Proceedings of 37th International Business Research Conference

1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA

ISBN: 978-1-925488-14-2

Vietnamese Consumer Behavior of Cosmetics Products:

Effects of Extrinsic Cues

James Cho*, Duy Binh Luong**, Thi Huong Giang Vo Lee*** and
Wei-chun Lee****

Cosmetic industry is receiving increasing attention as a market of luxury and

more necessary goods with increasing growth rate annually. In order to research
and managing the appropriate strategies for this sector, managers need to
understand the consumer buying behavior toward cosmetics products. Hence
this study provides an overview of the global cosmetics markets and its role in
Vietnam segment. Thence investigating the relationship between three factors
country of origin, brand and price with Vietnamese consumer buying behavior
toward the facial skincare products, and researching the difference between the
impacts of three factors and consumer behavior. The influence of other
parameters concerning cosmetics consumption is also explored. Finally the
findings contribute useful information to the cosmetics companies to determine
their consumer behavior so that design the appropriate campaigns for
development.

1. Introduction

This research focuses on personal appearance in society is increasingly crucial, it

led to a continuing and high demand on beauty and personal care products of
everyone in general and women in particular (Elena, 2010). Therefore, the term
“cosmetics” is adopted for all preparations which are used to externally beautify and
improve the appearance (Schneider, Gohla, Schreiber, Kaden, Schonrock,
________________________________________________________________
*Dr. James Cho, Department of Business Administration, Lunghwa University of Science and
Technology, Taiwan. E-mail: jameschos@gmail.com.
**Mr. Duy Binh Luong, Department of Business Administration, SaiGon University, Vietnam. E-mail:
duybinh0106@yahoo.com.
***Miss Thi Huong Giang Vo, Department of Business and Tourism, Ho Chi Minh City University of
Food Industry, Vietnam. E-mail: vthg0510@gmail.com.
****Dr. Wei-chun Lee, Department of Business Administration, Lunghwa University of Science and
Technology, Taiwan. E-mail: liwj@mail.lhu.edu.tw.
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

Schmidt-Lewerkuhne, Kuschel, Petsitis, Page, Ippen & Diembeck, 2001). Female is

known as the core object consuming cosmetics products, likewise the number of
consumers utilizing beauty and personal care products is also increasing in male
population. Cosmetics products have been considered as luxury goods before, only
high stratum in society was able to afford; however nowadays people gradually
perceive the use of cosmetics as necessaries in their daily life (Wu & Chen, 2012). It is
the fact that in more modern times, consumers would spread awareness about more
various available products. Especially in the context of globalization, global trade is
being encouraged, the international markets are more open bringing cosmetics
companies more competitive advantages.

Among various categories, skincare has emerged as a popular and potential

segment in cosmetics market in recent years (Lopaciuk & Loboda, 2013). The users
have more opportunities to choose purchasing abundant brands of skincare products
from different foreign countries with different prices. In order to identify and produce
more opportunities to consolidate and expand the target market as well as efforts in
increasing the revenue and profits, cosmetics companies need to determine the
factors which are related to consumer buying behavior directly based on the
companies’ own resource.

A large number of foreign skincare products as well as the diversity of brands in

Vietnam motivated the research of the relationship between three values:
country-of-origin (COO), brand and price of facial skincare products with Vietnamese
consumer buying behavior towards this potential sector. In this study four global
brands from top five largest countries (USA, Japan, Korea, Thailand and others)
exporting cosmetics products into Vietnam were taken to examine the respondents’
evaluation in the context of the research model.

Be awareness of the importance of cosmetics toward Vietnamese women and the

situation of Vietnam, which is not only a potential but also competitive and attractive
market for foreign investors, the research was conducted to provide the knowledge
and the fact of Vietnamese consumer buying behavior toward consuming skincare
products regarding to the factors COO, brand and prices.

When being considered individually in single-cue approaches, every factor itself

has a significant effect on consumer buying behavior. However in multi-cue approach
studies of consumer behavior in general and in cosmetic industry in Vietnam in
particular, the role of three factors has still not been examined and concluded yet. And
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

most of the studies investigating the case of COO images that have been done have
focused mostly on developed countries, there has been little studies on such issues in
emerging countries. The sample products in this research were taken from both
developed and developing countries to understand Vietnamese consumers’
perception in two contexts, which also include the brands and prices of skincare
products from those countries.

