Summary of dissertation: Consumer behaviors and the marketing mix of mobile enterprises in Vietnam

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Research purposes: On the one hand, the research investigates the consumer behavior model, and the external and internal factors of the consumer’s “black box” that have impacts on the consumer’s behavioral intentions towards mobile services. On the other hand, based on theresults of the investigation of the Vietnamese consumer behaviors, the research provides an analysis of the orientation of the marketing mix employed by the Vietnamese mobile enterprises over the past time and proposes a new orientation to these enterprises for thecoming time.

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MINISTRY OF EDUCATION AND TRAINING NATIONAL ECONOMICS UNIVERSITY THIS DISSERTATION WAS ACCOMPLISHED AT THE NATIONAL ----- ECONOMICS UNIVERSITY Supervisors: 1. Prof. Dr. Luong Xuan Quy CHU TIEN DAT 2. Assoc. Prof. Dr. Luu Van Nghiem Critic 1: CONSUMER BEHAVIORS AND THE MARKETING MIX OF MOBILE Critic 2: ENTERPRISES IN VIETNAM Critic 3: MAJOR: BUSINESS ADMINISTRATION (MARKETING) This dissertation shall be defended before the State-level Dissertation Assessment CODE: 62.34.01.02 Council convening at the National Economics University, Hanoi, at …, on … 2014 This dissertation can be found at: SUMMARY OF DISSERTATION 1. The National Library IN BUSINESS AND MANAGEMENT 2. The National Economics University Library HANOI, 2014 1 2
Despite the appearance of new services such as value-added services, the ARPU has CHAPTER 1: INTRODUCTION continued to decrease. The present ARPU is 4.5 US dollars per subscriber. This is partly 1.1 The urgency of the dissertation due to discounts and other promotion programs. 1.1.1 In theory There has not much change in the market share. The three largest market share holders There have been many studies on consumer behaviors in the field of mobile are Viettel, Vinaphone, and Mobifone. telecommunications throughout the world. However, most of these studies have addressed As the result of slow-growth market and low ARPU, the big service providers in only one aspect of consumer behaviors, examining the impact of the external or internal Vietnam have focused on safeguarding the market, furthering the intensive development via factors of the consumer’s “black box” or technology on consumer behaviors. Almost none the promotion of value-added services, continuously paying attention to pre-paid customers, of them have provided an overall examination of external and internal factors that may have and focusing more on post-paid ones. Enterprises with much potential are looking towards effects on behaviors consumers. the overseas market. In Vietnam, there have not been many studies on mobile services, especially on 1.3 Research purposes and tasks consumer behaviors towards these services. There are two reasons for this shortage. On the 1.3.1 Research purposes one hand, not many enterprises have been licensed to trade in these services. On the other On the one hand, the research investigates the consumer behavior model, and the hand, due to the recent slow-growth market, the mobile enterprises have started to develop external and internal factors of the consumer’s “black box” that have impacts on the intensively, retaining customers and paying more attention to them, instead of developing consumer’s behavioral intentions towards mobile services. On the other hand, based on the extensively with the focus on increasing subscribers. results of the investigation of the Vietnamese consumer behaviors, the research provides an 1.1.2 In practice analysis of the orientation of the marketing mix employed by the Vietnamese mobile 1.1.2.1 Mobile enterprises are recommended to start with a good understanding of enterprises over the past time and proposes a new orientation to these enterprises for the customers to have appropriate strategies for a reasonable distribution of their limited coming time. resources to both marketing and technology developing activities. 1.3.2 Research tasks Mobile telecommunications is a service industry that is greatly affected by technology. To achieve the afore-mentioned purposes, the research is supposed to fulfill the If mobile enterprises pay too much attention to marketing and sales activities without following tasks: developing technology, they will unavoidably fail. On the contrary, if they only focus on - Synthesize and systematize the concepts, contents, and theories on consumer behaviors, developing technology without any care about customers’ needs, they are more likely to the marketing mix, and the role of the research on consumer behaviors in the building of end with failures. In the present-day competitive environment, enterprises should have a the marketing mix; thorough grasp of consumers’ needs, intentions, behaviors, and attitudes in order to build - Examine and assess the fundamental models of theory and the research models of the appropriate strategies with limited resources. preceding studies on mobile consumer behaviors; work out a research model involving 1.1.2.2 The Vietnamese mobile market has nearly reached a saturation point in terms of both internal and external factors affecting mobile consumers in Vietnam, based on the subscribers in the transitional period from extensive development to intensive development. analysis of the preceding studies and the real situation of the Vietnamese mobile market; The slow-growth market and low ARPU, which is only one-fourth of the regional - Investigate, study, and analyze consumer behaviors, as well as the internal and external ARPU, require that the enterprises should shift the focus of competition, paying more factors’ levels of impact on Vietnamese mobile service consumers; attention to customers. It is because paying attention to customers and retaining them are - Synthesize and analyze the marketing mix employed by the Vietnamese mobile the best choice when it is difficult to gain new customers. Paying attention to customers is enterprises in the past five years; investigate how these enterprises distribute their also the most feasible way to increase the ARPU. In general, the enterprises should have resources to each marketing mix tool, corresponding to the external factors in the afore- appropriate strategies to best satisfy their customers’ needs, retain their customers, and mentioned research model; increase their ARPU. - Propose an orientation for strategies and solutions on marketing mix to mobile 1.2 The context of the Vietnamese mobile market enterprises, based on the results of practical analysis and those of the research on behaviors and factors affecting the Vietnamese consumer behaviors. The market growth has gradually slowed down for the last few years. 3 4
