Influence of promotion on consumer purchasing decision of un899(dinch) at upc technology corporation in vietnam market

UNIVERSITY OF ECONOMICS HO CHI MINH CITY NGUYEN THE ANH INFLUENCE OF PROMOTION ON CONSUMER PURCHASING DECISION OF UN899 DINCH AT UPC TECHNOLOGY CORPORATION IN VIETNAM MARKET MASTER T

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

NGUYEN THE ANH

INFLUENCE OF PROMOTION ON CONSUMER PURCHASING DECISION OF UN899 (DINCH)

AT UPC TECHNOLOGY CORPORATION

IN VIETNAM MARKET

MASTER THESIS OF COMMERCE

Ho Chi Minh City – 2020

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

NGUYEN THE ANH

INFLUENCE OF PROMOTION ON CONSUMER PURCHASING DECISION OF UN899 (DINCH)

AT UPC TECHNOLOGY CORPORATION

IN VIETNAM MARKET

Major: International Business

(Coursework) Major Code: 8340121

MASTER THESIS OF COMMERCE

Supervisor: Dr Dinh Tien Minh

Ho Chi Minh City –2020

DECLARATION

I hereby formally declare that the research titled “Influence of Promotion on Consumer Purchasing Decision of UN899(DINCH) at UPC Technology Corporation in Vietnam Market” is my original dissertation I myself shall hold

responsibility for plagiarism, if any, detected afterwards The data, information and analysis results that have been collected for this research is reliable and honest

The Author

Nguyen The Anh

Declaration

Table of Content

Acronyms and symbols

List of tables

List of figures

Abstract

CHAPTER 1 INTRODUCTION 1

1.1 Problem statement 1

1.3 Research methodology 2

1.4 Object and scope of study 3

1.5 Significance of the study 3

1.6 Structure of the research 4

CHAPTER 2 LITERATURE REVIEW 5

2.1 Concept of promotion 5

2.1.1 Promotion and an enterprise 6

2.1.2 Promotion and consumers 6

2.1.3 Promotion and society 6

2.1.4 Types of promotional activities 6

2.1.4.1 Advertising 6

2.1.4.2 Sales promotion 7

2.1.4.3 Direct marketing 7

2.1.4.4 Personal selling 8

2.1.4.5 Publicity/Pubic Relation 8

2.1.4.6 Industrial products and consumers’ purchase decision 9

2.2 Overview of UPC Technology Corporation (UPC) 11

2.2.1 UPC Profile 11

2.2.3.1 Market and sales overview 14

2.2.3.2 The market share: 14

2.2.3.3 Business operation and market share of UPC in Vietnam 14

2.3 Referential models and proposal research model 17

2.3.1 Referential models 17

2.3.2 Proposal research model 21

Chapter 2 summary 22

CHAPTER 3 RESEARCH DESIGN 24

3.1 Research methods 24

3.1.1 Qualitative research 24

3.1.2 Quantitative research 27

3.1.2.1 Sample size 27

3.1.2.2 Research process summary 28

3.2 Research framework 29

3.2.1 Research Procedure 29

3.2.2 Measurement of official scales 30

Chapter 3 summary 35

CHAPTER 4 RESEARCH RESULTS 36

4.1 Sample characteristics 36

4.2 Reliability check 38

4.3 Exploratory factor analysis (EFA) 46

Chapter 4 summary 58

CHAPTER 5 MANAGERIAL IMPLICATIONS 59

5.1 Findings 59

5.2 Managerial implications 59

5.2.3 Personal selling activities 60

5.2.4 Public relations activities 61

5.3 Limitations and suggestion for future research 62

5.3.1 Limitations 62

5.3.2 Suggestion for future research 63

REFERENCES

APPENDIXES

software specialized in statistical analysis produced by SPSS Inc., it was acquired

