MELJUN CORTES Online advertising

Online Advertising in China: Beliefs and Attitudes of Students as

Consumers

Thesis presented in partial fulfillment of the Requirements for the Degree of Master in Business Administration

Jose Rizal University Graduate School

By

MELJUN P. CORTESMELJUN P. CORTES

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Background of the Study

• This research study aims to describe and measure the beliefs and attitudes of students as consumers towards Network or online advertising in China.

• China is now the world’s second largest economic power, next to America’s; in 2011, it has dislodged Japan in the global economic race.

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Background of the Study

• Internet Usage in China has registered impressive growth over the recent years, both in urban and rural areas. Likewise, online advertising has also grown tremendously. However, to date, there has been very little information about its effectiveness as the newest advertising platform.

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Statement of the Problem1. What is the profile of the respondents in terms of:

1.1 Age

1.2 Gender

1.3 Income Range

1.4 Education

1.5 Residence

2. What are their beliefs about online advertising?

2.1 Does it increase their interest to seek products online?

2.2 Does it increase product awareness?

2.3 Does it create desire to purchase the advertised product?

2.4 Does it enhance the image of the advertised product?4

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3. What are their attitudes towards online advertising?

3.1 Are they in favor of online advertising?

3.2 Do they find the information adequate in online advertising?

3.3 Do they find it useful in making a purchase - decision?

3.4 Is online advertising effective?

4. What are their behavioral responses to online advertising?

4.1 Will they continue to seek advertisements of products online?

4.2 Will they buy products advertised online?

4.3 Will they recommend products advertised online?

Statement of the Problem


5. Is there a positive significant relationship between the respondents’ profile and their beliefs?

6. Is there a positive significant relationship between the respondents’ profile and their attitudes?

7. Is there a positive significant relationship between beliefs and attitudes?

8. Is there a positive significant relationship between beliefs and purchase decision?

9. Is there a positive significant relationship between attitudes and purchase decision?

Statement of the Problem


Significance of the Study

• Primarily, this study hopes to fill the gap in online advertising, which is a relatively new advertising platform. Knowing the beliefs and attitudes of customers to this new advertising platform is crucial in crafting a strategic marketing program; specifically in budgeting for the advertising mix, which hugs the biggest chunk in today’s marketing.


Theoretical Framework

Independent Variables:

-Beliefs-Attitudes

Dependent Variable: (Behavioral Response or Action)Purchase-Decision

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Theoretical Framework

• The study is based on the traditional theory, which states that the customer’s behavioral response (or Action in the AIDA acronym) like making a purchase decision is largely influenced by the beliefs and attitudes of the customers on the advertised product.


Research Paradigm

Profile :-Age-Gender-Income range-Education-Residence urban or Rural

Consumer Behavior:-Acceptability (Searching)-Adequate information-Effectiveness

In terms of support and service

Purchase Decision

Product Recommendation

INPUT PROCESS PRODUCT OUTPUT

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Research Paradigm

• The research paradigm asserts that the demographic profile of respondents affect the beliefs and attitudes of the consumer, which in turn affect the purchase-decision. In psychology, beliefs affect the attitudes, which in turn, are then manifested in the behavioral response of the customers, like in making a purchase decision.


Research Methodology

• 1. Expository and Descriptive2. A Researcher-Crafted Instrument in Chinese was used to obtain the raw data, which shall be pre-validated for content validity and reliability; sample size, n = 100 Chinese graduate students from Metro Manila. 3. SPSS Version 16.0 shall be used for statistical analysis and interpretation

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Population, Locale, and Sample

• The population of the respondents are the Chinese college and graduate students in Metro Manila, Philippines. The sample (n=100) comprised the Chinese college and graduate students in the Philippines, from different universities in Metro Manila, who were also asked to help in the distribution of the questionnaire.


Conclusions

1. The respondents consist of 60 percent male and 40 percent female; majority of whom are coming from middle income families and are taking up MBA and DBA in universities in Metro Manila; their age range is from 20 to 32 years old, with 80 percent belonging to age range 23 to 32 years old. All respondents have access to the Internet and are computer-literate, and are exposed to online advertising. (See Table 4 to 12 from pages 37 to 40)

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Conclusions2. Descriptive statistics showed that majority of the respondents

are in favor of online advertising; in fact, 50 percent rated favorability of online advertising as “high”, and another 50 percent, rated it as “very high” (Table 13 to Table 15 is from pages 40 to 41).

3. Likewise, majority of the respondents gave high to very high ratings for adequacy/completeness and effectiveness of online advertising (Table 16 to Table 22 from page 42 to 44).

4. In other words, with respect to consumer attitudes about products advertised online, the general consumer attitude, as reflected in their ratings of favorability, adequacy and effectiveness, is from high to very high ratings. (Table 23 to 32 from Pages 45 to 48)


Conclusions

5. On the null hypothesis about the correlation between demographic profile and consumer attitude, the respondents demonstrated weak correlations, as the Pearson r on all five aspects of the profile, age, gender, income range, educational level, and residence, urban/rural (Tables 33 to 37 from pages 49 to 53) showed low values corresponding to weak correlations per the Appendix B matrix on Pearson r values and their interpretations. Therefore, the null hypothesis on the issue that there is no significant relationship between the demographic profile and consumer attitudes on online advertised products is accepted.


