOC Wine and food Inteval (5-level Likert) EB_FOO Relaxation Inteval (5-level Likert) EB_REL
The importance of ritual Inteval (5-level Likert) SB_RIT
Family tradition Inteval (5-level Likert) SB_FAM Memory Inteval (5-level Likert) SB_MEM
Lifestyle Inteval (5-level Likert) SB_LIF Self-image Inteval (5-level Likert) SB_SEL Status Inteval (5-level Likert) SB_STA
Average purchase price per bottle Nominal MS_PRI
Average bottles consumed per month
Table 4.1: Concept operationalization and measurement scales
Source: Developed for this project
Source: Developed for this project
Survey Design
Based on the operationalization of the theoretical model in the previous section, the questionnaire is created for this study (Refer to Appendix 1: Survey questionnaire)
Data collection for this study involved personally administered and email questionnaires targeting wine drinkers Initially, a filtering question was used to exclude non-wine drinkers The questionnaire consists of 18 instructional questions utilizing a 5-point Likert scale to gather information on independent variables Question 19 identifies preferred communication channels among wine drinkers, while question 20 focuses on their favorite consumption locations The dependent variable is assessed through questions 21 and 22, which measure the average number of bottles consumed monthly and the average price per bottle Demographic information is collected in the final section, including age (question 23), average income (question 24), and sex (question 25) Lastly, an open-ended question (question 26) invites respondents to share additional thoughts on wine consumption.
The study focuses on wine drinkers in Ho Chi Minh City, targeting individuals over the legal drinking age of 18 in a diverse geographic area Due to resource limitations, a non-probability sampling method is employed, primarily targeting the economy classes B (household monthly income of $500-$999) and A (household monthly income of $1,000 and above), as wine is considered a luxury good in Vietnam To effectively reach these demographics, convenience sampling is utilized, with respondents selected from supermarkets, department stores, alcohol shops, and restaurants, while an email-administered survey is distributed to friends and colleagues.
Determining the appropriate sample size for a study is crucial, particularly when the exact number of wine drinkers in Ho Chi Minh City is unknown To address this challenge, this research employs the proportion technique to calculate the necessary sample size (Zikmund, 2000).
To determine the sample size, the study uses a formula based on a confidence level of 95 percent and sampling error of not greater than 5 percent
- n : First estimate of sample size
- : Square of confidence level in standard error units
- q : Estimated proportion of failure, or (1 – p)
- : Square of the maximum percentage of allowance for error
If researchers have no information regarding the probable p values, researchers can assume that p = 0.5 and solve the sample size However, the pq ratio can never exceed 0.25 (Cooper and Schindler, 2003)
This study adopted a 95% confidence level, hence, the population parameter is ± 0.10 of the sample portion So, the sampling error or level of precision is ( 0.10/1.96) or 0.05
So, the sample size of this research is calculated as following:
Therefore, the selected sample size is 400 samples In order to have valid 400 responses,
450 questionnaires are used in the survey The personally administered survey aims to collect 300 valid responses; in the meantime the email administered survey seeks to have
Chapter Summary
This chapter outlines the research's conceptual framework and details the formulation of four research hypotheses The framework is operationalized into twenty independent variables measured through a questionnaire, which also gathers data on two dependent variables Due to resource constraints, a convenient sampling method is employed, resulting in a sample size of 400 to maintain statistical significance The data collected from the survey will be analyzed and presented in the following chapter.
DATA ANALYSIS & FINDINDS
Chapter Overview
This chapter outlines the research findings, beginning with descriptive statistics such as response rate, age, gender, and income of respondents It then explores the factors impacting wine consumer behavior, highlighting marketing efforts, utilitarian, experiential, and symbolic benefits as they relate to consumption volume and value Finally, the chapter summarizes the outcomes of each research hypothesis.
General Descriptive Information
The survey conducted over one month involved the distribution of 450 questionnaires, yielding 414 responses, which represents a 92% response rate However, respondents who had never consumed wine were excluded from the analysis, leading to the removal of invalid responses during data cleaning Ultimately, 386 valid cases were retained for data analysis, satisfying the sample size criteria established in the previous chapter.
This study reveals a significant gender disparity among respondents, with males comprising 82.4% and females only 17.6% Despite a rising trend in female wine consumption in Vietnam, men continue to dominate the alcohol consumption landscape.
Source: Data of the study
The majority of respondents in the sample population are under 30 years old, with 77% falling within the 20-29 age group Additionally, 14% of respondents are aged 30-39, while those under 20, aged 40-49, aged 50-59, and over 60 represent 5%, 3%, 1%, and 0.3%, respectively.
