NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department

Fairview, Quezon City
(02) 4270290

Chapter 2
REVIEW OF RELATED LITERATURE AND STUDIES

Related Literature

Marketing provides services in order to satisfy customers. With

that in mind the productive system is considered from its beginning at
the production level, to the end of the cycle, the consumer (Kioumarsi
et al., 2009).

Consumer behaviour is the process; thoughts, feelings and

actions related to consumption process, this behaviour is the dynamic
interaction of the individual thoughts, feelings, 9 actions and
behaviour in the environment by which the human being conducts
exchange aspect of their lives. The environment refers to the external
factors that influence the human being, these factors such as cultural
and social forces in the society and in personal lives as well as
physical and situational forces relates to the actual shopping
experiences. The behaviour is a dynamic interaction and

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

communication between consumers and the marketers doing

exchanges. (Peter& Olson 2008, 5.)

There are four main factors influencing consumer behaviour

each of these factors can influence a consumer action in different
ways, a combination of these factors affect the decision making
process differently these factors are cultural, social and religious,
personal and psychological.

Foreign Literature

In a study in China, the shoe industry is now facing grim

challenges due to rapidly changing tastes of shoe buyers and fierce
competition in the footwear market. Shoes marketers are increasingly
concerned about how to keep the good and long term relationship
with customers and also increase customer loyalty at shoe stores. The
research focuses on customer satisfaction and customer loyalty of
footwear products in Lanzhou, China. The purpose of the research is
to explore the possible antecedents of customer loyalty among Belle
shoes store customers. The researcher theorizes and investigates that
there is a positive relationship between image, price, perceived quality
(in terms of reliability, tangibles, empathy, responsiveness and
assurance) and perceived value with customer satisfaction, which in

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

turn, significantly influences customer loyalty towards Belle Footwear

Company. 400 self-administered questionnaires were distributed to
respondents. The results of the study indicate that all independent
variables (image, price, reliability, tangibles, empathy, responsiveness,
assurance and perceived value) have a significant relationship with
the intervening variable (customer satisfaction) and dependent
variable (customer loyalty). Shoe marketers will have a better
understanding about Chinese consumers and also could learn to
improve their strategies to improve their product quality and gain
more customers to extend their market size. (Jaio Li, 2013)

The role of the consumer can be taken by any buyer or person

depending on the product, it qualities and can also change the role.
Gender plays an important role in the decision making as men and
women have different preferences. (Jobba 2004, 68.)

Expectations of a customer on a product tell us his anticipated

performance for that product. As it is suggested in the literature,
consumers may have various "types" of expectations when forming
opinions about a product's anticipated performance. For example,
four types of expectations are identified by Miller (1977): ideal,
expected, minimum tolerable, and desirable. While, Day (1977)
indicated among expectations, the ones that are about the costs, the
product nature, the efforts in obtaining benefits and lastly
expectations of social values. Perceived product performance is
considered as an important construct due to its ability to allow
making comparisons with the expectations.

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

It is considered that customers judge products on a limited set

of norms and attributes. Olshavsky and Miller (1972) and Olson and
Dover (1976) designed their researches as to manipulate actual
product performance, and their aim was to find out how perceived
performance ratings were influenced by expectations. These studies
took out the discussions about explaining the differences between
expectations and perceived performance." [4]

In some research studies, scholars have been able to establish

that customer satisfaction has a strong emotional (i.e., affective
component).[5] Still others show that the cognitive and affective
components of customer satisfaction reciprocally influence each other
over time to determine overall satisfaction.[6]

Especially for durable goods that are consumed over time, there
is value to taking a dynamic perspective on customer satisfaction.
Within a dynamic perspective, customer satisfaction can evolve over
time as customers repeatedly use a product or interact with a service.
The satisfaction experienced with each interaction (transactional
satisfaction) can influence the overall, cumulative satisfaction.
Scholars showed that it is not just overall customer satisfaction, but
also customer loyalty that evolves over time.[7]

