John Mark Zambrano

UNDERSTANDING THE SELF E-02

Filipinos Buying Behavior

When it comes to shopping, Filipino consumers would most likely be attracted to buy products
that come with free gifts. This is according to a new online study from leading global
information and insights provider, Nielsen.

The Nielsen survey of more than 29,000 Internet respondents in 58 countries revealed that 76
percent of Filipino respondents say that products with free gifts are more attractive to buy,
exceeding the Asia Pacific average of 58 percent. With the exception of Greece (74 percent),
developing countries such as Vietnam (75 percent) comprised the list of countries that responded
most strongly in favor of receiving free gifts.

"The allure of good product promotions is strongest in developing countries such as the
Philippines where practicality and creativeness are needed in order to stretch the budget.
Filipinos may be ready to spend but still they are on the lookout for the best deals and promos.
Offering extras or gifts to consumers will get them to buy a product over another, " says Stuart
Jamieson, managing director at Nielsen Philippines.

In the survey, it was further revealed that more than 80 percent of Filipino respondents shop
around in order to buy the most favorable product.

While various forms of media are available as source of information on products, the television
is the dominant source of information for Filipino respondents. Particularly, the respondents
prefer to get information from television on cosmetic/skin care, food and beverage, personal
care, health care/medicine, household product and home appliance. Filipino respondents choose
the Internet as source of information for cars, while magazines are the favoured information
source for jewelry and in-store display /promotion for clothes.

The Nielsen report also brings to light the consequential role advertising has on influencing
consumers’ purchasing decisions. Two thirds or 67 percent of Asia Pacific consumers say that
advertising influences their preference for a brand – the highest in the world and 12 points above
the global average of 55 percent.
This was especially pronounced in Korea and the Philippines, where around four in five
consumers (79 percent and 78 percent respectively) said commercials increased their brand
preference, followed by Indonesia (74 percent), India (74 percent) and China (72 percent).

I agree that it really depends on the situation. Sometimes quality is more important and other
times quantity. Many times, this is really a matter of opinion. In one example given above, the
post stated they would rather have a quality piece of chocolate rather than several lesser quality
pieces of chocolate. I might disagree. If I'm really hungry, I would rather have more to eat than
a higher quality of food.

Opinion might come in to play in other areas as well. For instance, I prefer to have less higher
quality items of clothing while my sister prefers to have more quantity than quality. She
purchases new clothes each season because they do not last. I prefer to save my clothing and
have it last longer. Neither way is wrong. It's just a matter of preference.

There are situations where one will always matter more than another. Drinking water, for
instance, will always put quality over quantity. You could have all the water in the world, but if
it is polluted or otherwise unsafe to drink it doesn't matter how much you have.

The study is concerned in identifying and comparing the different buying behaviors of Filipino
consumers and the marketing practices adopted by eight selected fast food companies in relation
with the four P's of marketing.

The fast food industry is a sub-sector of the larger restaurant industry. There are 15,000 fast food
restaurants operating in Metro Manila. The most common tools adopted by the fast food
companies in the Philippines are window displays, free delivery, radio and TV advertising, and
billboard advertising.

The success of the fast food industry in the Philippines can be attributed to the factors of
standardized procedures, limited menus, placing emphasis on value, speed and efficient service
and franchising. The fast food industry has changed the urban lifestyle because it developed well
in cities but fast food companies are reluctant to develop a market in the suburbs. That is, the fast
food market in the Philippines still has room for expansion to those who want to invest.

Consumer behavior has affected Filipinos' self identity. Consumer behavior refers the study on
how people mentally, physically or emotionally react or respond on different products and
services. Self-identity refers to the overall perception of oneself in relation to the society
someone belongs to.

The Filipino people's buying behavior has become highly dependent on vanity and materialism
nowadays. This means that more people would more likely buy products as long as these have
higher aesthetic value and "better" than what others are using. An example of this phenomenon
is investing more on top-rated yet very expensive gadgets as opposed choosing more functional
ones.

People buy products based on the physical aspects and not by the content. Another example of
this is parents opting to buy formula milk brand A because it is simply much more expensive
than brand B when in fact the nutritional value of both is just the same. These characteristics of
Filipino consumers lead to higher spending on disposable income and not being able to save
money anymore. Expensive products like cars and gadgets also need higher maintenance which
means consumers end up spending even more than what they originally planned.

In my own opinion, Filipino consumers' buying habits have to be remodeled. I am also guilty of
this unhealthy behavior and I think people's perception on products have to change.