Therefore, the research provides further understanding of three factors as well

as other aspects influencing on Vietnamese consumer buying behavior. In that regard,
the study was aimed to answer these research questions:

1. How does COO affect Vietnamese consumers’ evaluation and purchase

intentions on the skincare products as they have different cognitions toward the
products originating from different countries?
2. How does price affect Vietnamese consumers’ evaluation and purchase
intentions toward the luxury category of cosmetics products?

2. Literature Review

COO of products is defined by brands’ and companies’ headquarter origin, not by

country of manufacturing or assembly. This is supported by Johansson, Douglas and
Nonka (1985) whom considered COO of the product in regard to the place where the
headquarters of the company are located, and it is consistent with the context of
cosmetics products. There have been abundant studies of COO to make clear the
importance that consumers place on COO, and they come to two opposite
conclusions. Researchers indicate that COO plays a significant role in consumers’
product evaluation (Liu & Johnson, 2005; Laroche, Papadopoulos, Heslop & Bergeron,
2002; Agrawal & Kamakura, 1999; Ahmed & d’Astous, 1996; Ahmed, Johnson, Ling,
Fang & Hui, 2002; Tse & Gorn, 1993).

Gordon (2002) has recently affirmed that brand represents how a promise of what
consumers can expect from a product or a service of the company can be enforceable.
Brands are the aggregation of all images about a specific company or product that
consumers have and brands may take the place of numerous attributes such as
quality (Xiaoling et al., 2008; Lockshin, Rasmussen & Cleary, 2000), thus brands play
a significant role to consumers’ evaluation and take part in consumers’ choice process
(Hoyer & Brown, 1990; Dillion, Madden, Kirmani & Mukherjee, 2001).
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

Price is defined as what consumers are charged for a service rendered or goods
supplied (Perreault & McCarthy,1993). Chang and Wildt (1998) emphasized in the
condition that price is considered as the only available information for consumers or a
single-cue access, it would impact significantly on consumers’ perceived quality; i.e.,
price-level perceptions in single studies had a direct negative impact and an indirect
positive impact on consumers’ purchase intentions through their perceived quality
(Erickson & Johansson, 1985).

Consumer buying behavior - According to Armstrong and Kotler (2003), “consumer

buying behavior refers to the buying behavior of final consumers, individuals and
household who buy goods and services for personal consumption”. The consumer
market is an assemblage of all buyers who are termed as final consumers with varied
purchasing power of products and services. These final consumers refer to both
human beings and other non-living entities from all over the world with different age,
income, educational level, gender and tastes . A large number of buying decisions are
made every day. To research a consumer’s decision-making process of buying, the
basic requirement for the marketers is aimed to find out the questions of what
consumer buy, where they buy, how and how much they buy, when and why they buy
(Luong, Cho, & Vo, 2016).

2.1 The model

Consumer behavior referring to both intrinsic and extrinsic factors influences are
observed during the purchasing decision making process (Hawkins, Best & Coney,
2001). In the broad sense, consumer behavior could be assessed through the
elements from sociology, psychology, and economics. A literature review of the
relevant studies suggests some critical factors that drive to consumer behavior toward
cosmetics products. However this study narrowed the scope of researching the
factors affecting Vietnamese women’s buying behavior regarding to three extrinsic
cues: COO, brand and price. In the context of Vietnam beauty care and personal
products market, it contains different population segments with various demands and
buying powers; besides, the major shift of Vietnam socio-economies at the turn of 21st
century has boosted the expansion in all the kinds of goods markets in general and in
cosmetic industry in particular. COO therein is the factor that consumers get the most
knowledge about and considered regarding to the deficit of cosmetics products in
Vietnam market. And factor price was taken as an indicator of the product quality
(Erikson & Johansson, 1985) while Vietnamese consumers are known as price
sensitive but with luxury goods. The opening of Vietnam market gave opportunities for
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

oversea cosmetics entering with abundant brand names, made the cosmetics segment
in Vietnam diversified. Therefore, the research is based on the related literature review
and the situation in fact of cosmetic industry in Vietnam to formulate the concept and
framework about Vietnamese consumer buying behavior toward skincare products.

