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Overview of Relevant Theories
Consumer behavior is a complex field. The complexity arises from the difficulties associated with predicting human behavior. People exposed to the same conditions do not always respond in the same way. This makes the study of consumer behavior important to help determine the potential range of consumer responses that arise from exposure to marketing communication.
There are many theories that seek to explain why consumers behave in certain ways. In this section, the theories reviewed are the Theory of Reasoned Action, and the Theory of Social Comparison. In addition, it will be important to review Kozinets’ Model that describes online consumer user typologies, and the one-to-many communication model.
The Theory of Reasoned Action (TRA) was the precursor to the Theory of Planned Behavior (TPB). The main assumption that led to the development of TRA was that all behavior arises from the intention to do something. This means that every person makes a deliberate choice to behave in a certain way. The researchers attributed the intention to do something to three factors.
The first factor was the attitude of the individual towards the activity. If a person was favorably disposed towards a certain activity, then the individual was likely to engage in it. The second factor put forward by the researchers was that the intention to carry out an activity depended on the subjective norms of the individual.
This meant that if the activity was within the experience of the individual, then the likelihood of engaging in it was higher. The third element that contributed to behavior was the perceived behavioral control of the individual.
It was necessary for the person to have the capacity to direct their actions to carry out a specific activity. The realization that some behavioral patterns were involuntary led to the emergence of TPB. This change made it possible for researchers to account for involuntary behavioral traits that the TRA model could not explain.
The second theory that is of interest to this project is the Theory of Social Comparison. This theory postulates that people judge their personal worth based on social comparisons.
The measures used for social comparison include intelligence, wealth, and personal attractiveness. This theory seeks to explain consumer behavior based on the realization that people take action to improve their perceived social value. Consumers buy certain products to increase their social worth.
Kozinets model deals with the specific factors that influence consumption in online communities. Consumers in online communities do not have sufficient social pressure to drive them to make decisions based on social comparison. Kozinets picked two main measures to develop four basic typologies of online consumers. The first measure was social ties within the online community.
A new member in an online community does not have any ties with the other members of the community, despite sharing an interest. If the new member chooses to become active in the online community, the member develops social relationships with other members of the online community. This increases the member’s sense of belonging to that online community.
The second measure identified by Kozinets (1999) was the level of priority of the consumption activity to the users. Accordingly, a user was likely to spend money online if the activities of the specific community were a priority for that user. This decision usually depended on the personal relationships and the interpersonal dynamics at play in the online community.
Based on these two measures, Kozinets developed a model that classified online consumers into four quadrants as shown in figure 1 below. The four main types of online consumers according to the model are devotees, “minglers”, insiders, and tourists. Devotees refer to members of an online community who have a high level of association with the activities of the online community, but have weak social ties.
Figure 1: User typology for communities of consumption
The fourth model of interest in this project is the one-to-many communication model. It describes communication from one point to many other points. It resembles traditional broadcasting. A central station beams messages to a large audience of passive listeners. Other models within this framework include the one-to-one model, which describes personal marketing communications targeting specific marketing needs.
There is also the many-to-many model that represents the participation of a community in several discussions within the network. Each of these models has implications and applications in marketing communication. Perhaps the best way to capture these ideas is to take into account that communication has shifted from mass communication to communication within networks.
Consumers have varying levels of power over their buying behavior. The three dimensions of consumer power include consumer sovereignty, cultural power, and discursive power. Consumer sovereignty assumes that a consumer is fully in charge of their buying behavior as modeled by the Theory of Reasoned Behavior. Cultural power on the hand refers to a power matrix piled against the consumer by political and social processes.
In this case, the consumer is under the influence of culture, politics, and the views of opinion leaders when making purchasing decisions. Discursive power is the combined action of both consumer sovereignty and cultural power to yield a blend that has space for consumer decision making as well as the other influences in the making of buying decisions.
Celebrity Consumption
Strong brands are very attractive to consumers in Thailand. The consumers associate strong brands with status and value. This phenomenon is not unique to Thailand.