Age groups of respondents under 20
Figure 5.2: Age groups of respondents
Source: Data of the study
The average monthly income of the respondents reveals that over half earn between 3 to 7.5 million VND, with the most prevalent income brackets being 3 to 4.5 million (38%) and 4.5 to 7.5 million (35%) Additionally, 10% of respondents earn under 3 million, while 9% fall within the 6 to 9 million range, and 8% earn over 9 million This income distribution aligns closely with the age demographics of the population.
Figure 5.3: Average monthly income of respondents
Source: Data of the study
5.2.3 Favorite communication channels and wine consuming place
The study gathers data on preferred communication channels and wine consumption locations as part of its marketing strategy These elements will be examined in detail in the following section Nonetheless, the descriptive insights from these variables offer valuable understanding of wine consumption behavior.
Wine fair Wine tasting fair
Figure 5.4: Marketing efforts - Communication channel
Source: Data of the study
From the result, we can see that the consumers look for wine information from various sources Among them, Internet and Friend’s recommendation are the most favorite ones
Marketing Efforts - Wine consuming place
Figure 5.5: Marketing efforts - Wine consuming place
Source: Data of the study
The survey results indicate that the majority of people prefer to drink wine at home, whether in their own residence or at a friend's place, with this setting representing over 60% of responses Additionally, consumers frequently enjoy wine in restaurants and occasionally at bars or nightclubs.
Factors Influencing of Wine Consumption
The conceptual framework includes four independent variables and one dependent variable To evaluate the internal consistency and unidimensionality of each construct, a reliability test and factor analysis of the single construct are utilized A reliability test is only conducted if the assumption of unidimensionality is validated (Hair et al., 1998) Consequently, a test for unidimensionality should be performed prior to assessing the reliability of the measurement scale.
The assessment and refinement of measurement scales are conducted in two steps using SPSS software The first step involves Exploratory Factor Analysis (EFA) and Cronbach’s alpha to evaluate unidimensionality and reliability The second step entails EFA applied to all scales collectively to assess both convergent and discriminant validity During this process, items that do not meet the established evaluation criteria are removed The refinement criteria for items include a factor loading greater than 0.40, an item-total correlation exceeding 0.35, a Cronbach’s Alpha above 0.60, and an appropriate percentage of variance, as outlined by Hair et al (1998).
The following table listed the summary of EFA and Cronbach’s Alpha test for each concept / dimension (Refer to Appendix 2: SPSS results for full detail)
ME_COU Country of Origin 0.882 77.78 0.556
EB_FOO Wine and food 0.582 0.383
SB_RIT The importance of ritual 0.677 47.052 0.463
Table 5.1: EFA & Cronbach's Alpha for each concept / dimension
Source: Data of the study
The Marketing effort concept is divided into two key factors: Product, which includes Grape Varieties and Country of Origin, and Price and Packaging However, Price and Packaging were excluded from further analysis due to insufficient Cronbach’s Alpha values, failing to meet the criteria of greater than 0.6 and a Corrected item-total correlation exceeding 0.35 Consequently, the focus will shift to Country of Origin and Grape Varieties in the upcoming Exploratory Factor Analysis (EFA) phase.
The Utilitarian Benefits concept comprises of the Healthy and Refreshness elements They all meet the selection criteria, so they are going to participate in the next EFA phase
Experiential benefits comprise of two dimensions (Enjoyment and Situation) Each of them includes three elements (Alcohol effect, Diversity & Intellectual challenge, Taste) and
(Social drinking, Wine & Food, Relaxation), respectively All these elements meet the selection criteria So they will participate in the next full scale EFA
The symbolic benefits are characterized by six key elements: the importance of ritual, family tradition, memory, lifestyle, self-image, and status These elements are organized into three dimensions: the importance of ritual, historical perspective, and image However, the status element did not meet the required criterion for corrected item total correlation (0.296 < 0.35) and has thus been excluded from the observation variables for this concept The exploratory factor analysis (EFA) and Cronbach’s Alpha results for the remaining elements are deemed acceptable, allowing for further analysis in the next phase of the EFA.
5.3.1 EFA for all the valid scales
All variables that successfully passed the EFA and Cronbach’s Alpha tests will undergo a comprehensive EFA analysis to evaluate both convergent and discriminant validity The results of this analysis can be found in Appendix 2, which contains the detailed SPSS findings.
Kaiser-Meyer-Olkin Measure of Sampling Adequacy .797
Bartlett's Test of Sphericity Approx Chi-Square 1195.345 df 105
Rotation Sums of Squared Loadings a
Extraction Method: Principal Component Analysis a When components are correlated, sums of squared loadings cannot be added to obtain a total variance a 4 components extracted
Symbolic Benefit - The importance of ritual
Extraction Method: Principal Component Analysis
Rotation Method: Promax with Kaiser Normalization a Rotation converged in 4 iterations
Table 5.2: EFA result - Full scales
Source: Data of the study
The exploratory factor analysis (EFA) yielded four distinct factors, with Symbolic benefits and Marketing efforts remaining consistent Notably, three elements from Experiential benefits—Refreshness, Alcohol effect, and Diversity & Intellectual—merged with Utilitarian benefits to form a new category Additionally, Wine & Food, Taste, and Relaxation combined to create another factor, which we will refer to as Enjoyment benefits Thus, we identify two new factors: Utilitarian & Experiential benefits and Enjoyment benefits.