Country of Origin

Consumer Buying
Brand
Behavior

Price

Figure 1: Conceptual model of the study

In this research, Vietnamese consumer buying behavior was made up three

components: COO, brand and price based on literature. A number of variables that
moderate the relation of cosmetics products and consumer awareness have also
been found. To predict the influences of three factors on Vietnamese consumer
buying behavior toward skincare products, a model was developed along with three
hypotheses.

Hypothesis 1: COO of the facial skincare products has a positive effect on

Vietnamese consumer buying behavior.
Hypothesis 2: Brand of the facial skincare products has a positive effect on
Vietnamese consumer buying behavior.
Hypothesis 3: Price of the facial skincare products has a positive effect on
Vietnamese consumer buying behavior.

3. Methodology

3.1 Data collection and sampling

A convenience sampling and snowballing were used in this research because this
method is easy to access, requiring little time. To conduct the surveys, the
questionnaires were sent via online to respondents, the objective of the survey is
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

through the qualitative data collection to determine behaviors of Vietnamese

consumers when they purchase a foreign facial skincare product. The sampling frame
of this survey included Vietnamese female consumers who are known as having
experience in using the facial skincare products by the filter question in the survey that
“Do you use any facial skincare products?”. After elimination, 252 questionnaires were
used for this study’s analysis. The data of the survey were checked for omissions,
legibility and consistency, then were analyzed by using SPSS (Statistical Package for
the Social Sciences). To achieve the study objectives, a self-administered survey
questionnaire was developed based on the literature review. The questionnaire was
pre-tested with 50 respondents and revised. The survey consisted of five parts
covering the following issues:

(1) Country of Origin; (2) Brand; (3) Price; (4) Consumer buying behavior; (5)
Demographics

In the COO section, with five items, respondents were asked about COO of facial
skincare products (Klein, Ettenson & Morris, 1998; Parvin & Chowdhury, 2006). In the
brand section, with six items, respondents were asked to rate their level of agreement
on the importance of brand image regarding facial skincare products (Parvin &
Chowdhury, 2006; Yoo, Donthu & Lee, 2000). In the price section, with five items,
respondents were asked about their interested in price of facial skincare products
(Yoo et al., 2000; Lichtenstein, Ridgway & Netemeyer, 1993). Finally, in the consumer
buying behavior section, respondents were asked about their decision to purchase
facial skincare products (Luong, Cho & Vo, 2016). Measurement of “COO”, “Brand”
“Price” and “Consumer buying behavior were measured on a five-point Likert scale
ranging from 1 (strongly disagree) to 5 (strongly agree).

4. Results and Discussion

4.1 Description of Sample

The consumers’ demographics included questions about general information such

as age, occupation, monthly income, education; moreover consumers’ interests and
opinions of beauty care in general and facial skincare products in particular, their
shopping and using facial skincare products habits, spending, and favorite
country-of-origin and brands of the products.
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

Of a total sample of 252 respondents, 100 percent were female. A large majority of
respondents’ ages were in the ranges 18-24 (65.9%), 25-30 (25.4%) and 31-40
(7.5%). the highest ratio of utilizing facial skincare products belongs to student with
62.7% and followed by the officer group which is accounted for 24.2%. This presented
that the people who care and pay attention to their skincare are principally students
and officers, they are consumers who have stable work and needs to serve their life
and jobs. The majority of the respondents (41.3%) had a monthly income of more than
$100-$250 dollars. In addition, more than half of respondents (64.7%) graduated
bachelor degree. The number reflected the fact that consumers with high knowledge
pay more attention to their skin as well as personal care needs. Descriptive statistics
are displayed in Table 1.

Table 1: Demographics information of respondents

Cumulative
Frequency Percent
Characterics Percent
Gender Female 252 100.0 100.0
18 - 24 166 65.9 65.9
25 - 30 64 25.4 91.3
Age
31 - 40 19 7.5 98.8
41 - 55 3 1.2 100.0
Student 158 62.7 62.7
Officer 61 24.2 86.9
Occupation
Businessman 18 7.1 94.0
Others 15 6.0 100.0
$100 - $250 104 41.3 41.3
Monthly $251 - $400 79 31.3 72.6
income $401 - $550 46 18.3 90.9
More than $550 23 9.1 100.0
Secondary
2 0.8
school 0.8
High school 45 17.9 18.7
Education Bachelor 163 64.7 83.3
Master 27 10.7 94.0
Ph.D 1 0.4 94.4
Others 14 5.6 100.0
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