by IBM in 2009

List of tables

Table 2.1 UPC Group Revenue (2017-2019) 14

Table 2.2 Revenue in Vietnam market (2017-2019) 15

Table 2.3 Summary of referential models 22

Table 3.1 Research process summary 28

Table 3.2 Measurement scales 30

Table 4.1 Reliability summary 39

Table 4.2 First Cronbach’s alpha reliability check of Direct Marketing 39

Table 4.3 Second Cronbach’s alpha reliability check of Direct Marketing 40

Table 4.4 Cronbach’s alpha reliability check of Personal Selling 41

Table 4.5 First Cronbach’s alpha reliability check of Sales Promotion 42

Table 4.6 Second Cronbach’s alpha reliability check of Sales Promotion 43

Table 4.7 First Cronbach’s alpha reliability check of Public Relation 44

Table 4.8 Second Cronbach’s alpha reliability check of Public Relation 44

Table 4.9 First Cronbach’s alpha reliability check of Purchasing Decision 45

Table 4.10 Second Cronbach’s alpha reliability check of Purchasing Decision 45

Table 4.11 First EFA result 46

Table 4.12 The second EFA result 48

Table 4.13 First Results of Multiple Regression Analysis 50

Table 4.14 Second Results of Multiple Regression Analysis 53

Table 4.15 Descriptive Statistics 55

Table 4.16 Mean of direct marketing and sales promotion 56

Table 4.17 Mean of personal selling and public relations 57

Figure 2.1 Industrial goods classification 10

Figure 2.2 UPC Group Organization 12

Figure 2.3 UN899 products and applications 13

Figure 2.4 UN899 production capacity 13

Figure 2.5 DOP market share 15

Figure 2.6 DINP market share 16

Figure 2.7 DINCH/UN899 market share in Vietnam 16

Figure 2.8 The Role of Advertising in Consumer 18

Figure 2.9 Impact of Sales Promotion Tools on Consumer’s Purchase Decision Research Model 19

Figure 2.10 The Impacts of Direct Marketing on Consumers’ Purchasing 20

Figure 2.11 The effect of promotion mix dimensions on Consumers’ Purchasing decision 20

Figure 2.12 Theoretical Framework 21

Figure 3.1 Research Framework 29

Figure 4.1 Industrial sectors chart 36

Figure 4.2 Annual revenue of enterprises 37

Figure 4.3 Work experience 37

Figure 4.4 Known and used UN899(DINCH) timeline 38

–costumer purchase decision, which are direct marketing, personal sales, sales promotion, and public relations Another word, promotional activities that influence on consumer purchase decision of UN899(DINCH) at UPC Technology Corporation (UPC) The survey was conducted with 200 respondents who are UPC’ clients Promotion is one of important components in the marketing mix Multiple regression came out to point out which promotional tool had strongly influence on consumer purchase decision on UN899(DINCH)

The research has been proceeded by quantitative and qualitative methods; results came out the two determinants were direct marketing and sales promotion significantly influenced on consumer purchase decision of UN899(DINCH) The other two determinants were personal selling and public relations did not impact on consumer purchase decision of UN899(DINCH) at UPC in Vietnam market as proposed hypothesizes for the study, whereas these two tools play very important role in reality; therefore, they need verifying or are a foundation for future research Nevertheless, the study reveals the managerial implication for UPC mangers or sales, and marketing department or promotional improvement of UN899(DINCH) at UPC in Vietnam

Keywords: Influence of promotion, purchasing decision, UN899(DINCH), UPC Technology

Corporation

CHAPTER 1 INTRODUCTION 1.1 Problem statement

According to the statistics of Vietnam Plastic Association (VPA), the plastic industry has been approaching saturation in the world The growth of outcome and consumption gradually decreased 4% from 2013 to 2017 The go-green trend or using non-phthalate product has been driving in the vital criteria at plastic industry Whereas the plastic industry in Vietnam has been very dynamic with around 3,300 enterprises; this is a very potential and attractive market for overseas raw materials suppliers Besides, Vietnam Plastic Industry (VPI) has still relatively depended on overseas raw materials due to higher demand UPC early infiltrated into Vietnam since

2012, and the name UPC has been widely known as one of the biggest plasticizer suppliers such as Dioctyl phthalate (DOP) and Diisononyl Phthalate (DINP) So far, the phthalate plasticizers were most used materials for flexible and soft PVC products in Vietnam in particular and developing countries in general However, such phthalate plasticizers might get health risk and environmental concerns from some products – having direct human contact or sensitive applications like food contact, medical things, and toys Furthermore, as mentioned above, more and more plastic users have been required eco-friendly or non-phthalate for daily products Specially, European countries and developed ones prevented phthalate products to their market BASF is the first successful mover for their Hexamoll DINCH (Plasticizers) by launching in 2002 in the world and held 72% of market share in Vietnam, whilst the second big competitor Nan Yan held 16%, and others gained 9% Conversely, UPC has penetrated and promoted UN899(DINCH) with only three percent of market share The UN899 at UPC group launched in 2012; it has been started promoting in Vietnam by

