Você está na página 1de 63

FSM

- National University of Computer & Emerging Sciences, Islamabad

FINAL YEAR PROJECT REPORT


A study on the consumer behavior & factors affecting consumer
choice - A case of mobile phone market in Pakistan

AHSAN KHAN NIAZI


MBA-II
14i-1045


PROJECT SUPERVISOR
__________________
(RAJA SHUJA UL HAQ)


1
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

ABSTRACT
Mobile phones during the past few years have become one of the most important consumer
accessory item and is perhaps one of the most dynamic industry in terms of competition
and change. This study discusses the factors that affect/motivate Pakistani consumers in
their mobile phone choice decision. The purpose of the study was to identify different
factors/features that consumers value in their mobile phones and then analyze as to which
factor according to them is the most important and to study the effects of demographic
differences on preferences of people belonging to diverse demographic groups. For this
particular study four important factors i.e. price, size/shape, new technology features, brand
name were selected and were analyzed through the use of questionnaire in registering
consumers perception of these factors. From the analysis it is clear that consumers value
new technology features as the most important variable amongst all and it also acts as a
motivational force that influences them to go for a new handset purchase decision. The
study also discusses that when selecting between different mobile phone handsets
consumers prefer well known brands instead of non familiar brands or Chinese handsets.
The study also shows that price does affect consumers choice for a mobile phone but
becomes less important of a factor as we move from low monthly income to higher income
earning consumers. From the study it is clear that consumers in Pakistan are well aware of
the new technology trends in the mobile phone industry and are techno savvy. The study
also reveals that male respondents were more interested in the new technological
developments in the mobile phone industry as compared to female respondents. The study
provides several recommendations for the mobile phone manufacturers operating in
Pakistan and since the smart phone era has just begun a better understanding of consumers
insights and preferences is needed in order to achieve and maintain competitive edge over
rivals.

2
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

DEDICATION
Learning is a process that can be divided into three components i.e.
understanding, retention and application. The process of learning is complete
only when an individual not only comprehends what he learned but more
importantly is able to apply it in practical. It is through report writing a
student of a particular discipline can apply a concept/s to some practical
issue.
This particular report is a study that discovers the consumer behavior &
factors which Pakistani consumers value the most in their mobile phones
which motivates them to go for a particular choice and how by studying these
factors and their interplay one could better market mobile phones to Pakistani
consumers.
I am highly grateful to Almighty Allah for granting me strength and guiding
me throughout my study. I consider myself lucky that I studied at the best
management school of Islamabad, Pakistan and cannot thank enough all of
my teachers for everything. I would like to specially thank my research
supervisor Mr. Raja Shuja for giving me time whenever I needed it and doing
all he could do in helping me out. I would also like to thank Dr.Shuja ul Islam
for motivating me to conduct this research and teach me methods for
execution, and Mr. Yasir khan Wazir, Mr. Raja Jehanzaib and Mr. Shoukat
for distributing questionnaires for me in their respective institutes and also
Dr. Ayub Siddique for helping me out in using SPSS software.
I dedicate my study to all of my teachers, my class mates and my university
without whom it would not have been possible.
It is a humble effort on my part and I am positive in expecting the report to
work as a real guide for those who further progress the study.
AHSAN KHAN NIAZI

3
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter 1

PAGE NO

INTRODUCTION
1.1 Background of the study
1.2 Purpose of the study
1.3 Scope of the study
1.4 Methodology of the study
1.5 Limitations of the study
1.6 Delimitations of the study
1.7 Scheme of the study

6
9
9
9
10
11
11

Chapter-2
LITERATURE REVIEW
1.1 Introduction

14

2.2 Consumer Purchase Behavior

14

2.3.1 The Status of Pakistans Telecom and Handset Market

16

2.3.2 Preferences of Pakistani Users

20

Chapter 3
METHODOLOGY
3.1

Sample and sampling techniques

22

3.2

Theoretical Framework

22

3.3

Hypothesis formulation

23

3.4

Survey Methodology

25

4
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter 4
ANALYSIS
4.1 Questionnaire Analysis

28

5.1

45

Cross Tabulation Analysis

Chapter 5
CONCLUSIONS AND RECOMMENDATIONS
Conclusions

53

Recommendations

56

ANNEXURE
REFRENCES

58

QUESTIONNAIRE

62

LIST OF GRAPHS
Annual Cellular Mobile Tele-density

17

Annual Cellular Subscribers

17

Handset Industry Market Share-Manufacturers

18

Factors Effecting Consumers choice of Mobile Phone Selection

23

5
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter-1
INTRODUCTION TO THE REPORT
1.1 Background of the Study
It started in USA on June 17, 1946 when the very first cellular telephone call was
engineered in the city of St. Louis Missouri. But the then system was impractical if we
compare it to present day mobile phones because it weighted 80 lbs and cost $30 US dollars
on monthly basis along with that 30-40 cents were also charged on every local area call. It
were the 1960s when the world of cellular industry managed to invent the first partially
automatic vehicle mobile systems that were launched in Sweden but these were also not
practical and they weighed nearly 40kg. On April 3rd, 1973 Martin Cooper a researcher
from Motorola managed for the first time, a call successfully made by using a hand held
cell phone, which was the first instance in history when a call was done from a device that
was a non-vehicle set. The premier economically viable fully automatic mobile network
known as the first generation i.e. 1G was initiated in Japan in 1979 from NTT ( i.e. Nippon
Telegraph and Telephone Corporation) by at first concentrating just on metropolitan parts
of the city of Tokyo. During the next five operational years NTTs service expanded and
covered the entire Japanese population and hence became the pioneer nationwide first
generation network of the world. In 1981, Nordic Mobile Telephone (NMT) followed its
success in Japan and launched its services in Sweden, Finland, Norway and Denmark and
became consequently worlds pioneer cellular services provider who were for the first time
offering international roaming as well. Meanwhile, in USA the first 1G network was
launched by Ameritech in the year 1983 which was a Chicago based company that was
using Dyna-TAC handsets made by Motorola. After that many countries followed in the
early 1980s such as Canada, UK and Mexico.