The results of descriptive analysis for demographic information of interest in and

necessity of skincare products indicated that 39.3% of respondents said that they are
fairly interested in cosmetics and 49.2% of them evaluate skincare particularly
important. Knowing its importance, most of respondents utilize the facial skincare
products everyday (51.2%). Likewise 31.7% of the respondents frequently purchase
the facial skincare products once in more than 3 months while the others showed that
26.2% of them purchase monthly and 20.2% of them purchase every 2 months. This
means that facial skincare products belong to the category of vital commodities and
consumers’ needs of these products are high. However though cosmetics are listed
into the luxury goods, based on the monthly average income the respondents who are
accounted for 41.3% spend less than $10 per month to purchase. And followed by
other 52% of them pay $11 - $50 for cosmetics every month. It can be forecast that
the mid-range facial skincare products are popular to consumers.

Korea was rated the favorite country as 118 of total samples selected it.
Nevertheless the most people (56) selected Olay, a brand originated in USA, as their
favorite brand of facial skincare products. This proved that consumers perceived and
differentiated the COO and brands of the products as two independent objects. In the
other hand, most of respondents who select their favorite country of origin also picked
that country’s products such as 40 of 118 people who chose Korea also selected The
Face Shop brand as their favorite and similarly 20 of 38 people chose both country
and brand of Japanese. A small number of the other options were also mentioned
beside these four ones; the additionally mentioned countries were Thailand, Vietnam
and the UK; and brands were Clinique, Skinfood, Yves Rocher, Biore, Pond’s, Estee
Lauder, etc.

Table 2: Consumers’ personal interest, habits and frequency of buying and

using facial skincare products.
Frequenc Cumulative
Characterics Percent
y Percent
Not intersted at all 9 3.6 3.6
Fairly little interested 22 8.7 12.3
Interest in
Somewhat interested 69 27.4 39.7
cosmetics
Fairly interested 99 39.3 79.0
Very interested 53 21.0 100.0
Necessity of Unnecessary 8 3.2 3.2
using Fairly little necessary 9 3.6 6.7
 Proceedings of 37th International Business Research Conference
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ISBN: 978-1-925488-14-2
skincare I don't know 5 2.0 8.7
Fairly 106 42.1 50.8
Very necessary 124 49.2 100.0
Once in more than 2
48 19.0 19.0
weeks
Frequency of
Once in 2 weeks 22 8.7 27.8
using
Once a week 20 7.9 35.7
skincare
More than once a week 33 13.1 48.8
Everyday 129 51.2 100.0
Once in more than 3
80 31.7 31.7
months
Frequency of Once in 3 months 35 13.9 45.6
buying Once in 2 months 51 20.2 65.9
skincare Once a month 66 26.2 92.1

More than once a month 20 7.9 100.0

Less than $10 104 41.3 41.3
$11 - $20 74 29.4 70.6
Spending on $21 - $50 57 22.6 93.3
skincare $51 - $70 8 3.2 96.4
$71 - $100 6 2.4 98.8
More than $100 3 1.2 100.0
France 37 14.7 14.7
Favorite Korea 118 46.8 61.5
country Japan 38 15.1 76.6
of skincare USA 35 13.9 90.5
Others 24 9.5 100.0
L'oreal 42 16.7 16.7
Favourite The Face Shop 48 19.0 35.7
brand Shiseido 38 15.1 50.8
of skincare Olay 56 22.2 73.0
Others 68 27.0 100.0

4.2 Factor Analysis

According to the results shown in table 3, a total of 19 items were classified into
four factors with the accumulation percentage of explained variance being 68.064%.
In other words, the principal components analysis released four components, which
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

attribute to the 68.604% of total variance. The appropriateness of factor analysis

which was determined by the Kaiser-Meyer-Olkin (KMO) measure of the sampling
adequacy was 0.917 and the chi-square value of Bartlett’s test to test the null
hypothesis which presents the strength of the relationship among variables was 0.000
(p<0.001). According to Kaiser (1974) to examine sample sufficiency, he
recommended that the sampling adequacy as minimum at 0.5 is barely acceptable,
while values between 0.7-0.8 are acceptable and values above 0.9 are superb. It
means that KMO value and the chi-square value of Bartlett’s test of this study were
significant; or the sample data were sufficient to undergo factor analysis and the
principal component analysis had sense. Therefore, by choosing the coefficient to
suppress absolute value less than 0.40, four factors were shown in detail in table.