2016, but it got acceptable in 2018 After more three years to approach and promote UN899 (DINCH) to consumers, the result has not brought back without expectation yet It was the evident that the latest year 2019 the non-phthalate plasticizers and other plasticizers have the similar application to DINCH and UN899 recorded more 27,000 tons from the trade statistics of Vietnam Custom Although UPC has been making a great promotion effort

have not touched at 200 tons per year Certainly, UPC must review and improve its marketing strategy or finding solutions for effective promotion, and this is the big question that UPC group has been finding the answer The author, who has been in charge in Vietnam market decided to make the

research “Influence of Promotion on Consumer Purchasing Decision on UN899(DINCH) at UPC Technology Corporation in Vietnam Market” is

expecting to find out the internal and external factors that could promote UN899 products more effectively in Vietnam market

 Encouraging manufacturers to use green plasticizers for sensitive application for human contact products

1.3 Research methodology

The author uses both qualitative method and quantitative method This study collects and summarizes sources of information from General Department of Vietnam Customs, General Statistics Office of Vietnam, Vietnam Plastic Association (VPA), Vietnam Chemicals Agency (VCA), references, literatures, and academic journals, other business and sciences sources on internet to have secondary data sources with real market survey to have primary data

 Qualitative method is by focus group like experts and senior managers

in soft PVC industrial companies

 Meantime, interviewing customers (in-depth interview) to comprehend the reality of consumers purchase decision in order to build and adjust the measurement scales and study model for UN899 promotional activities

 Quantitative method is conducted by spread-out questionnaires to respondents in accordance with UN899 promotional activities and UN899 (DINCH) purchasing decision making in Vietnam market Cronbach’s alpha, Exploratory Factor Analysis (EFA) and multiple regression methods are carried out to analyze the collect data

1.4 Object and scope of study

 Object: promotional activities for the UN899 of UPC Technology

Corporation in Vietnam market

 Interviewees: UPC’s existing and potential clients in Vietnam market

 Scope of study

2019-2020

for the UN899 of UPC Technology Corporation in Vietnam market, and relevant plasticizers industry

1.5 Significance of the study

Summarizing and consolidating the implication of promotional activities on business It re-maps the promotional activities of UPC Technology Corporation This is also one of essential references for UPC group’s managers in order to make the important decisions

Proposing some feasible solutions to UPC group’s functional managers and leaders for improving promotional activities of UN899 product

1.6 Structure of the research

This study will be composed in five chapters:

References

Appendixes

CHAPTER 2 LITERATURE REVIEW 2.1 Concept of promotion

‘Promotion is the company strategy to cater for the marketing communication process that requires interaction between two or more people or groups, encompassing senders, messages, media and receivers’ (Lager, 1971)

F Lao (1998, p.149) defined that ‘promotion stands for activities that communicate the merits of the products and persuade target customers to buy

it, use or experience the product, once, twice, and many times over competing products in the market place’

Kotler and Armstrong (2006) stated that ‘promotion as activities that communicate the merits of the product and persuade target customers to buy

it Promotion mix can be seen as the specific blend of advertising, sales promotion, public relation, and direct marketing tools that the company uses

to pursue its marketing objectives’

consists of the specific blend of advertising, personal selling, sales promotion, public relations, and direct marketing tools that the company uses to communicate customer value and build customer relationships’ (Kotler & Armstrong, 2012, p 406)

Hence, it basically implies that promotion includes specific activities such as advertising, personal selling, sales promotion, public relations, and direct marketing tools in order to approach purchasers or customers for selling goods or service of an enterprise In other word, promotion occurs during pre- selling, selling, and post-consuming stage

2.1.1 Promotion and an enterprise

Promotion is to help a company message or remind the purchasers a company brand name or a company product, which consists of newspaper, television, billboards, social media, or internet marketing tools, so on

Several promotional strategies could be applied to promote a business relying

on a firm’s objectives, goals, and priorities One company brand name or product or service might not gain the attention of customers or give them empty-minded space of a firm brand name or service

2.1.2 Promotion and consumers

Promotional activities provide consumers with valuable information in order

to save time and make quick and right decision to purchase some products or service