6
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Worlds first ever modern technology based network i.e. Second Generation 2G mobile
systems was launched in Finland by Radiolinja in 1991 which operated on the GSM
standards and gave rise to for the first time competition in telecom services providers at a
time when the already experienced 1G NMT Network of Telecom Finland was challenged
by Radiolinja.
The year of 2001 saw the first totally commercial launching of third generation i.e. 3G
mobile technology and since then mobile phones and mobile phone services have seen an
exponential growth throughout the world and surely it can be said that the world has seen
a communication revolution because of this technology.
The extraordinary exponential consistent growth of mobile phones in the society is a
phenomenon never witnessed in consumer electronics history. The best thing about this
growth is that every person in the society whether belonging to a higher or lower class has
access to such accessories. It has now become a huge multibillion dollar industry and as of
now still growing strongly. With the emergence of the new markets like India, Russia,
China and Pakistan the mobile handset industry is still going strong and is growing at a
remarkable pace, it has surpassed the purchases of all the electronics products like
computers, televisions, cameras etc.
Instaphone could be rightly called the pioneer of cellular industry in Pakistan and it was
the first corporation to introduce cellular services to the people of the country. Instaphone
was at first owned by Millicom Corporation but later on it was acquired by Afreen Group
of industries; it started its operations in Pakistan in 1991 as an APMS mobile service
provider. In 2004 Mobilink became the first GSM service provider in Pakistan and after
the introduction of GSM service in Pakistan the industry has seen many new players and
tremendous growth. In the beginning the target market comprised of upper class consumers
but the industrys rapid growth started after 2000-01 and today it has even penetrated
consumers belonging to the lower class. Nokia, Sony Ericsson, Samsung, LG and Motorola
at present are the leading mobile phone manufacturers in Pakistan.

7
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

The telecom sector of Pakistan during the past decade has contributed enormously to the
overall development of Pakistan. This particular sector is constantly achieving high growth
rates in the country. It is believed to be achieving growth every year despite economic
setbacks faced by Pakistan. During the month of October, 2010 mobile service subscribers
in Pakistan exceeded the psychological mark of 100 million (The Express Tribune, 2010).
Similarly, it is believed that Pakistan amongst all south Asian regions has the highest
cellular penetration rate. According to Pakistan Telecommunication Authority (2010), the
market leader is still Mobilink with 30 million subscribers, with Telenor enjoying the
second spot having 21 million users, with 20 million users Ufone is in third place, Warid
resides in fourth place having 18.14 million subscribers and with 6.48 million subscribers
Zong is at the last. Every player in the industry is working hard to expand the services
throughout the country and are entering to regions like Azad Kashmir, Tribal Areas and
Northern Areas which are still not fully covered. So far five tribal agencies of FATA have
been covered.
With increase in mobile subscribers the country has also seen increase in the purchase of
mobile handsets. A brief survey in Karachi of main mobile handset markets came up with
the information that about seventy percent of cell phones users are having two handsets at
the same time indicating the increasing demand for mobile phones in Pakistan (Najeeb,
2010). According to Pakistan Telecommunication Authority (2006), figures given about
the mobile phone sets by the local dealers show that per month 750,000 to 800,000 mobile
handsets are imported into Pakistan. Among many players the four main brands that are
the market dominators of Pakistans handset market are Nokia having the largest market
share i.e. 55 percent, followed by Sony Ericsson having 23 percent market share, third is
Samsung with 17 percent and with five percent Motorola is fourth. Latest sets with state of
the art technology are available in the markets throughout the country, amongst all sets,
sets having music playing features and powerful cameras are very popular and it is
expected that this tendency will be persistent in the coming years as well and ultimately
such facilities would become future standards. Services or products have many different
features such as value for money, quality, cost, brand image, brand associations, value for
money etc, but it has been observed that size/shape, new technology features, price and
8
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

brand name are the most vital attributes in a mobile phone for consumers (Karjeluoto,
Karvonen, Kesti, Koivumaki, Maninen, Pakola, Ristola and Salo, 2005) so these attributes
have been selected for the study. In this study the variables that are affecting selection of
mobile handsets in Pakistani market are studied and it was searched that which factors the
people of Pakistan value the most in the choice of their mobile sets.

1.2 Purpose of the Study


I have chosen the topic of the study because of my personal interest in mobile handsets and
the industry as a whole. This research attempts to rank factors affecting consumers
preferences for mobile phones. This study can help advertisers to focus on that attribute
more which is ranked highly by the consumers. This research can also help the mobile
phone manufacturer/marketer in Pakistan to recognize the potential attribute positioning
errors (if any). Utmost effort has been put in to the study in making it accurate and to make
it possible to be used as a reference material for similar studies.

1.3 Scope of the Study


The study primarily focuses on respondents between the age group of 15-25, 26-35 and 3650 and limited to four attributes. Because of being a research of a single researcher with
limited time and financial limitations, study would only target people of Peshawar.

1.4 Methodology of the Study


The study by enlarge is descriptive in nature as well as qualitative and is an applied
research. Both primary as well as secondary sources contributed to the data
For Primary data, research questionnaire was developed and used.
For Secondary research journals, online resources and newspapers were studied.
Because of the limitations, convenient sampling method was chosen, since it is evident
from the name, that sample is chosen which is at convenience. The convenient non
probability method many times is used in the preliminary research phase to get the gross
9
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

estimation of results devoid of bearing the time and cost needed in random sample selection
process.
Sample included 100 respondents from three different age groups of mobile phone users,
majority being in the age group between 15-25 years of age because its observed that the
above age group has been and still is the maximum mobile phone users and is often well
aware of what they want from their cell phone. Questionnaires were distributed equally
amongst the male and female respondents. Hypothesis were formulated using past
researches done on similar topics and were tested using the findings from the questionnaire.