In the Western world, strong brands such as Coca-Cola and Pepsi have global recognition. In the technology field, companies such as Google, Microsoft, Intel, Apple, and HP have a big market share because of the strengths of their brands. Branding is an essential aspect of the every business.
A survey conducted by the Grey Group in Thailand found that many consumers based their purchasing decisions on the image and social status associated with brands. In addition, up to 26% of the respondents in the same study felt that image and social status were the most important aspects to consider when making purchases, regardless of personal economic circumstances.
This phenomenon is associated with vigorous advertising campaigns in Thailand. The adverts create a strong consumer culture that encourages luxury spending on fashion and design items that Thai people associate with success and prestige. In addition, the adverts use celebrity endorsements to persuade consumers to purchase the products. Association of brands with celebrities usually leads to a great demand for the products.
In relation to this trend, Chadha and Husband (2006) stated, “luxury brands are a modern set of symbols that Asians are wearing to redefine their identity and social position.” One of the signs of this phenomenon in the Thai society is the many female students who look at themselves as trendsetters because of their exposure to the internet. Subsequently the female students spend huge sums of money on designer items.
This is because young women are more impressionable which makes them more willing to spend their money on luxury items promoted by celebrities. This wave of young internet savvy consumers being transformed into ferocious consumers is fuelling electronic commerce in Thailand.
Some commentators feel that the proliferation of the consumer culture in Thailand will jeopardize the future of the county. Consumerism tends to encourage debt spending. This will rob the country of its ability to meet it long-term obligations and may derail the economic progress of the country. Traditionally, Thai people have been good at saving and have not had strong materialistic tendencies that the young people are now embracing.
Social media is playing an important role in the transformation of Thailand into a consumer society. One of the strongest areas of economic growth in the country is electronic commerce. A survey by MasterCard in 2010 revealed that online shopping is growing very fast in Thailand
. This can be explained by the growth in the uptake of smart phones in Thailand. Many people are using mobile phones to access the internet and to make purchases. The smart phones are also making it very easy for consumers to access information from their online social networks.
Thailand is a collectivist country in its consumption patterns . This means that people tend to buy products based on a group mentality in order to fit in peer groups. In this culture, people tend to rely on the collective wisdom of their communities to make decisions. Therefore, before making purchases, people in Thailand are likely to confer with their peers on the merits and demerits of their intention.
The traditional word-of-mouth process still governs commerce in many societies. With the recent advances in technology, people are now using the internet to confer with their peers concerning their intention to make purchases. Online marketers refer to this process as electronic word of mouth (eWOM). When celebrities are involved in eWOM, the impact it produces increases significantly.
Celebrity eWOM can increase the consumption of a product because their endorsement increases the brand recognition of the product . According to the theoretical models reviewed earlier, the behavior of Thai consumers tends to conform to TRA. In many cases, the consumers remain in charge of their decisions to buy, but they allow the opinion of celebrities to guide their decisions.
In the same vein, there is a strong correlation of this behavior with the Theory of Social Comparison. As a community, the Thai people are collectivists. The society encourages conformity rather than competition. Therefore, everyone seeks to attain a prosperous self- image, which is consistent with the national psyche.
Electronic Word of Mouth (eWOM)
The availability of information plays a major role in the purchasing decisions of international customers. Consumers take a keen interest in the acquisition of information because of the role information plays in the reduction of purchasing risks. Word of Mouth (WOM) plays an important role in the gathering of information, which in turn influences consumer attitudes, choices, and purchasing decisions.
A related development is that advertising is becoming outdated because of an erosion of consumer trust from conventional advertisements. Consumers have been questioning the reliability of advertisements as a means of acquiring accurate information about a product because of the obvious interest of the manufacturer in the sales and marketing of the product.
This makes WOM more popular than seeking information from conventional advertisements. Subsequently, WOM has a strong effect on consumer choices. WOM takes different forms, which range from face to face communications, to the use of social media to convey information. When WOM takes place on line, its name becomes Electronic Word of Mouth (eWOM).