1.4 Subjects, objects, and scope of research 1. The dissertation provides an overall review of external and internal factors affecting 1.4.1 Subjects and objects of research behavioral intentions, as well as consumer behaviors in relation to the marketing mix. The subjects of research include the behaviors of Vietnamese mobile consumers and the 2. The dissertation investigates the switching cost’s impact on consumer behaviors. marketing mix of Vietnamese mobile enterprises. 3. The internal factors, or characteristics, of the consumer’s “black box” are used not only The objects of research include mobile service consumers in Vietnam and mobile as independent variables to study their effects on consumer behaviors, but also as enterprises which have operated in Vietnam since 2008 (including Mobifone, Vinaphone, controlled variables to examine the impacts of external factors on consumer behaviors Viettel, EVNTelecom, Vietnammobile, Sphone, and Gmobile). with corresponding characteristics. Specifically, the research addresses the following issues: 4. With regard to the quality, this dissertation presents a clear delineation and separation between the basic service quality and the value-added service quality. Regarding the • The real situation of the Vietnamese mobile market; switching cost, this dissertation draws a distinction between its two component factors: • Theoretical background on consumer behaviors, the marketing mix, and the building the switching cost and difficulties due to consumers’ fear of changing their mobile of the marketing mix based on the research on consumer behaviors; numbers when switching mobile service providers. • The external and internal factors affecting the behaviors of Vietnamese mobile 5. Results of analyzing the collected data show some new points in the Vietnamese service consumers; consumer behaviors towards mobile services as follows: • The real situation of the marketing mix, and the strengths and weaknesses of the • In terms of internal factors or characteristics, Vietnamese consumers can be marketing mix used by the Vietnamese mobile enterprises. classified into four groups corresponding to four basic characteristics, including: 1. 1.4.2 Scope of research Novelty-fashion consciousness; 2. Quality consciousness; 3. Use-value The research is restricted to: (1) mobile service customers in Vietnam and (2) mobile consciousness based on the balance between benefits and costs; 4. Habitual shopping. enterprises in Vietnam (7 enterprises). Among them, the characteristics 1, 3, and 4 have direct effects on consumer The research focuses on the following contents: (1) factors affecting the customer’s behaviors. behavioral intentions and their levels of impact, including the specific characteristics— • In terms of external factors, such factors as corporate image, after-sales—customer internal factors of the consumer’s “black box” and external factors related to the marketing care services, basic service quality, switching cost, service price, and value-added mix such as corporate image, perceived service quality, perceived price, perceived service quality have effects on consumer behaviors. promotion, and perceived switching cost; (2) the marketing mix employed by the Vietnamese mobile enterprises, the real situation, and some suggestions. 1.6.2 Practical contributions—new proposals of the dissertation Research schedule: The theoretical study, the analysis of statistical reports, and the 1. The dissertation defines the customer’s future behaviors (behavioral intentions) towards investigation of reality were conducted in five years, from 2008 to 2013. Sociological mobile services, as well as external, internal and demographic factors and their levels of survey activities were carried out within two months, starting in May 2013, to ensure the impact on the consumer’s behavioral intentions. topicality of the research. 2. The dissertation suggests the Vietnamese mobile enterprises change the orientation of 1.5 Research methodology their marketing mix, from distributing resources according to the priority: promotion, The dissertation uses a combination of different methods for analysis, comparison, discount, quality, corporate image, and after-sales—customer care services services, to synthesis, statisticalization, description, evaluation, and investigation, with the employment distributing resources according to the priority: corporate image, after-sales—customer of different tools such as questionnaires. Specifically, the dissertation uses three main care services, basic service quality, service cost, and value-added service quality. The methods: (1) analyzing and synthesizing secondary data, (2) interviewing specialists, and tool of promotion should be used reasonably by enterprises. (3) conducting sociological surveys. 3. It is suggested that Vietnamese mobile enterprises should segment the market according 1.6 Contributions of the dissertation to the four internal factors (characteristics) of the consumer, each with a corresponding 1.6.1 Theoretical contributions marketing mix in conformity with consumer behaviors. 5 6
4. The fear of changing mobile phone numbers when switching service providers has a 2.2.1 Consumer behaviors direct impact on the consumer’s behavioral intentions. To guarantee the consumer’s Consumer behaviors, as defined by Philip Kotler (1999), are specific behaviors that a interests and improve the mobile enterprise’s competitive ability, it is reasonable for the consumer displays in searching for, purchasing, using, evaluating, and disposing of State management bodies to apply the MNP policy that has been implemented in over products and services that they expect will satisfy their needs. 70 countries in the world. Figure 2.3 Kotler’s model of consumer behaviors (2004) 1.7 Structure of the dissertation Apart from tables, diagrams, figures, abbreviations, references, and appendices, the Marketing Customer’s Customer main contents of the dissertation are divided into five chapters as follows: and Other “Black Box” Responses Stimuli - Chapter 1: Introduction - Chapter 2: Literature review According to Kotler (2004), the stimuli, after entering the customer’s “black box,” will - Chapter 3: Research methodology cause customer responses. These responses include: choosing goods-services, choosing a - Chapter 4: Research results brand, choosing an enterprise, and choosing the purchase amount. - Chapter 5: Proposal of marketing strategies 2.2.2 Marketing mix The traditional marketing mix for goods includes four so-called Ps: product, price, place and promotion. According to Luu Van Nghiem (2008), the marketing mix for services, with their own characteristics, includes seven Ps. Besides the four Ps of the traditional marketing CHAPTER 2: LITERATURE REVIEW mix, these seven Ps also include people, process, and provision of customer services. 