Table 3: Percentage of variance explained and eigenvalues, KMO and Bartlett's

Test
Accumulation
Number of
Number percentage of Bartlett's Test
components KMO
of items explained variance Sig.
extracted
(%)
19 68.064 4 .917 .000

Table 4: Descriptive statistics and the Cronbach’s α coefficients. (N=252,

overall Cronbach’s α = 0.915)

Factor
Std.
Me
Item labels Deviati
an loadin
on
g
3.7
Country-of-origin (5 items, Cronbach's α = .918) .805
9
3.8
Facial skincare products made in this country are reliable .892 .765
8
I will get good results from using facial skincare products 3.7
.919 .832
made in this country 7
3.7
Facial skincare quality of this country is high level .911 .809
7
 Proceedings of 37th International Business Research Conference
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3.8 .932 .802

It is great to have facial skincare products of this country
1
Facial skincare products made in this country are usually 3.7
.980 .758
a good value for money 2
3.6
Brand (6 items, Cronbach's α = .892) .754
3
3.5
This brand is more advanced than any other brands .955 .719
1
3.6
This brand has unique features .910 .650
2
This brand has attractive attributes 3.6 .920 .797
3.7
This brand is popular to consumers .909 .749
7
3.4
A well-known brand product is always better .980 .661
9
It's safe to buy a branded product as they always come 3.8
.940 .601
with better quality 2
3.0
Price (5 items, Cronbach's α = .771) .776
5
2.8
The price is always very high 1.106 .792
8
3.4
The price is always reasonable .980 .426
9
2.5
The price is always underpriced 1.198 .743
6
Generally, the higher price, the higher quality 3.1 1.030 .778
The price of a facial skincare product is a good indicator 3.2
1.045 .673
of its quality 3
Consumer buying behavior (CBB) (3 items, 3.6
0.876
Cronbach's α = 0.785) 3
When I buy a facial skincare product, I think its price is 3.4
1.134 .755
important. 9
When I buy a facial skincare product, I think its brand is 3.6
1.018 .791
important. 1
When I buy a facial skincare product, I think its 3.8
.984 .695
country-of-origin is important. 1
 Proceedings of 37th International Business Research Conference
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ISBN: 978-1-925488-14-2

4.3 Pearson correlation, regression

Table 15 presented the results of the Pearson’s correlations of all four factors. All
the 2-tailed p-values are less than 0.05 (p<0.01) and all the Pearson correlation
values are positive (p<0.01). That means there is a statistically significant correlation
between two factors of total four factors and the correlations are positive. However, in
this case the significance may be misleading due to the moderate or small
correlations

Table 15 : Pearson’s correlations

COO Brand Price CBB
Pearson
1
COO Correlation
Sig. (2-tailed)
Pearson
.673** 1
Brand Correlation
Sig. (2-tailed) .000
Pearson
.264** .473** 1
Price Correlation
Sig. (2-tailed) .000 .000
Consumer Pearson
.561** .564** .318** 1
buying Correlation
behavior Sig. (2-tailed) .000 .000 .000
** p<0.01

Table 16: The results of the regression analysis hypothesis

Consumer buying behavior
R2 .384
Adjusted R2 .377
N 252
F 51.561
Sig (p<0.05) 0
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Table 17: Coefficients of the regression analysis hypothesis

Unstandardized Standardized
Independent Coefficients Coefficients
t Sig.
variable Std.
B Beta
Error
(Constant) .689 .248 2.776 .006
COO .370 .074 .340 5.026 .000
Brand .340 .086 .293 3.954 .000
Price .101 .064 .090 1.577 .116

In table 16, R2 value which is 0.384 means that around 38% of the variance in
consumer buying behavior can be explained by three factors COO, brand and price.

The F-test outcome is highly significant (p<.01), so the model in this study does fit the
data.

In addition, table 17 gives focus to the three independent variables which are
COO, brand and price. The results presented that there is a statistical significance
between two factors COO, brand and Vietnamese consumer behavior. The effect of
“COO” (β = .340, p<.05) is significant and its coefficient is positive. It means that COO
has a positive relationship with Vietnamese consumer buying behavior. The
hypothesis 1 is supported.