1.5 Limitations of the Study

Because seeing the nature and scope of the topic, all aspects of the observable facts
under the study could not be analyzed due to many constraints, and only a few
variables were selected to find out consumers preferences in selection of a mobile
phone.

The most significant constraint to the report was its novel nature and new matter
under scrutiny it suffered from lack of availability of required information needed
for comprehensive examination. Mobile phones have seen their emergence as the
new consumer must have item just in the past decade and its still an ever evolving
consumer item.

Since my study only included sample from Peshawar and there was no
representation from rural parts of the country therefore the findings of the study
couldnt be generalized.

Owing to lack of required time I was unable in making the study more
comprehensive and applying to all variables that may affect the phenomenon under
consideration.

10
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

1.6 Delimitations of the Study

In spite of all constraints the report is comprehensive enough to help my fellow


students to use it as a future reference material for their assignments connected to
the research topic under study.

The results of the study could provide advertisers the consumers preferences which
could be targeted in their Ads. It could also be used as a reference material by them
in order to realize the consumers purchase decision while opting for a particular
handset, and mobile phone manufactures could modify their products according to
the consumers requirements.

1.7 Scheme of the Study


Mainly the study has four main sections. A section in its self is further divided into
respective chapters. Following is the format of the study which shows how it is planned.
Section # 1, Introduction
The

first

chapter

includes

background,

purpose,

scope,

methodology,

limitations/delimitations, and scheme of the report.


Section # 2, Body of the Report
The second chapter i.e. Chapter No. 2 comprises of the review of the literature connected
to the study including past researches done on the topic plus their main findings.
The third Chapter i.e. Chapter 3 covers the methodology of the study, comprising of
research questions/problems, hypothesis, sample and sampling technique plus the survey
methodology.
Section # 3, Analysis

11
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter No. 4 covers analysis of the questionnaire including the discussion of facts and
figures derived from the questionnaire, plus presentation of such findings in tables and
graphs. Analysis of the derived hypothesis is also covered in this chapter.
Section # 4, Conclusions and Recommendations
Chapter 5 has the findings and results of the studys questionnaire, also having
recommendations for mobile phone manufactures meant for better targeting their
consumers with products and their features best suited for the target market.

12
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

SECTION # 2

13
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter-2
LITERATURE REVIEW
2.1 Introduction
Over the past few years mobile phones have become an essential source of connection and
communication throughout the world, especially during the past decade, but little consumer
research studies regarding basic motives and choices affecting buying process of mobiles
phones can be found. Similarly, we should put into our consideration several complex
factors with reference to studying the mobile phone buying decision processes. These
factors include both macro as well as microeconomic variables that may have an effect
over the development of cell phone industry as a whole and on an individual customers
preferences along with choice decision making in particular. Based on such factors
consumers may go for a particular brand which may have the desired features that they
require and if such important factors are identified, marketers can use such features to get
competitive advantage over their rivals, and as a result become change leaders rather than
followers because of better understanding of consumer preferences.

2.2 Consumer Purchase Behavior


In order to comprehend an individuals choice in a cell phones selection or any other
product, it is imperative to study customers purchase behavior. A definition of consumer
behavior given by Perner (2009) It is the study of groups, organizations or individuals
and also the procedures by which they select, acquire, use and dispose products, ideas,
experiences or services in order to fulfill their needs and wants and the potential impacts
that these procedures have on the consumer and the society as whole. The definition
provides some constructive arguments:

Consumer Buying Process takes place either on individual basis or in some


instances in a group for example friends can manipulate the types of apparel a
person goes for and if in the case of an organization company employees working
on the job may decide about the products that firm ought to be using.

14
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

The process of consumer buying behavior incorporates the use and discarding of
products and involves the study of how they are purchase. A matter of great concern
to the marketer is how a product is used because it reflects how by better positioning
ones product a marketer can achieve greater than before consumption.

Consumer behavior does not only include tangible products but along with them
ideas and services as well.

From the perspective of marketing consumers purchase process can be categorized into a
five step problem solving process i.e. 1. Need, 2. information gathering, 3. Evaluating the
given alternatives, 4. Purchase activity, 5. Post purchase status (Dorsch, Grove and Darden,
2000). This five step process of decision making is most suitable for a purchase decision
that requires problem solving behavior or complex decision making process and not for
purchase decisions related to low involvement products. Similarly the purchase decision
for a new handset follows the same buying process but in some instances it may also be
affected by symbolic preferences linked to some brands.
In studying consumer choice behavior its important to take some general conditions into
consideration. Considering the case of the classical problem solving buying process
behavior, it is almost always the case that consumers go for information search before
taking purchase/choice decision. And it is also common in such behavior that consumers
decision practice is directed by previously made likings for some specific alternatives. So
it shows that customers are expected to formulate their selection decision based on the
limited information search activity that they conducted (Moorthy, S., Ratchford and
Talukdar, 1997) rather than a detailed evaluation of all the possible alternatives (Chernev,
2003). Laroche, Kim, and Matsui (2003) opined that along with information search
evaluation of alternatives is an important activity that determines consumers choice and it
is often influenced by Cognitive Heuristics or in simple words a buyer choose a particular
product provide if it fulfills his perceived values based on his past experiences. In this
specific technique of assessment a buyer automatically eliminates a brand that do not meet
his set principles and even if it does, it does not have one or two attributes of extreme
importance to him even it has all other attributes. In this study the analysis would be limited

15
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

to consumers choice as to which product to purchase from a given set of alternatives and
whether to purchase or not.
Similarly, it is also believed that a lot of decision behavior exercised by buyers can be
different from one individual to another due to context of purchase so this means that
mathematical modeling has its limitations because consumers may use different
approaches to make their choices (Swait and Adamowicz, 2001). Furthermore the influence
of personal preferences and context of purchase may have a greater effect on choice if a
potential buyer has little subsequent knowledge or experience.
An important thing to note is that the conventional problem solving technique used in the
making of a decision that affects purchasers preference might not be the best approach in
all conditions. A mobile phone selection can either be based purely on
functional/primary/rational factors or it can be based on emotional factors e.g. fun,
excitement, pleasure etc (Batra and Ahtola, 1990). It has been proven that a lot of consumer
choices may be having both rational features (e.g. communication, time management) as
well as emotional features (e.g. applications, games, music, camera). Wilska (2003)
established that the younger the consumer the more he would prefer emotional features in
mobile phones rather than rational ones.