2.1 Overview of mobile services-networks According to Truong Dinh Chien (2012), in order to satisfy the customer’s needs and 2.1.1 Mobile services thereby maximize the enterprise’s profits, the enterprises should develop effective Mobile services are two-way radio information services that allow their subscribers to marketing mix strategies with major groups of measures including decisions on services use different forms of telephone and non-telephone services within the coverage of service (products), decisions on price, decisions on the provision of customer services, and providers. decisions on marketing. These four groups of decisions are called 4 Ps for short. Mobile services are always associated with mobile networks. This is true to this 2.2.3 The building of the orientation of marketing mix based on the research on dissertation. consumer behaviors 2.1.2 Technical characteristics of the mobile network in relation to marketing mix According to Vu Huy Thong (2010), consumer behaviors have a significant impact on - The element P on process does not play a big role in the provision of services because marketing strategies, including the marketing mix. On the one hand, on an overall scale, the this process is standardized. knowledge of consumer behaviors is considered as the starting point for the proposal of - The element P on people has a minor part in the provision of services since people are marketing strategies and tactics, including those for marketing mix. On the other hand, the not directly involved in the provision of services. knowledge of consumers helps enterprises find answers to the basic questions when - Regarding the element P on services, the service quality and the service quality gap forming marketing strategies for each specific market, and enables them to provide between network operators are mainly reflected in their investment in the audio section. products and services to satisfy the customer’s specific needs. - Technology affects all the Ps of the marketing mix. However, its effects are found 2.3 Overview of research on the behaviors of mobile service consumers mainly on the two Ps: services and service prices. Changes in technology not only bring 2.3.1 Research in Vietnam about further improvements in service quality and strong decreases in service prices, but In Vietnam, there have been few intensive studies on consumer behaviors in the field of also sometimes lead to basic changes in the nature of services. mobile services, especially those in association with marketing mix. 2.2 Consumer behaviors and the building of the marketing mix based on consumer The preceding studies on marketing in the field of mobile services have mainly focused behaviors on researching an aspect of mobile services (such as telephones), or examining consumer 7 8
satisfaction or loyalty to mobile services. Regarding studies on consumer behaviors in other 2.3.2.3 Research on consumer behaviors according to the Euro-American school fields, many of them have clear theoretical foundations. However, due to the big differences The European-American school examines the relation between external affecters, such in studied services, they are used in this dissertation as references only. In general, most of as perceived quality and satisfaction, on service purchase behaviors. these studies have not shown an overall examination of internal and external factors that This approach has several limitations. First, it has just examined the external affecters have effects on consumer behaviors. and has not studied thoroughly the internal factors of the “black box.” Second, regarding 2.3.2 Research in the world the external affecters, it has just focused on studying perceived quality and has not 2.3.2.1 Theoretical model of consumer behaviors addressed the others such as price and corporate image. Last, with regard to the switching cost, it has just examined the opponent’s attraction in terms of price. According Philip Kotler (2004), the stimuli (or affecters) affect the consumer’s “black box” and cause certain responses—consumer behaviors. 2.3.2.4 Research on consumer behaviors according to the Asian school In comparison with studies in the Euro-American school, the recent studies at some Asian Marketing Environmental Consumer’s “black box” Customer markets have been conducted in the approach of adding the concept of “provider switching stimuli stimuli responses cost.” This concept refers to the following situation: when a customer is not satisfied with the - Products/ - Economic Consumer’s Decision- -Selecting services he is being offered and wishes to change to other services, he will have to bear many services - Scientific- characteristics making products/services costs (including financial, psychological, and social costs) and other risks. - Price technical process - Selecting a brand 2.3.2.5 Some other consumer behavior research models - Provision - Political/legal - Selecting a provider Many studies have been conducted in the direction of considering mobile services as - Promotion - Competitive high-tech services and investigating how consumers respond to these services. These - Selecting the purchase amount studies are based on the following theories and models: - Selecting the time - Theory of Reasoned Action (TRA): behavioral intentions are influenced by individual and place of attitudes and subjective norms; purchase - Theory of Planned Behavior (TPB): originating from the limits of behaviors under little human control; This overall model shows that there are two approaches to the research on consumer behaviors: research on the impacts of the internal factors of the consumer’s “black box” on - Technology Acceptance Model (TAM): featuring the causal relationship between consumer attitudes, behavioral intentions, and behaviors in reality; consumer behaviors and research on the impacts of external marketing stimuli. - Unified Theory of Acceptance and Use of Technology (UTAUT), featuring the impacts 2.3.2.2 Research on consumer behaviors based on the consumer’s “black box” of four main factors on behavioral intentions and behaviors, namely expected efficiency, It is very complicated and costly to study all the factors that affect the afore-mentioned expected effort, social influence, and material conditions; “black box.” Therefore, instead of studying the internal factors of the “black box”, - The combination of TAM and TPB. researchers have focused on investigating the possible output of the “black box.” The CSI 2.4 Proposed research model was first developed by Sproles and Kendall (1986 & 1987) for this purpose, and has been applied and adjusted by many researchers. Accordingly, there are seven consumer decision- This dissertation aims at an overall investigation of consumer behaviors towards mobile services, as well as a comprehensive examination of the external factors of the marketing making styles as follows: perfectionism/high quality consciousness, brand consciousness, mix, the internal factors of the consumer’s “black box”, and the impacts of these factors on fashion-technology consciousness, factor balance and synthesis consciousness, price the consumer’s planned behaviors—behavioral intentions. To reach this goal, the researcher consciousness, confusion by over choice, and brand loyalty. has proposed a working research model for this dissertation. This approach has been used by researchers to examine consumer behaviors in different This research model focuses on behavioral intentions and factors affecting behavioral countries. For example, it was used by Durvasula (1996) and Fan and Xiao (1998 & 2001) intentions for the analyses of and recommendations on marketing mix to mobile enterprises. for their research in China, Mitchell and Bates (1998) in Britain, Wang (2004) and Song According to TRA, TPB, TAM, and UTAUT, the behavioral intention is the only factor that (2011) in China, and Hunjra (2012) in India. has a direct impact on the consumer behavior in reality. As a result, many studies that apply these models and theories have focused on examining behavioral intentions, instead of 9 10
