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EFEK SIFAT-SIFAT PSIKOLOGIS PADA SIKAP TERHADAP BRAND DAN INTENSI PEMBELIAN: PENGETAHUAN KONSUMEN SEBAGAI EFEK MODERASI CLARA SARAH & ARGA HANANTO INTERNATIONAL UNDERGRADUATE PROGRAM FACULTY OF ECONOMICS [email protected] ABSTRAK Fokus dari skripsi ini adalah untuk meneliti sikap dan intensi pembelian terhadap suatu brand luxury dengan menganalisis sifat-sifat psikologis yang mempengaruhinya termasuk value consciousness, susceptibility to normative influence, dan need for uniquenes. Penelitian ini adalah penelitian kuantitaf dengan desain deskriptif. Hasil penelitian ini menyarankan bahwa apabila Louis Vuitton ingin meningkatkan sikap dan intensi pembelian konsumen, sebaiknya manajer focus kepada sifat susceptibility to normative influence. PYSCHOLOGICAL TRAITS EFFECT ON BRAND ATTITUDE AND PURCHASE INTENTION: CONSUMER KNOWLEDGE AS MODERATION EFFECT ABSTRACT The focus of this study is to examine the attitude and purchase intention towards a certain luxury brand by analyzing the psychological traits affecting them including value consciousness, susceptibility to normative influence, and need for uniqueness. This research is quantitative descriptive interpretive. Researcher suggests that to increase brand attitude and purchase intention, Louis Vuitton managers should focus on the susceptibility to normative influence trait. Keywords: Brand attitude, purchase intention, susceptibility to normative influence, need for uniqueness, value consciousness Introduction The luxury retailers are growing bigger nowadays. It is not just Western Europe that becomes the main target for luxury goods, many luxury goods companies are now expanding to Latin America, Asia Pacific, and Africa because of the burgeoning middle class (Wang, 2013). Euromonitor (2013) predicted that Asia Pacific would be the biggest region in the world for luxury goods by 2018. It is not just China and India that hugely contributes to the growth of luxury consumption, but also emerging Asian markets like Indonesia. Indonesia middle class is raising every year and has hugely Efek sifat sifat psikologis pada..., Clara Sarah, FE UI, 2014

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EFEK SIFAT-SIFAT PSIKOLOGIS PADA SIKAP TERHADAP BRAND DAN INTENSI PEMBELIAN: PENGETAHUAN

KONSUMEN SEBAGAI EFEK MODERASI

CLARA SARAH & ARGA HANANTO

INTERNATIONAL UNDERGRADUATE PROGRAM FACULTY OF ECONOMICS

[email protected]

ABSTRAK

Fokus dari skripsi ini adalah untuk meneliti sikap dan intensi pembelian terhadap suatu brand luxury dengan menganalisis sifat-sifat psikologis yang mempengaruhinya termasuk value consciousness, susceptibility to normative influence, dan need for uniquenes. Penelitian ini adalah penelitian kuantitaf dengan desain deskriptif. Hasil penelitian ini menyarankan bahwa apabila Louis Vuitton ingin meningkatkan sikap dan intensi pembelian konsumen, sebaiknya manajer focus kepada sifat susceptibility to normative influence.

PYSCHOLOGICAL TRAITS EFFECT ON BRAND ATTITUDE AND PURCHASE INTENTION: CONSUMER KNOWLEDGE AS MODERATION

EFFECT

ABSTRACT

The focus of this study is to examine the attitude and purchase intention towards a certain luxury brand by analyzing the psychological traits affecting them including value consciousness, susceptibility to normative influence, and need for uniqueness. This research is quantitative descriptive interpretive. Researcher suggests that to increase brand attitude and purchase intention, Louis Vuitton managers should focus on the susceptibility to normative influence trait. Keywords: Brand attitude, purchase intention, susceptibility to normative influence, need for uniqueness, value consciousness Introduction

The luxury retailers are growing bigger nowadays. It is not just Western Europe that

becomes the main target for luxury goods, many luxury goods companies are now

expanding to Latin America, Asia Pacific, and Africa because of the burgeoning

middle class (Wang, 2013). Euromonitor (2013) predicted that Asia Pacific would be

the biggest region in the world for luxury goods by 2018. It is not just China and India

that hugely contributes to the growth of luxury consumption, but also emerging Asian

markets like Indonesia. Indonesia middle class is raising every year and has hugely

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contributes to the economy growth because compared to other class, this class is the

one that has a large portion of consumption.