The factor scores for Symbolic (SYM_FAC), Utilitarian & Experiential (UE_FAC), Marketing Effort (ME_FAC), and Enjoyment (ENJ_FAC) are computed using SPSS and stored in four new variables These variables will be utilized in regression analysis to explore the relationship between independent and dependent variables Figure 16 illustrates the adjusted conceptual framework following the exploratory factor analysis (EFA).
SB_MEM SB_SEL SB_LIF
Figure 5.6: Adjusted conceptual framework after EFA
Source: Developed for this project
The dependent variable, representing money spent on wine, is determined by multiplying the average number of bottles consumed per month by the average price per bottle, resulting in a new variable called MS_CAL This variable will be utilized in the multiple regression model alongside the previously mentioned factors For comprehensive results, please refer to Appendix 2, which contains the detailed SPSS analysis.
Std Error of the Estimate
1 209 a 044 034 2.80967 a Predictors: (Constant), Enjoyment benefit factor, Marketing effort factor, Symbolic benefit factor, Utilitarian & Experiental benefit factor
Model Sum of Squares df Mean Square F Sig
Total 3144.777 385 a Predictors: (Constant), Enjoyment benefit factor, Marketing effort factor, Symbolic benefit factor, Utilitarian & Experiental benefit factor b Dependent Variable: Money spent calculated
Source: Data of the study
The regression model demonstrates statistical significance with a p-value of 0.002, indicating a meaningful relationship; however, the Adjusted R Square value of 0.034 reveals that it only accounts for 3.4% of the variance in the study's cases Consequently, this regression model is inadequate for effectively identifying the relationship between the dependent variable and the independent factors.
To test the hypotheses effectively, an alternative analysis method is required The dependent variable, which is the money spent on wine, is quantified by the average number of bottles purchased per month (MS_BOT) and the average price per bottle (MS_PRI), both measured on a nominal scale Consequently, Discriminant Analysis is identified as the appropriate method for data analysis The conceptual framework is divided into two distinct frameworks to explore the relationships between the factors and the dependent variables, as illustrated in Figures 17 and 18 Two sets of hypotheses are formulated in relation to these two frameworks.
Average bottles consumed per month
Source: Developed for the project
H1_1: Symbolic benefit factor has a contribution to the differentiation of average bottles consumed per month
H1_2: Utilitarian & Experiential benefit factor has a contribution to the differentiation of average bottles consumed per month
H1_3: Marketing effort factor has a contribution to the differentiation of average bottle consumed per month
H1_4: Enjoyment benefit factor has a contribution to the differentiation of average bottle consumed per month
Source: Developed for the project
H2_1: Symbolic benefit factor has a contribution to the differentiation of average price paid per bottle
H2_2: Utilitarian & Experiential benefit factor has a contribution to the differentiation of average price paid per bottle
H2_3: Marketing effort factor has a contribution to the differentiation of average price paid per bottle
H2_4: Enjoyment benefit factor has a contribution to the differentiation of average price paid per bottle
5.3.3 Discriminant analysis for conceptual framework 1 and hypotheses testing
The Average bottle per month serves as the grouping variable in the SPSS Discriminant Analysis, while three factors are utilized as independent variables Detailed results of the analysis can be found in Appendix 2: SPSS results.
Tests of Equality of Group Means
Wilks' Lambda F df1 df2 Sig
Summary of Canonical Discriminant Functions
Function Eigenvalue % of Variance Cumulative %
3 003 a 1.4 100.0 058 a First 3 canonical discriminant functions were used in the analysis
Test of Function(s) Wilks' Lambda Chi-square df Sig
Standardized Canonical Discriminant Function Coefficients
Money spent on wine - Average bottle per month
100.0 a 74.1% of selected original grouped cases correctly classified b 70.5% of unselected original grouped cases correctly classified
Table 5.4: Discriminant analysis result - Average bottle consumed per month
Source: Data of the study
The discriminant score equation is as follows:
In the Tests of Equality of Group Means, the Marketing effort factor isn’t statistically significant (Sig = 0.113 > 0.05) So this factor will be removed from the discriminant equation
In the Test of Function(s), functions 1 through 3 show a significance value of 0.000, which is less than the 0.05 threshold, indicating that discriminant function 1 is statistically significant The Canonical Discriminant Function Coefficients provide the discriminant equation for conceptual framework 1.