Similarly, the effect of “brand” (β = .293, p<.05) is significant and its coefficient is
positive. It means that brand has a positive relationship with Vietnamese consumer
buying behavior. The hypothesis 2 is supported.

However, the effect of “price” (β = .090, p>.05) is not significant. It means that
there is not a positive relationship between price and Vietnamese consumer buying
behavior. The hypothesis 3 is not supported.

For inside, “COO” is the most important factors of Vietnamese consumers in

purchasing cosmetics in general and facial skincare products in particular. Besides,
two factors “COO” and “brand” have a direct relationship with consumer evaluation,
while based on the Pearson’s correlation analysis, factor “price” has a significant
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

correlation with consumer behavior but it does not affect directly Vietnamese
consumer perception.

4.4 Analysis of Variance (ANOVA)

Table 18:The results of one-way ANOVA by personal profile

Factors Age Occupation Income Education
COO .848 .239 .149 .003**
Brand .508 .833 .031* .006**
Price .817 .138 .475 .019*
Consumer
.210 .729 .013* .015*
behavior
(*p<.05; **p<.01)

Table 18 showed that the personal information is meaningful to four factors in

purchasing facial skincare products of Vietnamese consumers, especially female. The
results indicated that “Age” and “Occupation” are not significant on all factors.
However, “Education” has significant effects on all four factors. Consumers with high
knowledge have high needs of utilizing cosmetics and tend to purchase the foreign
facial skincare products more than people with lower knowledge. Most of them have
bachelor degree, and they may differentiate and perceive the product quality highly
through COO, brand and price of the products. Besides, “Income” has a significant
effect on “Brand” and “Consumer behavior”. It is the fact consumers consider brand
image as a symbol of social status, and whom with higher income can afford higher
brands, this reflects partly a person’s social class.

4.5 Discussion

Along with the change in economy, policies and culture, the demand for cosmetic
products of Vietnamese consumers is increasing, especially for the foreign products
more than the domestic ones (Nguyen & Sirikhoon, 2008). In addition, regarding to
the findings of consumers’ interest and concerns about as well as their frequency of
utilizing facial skincare products, cosmetics nowadays are more and more necessary
for Vietnamese women. Hence Vietnam, in which more than 95% of cosmetics are
imported, is a potential market with majority of foreign cosmetic products and gives
lots of chances to the foreign companies investing. This study is aimed to examine the
influence of each factor like COO, brand and price on Vietnamese consumer buying
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

behavior when they purchase a facial skincare product; for inside, it clarifies the role
and difference among three factors. The results of the research apply some
meaningful points to the marketers.

To answer the first research question, the research showed that role of COO had
positive and direct impact on Vietnamese consumer buying behavior. It means that
when respondents are awareness of the country image favorably, they also consider
the product from that country positively. As many authors suggested that COO plays a
significant role in consumers’ product evaluation (Liu & Johnson, 2005; Laroche et al.,
2002; Agrawal & Kamakura, 1999; Ahmed et al., 1996, 2002; Tse & Gorn, 1993), in
this research it was found that COO acted as the most important factor affecting
Vietnamese consumer evaluation and they were concerned with COO than brand.
Regarding to the findings, COO which is related to consumers’ reliability toward
skincare products had highest mean at 3.88 value. This presented that a country
image contributes directly and positively to consumers’ beliefs in shaping reputation of
a skincare product. COO was assessed as a surrogate indicator of product quality,
thus it also brought respondents the performance and impression of the product.

When considering issue brand in relation to purchasing behavior in the second

research question, the study pointed out that similarly to COO, relationship between
the perception of brand and consumer buying behavior is also positive and directive.
This is consistent with some scholars who claimed that brands play a significant role
to consumers’ evaluation and take part in consumers’ choice process (Hoyer & Brown,
1990; Dillion et al., 2001). For this research, the idea of brand image in mind of
Vietnamese consumers was assured by the descriptive analysis research with the
highest mean 3.82 “It’s safe to buy a branded product as they always come with better
quality”, this supported Samiee’s (1994) research that consumers perceive global
brands with higher price and better quality. In other words, it clarified that Vietnamese
consumers with popular brands, they would have idea of the skincare product quality.
However, in mentioned concept where consumers perceive the facial skincare
products through three factors, brand is not taken as the most significant indicator to
consumers. Due to the diversity of brands in cosmetic market, consumers may not
perform full packet capture of information across all brands; meanwhile COO of the
product maybe used by Vietnamese consumers directly to evaluate as Lockshin et al.
(2000) mentioned that brands may take place of some product attributes like quality.