In addition to rising number of middle class consumers, the rising number of luxury

brand stores also shows that there is a huge potential of luxury goods consumption by

Indonesian consumers. It is not just the elite and super-wealthy class that becomes the

target of luxury brands, the emerging middle class also become another important

target because they can afford luxury goods. These make Indonesia has a very

attractive value proposition in its economy because, unlike other Asia “tiger”

countries, Indonesia economy has a strong consumption.

However, there are several factors that distinguish Indonesian market from the other

market. The culture of Indonesia consumers set them apart from other consumers.

According to Oxford Business Group 2013 report, the Internet and social media trends

keeps Indonesia consumers up to date with the latest trend globally, which makes

Indonesia consumers have a high brand awareness (Oxford Business Group, 2013).

Indonesia consumers are also becoming much more sophisticated, which means

buyers demand better quality products (Oxford Business Group, 2013).

Whilst Indonesia market is very potential, those facts provide several challenges for

luxury retailers in Indonesia. Indonesia consumers are very brand conscious and it is

not clear which brand is perceived as the best-known brand for a certain product

category, for example Louis Vuitton for suitcases. Indonesia consumers are also

becoming much more sophisticated, which means buyers become more critical of the

brands, products and marketing strategies that have worked well in recent years

(Oxford Business Groups, 2013).

The purpose of this study is to provide understanding of the Indonesia consumers’

behavior of luxury brands based on their psychological traits. There are a substantial

amount of traits that can affect the behavior, however to evaluate the behavior of

Indonesian consumers towards a luxury brand, researcher focus on three main traits

based on variety of previous researches (e.g., Amaldoss & Jain, 2005; Clark et.al.,

2007 in Zhan & He, 2011). These traits are value consciousness, susceptibility to

normative influence, and need for uniqueness. Based on the research, these traits have

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effect on brand attitude that eventually leads to purchase intention. Therefore, the

problem formulation of this thesis is to analyze the effect of these three traits on brand

attitude and purchase intention.

The primary goal of this study is to examine the behavior of Indonesia consumers

towards a certain luxury brand. The problem formulations of this study are:

1. How is the effect of VC and brand attitude?

2. How is the effect of SNI and brand attitude?

3. How is the effect of NFU and brand attitude?

4. How is the effect of NFU and consumers knowledge on brand attitude?

5. How is the effect of brand attitude and purchase intention?

Therefore, based on the problem formulation above, the purposes of this research are:

1. To analyze the effect of value consciousness on brand attitude.

2. To analyze the effect of susceptibility to normative influence on brand attitude.

3. To analyze the effect of need for uniqueness on brand attitude.

4. To analyze the moderation effect of consumers knowledge on need for

uniqueness and brand attitude.

5. To analyze the effect of brand attitude on purchase intentions.

Theoretical Analysis Attitude can be defined a composite of a consumer’s beliefs, feelings, and behavioral

intention toward some object within the context of marketing (Perner, 2010).

According to Khan et al. (2012), purchase intention is the decision making process

used by consumers relating to a market deal in the form of purchase of products and

services from one seller or group of sellers. Lichtenstein et al. (1990) define value

consciousness as “a concern for paying low prices, subject to some quality

constraint”. The definition qualifies the technical notion of value as the ratio of quality

to price with a quality constraint, acknowledging the fact that for some consumers a

certain quality might be beyond their requirements.