2.3 The Status of Pakistans Telecom and Handset Market


The past decade has seen a telecommunication revolution not just in Pakistan but
throughout the world. It is a fact that for a lot of years Pakistans telecommunication sector
was ignored; the technology was outdated and stuck in the mid-20th century. In 1999 there
were 2.1 phones per hundred people in Pakistan from that it expanded to 100 million mobile
phone users in 2010 and still growing, Pakistan in the past decade has seen a
communication revolution. Pakistans telecom sector is undoubtedly one of the most rapid
growing markets of the world. This extraordinary growth in mobile phone subscribers has
attracted many foreign mobile service providers and mobile handset manufactures such as
Nokia, Sony Ericsson, Samsung, HTC, LG, Motorola etc.

16
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

(Source: Pakistan Telecom Authority, 2016)

The telecom industry of Pakistan is estimated to be rising at a rate of 170% annually.


According to Pakistan Telecommunication authority 2.7 million subscribers gets added
into the industry on monthly basis (Ansari and Khan, 2009).

(Source: Pakistan Telecommunication Authority, 2016)

17
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Shariq Syed (2008) suggests that Pakistani mobile phone market has played the most
important part in the rise of telecom business in Pakistan. The Pakistan mobile handset
market should be given equal credit for the enormous growth of Pakistans telecom sector
along with telecommunication service providers. Since 1st quarter of 2008 and up till now,
Pakistan is going through hard times generally in all industries and also in telecom industry
too with many negative economic indicators, political tensions, double figure inflation &
inconsistent financial plans have played their part in limiting economys growth compared
to previous years.
However, in spite of the economic setbacks Pakistan handset sales still remain on the higher
side and are predicted to be 27million by the year 2011. Competitive rivalry for market
share is still intense with the leadership position dominated by Nokia while Samsung
benefits from the growing market for very low cost handsets. The gray market remains a
key issue with 20%-22% share of total sales estimated for 2008 (Kerr and Harris, 2008).
The handsets distribution market is dominated by handful of companies and among them
United-Mobiles, Advance-Telecom and Mobile-Zone represent the largest phone
distributors.
Nokia is the undisputed market share leader of cellular handset market of Pakistan followed
by two Korean manufacturers Samsung and LG. Nokia has 48 percent market share but its
declining steadily due to competition from other manufacturers and especially from
Chinese handsets. Samsung has seen tremendous rise in their market share i.e. having 8%
market share in the year 2006, its market share has increased to 30% in 2008 and still going
strong. LG is also enjoying favorable growth in market share with its success due to two
highly successful handset models that were LG, KG195 and LG, KG270. Motorola and
Sony Ericsson are showing un-impressive performance with just 5% and 1% share in the
total Pakistani handset market (Syed, 2008).

18
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

(Source: Artistryofbranding.wordpress.com)

Demand for mobile phones in Pakistan has surged up their imports highly; it has seen
approximately 100 percent increase in-terms of their imported costs during the first month
of current financial year 2010-11. The Federal Bureau of Statistics (FBS) Pakistan indicates
the import bill of cellular handsets reached 39 million dollars during the month of July as
compared to the same months cost last year which was at US dollars 19.59 million thus
showing a growth of 99.15%. Similarly mobile accessories expenditure was 27 % higher
as weighed against the month of June which was $30.8 million. Altogether according to
FBS the import of handsets for the year 2009-10 moved up to 215 million US dollars as to
US 139 million dollars in the prior year indicating a surge of 54.6%. According to the
representative of Karachi Electronic Dealers Association (KEDA) representative 55
percent increase in imports of cellular handsets is due to greater demand of Chinese
handsets (Khan, 2010).
This increase in mobile phone demand is also characterized and inflated by continuing
demand for Chinese-made mobiles which were introduced into the market about two and
a half years ago. Chinese sets have gained popularity among the people because of having
dual SIM facilities and are copycat versions of familiar branded phones.
But the branded phone manufacturers like Nokia, Samsung, LG, Sony Ericsson etc have
managed to maintain their market share among the masses of the society who still prefer
branded sets compared to Chinese handsets. Pakistans handset market is unique in the
sense that it sees a surge in sales just before and after the Eid festival (Mobile handset
import bill up 100 percent, 2010). Mr. Imran Zaki, marketing head at LG electronics
reports that demand from the market is constantly increasing day by day particularly in
19
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

entry stage segments, that includes lowest costing handsets ranging between Rupees 1200
to Rs 2000.

2.4 Preferences of Pakistani Users:


Nokia for understanding consumers preferences in a mobile phone conducted a study and
found out that Pakistani customers prefer style over the desire of being connected. Their
study also concluded that latest mobile phones teamed up with attractive folding designs
quick launch short cut buttons are in style, and these preferences are commonly acceptable
in Pakistan compared to markets within Asian and Asia Pacific regions. Nokias study also
came to the conclusion that for innovation demanding customers Nokia needs to bring in
entertainment filled intelligent multimedia experience in an ultra slim easy to use package
(Bhatti, 2007).
Giving an interview to The Daily Nation about their study of mobile telephone users
preferences for Nokia in Pakistan, the Vice President for Nokia Cell Phone Market and
Sales Operations Middle East and Africa Mr. Tomi Paatsila revealed that customers in
Pakistani market surpassed other nations customers in their desire for innovative
technology and that Pakistani consumers were very conscious about style and shape, which
was beyond their expectations. He revealed that Pakistani customers desired design and
style more than any other factors.
Nokias consumer preference study in mobile phone also showed that youth demanded
more innovation in multimedia options that is coupled with a slim handset. Based on these
demands Nokia has managed to modify their products accordingly. It was also found that
users in Pakistan were aware of the technology and with that in mind Nokia is now
modifying its products to offer intelligent and entertainment filled multimedia experience
in a user friendly interface and ultra slim package (Bhatti, 2007).
According to Aijaz (2008) nowadays customers are asking for more and more
compatibility in their handsets user interface, which is why Nokia is liked by all for its
user friendly interface. A study conducted by Nokia showed that those Pakistanis who go
for low priced handsets still want the best possible package for their phones. Nokias
20
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