D1 = 0.85 * SYM_FAC – 0.02 * UE_FAC + 0.261 * ENJ_FAC
SYM_FAC: Symbolic benefit factor
UE_FAC: Utilitarian & Experiential benefit factor
The classification results indicate that 74.1% of the selected original grouped cases were accurately classified, while 70.5% of the unselected original grouped cases were also correctly identified These findings demonstrate that the discriminant analysis is reliable and acceptable.
H1_1: Symbolic benefit factor has a contribution to the differentiation of average bottles consumed per month
The discriminant function coefficient of Symbolic benefit factor is 0.85, and in the Test of Equality of Group Means, this factor is also statistically significant (Sig = 0.00 < 0.05)
This means that the Symbolic benefit factor is a strongly contribution to the differentiation of average bottles consumed per month with 95% level of confidence Therefore hypothesis 1 is supported
H1_2: Utilitarian & Experiential benefit factor has a contribution to the differentiation of average bottles consumed per month
The discriminant function coefficient of Utilitarian & Experiential benefit factor is -0.02, and in the Test of Equality of Group Means, this factor is also statistically significant (Sig
= 0.029 < 0.05 ) This means that the Utilitarian & Experiential benefit factor contributes to the differentiation of average bottles consumed per month with 95% level of confidence Therefore hypothesis 2 is supported
H1_3: Marketing effort factor has a contribution to the differentiation of average bottle consumed per month
The Test of Equality of Group Means indicates that the Marketing effort factor is not statistically significant (Sig = 0.113 > 0.05), suggesting it does not affect the average number of bottles consumed per month at a 95% confidence level Consequently, hypothesis 3 is not supported.
H1_4: Enjoyment benefit factor has a contribution to the differentiation of average bottle consumed per month
The discriminant function coefficient for the Enjoyment benefit factor is 0.261, indicating its statistical significance with a p-value of 0.013, which is less than the 0.05 threshold This suggests that the Enjoyment benefit factor plays a crucial role in differentiating the average number of bottles consumed per month, supporting hypothesis 4 with a 95% level of confidence.
5.3.4 Discriminant analysis for conceptual framework 2 and hypotheses testing
Findings
Session 5.3 presents the results of the empirical investigation The measurement scales were verified by EFA and Cronbach’s Alpha test; and there were four factors extracted These factors were input into multiple regression model to analyze the relationship between them and the dependent variable (Money spent on wine) However, the multiple regression result was not statistically significant Therefore, discriminant analysis method was employ to evaluate the contribution of the factor to the observation variable measuring the level of wine consumption (Average bottle consumed per month)
The discriminant analysis identified three key factors that significantly influence the average number of bottles consumed per month: the Symbolic benefit factor, the Enjoyment benefit factor, and the Utilitarian & Experiential benefit factor In contrast, the Marketing effort factor did not provide enough statistical evidence to impact the differentiation of this variable.
The symbolic benefit factor significantly differentiates wine consumption groups, with ANOVA analysis confirming that its importance grows as wine consumption increases This indicates that symbolic benefits positively influence wine consumption levels, as consumers prioritize aspects like lifestyle, family tradition, and self-image over other elements while enjoying wine.
The Enjoyment benefit factor significantly influences wine consumption, derived from three elements of the original Experiential benefit concept ANOVA analysis indicates that the importance of this factor increases as consumers move from drinking less than one bottle per month to one to four bottles per month However, there is insufficient statistical evidence to support an increase in importance for higher consumption groups Ultimately, the enjoyment derived from wine, including food pairings, taste, and relaxation, plays a crucial role for consumers.
The combination of Utilitarian and Experiential benefits plays a role in differentiation, though its impact is less significant than the two primary factors ANOVA analysis indicates insufficient statistical evidence to support a strong relationship between this factor and the dependent variable While respondents acknowledged the Healthy benefit and Social drinking aspects of wine, these were found to be less important than the aforementioned factors.
The Marketing effort factor lacks sufficient statistical evidence to differentiate between groups of wine consumers in Vietnam, as indicated by responses to open-ended questions highlighting minimal communication and information about wine This factor includes the Country of Origin and Grape Varieties, which surprisingly are the primary product details conveyed to consumers by wine producers and distributors.
Chapter Summary
This chapter discusses the analysis of data, revealing that the original conceptual framework required adjustments based on the results of the exploratory factor analysis (EFA) The study utilized discriminant analysis instead of multiple regression analysis, identifying the Symbolic factor as the primary contributor to the differentiation among wine consumer groups, significantly influencing wine consumption levels In contrast, the Enjoyment benefit and Utilitarian & Experiential benefit factors contributed to this differentiation at a lesser degree Notably, the Marketing effort factor showed no statistically significant relationship with wine consumption levels The subsequent chapter will offer recommendations for wine manufacturers and distributors, along with the study's conclusions.