consumer behaviors. Besides, with reference to the reality of production and business, and CHAPTER 3: RESEARCH METHODOLOGY the relationship between customer behaviors and corporate strategies, the grasp of customer 3.1 Research process intentions and needs plays a more important role than the grasp of customer behaviors in The research process involves the following steps: (1) Study theoretical background; (2) the building of appropriate corporate strategies. Technically, a behavioral intention is an Build the theoretical framework, research model, and hypotheses; (3) Consult specialists individual’s tendency leading to a specific practical behavior. It is the major determinant of a practical behavior that is about to occur. Therefore, in many cases, it is more important to (intensive interview); (4) Create a pilot questionnaire and conduct a pilot investigation; (5) investigate behavioral intentions, or possible behaviors, than behaviors (actions that have Develop official measurement scales and build the official questionnaire; (6) Carry out a happened or are going on). This is especially true to predictive studies or studies that aim to sociological survey with the questionnaire; (7) Run Cronbach’s alpha tests and conduct find out solutions to a problem (according to Ajzen, 1985; Ajzen & Fishbein, 1980; Yi, exploratory factor and linear regression analyses; (8) Analyze the situation of the Jackson, Park, & Probst, 2006, cited in Kuo, 2008). orientation of the marketing mix employed by the mobile service enterprises in Vietnam in Demographic factors the period of 2008–2013 by analyzing and synthesizing secondary data; (9) Make recommendations on the orientation of marketing mix Perceived quality 3.2 Data collection methods Perceived promotion Secondary data is collected from reports by the Vietnam Ministry of Information and Communications, reports on market analysis by foreign organizations such as BMI, reports Perceived price Behavioral intention by enterprises, and preceding studies. Corporate image Primary data is collected via questionnaires, which are administered to randomly Switching cost selected households in five cities and provinces of Vietnam. Electricity bill collectors in Hanoi, Ho Chi Minh City, Hue, Ninh Binh, and Binh Duong are involved in this research as Consumer decision-making style investigators. They are given instructions on how to assist informants in filling the questionnaire. Type 1 Type 2 Type 3 Type 4 Type 5 Type 6 Type 7 3.3 Intensive interview—qualitative research The intensive interview is designed to (1) test and filter the research model and the 2.5 Research hypotheses factors affecting consumer behaviors in this research model and (2) analyze the situation of H1: The external marketing mix factors have positive impacts on the behavioral the orientation of the marketing mix employed by the Vietnamese mobile service intentions of mobile service consumers in Vietnam. enterprises in the period of 2008–2013. H2: The external marketing mix factors have different levels of impact on the behavioral The participants in this intensive interview are divided into three main groups: (1) intentions of mobile service consumers in Vietnam. specialists in the fields of marketing and marketing research, (2) State administrators in the H3: The internal factors of the consumer’s “black box” (consumer characteristics) have field of telecommunications, and (3) mobile enterprise administrators. impact on the behavioral intentions of mobile service consumers in Vietnam. 3.4 Quantitative research H4: The internal factors (corresponding to consumer decision-making styles or 3.4.1 Research design consumer characteristics) have different levels of impact on the behavioral intentions of Stage 1: Test the research model and questionnaire with the intensive interview. mobile service consumers in Vietnam. Stage 2: Conduct the pilot investigation. H5: The external factors (corresponding to each group of customers with its own Stage 3: Conduct the official investigation. This dissertation uses the sociological survey decision-making style or characteristic) have different levels of impact on the behavioral and quantitative research methods with the research tool of questionnaire and the sample intentions of mobile service consumers in Vietnam. size of 860 participants. H6: The demographic factors create differences in the behavioral intentions of mobile 3.4.2 Questionnaire design service consumers in Vietnam. 11 12
To investigate the Vietnamese consumer decision-making styles, this dissertation uses CHAPTER 4: RESEARCH RESULTS the shortened version of CSI with 16 five-level Likert items that are developed by A. RESULTS OF THE ANALYSIS OF CONSUMER BEHAVIORS researchers Sproles and Kendall (1986 & 1987). 4.1 Survey data analysis Other scales are also used for other factors. They include Konuk (2012)’s scale for the Of 860 collected responses, 711 are valid for statistical analysis. behavioral intention with 4 items; Kim, Park, and Jeong (2004)’s scale for the switching 4.1.1 The sample’s demographic features and use of mobile services in reality cost with 5 items; Kim et al (2004)’s scale for the perceived service quality with 8 items; It is shown by the results of statistical analysis that there is no noticeable difference Tung (2011)’s scale for the perceived promotion with 3 items; Nguyen and Lebland between the sample and the general research subjects in terms of demographic features and (1998)’s scale for the corporate image with 4 items; and Koi-Akrofi (2013)’s scale with 4 the actual use of mobile services. items. In terms of purposes and motives, the majority of respondents use mobile services for 3.4.3 Sampling basic needs such as making and receiving calls and sending text messages. Besides these The research subjects are customers using mobile services throughout Vietnam. basic services, others such as accessing the Internet and joining online communities are Regarding the sample size, according to Hoang Trong and Chu Nguyen Mong Ngoc, the attracting more and more users. number of research participants (sample size) should be