handset prices range from Rs. 2000 to over 50000. In order to measure Nokias market
share and satisfaction of their customers a survey was conducted in Lahore by Omar Aziz
in 2008 and he discovered that demographics of the locality play the most vital role, he
observed that Defense Housing Authoritys residents preferred brand reputation and
quality, whereas price was not considered as a major factor for residents of DHA. While
the preferences of the people of inner city of Lahore were totally different who were more
attracted towards lower prices as compared to other variables.

21
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter-3
METHODOLOGY

3.1 Sample and Sampling Techniques


A sample of 100 people was taken by using the sampling method of Convenience Sampling
(or Accidental Sampling). In Convenience Sampling (also known as opportunity or grab
sampling technique) a sample is taken from the population which is at convenience or in
other words which is close at hand and it is a form of non-probability sampling method.
Since lack of financial resources, time constraint and a study conducted by a single
researcher, convenience sampling was adopted as the population sampling technique for
this particular research.

3.2 Theoretical Framework


It has been found that variables like demographics, price of the handset, brand familiarity,
new technology features/applications does have an impact on consumers decision to go
for particular mobile phone selection (Karjiluoto., Karvonen, Kesti, Koivumaki.,
Manninen, Pakola, Ristola and Salo, 2005). So as a result it can be inferred that mobile
phone choice is a dependent variable which is affected by demographics, brand familiarity,
price, technology features which are independent variables and hence have a direct impact
on consumers choice of mobile phone selection.

22
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Factors Effecting Consumers choice of Mobile Phone Selection

3.3) Hypothesis Formulation


Not a great amount of research is available on mobile phone choice. However, a few
articles have studied consumer decision process in relation to their mobile phone usage.
Riquelme (2001) studied how much prior information consumers posses when making a
choice between different mobile handsets of different brands. He based his study on six
key variables i.e. connection fee, free calls and call rates, mobile phone features, access
cost and mobile to mobile phone rates; these variables were rated by the respondents interms of their importance. The results of the study illustrates that respondents with previous
knowledge about a particular product can make their choices relatively well but they had a
tendency to overestimate the significance of free calls and call rates, features and
undermine the significance of mobile to mobile phone tariffs, monthly subscription fees
and phone rates.
23
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Demographic variables play an important role in selection of mobile phones amongst


people belonging to different demographic groups. Demographic variables include age,
gender, income, class and employment (Johansson, Douglas and Nonaka, 1985). Wilska
(2003) conducted a survey of young people between the age of 16-20 in Finland and it was
found that mobile handset choice was consistent with their general consumption patterns.
The studied explained that in females addictive use was common and they exhibited
impulsive consumption patterns and went for trendy handsets. While, male respondents
preferred more technology packed handsets and they were also trend conscious. However,
the research concluded that both the genders preferences are becoming alike in mobile
handset choice behavior. Since personal differences in purchase patterns are becoming
more and more identifiable so demographic variables were included in the questionnaire
for analysis and the effect of demographics on certain perceptions about mobile phone
related behavior have been studied by using cross-tabulation.
Similarly, brand familiarity also has an effect on consumers mobile phone choice along
with other features. In a survey of Asian mobile phone users, Liu (2002) came to the
conclusion that the brand of the phone did have an impact on mobile phone choice decision
as all the competing brands in the study had similar sizes/features and majority of the
respondents preferred a well known brand instead of a new one. The sales of mobiles
handsets are affected by replacement of an outdated set by a new model of it because of
constant technology change in the industry consequently, many people opt for a familiar
brand to replace it than go for an unknown one. So it can hypothesized that brand of the
mobile phone has an effect on mobile handset selection to some degree:
H1: When choosing between different mobile phone models, consumers prefer wellknown brands.
One of the most important factor that effects many purchase decisions is a products price
and in mobile phone choice too it can be considered as an important variable, more
importantly among young consumers (Karjaluoto et al., 2003). Karjaluto et al. (2003)
conducted a survey of 397 respondents and found that price was the most important
dominant factor that was influencing the choice decision of new mobile phone models
along with other factors like new technological advances etc. Chinese mobile phones are
24
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

dominating Pakistani handset market for the simple reason that they are providing cloned
models of famous brands but at an extremely affordable prices and this is the reason why
they are a huge success story in Pakistan (Hassam, 2010). So, a hypothesis can be reached
that the price of mobile phone has an impact over its choice:
H2: Price has a direct effect on consumers mobile choice decision.
Many studies have revealed that consumers go for a purchase decision of a new handset
based on the simple fact that their present mobile phone has become outdated and need a
new model with better messaging system, in-built camera, larger memory capacity, sharper
color displays, new multimedia features etc (OKeefe, 2004). Nokia conducted a survey of
Pakistani consumers as to what they prefer the most in a mobile set and they found that
young consumers needed and were conscious of the new technology and wanted
entertaining and intelligent media services in their handsets (Bhatti, 2007). Since mobile
handset industry is a dynamic industry in which new technology and applications are being
introduced at a fast rate due to constant demand and expectations by the consumers so the
following hypothesis can be formulated:
H3: New technology features increases consumers motivation to acquire new phone
models.

3.4) Survey Methodology


In order to test the hypothesis a questionnaire was designed to find out as to what are the
factors that determine the choice of a mobile phone selection in Pakistani consumers and
to study which factors are valued the most and how much effect does demographic
differences have in mobile phone preference amongst consumers belonging to diverse
demographic sets. A sample size of 100 respondents was taken by using Convenience
Sampling method. Most of them were circulated amongst the students of Institute of
Management Sciences and Edwardes College Peshawar, some of them were also
distributed amongst the employees of Accountant General Office Peshawar.
The hypotheses were tested by asking different relevant questions regarding the predetermined hypothesis and results were processed using SPSS software by using frequency
25
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

distribution tables and cross tabulation. Based on the results of the questionnaire and its
analysis various conclusions were derived and recommendations were given so as to how
better market mobile handsets to consumers of Pakistan.