Normative influence is an enduring trait in which individuals tend to conform to the

expectations of other members of a reference group in order to enhance their social

image (Burnkrant and Cousineau, 1975 in Ling, 2009). In psychological terms, the

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normative influence involves conforming in order to be accepted or liked by a group,

not necessarily because one actually believes the things one is doing or saying

(Fournier, 2009). Consumer need for uniqueness is a tendency to actively pursue

dissimilarity from other members from other members of a reference group through

product and brand purchases as a means of developing a distinct self-image and

social-image (Tian et al., 2001 in Zhan & He, 2011).

Methodology This study uses descriptive cross-sectional research design, because the research has a

specific hypothesis and the data collection is conducted one time at one period to all

population samples. In addition, this study is quantitatively oriented. Data collection

for this study will be conducted through primary and secondary data collection. The

primary data will be gathered through questionnaire.

The population of this study is both male and female aged above 20 years old that

have the knowledge of luxury brands and Louis Vuitton. Based on Hair et al. (1998),

the sample needed for this study is 135 derived from the number of observed variable

multiplied by five. Since this study has moderating effect, the number is multiplied by

2 making this study needs the minimum of 270 respondents. In gathering population

sample, researcher uses combination of non-probability sampling that is convenience

and purposive samplings. Purposive sampling is a form of convenience sampling in

which the population elements are selected based on the judgment of the research

(Malhotra, 2007) while, convenience sampling attempts to obtain a sample of

convenient elements (Malhotra, 2007).

Before processing the data obtained through questionnaires, researcher conducts

initial screening questionnaire to determine whether or not to further process the

questionnaires. Pretesting is performed to test the feasibility of the questionnaire that

will be distributed to the respondents by using validity and reliability indicators. After

pretesting shows that the questionnaire is valid and reliable, then researcher distribute

the main questionnaire. In analyzing main questionnaire data to test the proposed

hypothesis, researcher uses Structural Equation Model (SEM) version 8.8. SEM is a

general approach to multivariate data analysis.

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In the SEM analysis, researcher uses two-step approach, or respesification, that is the

test is conducted twice if the first results have indication that the model test value is

still not good. To analyze the moderation effect, researcher uses multi sample model

and there are six steps in conducting multi sample model, they are:

1. Estimation of Research Model

This first step contains estimation process to research model by using all

sample data. Then this process will results in research model with the best

fitness level.

2. Distributions of Samples into Groups

The second step is related to the distribution of sample data into groups in

accordance to the moderating variable’s category.

3. Base Line Model

The third step contains the formation and base model estimation for each

group. This research model estimation is conducted separately using input data

for each group.

4. Multi-Sample Model Estimates with the same Parameter Set

The forth step is related to the estimations to multisample model, in which the

base model of all groups is placed on a program and simultaneously estimated.

In this step, the parameters values of model base are set to the same value. The

results of estimation will show that all parameter from base model is the same

for all the groups.

5. Estimation of Multi Sample Model with different set of Parameter

The fifth step is similar to the fourth step, however there are several parameters

that will be analyzed freely estimated into each group. We will also note the

value of X2 and degree of freedom.

6. Evaluation of Parameter Differences between each Group

The last step contains the calculations of value differences between X2 and

degree of freedom that are resulted from the forth and fifth step. From the X2

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value of ΔX2 with df of Δdf then we get the results of p value. If the p value is

below 0.05, then the differences between analyzed each groups parameters is

significant. However, if p value is above 0.05 then the differences between

analyzed each groups parameters is not significant

As for the hypothesis testing, this study uses two-tailed prediction. A two-tailed t-test

is a statistical test in which the critical area of a distribution is two sided and tests

whether a sample is either greater than or less than a certain range of values

(Investopedia).

Results

The results of SEM analysis are as below:

• The effect of value consciousness towards brand attitude is significant with the

T-value of 1.76 > 1.65.

• The positive effect of susceptibility to normative influence towards brand

attitude is significant with the T-value of 3.10 > 1.65.

• The effect of need for uniqueness towards brand attitude is not significant with

T-value of 0.72 < 1.65.