Furthermore, promotion creates clients’ good awareness of choosing good and qualified products On the other hand, promotional activities create fierce competitiveness for firms or enterprises as not to be stoppable improving and serving clients with the best service

2.1.3 Promotion and society

Promotion makes an incredibly supportive contribution to social media, bringing much more jobs to labors or employees with diverse fields It not only saves publish cost but also enhances qualified and diverse products or service, which helps to increase competitiveness and economic development

2.1.4 Types of promotional activities

2.1.4.1 Advertising

‘Advertising Any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor’ (Philip Kotler and Gary Armstrong, 2004)

Advertising is a ‘means of communicating information pertaining to products, services or ideas by other than direct personal contact and on an openly paid

basis with an intent to sell or otherwise obtain favorable consideration.’ (R.V

Therefore, the sense of adverting is that a firm or an enterprise publishes its products or service by using of several types of media such as newspapers, radio, television, billboards, outdoor banners or website for the purpose of selling products or services

2.1.4.2 Sales promotion

Sales promotion is ‘the use of activities and materials as direct inducements

to customers and salespersons’ The core objective of sales promotional

promotional methods consists of rebates, coupons, samples, premiums, point- of-purchase display, trade show, and cooperative advertising (William Pride, Robert Hughes, and Jack Kapoor, Foundations of Business, 2011, p.397) Sales promotion is ‘short-term incentives to encourage the purchase or sale

Hence, it can be said that sales promotion is as one type of marketing that reaches consumers or distribution channels in order to offer new products, cut-off inventories or such an action to promote sales, or even such efforts of selling force by an organization or a firm

2.1.4.3 Direct marketing

‘Direct marketing as an interactive system of marketing that uses one or more advertising media to effect a measurable response and/or transaction at any location.’ (Principles Advertising: A Global of Perspective –Monle Lee&Carla Johnson, 2005, p.311)

‘Direct marketing is advertising strategy that relies on the individual distribution of a sales pitch to potential customers Mail, email, and texting are among the delivery systems used’ (Will Kenton, 2019)

All in all, it can simply be comprehended that direct marketing is that a business or message transaction address customers via many kinds of channels

such as mail, e-mail, telephone, and in person These messages aim at setting-

up, maintaining and building direct relationship with clients Moreover, direct marketing is to sell goods or find out customers in detailed, then key-in the database so as to build close business relationship or customize

2.1.4.4 Personal selling

Personal selling is ‘an oral presentation of ideas about products or services with the aim of persuading potential buyers to buy such products or services

from which they can derive maximum satisfaction’ (Olukayode, 1997)

Personal selling is ‘Personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships’ (Kotler

& Armstrong, 2012, p.408)

Thus, personal selling occurs where businesses or transaction that goods or services are sold to purchasers or service users after face-to-face meeting By sellers’ attitude, appearance, product and service knowledge or communication skills that can promote, inform, and persuade customers to buy or trial goods

2.1.4.5 Publicity/Pubic Relation

Public relations (PR) are ‘Building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events.’ (Kotler

& Armstrong, 2012, p.408)

Meanwhile, the Public Relations Society of America (PRSA) officially stated that public as a management function For management part, public relation managers ought to be closely choosing and running the organization’s/firm’s strategic goals by co-operating with other managers who lead the organization/ firm For public relations practitioners help or support other managers to ‘make sound strategic-planning and operating decisions’ For doing so, ‘they anticipate, analyze, and respond to opinion of people and groups (stakeholders)’ – both internal and external the organization – ‘whose

opinions and actions can affect the organization in positive or negative ways.’ (Today's Public Relations: An Introduction by Robert L Heath, W Timothy Coombs, 2006, p.8)

To sum up, publicity/public relations releases to social media/ broadcast or interviews to the medial via speech or word-of-mouth A firm or an enterprise marketer develops a favorable image of its products by connecting or linking

in public relations to get public eyes These activities aim at making communicational efforts and maintaining favorable relationship between a firm/ an enterprise and its publicity, and for inducing target consumers

2.1.4.6 Industrial products and consumers’ purchase decision

2.1.4.6.1 Industrial products and classification

 Industrial products: the products or services with technical

complexity are generally not for personal user and for industrial and business use; they are such materials or partial components of the

products, whilst consumer goods are finished products Consumer goods are to gain the consumption and satisfaction of human wants, such as food, drinks, and clothing