26
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

SECTION-3

27
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter-4
ANALYSIS

On the basis of past research on the topic under study hypothesis were developed and to
test these hypothesis a questionnaire was designed and distributed among 110 respondents
amongst which 100 questionnaires were useable. Among the total 100 respondents 61 of
them were male and 39 of them female. For demographics Gender, Age and Income level
were selected. The majority of the respondents were university students of Institute of
Management Sciences Peshawar belonging to different BBA, MBA and MS programs,
college students of Edwardes College were also a part of the study while questionnaire
were also circulated amongst staff of Accountant General Office Peshawar. The
respondents belonged to three different age i.e. 15-25, 26-35, 36-50.

Demographics

28
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

29
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Income/pocket money per month


Frequency

Percentage

Valid Percentage

Cumulative Percentage

2000-5000

37

37.0

37.0

37.0

6000-10000

37

37.0

37.0

74.0

11000-15000

19

19.0

19.0

93.0

16000-25000

6.0

6.0

99.0

40000+

1.0

1.0

100.0

100.00

100

100

Total

30
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

31
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

A total of 96% respondents had mobile phones while 4% still were a segment that
did not own a mobile phone indicating that this 4% can also be a market worth
capturing. The overwhelming amount of respondents having a mobile phone shows
that nowadays cell phones have become a must have accessory for nearly everyone.

32
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

This question was asked in order to know how successful Chinese Mobile replica
phones are in our market and whether they have a potential to replace the already
famous brands known by all. 66% percent respondents believed that they are not
any threat for the present brands indicating that famous brands still have a strong
following but 34% of the respondents were seeing them as the replacement for the
present established brands, but no one in the study possessed a Chinese mobile
indicating that it was just a matter of perception and people were still brand loyal
to the present brands because their actions did not reflect their perception.

33
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

This question is of particular importance because it shows a trend that a


considerable number of respondents use 2 or more mobile phones at the same time
for different reasons. 62% respondents had a single mobile handset while 24% had
two mobile phones, 5% had three phones and 9% had four or above. These are
important findings because they present an opportunity for mobile handset
providers to study why people carry multiple handsets and how by understanding
their reasons one could target them with their products. This also shows that a
single individual having multiple mobile phones can be a target customer for
multiple brands at the same time.
34
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Q.4. Which companys mobile phone do you have?


Cumulative

Valid

Frequency

Percent

Valid Percent

Percent

nokia

73

73.0

73.0

73.0

sonny ericsson

3.0

3.0

76.0

motorola

2.0

2.0

78.0

samsung

18

18.0

18.0

96.0

other

4.0

4.0

100.0

Total

100

100.0

100.0

73% of the respondents had Nokia handsets indicating that Nokia is by far the market leader
followed by Samsung having 18% of the respondents using it while Sony Ericsson once a
dominant player in the market just had just three respondents owning its handsets while
Motorola was struggling with two votes. 4% people under study used other brands that
were HTC, iphone and LG.

35
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Q.5. Which factor to you is the most important in purchasing a mobile phone
for yourself?
Validity of

Cumulative

Percentage

Percentage

Frequency

Percent

brand name

37.0

37

37

37

price

10

10.0

10.0

47.0

new technology features

47

47.0

47.0

94.0

size/shape

6.0

100

Sum=

100.0

100

100

This was the most important question that respondents were asked and it was asked to find
out as to what according to them was the most important factor in a mobile phone for them
which motivates them to purchase it. Out of the four factors selected for the study by the
help of past research New Technology Features was the most important reason to
36
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

purchase a mobile phone for 47% of the respondents while followed closely by 37%
respondents preferring Brand Name indicating them to be brand conscious. Surprisingly
just 10% of the respondents valued Price as the most motivating factor which shows the
fact that in purchasing a mobile phone not great many people in Pakistan rank price as the
determining factor in a mobile phone purchase decision. 6% of the people took size/shape
as the most important factor for them in purchasing a mobile phone.
Since new technology features have been ranked first amongst all the factors of influence
this proves hypothesis H3 which says that these new and improved technology features
motivate consumers to go for a particular set with superior technology. However,
consumers under study have not valued price as an important factor hence disproving
Hypothesis H2 as a result.

37
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Q.6. How Often do you Buy New Mobile for Yourself?


FREQUENCY PERCENT

VALID %age

Cumulative %age

Within Six Months.

12

12.0

12.0

12.0

Within a year.

36

36.0

36.0

48.0

14

14.0

14.0

62.0

38

38.0

38.0

100.0

100-0

100.000

100.000

When new model of your


present set arrives.
When

the

working.

last

one

stops

This question was asked to know how often are people in Pakistan motivated to go for a
purchase decision of a new mobile set. 38% respondents do not buy a new handset for
themselves until their present set stops working and is of no use to them while 36%
purchase a new set for themselves every year. 12% of the respondents buy a new set for
themselves every six months. 14% of the people who were studied showed that they are
motivated to buy a new set for their selves only when a new model of their present set
arrives in the market which shows that they are brand loyal.

38
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

This question was a cross question to the previous question about respondents take
on Chinese mobiles as the replacements for current established brands in order to
check the consistency of opinions and check for contradiction in answers. This
questions findings indicates that 89% people do not see Chinese mobile phones
dominating and replacing the current brands which is consistent to the results of
the previous question as well in which 66% respondents did not see Chinese mobile
as replacements for the familiar brands. It is also obvious from the results of the
above question that maximum number of the research subjects believed the
branded mobiles are here to stay and are not under any impending danger from
Chinese phones hence consequently proving hypothesis H3.
39
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Very often things of necessity become things of luxury showing ones Status in a
society and mobile phones to some extent do become symbols of an individual
achievement/status. 57% respondents replied negatively to it and did not agree to
the notion that mobile is a status symbol while 43% replied positively indicating
that a considerable number of individuals still take mobile phones a sign of Status
and achievement.