at least four or five times bigger 4.1.2 Consumer behavioral intentions towards mobile services than that of research variables. The questionnaire includes 50 variables, so the minimum With regard to the behavior of changing service providers, only 5.3% of respondents sample size for this research according to this formula should be 250. However, the will probably change their main service providers (the first SIM card in case of two SIM research uses stratified random sampling, so if the sample size is too small, the collected cards in use) in the next twelve months. Among this group, 0.8% will definitely make the information will not be enough for analysis. Moreover, the bigger the sample size is, the change. On the contrary, up to 78.4% of respondents will not change service providers in more reliable the research results are. Therefore, the research is administered to a sample the same period of time. About 20.3% of this group will surely make no change. size of 860 to increase the validity and reliability of the research results. With regard to the behavior of recommending the services they are using to their friends 3.4.4 Sampling method and relatives, 48.3% of respondents will do while only 12.7% will not. The research uses convenience sampling in combination with stratified sampling, so that With regard to the behavior of speaking well of their service providers, 45.4% of the selected samples are representatives of mobile service users both in urban and rural respondents agree while only 8.5% disagree. areas, big and small cities and provinces. 4.1.3 Analysis of research model based on collected data Accordingly, via the Electricity and Telecommunications Payment Solutions Joint Stock 4.1.3.1 Analysis of external factors affecting consumer behavioral intentions Company, the member companies and collection agencies of the Vietnam Electricity Group After three times of analyzing factors and rejecting variables with unsuitable (EVN), and the provincial branches of the Vietnam Posts and Telecommunications Group transmission coefficients, the researcher extracted seven significant factors from five (VNPT), the researcher contacts the collection sections of VNPT in five big cities and original ones. These factors are renamed herein as follows: (1) perceived switching cost, (2) provinces (Hanoi, Hue, Ho Chi Minh City, Ninh Binh, and Binh Duong) and administers perceived value-added service quality, (3) perceived corporate image, (4) perceived service the investigation to 860 households in these places. price, (5) perceived basic service quality, (6) perceived promotion, and (7) perceived 3.4.5 Data processing method inconvenience when changing mobile numbers. These new factors also have valid Cronbach’s alpha coefficients. This dissertation uses the SPSS 16.0 version for the analysis of collected data. 4.1.3.2 Analysis of internal factors (decision-making styles) affecting consumer behavioral 3.5 Secondary data analyzing and synthesizing method intentions This method is used in the stage of studying theoretical background and designing the It is shown by the results of three times of analyzing internal factors affecting consumer research model via the analysis and synthesis of information collected from preceding behavioral intentions towards mobile services that only four factors are extracted after studies. rotating the original ones. These factors are renamed herein as follows: (1) fashion- More importantly, the secondary data analyzing and synthesizing method is used in technology consciousness, (2) service quality consciousness, (3) service price combination with intensive interview to analyze the real situation of the mobile market in consciousness, and (4) habitual shopping. Vietnam. 13 14
These newly-extracted factors also have valid Cronbach’s alpha coefficients. YDHV = 1.391 + 0.13*KieuF1R + 0.208*Kieu3R + 0.261*KieuF4R 4.1.3.3 Factor analysis of behavioral intentions The three decision-making styles that have positive impacts on consumer behavioral Results of factor analysis reveal that there is no change in the measurement scale for intentions are listed in ascending order of impact as follows: fashion-technology behavioral intentions, so the only factor in the old scale can be reused. consciousness (variable KieuF1R); service value consciousness based on the balance 4.1.3.4 Modified research model according to actual survey between benefits and costs (variable KieuF2R); and habitual shopping (variable KieuF4R). The initial research model was designed to examine the effects of five external factors 4.1.6 Analysis of the effects of external marketing factors on the behavioral intentions of and seven internal factors of the consumer’s “black box” (equivalent to seven decision- each consumer style making styles) affecting consumer behaviors. After conducting factor analysis and scale In order to categorize consumers, researcher Sproles and Kendall (1986 & 1987) testing, however, the researcher decided to increase external factors, from five to seven, and developed the CSI instrument with the use of 16 five-level Likert items. Accordingly, for decrease internal factors, from seven to four. Here is the modified research model: each decision-making style, if a respondent has the mean value of his/her responses at 4 Demographic factors points and above then he/she will belong to that style. Table 4.38: Vietnamese consumer decision-making styles Corporate image Fashion- Quality Price-value Habitual Basic service quality technology consciousness consciousness shopping Behavioral consciousness Perceived promotion Mean value 3.013 3.895 3.745 3.592 intention Number 123 407 429 333 Perceived price Density 17.30% 57.24% 60.34% 46.84% Value-added service quality Results of linear regression analysis show reveal that the external factors have positive Switching cost effects on consumer behavioral intentions. These factors are listed in descending order of Switching barrier impact in the following table: Order Fashion- Quality Price-value Habitual All Consumer decision-making style of technology consciousness consciousness shopping consumers Type 1 Type 2 Type 3 Type 4 impact consciousness 1 Value-added Corporate Corporate Corporate Corporate service quality image image image 4.1.4 Linear regression analysis of the effects of external factors on consumer behavioral 2 Promotion Switching cost Service price Switching cost Switching cost intentions towards mobile services 3 Difficulties in Value-added Basic service Basic service Basic service changing service quality quality quality quality As the result of two times of multiple linear regression analysis, factors affecting numbers when behavioral intentions are presented in descending order of influence as follows: perceived switching providers corporate image, perceived switching cost, basic service quality, perceived difficulties 4 Provider image Service price Switching cost Value-added Difficulties in arising due to the change of mobile numbers when switching network, perceived price, and service quality changing numbers when value-added service quality. switching YDHV = 0.362 + 0.148*CLCoBan + 0.091*CLPhu + 0.135*CPCM + providers 5 Basic service Difficulties in Difficulties in Service price 0.096*CPDoiSo + 0.113*GiaCN + 0.315*HADN quality changing changing 4.1.5 Linear regression analysis of internal factors of the consumer’s “black box” on numbers when numbers when switching switching consumer behavioral intentions towards mobile services providers providers Results of two times of linear regression analysis show that only three internal factors 6 Basic service Value -added quality service quality (consumer decision-making styles) have direct impacts on consumer behavioral intentions with the following regression equation: 15 16