 Classification of industrial goods/ service: play a vital role which

assists to influence on purchaser decision making for a firm or an enterprise Basing on the relative cost of the industrial goods at which they run for production process There are five major classes of industrial goods: natural materials and parts, manufactured materials

and parts, capital items, supplies, and business services They are illustrated as the chart below:

Figure 2.1 Industrial goods classification

Source: Classification of industrial products –by Hitesh Bhasin, 2018 2.1.4.6.2 Consumers’ purchase decision and industrial market

 Purchase decision: The consumer has decided to purchase an item

after gaining information from various sources, evaluate and consider

it, then make up his or her mind where to buy and what to buy Consumers purchase the brand or product or service which he/she gives the highest rank in the evaluation stage The purchase decision also influenced by the surrounding environment (Kotler at el 2017,

p 157.)

 In industrial market:

 The purchase process is not easy to promote and sell goods to purchasers, it is more challenges than consumer marketing For purchase decision of any industrial products, the buyers consider many factors such as specifications of goods, quality, availability, delivery, payment terms, and

other trade terms cost effectiveness, post-sales service, and so forth quite rather than on social and psychological needs/ wants

 It takes a longer time and rely on many individuals from

technical/R&D, commercial/materials, and finance departments After a start

of an offer to purchaser, there will be more negotiations and information exchanges between the specialists and representatives from both the buyer and the seller firm or a company The relationships between the purchasing staff and selling person are greatly valued, which leads to be stable or have the long-term business cooperation due to a high degree of interdependence Therefore, changes are few and occur relatively slowly The cost of choosing suppliers can be high for those who meet delivery requirements or deliver qualified product Hence, the purchasing company ought to assure a potential supplier ‘s technical, administrative, and financial capabilities

2.2 Overview of UPC Technology Corporation (UPC)

2.2.1 UPC Profile

UPC Technology Corporation (UPC) established in 1976, specialized in manufacturing and distributing plasticizers in Asia particular and in the world in general The company’s core business consists of include phthalic anhydride (PA), maleic anhydride (MA), diisononyl phthalate (DINP), fumaric acid (FA), unsaturated polyester resins (UPR), poly ethylene (PE), polyester polyol, polyvinyl chloride (PVC) and epoxy resins, among others These products have been producing and distributing through six geographical segments: Eastern China, Southern China, Northern China, Central China, Taiwan and Malaysia In recent decades, UPC business started to focus on growing into specialty chemical business, logistics and service business

Figure 2.2 UPC Group Organization

Source: UPC Technology Corporation 2018

Figure 2.3 UN899 products and applications

Source: UPC Technology Corporation 2018

Figure 2.4 UN899 production capacity

Source: UPC Technology Corporation 2020

2.2.2 Vision and mission of UPC

UPC always makes a great effort to enhance in application research and new products innovation and development as to have been supported in reliable post- sales services The group aims at coming to be a whole service provider in

chemicals industry with “its belief that total customer satisfaction holds the key

to success, which in return gains confidence and trust from our customers”

2.2.3 Market share and revenue of UPC in 2017-2019

2.2.3.1 Market and sales overview

Table 2.1 UPC Group Revenue (2017-2019)

Source: UPC’s Sales & Marketing Department 2.2.3.2 The market share:

The main goods market is in Taiwan, Mainland China, and Southeast Asia The market share in China is around 25% and 20% for Southeast Asia

2.2.3.3 Business operation and market share of UPC in Vietnam

 Revenue in Vietnam 2017-2019

UPC expanded into Vietnam in early year 2015, but officially established

a presentative office in 2017 After landing in Vietnam successfully, UPC has been considered as the biggest raw materials for soft PVC industry or plasticizer supplier The most significant thing is that the yearly revenue increased in 2018, nearly double figure compared to 2017 However, there was a slight decrease in 2019

Table 2.2 Revenue in Vietnam market (2017-2019)

Source: UPC’s Sales & Marketing Department

Figure 2.5 DOP market share

Source: UPC’s Sales & Marketing Department

Figure 2.6 DINP market share

Source: UPC’s Sales & Marketing Department

Figure 2.7 DINCH/UN899 market share in Vietnam

Source: UPC’s Sales & Marketing Department

 Generally looking, UPC is the plasticizer supplier in Vietnam market for general plasticizers like DOP and DINP, but for green plasticizer DINCH/UN899, UPC has been still a follower Meanwhile, the non- phthalate materials are very potential, or they could be current and future alternative materials for soft PVC industry Therefore, UPC’s mission find the solution to improve promotional strategies in order to develop and maintain the market share in which UPC has been the best of all so far