40
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Q.9. In what price range does your current mobile phone lie?
collective

Occurrence

%age

Valid %

Percentage

2000-5000

24

24

24

24

6000-10000

20

20.0

20.0

44.0

11000-15000

29

29.0

29.0

73.0

16000-25000

15

15.0

15.0

88.0

25000+

12

12.0

12.

100

100.000

100

100.00

The respondents had mobile phones from diverse price ranges with majority i.e.
29% of them had handsets in the price range of 11000 to 15000 rupees, 20% in the
range of 6000 to 10000 rupees and 24% in the range of 2000 to 5000 rupees. While
12 respondents owned a mobile phone worth more than 25000 rupees.

41
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Q.10. Does a new model of your mobile phone motivate you to buy a new set for
yourself?

This question was asked to know how brand loyal customers are to their present
brand and whether they are motivated by the new models with new technology
features of their present handsets or not. 69% of them do get motivated while 31%
replied negatively. The results of this particular questions also proves H3
hypothesis which says that features that are new in a mobile phone as compared to
other sets of rival companies increases customers drive to acquire them.

42
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Likert scale was developed to study as to how important price is to a Pakistani


consumer in purchasing a mobile phone. Most of the respondents agreed that for
them price is an important factor in mobile handset purchase decision, 23%
respondents slightly agreed to it, 19% agreed while 18% highly agreed. Only a few
disagreed to it while 21% were neutral to it. The above question also answers and
tests Hypothesis H2 and the results show that a plain majority do agree that price
does affect them in their purchase and choice of cell phones thus supporting the
Hypothesis H2 in result.

43
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

This question was asked to know whether a mobile phone is just a communication
device or there is something more to it. Over the years of development and
evolution mobile phones are now an entertainment media, a computer, a gaming
handheld device, a calculator, a record keeper, a pocket dictionary etc. The answer
had a split mandate only a slight majority replied positively while many disagreed
to it. While 24% of the respondents were indecisive.

44
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Cross Tabulation Analysis


Gender * Which companys mobile do you have? Cross Tabulation
Which companys mobile do you have?
nokia
Gender

sonny ericsson

motorola

samsung

other

Total

male

48

11

61

female

25

39

Total

73

18

100

From the data it was clear that male respondents preferred Nokia more than any
other brands i.e. 78% of them preferred Nokia, while in female respondents 64%
of them preferred Nokia. Sony Ericson, Motorola and Samsung were preferred
nearly with the same ratio in both the genders. 10% of the female respondents had
handsets of other brands which were not included in the given options.

45
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Gender * Which factor to you is the most vital factor in purchasing a cellular phone for
yourself? Cross Tabulation
Which factor to you is the most essential in purchasing a cell phone for yourself?
new technology
brand name
Gender

price

features

size/shape

Total

male

21

32

61

female

16

15

39

Total

37

10

47

100

From the cross tabulation analysis of the above question it was discovered that 34%
male and 41% female respondents preferred brand name, 15% male and 10%
female preferred price, 52% male and 38% female favored new technology
features, 3% male and 10% female favored size/style. So to male respondents the
most important factor for them in the purchase decision of a mobile handset was
new technology features and the least important factor was size/shape of a
mobile, while for female respondents the most favored factor was brand name
and least favored factors were price and size/shape of a mobile.

46
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Age Range * Which factor is most important to you in purchasing a mobile phone for
yourself? Cross Tabulation
Most important factor?
new technology
brand name
Age Range

price

features

size/shape

Total

15-25

28

35

78

26-35

17

36-50

Total

37

10

47

100

Three age groups were involved in the study and the age group having respondents
between the age of 15-25 preferred new technology features the most in a mobile
phone which is understandable because they are aware of their applications and
most of the mobile phones are marketed to them. Age group between the range of
26-35 years preferred brand name and new technology features equally while price
was not seen as an important factor. While respondents of the age group 36-50
favored unanimously with 80% of the votes new technology features as their most
important desirables in a mobile phone.

47
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Gender * Does a new model of your mobile phone motivate


you to buy a new set for yourself? Cross Tabulation
Does a new model of your mobile phone motivate you to
buy a new set for yourself?
Agreed
Gender

Disagreed

Sum total

Male

44

17

61.0

Female

25

14

39.0

69

31

100.00

Although both the genders agreed that a new model of their present phone does
motivate them to buy a new phone for themselves but, male respondents replied
more positively with 72% agreeing as compared to 64% females.

48
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Gender * In what price range does your current mobile phone lie? Cross Tabulation
In what price range does your current mobile phone lie?
2000-5000
Gender

male
female
Total

6000-10000

11000-15000

16000-25000

25000+

Total

17

15

16

61

13

39

24

20

29

15

12

100

When price of the mobile phone of individuals was cross tabulated with their
gender it was found that majority of the male respondents had mobile phones that
were in the price range of 2000-5000 rupees (i.e. 27% male respondents) while
26% of them had handsets within price range of 11000-15000. Majority of the
female respondents had mobile phones between the price range of 11000-15000
rupees while only 12% of them possessed handset in between the range of 600010000 rupees. All in all surprisingly more female respondents had expensive sets
than male respondents i.e. 17% females respondents had mobile sets with price
range of more than 25000 rupees while 8% male respondents had such phones.

49
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

In what price range does your current mobile phone lie? * Which factor to you is
mainly essential in purchasing Mobile set for yourself? Cross Tabulation
Vital Factor?
new
technology
brand name
In what price range does
your current mobile

price

features

size/shape

Total

2000-5000

10

10

24

6000-10000

20

11000-15000

16

12

29

16000-25000

15

25000+

12

37

10

47

100

phone lie?