Another way of looking at eWOM is that it is an attempt by organizations to influence communication between consumers. When viewed in this sense, eWOM becomes a strategic and deliberate approach by a company to capitalize on good rapport with its clients. Opinion leaders such as celebrities are responsible for the success of eWOM because people trust their views and opinions.
Opinion leaders may vary in nature, but their common trait is that they have some influence over portions of the online community. Opinion leaders are not only celebrities. They include fashion bloggers, critics, and the dominant or active members of online communities. Opinion leaders control the discussions held through eWOM when they give their views to their online audience.
These views often make the difference between the success and failure of a product. One of the significant challenges facing eWOM is the presence of wrong information. In fact, eWOM suffers from many problems associated with communication such as noise and distortion. Consumers have the duty of sifting through their sources in order to assess the credibility of the information provided.
Another challenge associated with WOM is that it relies on the subjective experiences of individual when using a product. The experiences that people usually have with products are not necessarily universal. Therefore, there is a high the risk of finding false information in the eWOM network.
Secondly, the anonymity of the internet makes eWOM risky. Fraudsters attempt to use eWOM networks to take advantage of unsuspecting consumer. Despite these challenges, many consumers still rely on eWOM to find information to help them to make purchasing decisions.
Online Communities
The emergence and proliferation of online communities is giving consumers more avenues for sharing information and experiences relating to products in the market place. Online communities are an extension of human social organization found in other spheres. These communities exist in various forms such as online forums, bulletin boards, and newsgroups.
Usually, online communities arise from shared interests. The major output derived from online communities is information. The tools for encoding and sharing information have increased in number and efficiency since the popular acceptance of the internet as a means of global community.
The multiplicity of online information outlets is giving consumers a wide range of opportunities to upload information using video, audio, pictures, and text as they share their experiences with other consumers.
A large percentage of communication stills takes place in the real world without the assistance of technology. Consumers interact with their friends during social functions, where they obtain advice on their purchasing choices.
This notwithstanding, there is an increase in the number of people using the internet to access services because of the increasing confidence in electronic commerce. People are spending increasing amounts of time online, especially in the social media. This trend is likely to increase the volume of electronic commerce.
The Theory of Social Comparison and the Theory of Reasoned Action are ideal for explaining the dynamics of eWOM and the extent to which eWOM influences the buying intentions of consumers of designer products.
A study conducted to ascertain the role that travel blogs play in tourist purchase decisions found that tourists do not always rely on rational calculations based on cost benefit analysis when making the decision to visit tourist destinations. They use eWOM from blogs that talk about tourist issues to determine whether they will visit a certain place or not. Travel blogs also host adverts from various tourism-related businesses.
The level of involvement of the blog in the issues tends to influence the effectiveness of the adverts placed on their sites. The adverts have a big impact because of the contextual placement of advertisements. While this is going on, marketers carry the responsibility of maintaining the brand reputation of their products because strong brands get better exposure to online traffic when they advertise on travel blogs.
Electronic Word of Mouth is evolving along the same lines as the evolution of social media. As indicated earlier, offline WOM is a force to reckon with in social structures that are enclosed within physical boundaries. On the other hand, eWOM uses the power of the internet to do away with boundaries. This ensures that information within the eWOM network reaches audiences in various parts of the world.
The success of eWOM arises from the number of people that now receive information via the internet. For instance, news about a new product spreads very quickly in the internet.
This shows that eWOM has a very large impact on the transfer of information. Apart from the simple acquisition of knowledge, consumers have faith in the information they derive from eWOM, making it one of the most influential decision support systems in the purchase of electronic products.
At the same time, the increasing use of smart phones in Thailand makes it very easy for consumers to access information via eWOM networks. The possession of a smart phone is a status symbol in Thai urban areas, and the unfettered access to internet is consistent with the image of luxurious living that many people aspire to have.
A study in China showed that people are likely to generate and distribute information via eWOM networks if a product gives them a good feeling. It seems that eWOM derives its energy from the human desire to share good news. In other words, eWOM is the result of relationship marketing. In recent years, the concept of viral marketing has surfaced, also aided by online media.