The evaluation of the alternatives process is how the consumer

determines the different products available. According to Kotler et al.,

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

(2014) there appears to be no simple evaluation process useful by

consumers in all-buying situations. There are a few concepts that can
explain the consumer process. A consumer evaluates a product with
different attributes, for example Kotler et al., (2014) explains that
restaurant attributes would be food quality, price, location,
atmosphere, quality of service and menu selection. Consumers
depending on there geographic, demographic, psychographic and
behavioral characteristics will decide which attributes are important
to them. After evaluating the different attribute the product offers the
consumer will then priorities each attribute in the order from highly
important to least important. As stated in Kotler et al., (2014) these
priorities are directly related to the consumers needs and wants. The
next process in brand image, Kotler et al., (2014) says the consumer
applies certain beliefs to a particular known brand. The consumers
beliefs may differ depending on the consumers experience and the
effects of selective perception, distortion and retention. Kotler et al.,
(2014) portrays that one or more of the processes suggest above is
used depending on the customers buying decision process.

Local Literature

When Filipinos shop, the amount of money they have to shell

out is still a very important factor. Ninety-two percent plan their
shopping in advance, and 79 percent prepare a shopping list before
hitting the supermarkets or any place they want to do their shopping.
They look for cheaper options and prioritize buying the basics: 73
percent allot time to look for the best promotions, and even if 89
percent decide what brand to buy before shopping, 81 percent end up

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

choosing the brand to put in their baskets at the point of purchase,

and 74 percent are willing to try a new product.

Its not all about price, though, for Filipino shoppers. Loyalty is
still alive and well, with 89 percent saying that they would buy the
brands they regularly use, even if confronted with a promotional offer
from a competitive brand.

From the study, TNS has classified Filipino shoppers into six
categories. There is what is trademarked as Accepting Angels, the
come what may shoppers who are flexible enough to make do with
whatever is presented to them. Then there are Meticulous Mommas,
described as keen on detail, and looking for all the information they
can get before making the final purchase. Proud housewives who
value who they are but never forget their obligations as mothers to
their families are called the Power Pinays, while those contented
with casual yet guaranteed safe food that feeds the cravings of the
appetite are labelled No-Frills Seguristas. They are very concerned
about health and well being when they buy products. Considered
loyalists, they tend to stick with a brand they trust instead of trying
out new ones. (Bong R. Osorio, 2009)

Related Studies

Consumers allocate attribute factors to products, almost like a

point scoring system which they work out in their mind over which

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

brand to purchase. This means that consumers know what features

from the rivals will benefit them and they attach different degrees of
importance to each attribute.

Consumers usually have some sort of brand preference with

companies as they may have had a good history with a particular
brand or their friends may have had a reliable history with one.
(Vaani, 2011)
Foreign Studies

Customers buying behaviour is enormous, and highlights the

importance of the customer at the centre of the marketer's universe.
Each customer is unique with different needs and wants and buying
choices and habits are influenced by habit, and choice that are in
turn tempered by psychological and social drivers that affect purchase
decision processes. It is a complex multidimensional variable.
Customer buying behaviour is critical for influencing not only product
purchase decisions but also important marketing decisions for
commercial firms, non-profit organizations, and regulatory agencies.
Applications of customer buying behaviour decisions lie on marketing
strategies, regulatory policies, social marketing, and informed
individual. Buying Behaviour is the decision processes and acts of
people involved in buying and using products. Customer buying
behaviour is the sum total of a consumer's attitudes, preferences,
intentions and decisions regarding the consumer's behaviour in the
marketplace when purchasing a product or service. R. Alexander et. Al
(2015)

NATIONAL COLLEGE OF BUSINESS AND ARTS

Bachelor of Science in Business Administration Department
Fairview, Quezon City
(02) 4270290

The term consumer can be described as a person who acquires

goods and services for self satisfaction and his often used to describe
two different kinds of consuming entities: the personal consumers
and organizational consumers. The personal consumers buy goods
and services for his/her own use. In this context, the goods are
bought for final use by individual, who are organizational consumers,
they encompasses for profit and not for profit business, government
agencies, institutions, all of them must buy products, equipment and
services in order to run their organization (Hawkins, Best and Coney
1998). The consumer will respond according to the product quality
and reliability, the fundamental understanding of products is
necessary to understand the product features, products reliability and
product benefits (Baker, 2004). The consumer is the end user for the
product; consumers buy the products in market; in order to perform
successful sales operations in the market an effective distribution
channel and networks are required for the organizations. Distribution
channels and networks play an important role in the consumer goods
industry. Consumer is the ultimate user of every product, without any
consumer there is no market as such (Baker, 2004).

Local Studies