• The moderation relationship of consumer knowledge between need for

uniqueness and brand attitude is not significant based on the analysis

comparisons of moderation effect. It is not significant because there’s no

difference in chi-square of structural model and structural coefficient.

• The positive effect of brand attitude towards purchase intention is significant

with the T-value of 7.24 > 1.65.

Analysis and Discussion Based on the results above, researcher explains further the result of hypothesis:

a. H1: Value consciousness affects brand attitude positively The coefficient results for value consciousness effect towards brand attitude show a T-

value of 1.76, which means the effect of value consciousness towards brand attitude is

significant with T-value above 1.65. Therefore, hypothesis H1 is accepted.

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Lichtenstein et al. (1990) define value consciousness as “a concern for paying low

prices, subject to some quality constraint”. Although luxury items are generally

expensive, the benefits they provide, especially the psychological benefits derived

from the consumption experience, still make those items highly desirable options

(Belk, 1988). Thus, if a consumer is aware of the value or benefits that Louis Vuitton

provides, he or she will use the product even though it is expensive.

In addition to the result of t-test value, the result of value consciousness variable’s

descriptive analysis scores a high/good value. This result suggested that, overall;

Jabodetabek consumers have a high level of value consciousness. The descriptive

result of brand attitude scores a fairly high/good value, which means Jabodetabek

consumers regard Louis Vuitton as fairly desirable. Based on these descriptive results,

researcher summarized that consumers do have a high consciousness of luxury

products value and Louis Vuitton products are perceived as fairly high in delivering

those luxury value. To summarize, since this hypothesis is accepted, it means that

there’s an effect between Jabodetabek consumers’ value consciousness towards brand

attitude on Louis Vuitton.

b. H2: Susceptibility to normative influence affects brand attitude positively

The coefficient results for susceptibility to normative influence effect towards brand

attitude show a T-value of 3.10, which means the effect of susceptibility to normative

influence towards brand attitude is positive with T-value above 1.65. Therefore,

hypothesis H2 is accepted.

SNI, in consumption, is a trait reflected by a consumer’s tendency to conform to the

expectations of other regarding purchase decisions in order to be identified with those

others, to gain rewards, or to avoid punishment from others (Bearden, Netemeyer, &

Teel, 1989 in Zhan & He, 2011). One of the main benefits of luxury products is that it

can enhance the user’s social status, therefore making SNI as an important trait to

measure brand attitude.

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The descriptive analysis results also show that susceptibility to normative influence

scores a fairly high average of mean, which indicates that Jabodetabek consumers have

a fairly high level of tendency to conform to the expectations of other members of a

reference group in order to enhance their social image. Thus, researcher concluded that

consumers have a fairly high conformity to the ideals of their reference group, and

they have a good attitude towards Louis Vuitton as a brand that can enhance their

social image.

Based on the findings, it can be concluded that the potential consumers of Louis

Vuitton in Jabodetabek conformed to the expectations of their reference group by

developing a certain attitude towards brand Louis Vuitton.

c. H3: Need for uniqueness affects brand attitude

The coefficient result of need-for-uniqueness’ positive effect towards brand attitude is

not significant with T-value of 0.72 < 1.65. Therefore, the hypothesis H3 is rejected.

Need for uniqueness affects brand attitude when consumers wants to alleviate

similarity to others, thus consumers tend to engage in self-distinguishing behavior by

purchasing exclusive brand, that is luxury brands.

The descriptive analysis results of need for uniqueness show that Indonesian

consumers have a fairly high need for uniqueness and also a fairly high/fairly good

attitude towards Louis Vuitton. Even though both show a fairly high tendency, t-test

value shows that need for uniqueness does not have significant effect in the attitude

towards Louis Vuitton for the respondents. Researcher thinks there are several reasons

why this hypothesis is rejected.

First, there might be some mediating between NFU and brand attitude, as Tian et al.