4.1.7 Tests of differences between demographic groups in their behavioral intentions in the descending order of priority as follows: promotion, price, service quality, image building— towards mobile services communications and popularization, the building and development of sales channels, and after- The t-test is used to test the differences between the two gender groups. For other factors sales—customer care services. with three sample groups and above such as age, income, and academic standard, the CHAPTER 5: PROPOSAL OF MARKETING STRATEGIES ANOVA (analysis of variance) test is used. 5.1 About the orientation of marketing mix The test results show that there is no difference in behavioral intentions according to 5.1.1 The orientation of marketing mix in relation to the Vietnamese consumer behaviors gender, income, and academic standard. Long-term strategy for businesses: The Vietnamese mobile telecommunications Pre-paid subscribers have more positive behavioral intentions than post-paid ones. The businesses should focus on intensive development instead of extensive development, younger the subscribers are, the more positive their behaviors towards their service improving their prestige, brands, sales, and profits through the enhancement of their providers are. Subscribers in the retired/housewifely group have more negative behaviors customers’ satisfaction and loyalty. than those in other groups. It is seen from preceding countries’ experience that, the cost for attaining a new No. Hypothesis Result customer is five times as much as that for retaining an old one, while revenue from the 1 The external marketing mix factors have positive impacts on the behavioral Accepted former is only one-third of that from the latter (Kim et al. 2004; Kim, 2010). On the whole, intentions of mobile service consumers in Vietnam. there are two types of subscribers that mobile enterprises can develop: new subscribers 2 The external marketing mix factors have different levels of impact on the Accepted (students) and subscribers from other mobile networks. Both types have low ARPUs, and behavioral intentions of mobile service consumers in Vietnam. the costs for attaining them are high. They are also subject to changing networks. They are 3 The internal factors of the consumer’s “black box” (consumer characteristics) Accepted easily acquired, so they are easily lost. Therefore, mobile enterprises should concentrate on have impact on the behavioral intentions of mobile service consumers in long-term development, instead of new subscriber development. Vietnam. 4 The internal factors (corresponding to consumer decision-making styles or Accepted It is also advisable for mobile enterprises to enhance the development of value-added consumer characteristics) have different levels of impact on the behavioral services, after-sales—customer care activities, and care to loyal subscribers (especially intentions of mobile service consumers in Vietnam. post-paid ones). 5 The external factors (corresponding to each group of customers with its own Accepted The orientation of marketing mix: Based on the reality of consumer behaviors and decision-making style or characteristic) have different levels of impact on the factors affecting consumer behaviors, it can be said that the mobile enterprises’ marketing behavioral intentions of mobile service consumers in Vietnam. mix for resource allocation in such a descending order of priority (from promotion to price, 6 The demographic factors create differences in the behavioral intentions of Accepted quality, communications and popularization, network expansion, and customer care) at the mobile service consumers in Vietnam. present time is inappropriate. To match Vietnamese consumers’ behaviors and aspirations and thereby improve their B. RESULTS OF THE ANALYSIS AND SYNTHESIS OF DATA ON THE MARKETING production and business efficiency, the Vietnamese mobile enterprises should allocate their MIX OF THE VIETNAMESE MOBILE ENTERPRISES IN THE PERIOD OF 2008–2013 resources to the marketing factors in descending order of importance and impact as follows: 4.2 Analysis of the marketing mix of the Vietnamese mobile enterprises in the period corporate image (including communications and popularization, distribution channels, and of 2008–2013 service quality), after-sales—customer care services, basic service quality, service price, Regarding the business strategy, the Vietnamese mobile enterprises before 2012 mainly and value-added service quality. Specifically, in terms of marketing mix, the Vietnamese focused on widening the market and increasing subscribers and disregarded the retaining of mobile enterprises should: subscribers. - Change their focus from short-term and unsustainable development through discount Regarding the marketing mix strategy, the Vietnamese mobile enterprises in the same period and promotion to long-term and sustainable development via the building of their simultaneously implemented the marketing mix tools, at appropriate points of time, to achieve corporate image—a corporation or enterprise with high prestige, good brand name, high their business goals in general and their marketing goals in particular. Different enterprises might quality, professional staff, and regular presence in and contributions to the community; promote different Ps; however, on the whole, these enterprises distributed their resources to the Ps 17 18