2.3 Referential models and proposal research model

2.3.1 Referential models

Several research models and references are relevant to promotional mix

elements Firstly, one of the valuable researches collected in “The Role of

Advertising in Consumer Decision Making” (D Prasanna Kumar & K

Venkateswara Raju, 2013) for coming-out 3 observed variables The study pointed out any new product must create awareness and perception by its existence The second vital task should transmit fully enough information to purchasers The last one is to stimulate the buyer’s “desire –motivation – to satisfy his or her needs or wants by purchasing and repurchasing the product” According to Kotler & Armstrong, 2004, ‘Advertising whereby advertising can reach masses of geographically dispersed buyer at a low cost per exposure, it enables the sellers to repeat a message many times’ On the other hand, as Lee

at al., (2003) which addressed that total adverting expenditures have positive influence on the market entry studies For these views, we can find out that the primary goal of advertising aims at reaching prospective clients and impact on their awareness, perception, and opinion or purchasing behavior Since the consumers pay attention to advertising of a company’s products, it sends a purchaser a message of product information, then it enables to convince and lead the buyers to decide to purchase products Thus, advertising as a particularly important promotional tool in creating product awareness and controlling the mind of a potential consumer to take final purchase decision

Figure 2.8 The Role of Advertising in Consumer

Source: D Prasanna Kumar & K Venkateswara Raju, 2013

Second, according to Hawes et al., (1993), ‘consumers are increasingly turning to salespersons as a source of information and reliability.’ Furthermore, personal selling is word-of-mouth communication with potential purchasers of a product or a service with the intention of running sales The study also emphasized that the personal selling could begin to concentrate on relationship development for potential customers; however, still ultimately make a great effort to make the deal by impacting on potential customers into a purchase decision The findings of Soni Neha and Verghese Manoj in 2013 pointed out “sales promotion tools play significant role in consumer purchase decision”

Figure 2.9 Impact of Sales Promotion Tools on Consumer’s Purchase

Decision Research Model

Source: Soni Neha and Verghese Manoj, 2013

In accordance with Didem Yılmaz and Feyza Bhatti’s finding in 2017, the impact of Social Networking Site (SNS), Cause-Related Marketing (CRM) and Word of Mouth Marketing (WOM) on consumer's purchasing decisions for Avon cosmetic products in Istanbul, Turkey The research model presented as figure 2.10

Figure 2.10 The Impacts of Direct Marketing on

Consumer Purchasing Decision

Source: Adopted from Didem Yılmaz and Feyza Bhatti in 2017

Furthermore, the finding of Dr Iyad A Khanfar (Assistant Professor)

in 2016 examined ‘the effect of promotion mix dimensions (advertising, personal selling, sales promotion, public relations) on consumers buying decisions’

Figure 2.11 The effect of promotion mix dimensions

on Consumer Purchasing Decision

Source: Adopted from Iyad A Khanfar, 2016

2.3.2 Proposal research model

After referring such relevant findings or researches, it can be found that several researchers examined and studied different aspects of promotional activities that influenced purchase decision making, as well as inheriting theories and reality of business operation in UPC Technology Corporation as industrial firm Author proposed the research model, as shown in Figure 2.13

Figure 2.12 Theoretical Framework

Source: Synthesized by author

Basing on conception of direct marketing tool or previous study ‘The impacts

of direct marketing on consumer purchasing decision’ adopted from Didem

Yılmaz and Feyza Bhatti in 2017 In turn, consumer’s purchasing decision on UN899(DINCH) at UPC in Vietnam market as the following hypothesis:

 X1: There is a significant influence of Direct Marketing towards

Consumer’s Purchasing Decision at UPC’s UN899(DINCH)

Similarly, the influence of personal selling, sales promotion, and public relations on consumer’s purchasing decision at UPC’s UN899(DINCH) As

mentioned earlier for the previous study from Iyad A Khanfar, 2016 ‘The

effect of promotion mix dimensions on Consumer Purchasing Decision’ All these arguments propose the following hypothesis:

 X2: There is a significant influence of Personal Selling towards

Consumer’s Purchasing Decision at UPC’s UN899(DINCH)