Through the research of relationship between price and consumer buying behavior,
the answer of the third research question was that the factor price did not affect
 Proceedings of 37th International Business Research Conference
1 - 2 August 2016, Circus Circus Hotel, Las Vegas, USA
ISBN: 978-1-925488-14-2

Vietnamese purchasing behavior directly and significantly toward facial skincare

products. As Nguyen and Sirikhoon (2008) presented that in some cases Vietnamese
consumers are price sensitive; in the other hands, they are willing to pay a high price
to afford the luxury products such as cosmetics. Thus Vietnamese were less likely to
utilize price as an indicator unless lacking product information. This showed the
contrary to previous studies conducted by Ettenson et al. (1988) and Johansson et al.
(1985) that price affects consumers’ product evaluation more significantly than COO
information. But it supported Erickson and Johansson (1985) that price has an indirect
positive impact on consumers’ purchase intentions through their perceived quality.
Price was predicted to be the mediator between COO (brand) and Vietnamese
consumer buying behavior when consumers do not have enough information or
unfavorable perceptions about the facial skincare products.

For the last research question, from the results, the respondents were primarily
students and young generation aged from 18 to 24 and earned less than $100 to $250.
Though the majority of income was around the per capita income monthly of
Vietnamese, the outcome of personal profile information revealed that income
affected consumer buying behavior only in selecting brands but purchasing the facial
skincare products. Likewise the price was found to be only indirectly and positively
correlated to the purchasing behavior; in other words the price was not an important
factor. It can be concluded that Vietnamese women placed importance on cosmetics
in general and facial skincare products in particular, therefore the demand for these
products were high.

Vietnamese consumers evaluated skincare from four countries in the study higher
quality than from other countries because those countries are well-known in cosmetic
production technology and safety with global brands such as L’oreal from France, The
Face Shop from Korea, Shiseido from Japan and Olay from USA. Not only skincare
products from Europe, America but also from Asia like Japan, Korea became more
and more favorable to Vietnamese consumers because they believed that with similar
climate and skin types in Asia, companies would provide the appropriate skincare
products to Vietnam market. Nevertheless, some consumers prefer local products due
to reasonable price. Regarding to the study, respondents tended to purchase the
facial skincare from Korea as the most priority and followed by Japan, France, USA
and some others. Consumers utilizing the skincare products most are young groups;
and it can be seen now that Korea’s entertainment industry today develops rapidly
and their celebrities who generally represent and promote the skincare products are
popular globally, especially to Vietnamese young generation. Furthermore, Koreans
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are known for the symbols of beautiful skin and makeup among Asia countries. Thus
brands which originate in Korea attract more and more young people, even
Vietnamese.

In conclusion, following the results from the study of Parvin and Chowdhury (2006)
about the beautification products, this study is no exception that in overall
consideration of three extrinsic cues: COO and brand had positive and significant
influence on Vietnamese consumer buying behavior of cosmetics in general; only
factor price showed no such influence on Vietnamese consumer behavior. And among
them, COO was the most important factor that affected directly and positively
purchasing behavior.

5. Conclusion

5.1 Summary of the finding

Cosmetics in general and skincare in particular are more and more important and
necessary to Vietnamese women today. Vietnam is further one of countries where
cosmetic products are mostly imported yearly and Vietnamese consumers are
presented to consume more cosmetic products overseas than domestically through
several types of distribution channels. Cosmetic market in Vietnam is considered as
one of rapidly growing market sections which has been competitive and grown
continuously recently. In numerous categories of cosmetics, skincare group drives
principally the strongest cosmetic growth, especially facial items which are adopted in
the research. In this study, Vietnamese consumer buying behavior was examined
using some independent variables. The researcher applied and defined three
behavior related factors, they are COO, brand and price of a facial skincare product.
The effects of all three factors on how individuals subjectively are correlated to
consumer behavior were analyzed and measured.