Viral marketing works similarly to eWOM, but it has a higher degree of intensity. It comes about when consumers identify strongly with the marketing campaign or the product. Products that go viral usually receive a large amount of attention over a small period.
Uptake of Instagram in Thailand
The main objective of the research project will be to study the role that the social media plays in the marketing of luxury products in Thailand. The impact of social media varies from one segment to another, which then means that an effective study must focus on one industry. The industry of interest in this project is the fashion and design industry.
The emergence of Instagram as one of the leading smart phone applications in Thailand has intensified the exchange of eWOM among Thai consumers . Instagram is making it relatively easy for the public to access reliable information via eWOM by following celebrities who have Instagram accounts. Instagram is very compatible with the consumer culture in Thailand.
According to a Bangkok-based brand agency called Zocialrank, Instagram has become very popular in Thailand. Instagram has more than 150,000 users in Thailand who have already uploaded over 11 million photos. This makes Thailand one of the largest users of Instagram.
Thai people keep up with new trends by following celebrities through Instagram in order to find out the current “must have” items. One of the clearest indictors of this trend is the following that a single celebrity can command in Thailand. The actor Aum Patcharapa has almost one and a half million followers on Instagram.
Marketing campaigns in Thailand use celebrities to promote products. Celebrity endorsements spur consumers to buy the products based on the notion that the products are superior. Instagram allows celebrities and marketing companies to post pictures showing the celebrities promoting the latest trends in the fashion industry.
Customers get a glimpse of the new products as well as their favorite celebrities adorning the fashion items. The element of Instagram that makes it stand out as a platform that support eWOM is that it eases the sharing of photos. This means that people can share photos showing celebrities wearing the latest fashion items. This makes Instagram a very powerful tool in eWOM marketing, and influences consumer decision making.
Research indicates that the physical appearance of a storefront can influence buying behavior. In the context of eWOM, a good-looking store will attract positive eWOM, which can then drive up its sales.
This shows that customers want to associate with well-to-do brands. A research project was undertaken to find out whether being a fan or a follower of a celebrity changed the purchasing behavior of an individual. The researchers found that more than half of the fans were likely to purchase or recommend a product endorsed by the person they are following.
Celebrity Endorsement
Studies conducted to determine the impact of celebrity endorsements on brands show that celebrities increase the visibility of a brand, and create positive attitudes towards the brand. Endorsements from celebrities also increase brand loyalty and set the stage for positive eWOM for the brand. Celebrities influence consumer choices when consumers imitate the dressing mode and character of the celebrities.
Wei and Lu (2013) examined how the relationship between celebrity endorsements and online customer reviews can influence the shopping behavior of female consumers. The research revealed that although the image of a celebrity creates a positive impact on buying behavior, consumers hesitate from buying the endorsed product if the endorsement is perceived to be a commercial campaign.
However, the same consumers will rely more on customer reviews written by other consumers to make buying decisions. Consumers prefer to ape the celebrities but frown upon direct calls by the same celebrities to buy the products.
Consumers look at the pictures and the lifestyles of the celebrities to find out the brands they are wearing. They use their findings to decide on which products to buy based on the assumption that the celebrity likes the product.
An experiment by economic psychologists found that celebrities are more persuasive than people who are not famous even if the other people are as attractive as the celebrities. Respondents displayed a stronger intention to purchase a product when it was presented in close association with a celebrity. The effectiveness of celebrity endorsement usually depends on the greater cultural constructs of the specific country or region.
The two main perspectives in this regard are whether the dominant cultural philosophy in the region is individualism or collectivism. Individualism refers to cultures with a high level of autonomy. In such societies, people tend to rely on social structures developed by the state rather that a culturally derived one.
Countries such as Thailand have had a long time to evolve as a people. This has given the country the opportunity to streamline its collective aspirations, which has led to a homogenous worldview among the Thai people.
A study designed to compare how a person’s attachment to a celebrity affects buying behavior revealed that a person who feels strongly attached to a celebrity is likely to make purchasing decisions based on a single endorsement by the celebrity.