 X3: There is a significant influence of Sales Promotion towards

Consumer’s Purchasing Decision at UPC’s UN899(DINCH)

 X4: There is a significant influence of Public Relation towards

Consumer’s Purchasing Decision at UPC’s UN899(DINCH)

Chapter 2 summary

The chapter comes along with the literature review of promotional concepts, the role of promotion for enterprise, consumers, and society There are five main tools of promotion: (1) advertising, (2) direct marketing, (3) personal selling, (4) sales promotion, (5) public relation or publicity In addition, it is the concept of industrial products and consumers’ purchase decision On the other hand, it run through the overview of UPC Technology Corporation and its products Furthermore, there are previous researches and models Lastly, the indispensable part is that the structural model is to define what influences

or effects of promotion mix towards buyer decision, it is proposed the research model and related hypotheses The next chapter presents the research design and study methods as well

Table 2.3 Summary of referential models

No Authors Titles Findings

Awareness and perception of purchasers were stimulated by

information of any products to buyers and getting their curiosity

or customers’ needs and wants for buying and re-buying

Purchase Decision towards White Good

No Aut

hors Titles Findings

3

Didem Yılmaz and

Feyza Bhatti (2017)

The Impacts of Direct Marketing Strategies on Consumers Purchasing Decision in Cosmetic Sector in Turkey

‘Social Networking Site (SNS), Cause-Related Marketing (CRM) and Word of Mouth Marketing (WOM) impacted on consumer's purchasing decisions for Avon cosmetic products in Istanbul, Turkey’ Or direct marketing influenced on purchase behavior with SNS, CRM, and WOM aids

It was impossible to deny the effect

of promotion tools (advertising, personal selling, sales promotion, public relations) on consumer

purchase decision Or Consumers

Buying Decisions of Mobile Service had positive relations with

promotional activities

Source: Synthesized by author

CHAPTER 3 RESEARCH DESIGN 3.1 Research methods

3.1.1 Qualitative research

In order to explore the factors of promotional activities that impact on buyer’s decision, the qualitative method is applicable In this stage, author proceed both group-interview and expert-interview

 Group Interview: select six presentative people who used UPC’s products including UN899 Interview duration is

30 minutes in interviewees’ office

 Expert Interview: select two managers of sales and marketing department, 1 R&D manager, and 1 accounting and financial manager those who have worked for UPC over five years The interview works out via telephone Interview duration is 15 minutes/ person

The study also referred the research model of Lambertus Danniel (2015), which showed that ‘promotion mix towards customer purchase intention, or ‘The Impact of Promotional Mix Elements on Consumers Purchasing Decisions’ (Mahmud.I Nour, et al.,2014) The interview questions or qualitative questions are referred from two previous research models above, they are quite open and exploring to find out the relationship between promotional activities and purchasing decision making After gaining the results of preliminary investigation with the combination of literature review and problem statement in the research, it helps to collect ideas, modify, and adjust the research model as well as give out the questionnaire form before official investigation The research has been completed in customers’ office (Binh Duong, Dong Nai) and UPC Vietnam office (Ho Chi Minh) on

(Appendix 1 and Appendix 2) The experts all have their own

viewpoints: but the final the result of discussion unify and identify the official scale as below:

 Direct marketing of UPC:

+DM1 Once visiting UPC’s website by chance, it leads to me/us to find out and decide to purchase UN899(DINCH)

+DM2 I/we have got email of UN899 introduction and brochure in my office +DM3 I/we have got email or messages of UPC new products and R&D technology support

+DM4 I/we have got to know UPC new products via partners and friends +DM5 I/we could get complete information of UPC’s products once visiting UPC company website

For the scale of direct marketing, Mr Wei-ting Wu suggested that it should

be added one more statement to strengthen this scale and statement as below: +DM6 I/we purchase a product of UPC after finding out the product on the internet

 Personal selling:

+PS1 UPC sales staff are gentle and kind communication to offer products +PS2 I/we have got most feedback and concern when sending questions to UPC sales staff

+PS3 UPC sales staff provide all information of products that I/we require +PS4 I/we highly appraise the specialized and professional skills of UPC sales staff

+PS5.Information provided from UPC sales staff increase my/our level of understanding and highly influence in purchasing decision

As several years and represented as a director of ASEAN market Mr Wu,

Wei-ting proposed the statement “PS6.I am/we are likely to purchase a

product after seeing demonstration of the product being used” for personal selling, which can have a better study and more actual practice in industrial goods selling

+SP3 I/we have got special payment term by being UPC’s long term partner (E.g., TT30, DP, LC90, etc.)