- Continuously improve their quality in the direction of simultaneously expanding the are affected by extrinsic marketing factors in the descending order of impact as follows: infrastructure network in different ways and developing value-added services, as well as corporate image, switching cost, value-added service quality, service price, difficulties in customer care and assistance services; changing mobile numbers when changing networks, and basic service quality. - Invest more in after-sales—customer care activities. This factor has presently received 5.1.2.3 Marketing mix for value conscious customers based on the balance between benefits the least investment from mobile enterprises, though it is the third most important factor and costs affecting consumer behaviors. Retaining customers not only contributes to improving Customers with high value consciousness tend to choose services with the highest use services and service quality, but also helps to reduce selling expenses and increase values. They often select and compare options carefully to gain the best services based on profits; two criteria: price and usefulness. They select services for long-term use which suit their - Limit price competition. Price still has an effect on consumer behaviors, but its impact is needs and financial capacities. lower than the impact of other factors. In the long run, price competition reduces They are the biggest group, accounting for 60% of all mobile service consumers. enterprises’ reinvestment capacity and service quality. Instead of offering direct Demographically, they mainly fall into the group of 23–35 years old. They are either self- discounts, the Vietnamese mobile enterprises should build different service packages employed people or office workers with salaries ranging from VND 2–20 million. and prices for different types of customers; Seen from the angle of satisfying consumer needs and in relation to consumer behaviors, - Have a reasonable plan for promotion. True promotion, at least for the time being, has the Vietnamese mobile enterprises should have an appropriate marketing mix which little impact on consumer behaviors. focuses on the factors in the descending order of priority as follows: building corporate 5.1.2 Market segmentation and marketing mix for each market segment image, working out a reasonable price policy, and promoting basic service quality and care Results of survey show that the Vietnamese consumers have four main characteristics for loyal customers. This group is also affected by difficulties in changing mobile numbers and thus can be divided into four groups as follows: when switching networks. 1. Fashion-technology consciousness; 5.1.2.4 Marketing mix for habitual shoppers 2. Quality consciousness; According to Sproles and Kendall (1986), the habitual shoppers often repeatedly 3. Service value consciousness based on the balance between benefits and costs; purchase products and services from their favorite brands or simply from the brands they 4. Habitual shopping. are using. In the selection phase, they often learn about and compare different services and 5.1.2.1 Marketing mix for fashion-technology conscious customers service providers carefully. Once they have made their choices, they will maintain the This group of customers has three following characteristics: (1) value brands and tend to purchase of services from their chosen providers without changes. choose expensive and famous services, (2) follow technology, and (3) like changes. Habitual shoppers make up 48% of all mobile services consumers. They fall equally into This group is mainly below 23 years old. Most of them are students and office workers different age groups, occupations, and levels of income. with salaries ranging from VND 2–20 million. Although they account for only 17% of all Viewed from the angle of meeting consumer needs and in relation to consumer mobile service consumers, they play an important role for mobile enterprises. With regard behaviors, the Vietnamese mobile enterprises should work out a sound marketing mix, to marking mix, the Vietnamese mobile enterprises should allocate their resources to the giving priority to the factors in the following descending order: building corporate image factors in the following order of priority: value-added service quality, promotion, and brand, enhancing care to loyal customers and after-sales activities, improving basic difficulties in changing mobile numbers when changing networks, corporate image, and service quality, and raising the quantity and quality of value-added services. basic service quality. 5.2 Some solutions for perfecting the marketing mix for the Vietnamese mobile 5.1.2.2 Marketing mix for perfectionist/quality conscious customers enterprises According to the theory developed by researchers Sproles and Kendall, the 5.2.1 Diversifying and improving service quality perfectionist/quality conscious customers tend to choose services with best quality, most First of all, the Vietnamese mobile businesses should enhance the coverage area features, most value-added services, and best after-sales activities. extension. Based on the developed countries’ experience, they can consider the following These customers fall into different age groups with different occupations. They are the measures: (1) Promote the socialization of investment; (2) Encourage their customers to second biggest group, accounting for 57% of all mobile service consumers. Their behaviors take part in investment; (3) Share the infrastructure. 19 20
Besides, these enterprises should diversify high-quality value-added services and 5.2.6 Building reasonable human resource policies and popularizing the mobile encourage the participation of content service providers. enterprise culture 5.2.2 Applying a flexible price policy The Vietnamese mobile enterprises are recommended to promote the mobile enterprise First of all, to improve the customer’s perception of price, the Vietnamese mobile culture which is customer-oriented, satisfies the customer’s needs, and is suitable with enterprises should not focus on discount programs. Instead, they should offer different customer behaviors. packages so that customers can choose those suitable with their needs and financial 5.2.7 Building infrastructure and material and technical facilities capacities. It is necessary for each Vietnamese mobile enterprise to build a modern, youthful, and Second, the enterprises should offer discount programs to customers who purchase and stable corporate image in the eyes of customers. Corporate image and its appearance use great quantities of services, and care about business-to-business (B2B) transactions. frequency have a big impact on customers. Third, the enterprises should pay more attention to post-paid customers. 5.2.8 Ceaselessly attending to loyal customers Besides, the enterprises should apply a service price policy in association with It is advisable for the Vietnamese mobile enterprises to ceaselessly improve their products/services (mobile phones accompanied by mobile services), and offer special customers’ loyalty since it means to raise switching barriers. Customer care, for each packages to support new services, especially M2M (machine-to-machine) services. marker segment, is not only important to habitual shoppers, but it is also vital to fashion- 5.2.3 Extending service provision networks and improving their quality technology conscious customers. Keeping customers being well-informed of new services First of all, the Vietnamese mobile enterprises should extend their service provision and invited to free trials of these services also works for the latter group of customers. networks. 