On the other hand, multiple endorsements from a celebrity in regards to multiple products or multiple endorsements of the same product, adversely affected the purchasing decisions of the people who felt strongly attached to the celebrity.
On the contrary, multiple endorsements increased the likelihood of making a positive purchasing decision among those who did not feel strongly attached to the celebrity. This finding illustrates that while the celebrities have the ability to influence purchasing behavior, their influence must be exercised with care to achieve maximum impact.
However, Wei and Lu (2012) who carried out research on the relationship between endorsements and purchasing behavior were not focusing on Instagram. This means that their findings should not be generalized to all forms of eWOM. Some studies support the positive impact of eWOM on the buying decision of consumers. Other studies support the positive impact of celebrity endorsements on buying decision.
A Study in Thailand showed that the four factors that influenced consumer behavior were physical factors, personal identity, lifestyle, and store environment. This study did not include the role of eWOM, or social media on how consumers make their decisions. Therefore, there is need for fresh research into the impact of Instagram and social media in general on consumer behavior in Thailand.
This research project intends to fill this gap by examining the impact of Instagram as part of eWOM, on Thailand’s consumer behavior. A study that was evaluating the role of visual elements in advertisements that utilized social media platforms found that the visual elements that attracted the highest number of users were shock and sex appeal.
Sex appeal can go hand in hand with celebrity endorsement if the celebrity in question is also a sex symbol. A good example is actor Aum Patchrapa, who is not only a well-known celebrity, but also a sex symbol. This project intends to take a specific look at the role celebrity endorsements on Instagram play in consumer purchasing decisions.
Methodology
The research philosophy chosen for this project is positivism. The choice of this paradigm comes from the need to quantify the impact that Instagram has on consumer choices in Thailand. The research project will not be aiming at proving the impact, but rather measuring the impact.
Positivism is ideal for proving objective reality. Positivism asserts that a scientist is capable of using a scientific perspective in the observation of a social behavior in order to perform objective analysis.
Data analysis for a research project undertaken using a positivist philosophy requires using quantitative methods to describe large-scale phenomenon. In this case, it will be necessary to use quantitative research methods to ensure that the data is analyzed in line with the dimensions of the problem.
The results developed from the data analysis will show the level of influence that eWOM has on consumer decisions in Thailand’s fashion industry. The results will also show consumer behavior and the underlying market forces driving online commerce in Thailand. Data collection will be done using survey instruments developed for the project. A survey is the best tool for collecting a large pool of data.
Surveys are considered rigid in comparison to other research tools such as interviews. However, they provide the only realistic way of dealing with a large data set. In order to make sense out of the data, it is imperative to identify the dependent and independent variables that can help in the identification of consumer characteristics in the Thai market.
The main tool for data collection will be an online questionnaire. The target group identified for the project is Thai females aged 18-30. The total number of respondents for the project will be 400 individuals. The social class targeted in the survey is the young women from middle class families living in the urban areas of Bangkok.
The inclusion criteria for the respondents will include a range of dimensions such as the fulfillment of personal desires. The goal of this approach is to ensure that the sample contains respondents who have varying economic power because it will help to determine whether purchasing power affects purchasing behavior when it comes to fashion products.
The survey will be divided into the following four sections. The first section will deal with the demographic profile of the respondents. The second and third sections will deal with their Instagram use habits and the degree of reliance on eWOM for decision making when it comes to fashion products purchases. The fourth section will deal with impact of eWOM from celebrities on the purchasing behavior of the respondents.
The extent of influence on each of these measures will be captured using Likert Scales. The level of influence will have a five point Likert scale with “1” corresponding to “strongly disagree”, and “5” corresponding to, “strongly agree”. The fourth section will have an eight-point scale with “1” corresponding to “strongly disagree” and “8” corresponding to, “strongly agree”.
The questionnaire will also contain frequency measure that will capture difference aspects of the use of Instagram, such as photos uploaded per week, number of celebrities that the respondent follows, and time spent on Instagram. Data analysis will be done using the Statistical Package for Social Sciences (SPSS) to ensure the results meet all the requirements of a proper scientific inquiry.
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