+SP4 Free “overseas tour and visit factory site tour” for partners who have been purchasing UPC’s goods

+SP5 Loyalty discounts stimulate and encourage my/our regular purchase habit

Also, for sales promotion tool, Mr Wu highly recommended the statement

“SP6 I/we purchase UPC’s products more often if there are more promotions

or special favored policy to my/our enterprise” to modify for the scale of the study

+PR4 UPC is one of sustainable developing producers for raw materials in

“going green” trend

For this aspect, Mr Midas Yu highly recommended two statement to modify for the study They are “PR5 Comparing with other suppliers, UPC provides me/us reasonable price with good quality” and “PR6 I/we regularly get invitation of UPC launched new goods”

 Purchase decision:

+PD1 I/we decide to purchase UN899(DINCH) for competitive price +PD2 I/we choose UN899(DINCH) for good delivery time and payment term

+PD3 My/our expectation UN899(DINCH) that I/we get from UPC is the same as a result I/we satisfied by the product

+PD4 I/we entrust and choose UPC’s goods to build up close business relationship for special policy and warranty

+PD5 I/we only buy UPC’s good when our customers appoint UPC’ materials

+PD6 I/ We decided to purchase UN899(DINCH) as non-phthalate materials and safe for body-contacted one

After deeply interviewing many experts and directors, the scale of study for purchasing decision activities, it should be added the following statement:

“PD7 Types of products that I/we want are available in UPC”

3.1.2 Quantitative research

3.1.2.1 Sample size

 There were 200 respondents who are UPC’s clients The questionnaire was referred to the previous researches and literature review Author uses the papered- question form and online question form to get respondents’ answers The questionnaires include two parts; the first one is demographic factors of the respondents These factors are profession type, business revenue, purchasers’ work-experienced, and application status The second part of the questionnaires comprises independent factors such as direct marketing, personal selling, sales promotion, and public relations The third one is the dependent factor –consumer purchasing decisions This study used a Likert scale to measure independent and dependent factors, which widely applied for both marketing and social science Burns & Bush (2002)

This research uses Cronbach’s Alpha to scale the reliability of each independent variable and independent variable Besides, the Exploratory Factor Analysis (EFA) to identify the convergent validity and discriminant one for each observed variable It means that the minimum sample size ought to be 50 at least and preferably 100 observations is recommended (Hair et al 2006), it means 5 cases/ observations, or one observation must

at least have five samples (Nguyen Dinh Tho, 2011) After qualitative research, the research model has 24 observations of promotional elements and 7 observations of purchasing decision Thus, this research has 31 observations, the sample size N= 31x5=155

3.1.2.2 Research process summary

The research is undertaken through two steps that are preliminary survey and official one The author combines qualitative method and quantitative one

Table 3.1 Research process summary

3.2 Research framework

3.2.1 Research Procedure

The research will proceed as the following stages:

Figure 3.1 Research Framework

Source: Synthesized by author

3.2.2 Measurement of official scales

The official scale development based on the literature review in chapter 2, and previous research (Mahmud I Nour, et al.,2014), as well as the result of qualitative research in this study included direct marketing, personal selling, sales promotion, public relation, and customer purchase decision Each variable was measured on 5-points Likert-type scales with five levels; they are 1=strongly disagree, 2=disagree, 3= neutral, 4=agree, and 5= strongly disagree

Table 3.2 Measurement scales

Observed variables References/ Sources

Direct Marketing

DM1 Once visiting UPC’s website

by chance, it leads to me/us to find

out and decide to purchase

UN899(DINCH)

Adopted and adapted from Jo and Kim (2003)

DM2 I/we have got email of UN899

introduction and brochure in my office

Adopted and adapted from Jobber (2007)

DM3 I/we have got email or messages

of UPC new products and R&D

technology support

Adopted and adapted from Jobber (2007)

DM4 I/we have got to know UPC new

products via partners and friends

Adopted and adapted from David Yoon Kin tong, Kim Piew Lai, Xue

La Tong (2012) DM5 I/we could get complete

information of UPC’s products once

visiting UPC company website

Adopted and adapted from Jo and Kim (2003)