(2001) stated ‘consumers established their uniqueness through various uniqueness-

seeking behaviors in response to environmental inputs that increase or decrease their

perceptions of similarity to others’. Therefore, it is possible that in that seeking

behavior, consumers find Louis Vuitton to be increasing their perception of similarity

to others. Thus, even though results found that consumers have a fairly good brand

attitude to Louis Vuitton, they don’t think of Louis Vuitton as a brand that can deliver

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uniqueness they need. The high level of counterfeiting and knockoffs might also be the

reason.

d. H4: Consumer knowledge moderates the relationship between need for uniqueness and brand attitude

The comparisons of model A, model B, and model C in sections 4.7 shows that there

is a no difference between low-knowledge and high-knowledge consumers in NFU.

The effect of NFU on brand attitude was not significant for the low-knowledge group

(T-value = -0.09, p<0.05), the same as high-knowledge group. Therefore, consumer

knowledge does not have any relationship between need for uniqueness and brand

attitude.

To summarize, the relationship between consumer’s need for uniqueness and brand

attitude is expected to depend on consumer knowledge about luxury brand. The

hypothesis of “Consumer knowledge moderates the relationship between need for

uniqueness and brand attitude” is not accepted, thus this means consumer knowledge

does not influence consumer need for uniqueness towards certain brand.

e. H5: Brand attitude positively affects purchase intention

The coefficient results for brand attitude effect towards purchase intention show a T-

value of 7.24, which means the effect of value consciousness towards brand attitude is

positive with T-value above 1.65. Therefore, hypothesis H5 is accepted.

To fully explain the result of H5 hypothesis analysis, researcher briefly explains the

definition of brand attitude and purchase intention as already been explained in chapter

2, Phelps & Hoy (1996) define purchase intention as the likeliness for an individual to

purchase a product, or an individual’s intention to buy a specific brand in which they

have chosen for themselves after certain evaluation (Laroche and Zhou, 1996 in Ling,

2009). There are many factors that influence consumer’s purchase intention including

brand advertisement, brand knowledge, behavioral intention, and past experience

about the brand (Khan et al. 2012). In this study, these stated factors are analyzed in

the form of brand attitude.

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The analysis of this study shows that there is a significant effect of brand attitude

towards purchase intention. This means the result is supporting the findings of prior

studies where they found there’s a strong and positive relationship between attitude

and intention in a wide variety of settings (e.g., Dabholkar & Bagozzi, 2002;

Sheppard, Hartwick, & Warshaw, 1988 in Zhan & He, 2011 in Zhan and He, 2011).

Therefore, higher evaluation leads to higher purchase likelihood.

Summary

The goal of this thesis is to examine the effect of psychological traits to brand attitude

and purchase intention on the Louis Vuitton’s potential consumers in Jabodetabek

area. Here are the summaries based on the research and analysis that have been

conducted:

1. Value Consciousness affect brand attitude positively

This research has proved the positive effect of value consciousness towards brand

attitude because the T- value is above the minimum value. Therefore, researcher

concludes Indonesian consumers are conscious of Louis Vuitton luxury values despite

the high prices; and it has a positive effect to their attitude on Louis Vuitton brand to

be more favorable.

2. Susceptibility to Normative Influence affect brand attitude positively

This research has proven that the psychological trait of susceptibility to normative

influence of individuals in Jabodetabek does have effect on brand attitude since the T-

value of SNI that is above 1.65. Thus, researcher concludes that the higher consumers

conform to their reference group, the more favorable their attitude towards Louis

Vuitton. This can also suggested that Jabodetabek consumers might be influence more

by the social than by the functional benefits of luxury goods.

3. Need for Uniqueness doesn’t affect brand attitude positively

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This research has proven that need for uniqueness of consumer doesn’t have

any positive effect to his or her brand attitude. This can be seen by the T-value that is

below 1.65. Therefore, researcher concludes that no matter how high the level of need

for uniqueness of a consumer, it doesn’t affect his or her attitude towards Louis

Vuitton to be more favorable.

4. Consumer Knowledge doesn’t moderate the relationships of NFU and

brand attitude

This study founds that consumer knowledge does not have a moderation effect

to all of the variables. This suggested that consumer knowledge doesn’t have any

effect on psychological traits relationships toward brand attitude.