5.3 Limitations of the research and directions for further research Second, they should improve the quality of their service provision networks through 5.3.1 Some limitations of the research enhancing the quality of their service distribution networks and building policies to support First of all, due to the excessive quantity of items included in the questionnaire, the their agencies in the implementation of customer care services. research used the shortened version of Sproles and Kendall (1978)’s CSI with 16 five-level Last, they should open more and more agencies (or shops) which provide customers Likert items, instead of the full one with 50 items, for the survey of customer decision- both mobile phones and services. These mobile enterprises have an advantage that their making styles. brands have been known to many customers. The customers will find it more convenient to Second, the research has not approached the subjects who have not ever used mobile be able buy mobile phones and services at the same place. services and are learning about them for the first-time purchase and use. 5.2.4 Exploiting promotion at the right time Third, the research employed multivariate regression for data analysis to define the On the one hand, the Vietnamese mobile enterprises should renovate forms of promotion relationship between independent variables and dependent ones. However, this analysis via: (1) holding special promotion and sponsored programs with free trials offered to technique does not show the relationship between independent variables. members of technological forums, (2) organizing contests to learn about new products and Last, despite the use of convenience sampling in combination with stratified random services with prizes for winners, and (3) diversifying forms of promotions, such as cash sampling, the results of this research are hardly as valid as those gained via the use of pure gifts, minute gifts, value-added service gifts, and bonus points. random sampling. On the other hand, businesses should enhance the effect of promotion with the following 5.3.2 Directions for further research recommendations to be borne in mind: 1. A discount is reasonable if it makes up about 20– Firstly, it is recommended that further studies should extend research factors. More 40% of the normal selling price; 2. Small but frequent discounts are more effective and specific and specialized examinations should be conducted on the factors of distribution, impressive to customers than big but infrequent ones; 3. Reasons for promotions should be and communications and advertising. stated clearly. Secondly, it is advisable for further studies to consider the use of the full CSI version 5.2.5 Boosting public relations with 50 items developed by Sproles and Kendall (1986) so as to identify more exactly the It is advisable for the Vietnamese mobile enterprises to proactively communicate with external factors of the consumer’s “black box.” their customers via messages and emails, and establish relations with mass media. 21 22
Lastly, further research should be extended beyond the five cities and provinces chosen in this study. Simultaneously, the random sampling process and procedures, as well as the AUTHOR’S PUBLISHED STUDIES RELATED TO THE DISSERTATION questionnaire-based interviews, should be controlled more strictly for better results. 1. Chu Tien Dat (2006), “Promotion and Its Effects”, Journal of Post, Telecommunications CONCLUSION and Information Technology, issue 277, April 2006. 2. Chu Tien Dat (2013), “Opportunity for Overseas Vietnamese-language Pay TV Mobile services are services with high technological contents, but they are becoming Services”, Journal of Economics and Forecasting, issue 548, June 2013 (ISSN 0866- more and more popular in daily life. Consumer behaviors towards mobile services have 7120). attracted not only researchers but also service providers and State management bodies. 3. Chu Tien Dat (2013), “Hanoian Consumer Behaviors towards Mobile Services”, However, theoretically, few studies in the same field have provided an overall examination Journal of Economics and Development, special issue, August 2013 (ISSN 1859-0012). of internal and external factors affecting consumer behaviors. Practically, it is essential for 4. Chu Tien Dat & Tran Khanh Hung (2013), “Northern European Countries’ Welfare mobile enterprises to have a thorough understanding of consumer behaviors since it will State Model: Lessons of Experience”, Workshop on the Basic Theoretical Issues on help them work out good plans for reasonable resource allocation and increase their Modern Industrial Countries and Socialist-oriented Modern Industrial Countries, and ARPUs, especially in the present difficult economic and market context in Vietnam. International Experience on the Development of Modern Industrial Countries, October This dissertation has provided an overall examination and analysis of theoretical and 2013 (KX code: 04.07/11-15) practical issues and methods for researching consumer behaviors. This laid the foundations 5. Chu Tien Dat (2013), “Theory on Consumer Behaviors and the Application of the for the building of a model for researching the behaviors of mobile service consumers in Consumer Behavior Theory in Mobile Services in Vietnam”, Workshop on Economic Vietnam, as well as the basis for the analysis and proposal of an appropriate marketing mix Theories and Their Application Potential in Vietnam, 2013. for Vietnamese mobile enterprises. This research has achieved its general and specific goals set in the beginning. All hypotheses have been tested. Results of quantitative research have shown that the behaviors of mobile service consumers are affected by six external factors listed in the descending order of impact as follows: corporate image, switching cost, basic service quality, difficulties in changing mobile numbers when changing networks, service price, and value- added service quality. Regarding internal factors, the Vietnamese consumers have four main characteristics equivalent to four decision-making styles as follows: (1) fashion- technology consciousness, (2) quality consciousness, (3) value consciousness, and (4) habitual shopping. Among them, the characteristics 1, 3, and 4 have direct impacts on consumer behaviors. The research has also proved that consumers with different characteristics are influenced differently by external factors. Based on the results of quantitative research on consumer behaviors towards mobile services, the research has compared the marketing mixes of the Vietnamese mobile enterprises over the past time and then proposed the marketing mix for the whole market. Accordingly, the Vietnamese mobile enterprises should further develop value-added services and after-sales—customer care activities, build corporate image, and prevent themselves from abusing promotion. The dissertation has also suggested the marketing mix for each market segment according to consumer characteristics. 23 24