Conclusions

6. The weak correlation established in this study between the demographic profile and consumer attitudes on online advertising of products, only shows that there are other factors that are significantly affecting the development of consumer attitudes towards products advertised online. These “other” factors may be both internal or external to the respondents, but which could be the subject of another study.


Conclusions

7. However, strong correlations were established between consumer attitudes and purchase decisions. Majority of the respondents who demonstrated high ratings on attitudes towards online advertising showed high ratings on purchase decisions (i.e., whether respondents will recommend or buy the products advertised online). In Table 38 on page 54 those who rated online advertising as effective had a Pearson r = .816, significant at the 0.01 level (2-tailed); while in Table 39 on page 55, those who rated online advertising as both adequate and effective, had Pearson r equivalent to .802 and .816, respectively; both significant at the 0.01 level (2-tailed).


Conclusions8. These strong correlations between consumer attitudes and

purchase decisions are well documented in mainstream literatures in marketing using traditional media, such as television, radio, and print, but not on relatively new advertising platform like online advertising.

9. The regression analyses showing high goodness of fit between the consumer attitudes and purchase decisions. likewise validate the strong correlations between the said variables, Tables 43 -45 (from pages 58 to 59).

10.The areas of concerns revealed in this study pertain to pricing and availability of products advertised online, where both got low ratings (Tables 28-29 on page 47). Product quality got relatively, high rating.


Recommendations1. In view of the results of this study, present marketers in

China who are still in the traditional mode of advertising will have to revisit and rethink their advertising program and budget allocations on their promotion mix, with respect to television, radio and print. The growing popularity of the Internet both in Urban and Rural China, is a potent force to reckon with concerning the development of promotional mileage and impact to consumers. Marketers may have to reallocate their budget from the traditional media to online advertising, the newest platform in marketing today. The results of this study showed that indeed, there is a strong correlations and regressions between consumer attitudes and purchase decisions with respect to the online advertising.

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Recommendations2. Marketers may have to reinvent the wheel with

respect to penetrating the consumers through the online advertising technology. Basically, present-day marketers have more or less mastered the A to Z of the traditional promotions mix, but they have yet to develop and acquire mastery in the arts and science of online advertising. With the robust economy of China, and its huge consumer base, better allocation of advertising resources by marketers would significantly contribute to the company’s bottom line, among others.


Recommendations3. A change of paradigm by marketers with respect to

consumer education is also a must-do for marketers. With the high accessibility of information available through the Internet, consumers in the Digital Age are more aware and proactive. Marketing online must therefore religiously stick to the tenet of “truth in advertising”, because consumers could easily validate the information on products advertised online through the wealth of information in the Internet, such as Google and Yahoo, among others.


Recommendations

4. Government regulators, such as the department of trade and industry in China, or the AMA counterpart in China, may have to be proactive in initiating measures to manage, if not regulate, the growth and development of online advertising in their market, at least, to protect the consumers and the larger society, in general.

5. For future researchers, who would like to go into the deep, are cordially invited to validate the findings of this study, perhaps with a standardized instrument and a larger sample size to include other consumer types, besides university students


Recommendations

6. Online advertising is here and now. The trend is overwhelming, its onslaught in the marketing arena is unstoppable. Philip Kotler and company have been caught flat-footed by its powerful rampage. In this regards, a development program matrix, pertaining to the subject tackled in the study is hereby proposed, Table 46 on page 66


Online Sell and Shopping in China


Online Sell and Shopping in China


Introduction about Taobao

• It is the shopping and sell website named Taobao which is very popular in China, in includes anything that we can buy or sell, it change people shopping style. In Taobao, it is very convenience that we can cost 3 to 5 minutes to finish the trade. The images/icons, visuals/colors increase interest to seek products online. Majority of the respondents answer that the price of goods/services in Taobao is reasonable. If we are not pleased with goods/service that we already buy, then we can talk over with seller through Alitong (chat tool) for replacement the goods/service. If sellers have cheat behavior, cusetomer can have right protection.


app:ds:introduction

introduction about Taobao

• In Taobao website, we can see some recommendation goods/service through colorful picture that attract customer eyes. It enhance desire to buy, we can find online advertising can help Increase sales. If want to buy same kinds of things, we can seek, then Taobao will give more choice, they are Classified by difference kinds of brand. Majority of the respondents think that surfing/ search online increase awareness. In term of customer Reponses of online product, if buyer get the goods and use already, they can give evaluation in Taobao which can give some advises for other buyers.


app:ds:introduction

How to ensure money of customer safe in Taobao?


• It is a payment system named Alipay that we can login. Launched in 2004, Alipay (www.alipay.com) is a commonly used third-party online payment solution in China. It provides an easy, safe and secure way for millions of individuals and businesses to make and receive payments on the Internet. The preferred online payment tool of Internet merchants in China, Alipay provides an escrow payment service that reduces transaction risk for online consumers.

How to ensure money of customer safe in Taobao?


Alipay guarantee transaction process


Thank you!谢谢！


Technology

MELJUN CORTES Online advertising