5. Brand Attitude affect purchase intention positively

The hypothesis of brand attitude affect purchase intention positively is accepted.

Therefore, respondents who have more positive attitude towards Louis Vuitton have

more favorable attitude towards intention of purchasing Louis Vuitton products.

Suggestion

a. Managerial Suggestions

• Segmenting and Targeting

This study provides some information about demographics such as gender and

income, and can be a little useful in segmenting consumers. Beside

segmentation, the relationships between VC, CNI, and brand attitude also

provide insight on how to position Louis Vuitton in Indonesia and to

communicate with targeted consumers.

• Suggestions to Utilize Susceptibility of Normative Influence

The results show that SNI trait has a significant influence in brand attitude. In

luxury goods consumption, the reference group such as family, friends,

colleagues and spokesperson of the brand plays important part. These reference

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group influence consumers’ subjective norms and also attitude towards the

brand and the purchase intention.

Since reference group is proven to be influential in defining social norms,

marketers need to reconsider how to best present the reference groups in

marketing communication. Therefore, it is important for marketers to

recognize the importance of significant reference group for luxury goods

purchase decision-making. These results imply that building a good

relationships with the significant reference group of target consumers may be a

highly effective marketing strategy. Researcher would suggest marketers to

consider impacting the target consumers through interpersonal channel such as

social media and word-of-mouth strategy.

In addition, marketers can also feature movie starts or fashion models that are

popular or known among Indonesian consumers. Marketers need to understand

how these endorsers relate to social norms in Indonesia.

• Counterfeits and Knockoffs

This research found that consumers think Louis Vuitton has too many

counterfeits products. Counterfeit and knockoffs impose the same penalty on

genuine item consumers: They threaten the exclusivity that accompanies the

purchase of a premium brand (Commuri, 2009). In other words, counterfeits

diminishing the value of Louis Vuitton. Therefore, researcher would suggest

marketers to strengthen the law of counterfeits and knock-offs especially in

Indonesia. Researcher also suggests marketers to create a design that is hard to

copy.

b. Suggestions for Next Research

The previous sections have already discussed the findings and managerial suggestions

of this research. The limitation of this research also has been discussed in Chapter 1.

Both findings and limitations of this research have been taken into account in making

suggestions for the next research. Below are the suggestions for next research:

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1. Broaden the scope of analysis, not just in Jabodetabek. The next research

should analyze beside first-tier city because the characteristics of the people are

very different.

2. Next researcher can change the case study to another luxury brand such as

Versace or Chanel. The next researcher can also change the case study into

another luxury categories such as luxury automobiles.

Table

Table 1. Respondents’ Profile Results Category Results

Gender 209 respondents (75%) were females and 69 (25%) were males.

Education 139 respondents (51%) were undergraduates, 88 (36%) were high school

graduates, and 44 respondents (16%) were diploma.

Occupation The majority of occupations were student of 72 (39%) respondents. While 52

(26%) respondents were private company employee and 24 (18%) were

housewives.

Income per month The majority of 61 respondents (23%) have income above Rp 25.000.001 and

another 61 respondents (22%) of respondents have income ranging from Rp

2.000.001 to Rp 5.000.000. Then followed by 53 (20%) respondents with income

from Rp 5.000.001 to Rp 10.000.000, and 33 (12%) with income between Rp

10.000.001 to Rp 15.000.0001.

Expenditure per month The majority of 81 respondents have expenditure per month between Rp 4.000.001

to Rp 10.000.000. While 63 (23%) respondents with monthly expenditure from Rp

2.000.001 to Rp 4.000.000, and 48 (18%) with monthly expenditure below Rp

2.000.000

Figure

Figure 1. Conceptual Model

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Figure 2. Results of SLF and T-Values of Structural Model

Notes: Number in parenthesis is SLF and number without parenthesis is T-Values

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Efek sifat sifat psikologis pada..., Clara Sarah, FE UI, 2014