From the study, 252 respondents were participated; young generation’s age
between 18-24 was the majority of this study which was accounted for 65.9%. 62.7%
of respondents were students and 64.7% owned bachelor degree. In term of monthly
income, the majority of them earn less than $100 occupied of 38.9% and followed by
the group earning $100-$250 with 30.2% respectively. 39.3% of respondents implied
that they were fairly interested in and 42.6% of them identified the facial skincare is
necessary. About half of the respondents selected to purchase facial skincare
products from Korea with 118 out of total 252 responses and followed by three
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ISBN: 978-1-925488-14-2

countries Japan, France and USA approximately and equivalently, and a minority of
Vietnam. Half of the respondents had the habit of utilizing skincare products everyday
while 31.9% purchased products once in more than 3 months and spend averagely
less than $10 per month in purchasing.

The results showed that COO and brand had positive and significant relationship
with Vietnamese consumers. However a confusing and inverse result with factor price
was informed. On contrary with the hypothesis, price was revealed to have a positive
but insignificant influence on Vietnamese consumer buying behavior. To answer the
research questions, both COO and brand affect Vietnamese consumer behavior
positively and significantly in their purchasing; COO is therein the most important

factor. To the context of cosmetic products, price does not affect Vietnamese
consumers in buying skincare products directly, it is predicted to impact somehow
indirectly through COO or brand.

5.2 Contributions

Consumer buying behavior is definitely a crucial aspect in marketing research and

today along with the socioeconomic growth it keeps playing an important role for each
business strategy. Hence understanding consumer needs as well as how the factors
and variables affect consumer decision making process becomes essential,
especially toward the potentially developing industry like cosmetic market in Vietnam.
The findings of this study contribute the basis to develop a constructive suggestion to
the cosmetic companies in their marketing strategies planning. The results may help
the existing international companies or which are planning to export skincare products
into Vietnam by clarifying Vietnamese consumer buying behavior toward facial
skincare products in terms of COO, brand and price.

This study contributed partly to increase sales, market share and profits of
cosmetic industry in Vietnam market. This is helpful for spreading new cosmetic
markets and companies with more brands of the products and more various segments
of Vietnamese consumers.

5.3 Managerial implication

Due to various skin types, in which 50% of Vietnamese women have oily or mixed
skin types, the demands of each type are not similar. It is very important to the
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ISBN: 978-1-925488-14-2

consumers that the skincare products must be suitable with their skin types and the
skincare products should work effectively with theirs. Hence cosmetic companies
should create the products that matter to consumers based on their various demands.
From the research, cosmetic companies from Korea, Japan, France and USA would
have higher advantages than others. And the respondents perceived the skincare
products from Korea and Japan as both high quality and be appropriate to Asia skin
such as Vietnamese. Companies from the countries regarding to favorable and
positive COO images like four countries mentioned may focus on and attract
consumers to the label “made in” on their skincare products. When COO image of the
products are positive, the companies probably can adapt high price, exclusive
distribution and COO advertising so that they can strengthen and take advantage of
COO. On the contrary, companies from less favorable country images should focus on
their brand names together with other product attributes to improve consumer
awareness, a suitable price strategy should be also planned for these kinds of
skincare products.

While majority of the respondents is students at young age with averagely low
income, cosmetic companies can target the segment of young generation who have
high needs in skincare with low or medium price. Furthermore, the segment of middle
and mature age groups, who have more stable work and income, are predicted more
willing to pay for the high quality products with high price. Knowing the situation of
domestic and foreign cosmetic products in real market, the local companies should
concentrate more on improving their local products and Vietnamese consumer
behavior by various strategies which focus on the product attributes, distribution
channels, price strategy, product advertising and promotion and building a favorable
product image.

Besides, cosmetic companies need to notice the major competitors so that they
can discriminate their products by special strategies. Predicting the trend of utilizing
cosmetics in the future to adopt the suitable change should be considered carefully as
well.

5.4 Limitation and future research

This study includes some following limitations and potential directions for future
research. Generally when coming up with a decision, consumers will collect and
utilize as much as available information including all variables that affect of cues on
consumer behavior. The cues considered in this study were selected from some
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previous studies which contain both extrinsic and intrinsic variables. In the next
studies, more variables and constructs should be researched such as psychology,
reference group and product quality etc.

It is known that 70% of cosmetics in Vietnam are illegally imported by various ways
in compared with domestic products, legally imported and hand-carried products.
Thus the numbers reflecting reality in cosmetics in Vietnam do not include in the
official statistics and are not presented in the research. It also suggests the presence
of more other cues in future research.

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