Total

When respondents mobile phone price was cross tabulated with the factor to which
they value the most in a mobile phone some predictable answers were found.
Respondents having mobile phones with price range between 2000-5000 valued
price to some extent while the respondents with most expensive mobile phones did
not value price as an important factor, to them new technology features were the
most important must haves in their handsets . As we move along from less
expensive to most expensive handset owners it can be seen that price becomes less
and less important.

50
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Monthly income/pocket money? * Which factor to you is the most important in


purchasing a mobile phone for yourself? Cross Tabulation
Which factor to you is the most important in purchasing a mobile phone
for yourself?
new
technology
brand name
Monthly income/pocket 2000-5000

price

features

size/shape

Total

15

18

37

6000-10000

13

15

37

11000-15000

10

19

16000-25000

40000+

37

10

47

100

money?

Total

From the above comparison between respondents monthly income/pocket money


and to which factor they value the most in purchasing a mobile set for themselves,
it is clear that price with less monthly income respondents is a valued factor but as
we move along to higher income respondents price becomes less and less
important.
51
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

SECTION-4

52
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chapter-5
CONCLUSIONS AND RECOMMENDATIONS

Conclusions
Primary objective of this specific study was to examine consumers purchase behavior
relating to cell-phones and to look into the reasons which affects them to make their choice.
From the findings of this study it was clear that mobile is no longer a luxury of a selected
few in the society rather it is now a necessity and almost every posses one or more handsets.
It was also clear that Nokia is by far the market leader and has the largest market share
followed by Samsung, Sony Ericson, and Motorola.
Hypothesis H1 claimed that consumers prefer banded sets over unbranded ones and was
highly supported by the results of the study and proven as a result. The second hypothesis
H2 which related price with purchase decision got a mixed response in one question
respondents ranked it lowly as a factor affecting them in a purchase decision but when
asked to rate price and its importance as a motivational variable in purchase decision many
of the consumers rated it highly thus more research is recommended for the conformation
of Hypothesis H2. Hypothesis H3 was highly supported by the results of the study and
decisive majority of the respondents did agree with the hypothesis that new technology
features indeed affect people in choosing a particular product for themselves.
Although from the literature review it was found that Chinese mobiles are the new
dominant force and they may change the dynamics of the market but the results of this
study showed that even though majority of the respondents saw them as the replacements
for the present familiar brands but when asked would they prefer them instead of present
brands they replied negatively. So it can be inferred that even if there is a perception that
Chinese mobiles are penetrating the market but still no one from the respondents owned a

53
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Chinese mobile indicating that they still prefer the familiar brands and it is only a
perception that Chinese mobiles are taking over the market.
When the respondents were asked about the most important question of the research that
what according to them is the most important factor in a mobile phone selection? It was
found that overall Pakistani users surprisingly value new technology features as the most
motivating factor in purchasing a mobile phone for themselves. It was also found that
female respondents slightly valued brand name more than new technology features as their
most important factor while male respondents voted for new technology features which
shows demographics (i.e. gender in this case) having an effect on perception. Astonishingly
price was not seen as a major motivational factor in mobile phone purchase decision along
with size/shape.
It was also found that most of the people under study purchased a new handset for
themselves only when their present set stopped working and a great number of them went
for a new mobile within an year. While only a few were motivated to buy a new model of
their present handset indicating brand loyalty is not that common. But when the
respondents were asked a cross question that whether a new model of their present handset
motivates them to buy a new phone for themselves (i.e. Question No.10) a wide majority
of them replied positively indicating contradiction in the respondents replies for two
similar questions. It was also discovered that male respondents were motivated more than
the female respondents to buy a new phone for themselves by the entry of a new model of
their existing handset thus showing effects of demographics (i.e. gender) on purchase
behavior.
Mobile phones over the years have been seen as a mark of achievement/status symbol and
when consumers were asked about it, they showed split mandate i.e. nearly half of them
agreed while half of them did not agree with the notion. But still a slight majority believed
them not to be a sign of status symbol.
Although Pakistan is a developing country but from the study it was clear that it is a market
for all kinds of players i.e. the respondents had diversified handsets ranging in all price
ranges. The majority of the respondents had mobile phones in the price range of 11000 to
54
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

15000 rupees. Demographically speaking majority of the females had handsets between
the price range of 11000-15000 while majority of the male respondents had mobiles phones
in between the price range of 2000-5000 rupees.
Respondents were asked to rate the intensity of how much they valued price as the most
important determining factor in their purchase decision a good majority of them agreed
with it many were indecisive while a few of them did not see price as an important factor
influencing their purchase decision regarding their mobile phones. When monthly
income/pocket money was cross tabulated with the factors which users value the most in a
cell-phone it was found that the importance of price becomes less and less significant when
we move from low income getters to higher ones indicating the effects of demographics
(i.e. in this case income) on mobile phone selection.
When asked whether they see a mobile phone as just a communication device and nothing
else the respondents reply was again not unanimous nearly one third of them agreed, one
third of them disagreed while one third of them were indecisive about it.

55
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Recommendations

From the study it was clear that the respondents preferred new technology features
more than anything else in their handsets so it is advised that the mobile phone
manufacturers should concentrate on that and their advertising should highlight the
properties and abbreviations (e.g., EDGE, GPRS, WIFI, GPS) and at the same time
educate the people about the benefits of these attributes in their promotions.

Since smart phones era has just begun so the importance of reseller is becoming
more and more essential as such phones have loads of features and properties and
the users might be requiring hand-on instructions of their use. Furthermore, better
post purchase services should be there as well for such phones because that may
determine competitive edge over other rivals.

The study also revealed that many of the respondents did not value price that
important as compared to other factors in mobile phone selection and were willing
to pay higher prices if provided with better features than others. So it is
recommended that consumers can be charged higher prices for high end products
but their phones should have the attributes in them that are better/different than
rivals products.

It was also discovered that many of the people under study had multiple phones at
the same time so this presents an opportunity for mobile phone manufactures to
study why they carry multiple phones at the same time and how they can target
them either through making phones based on their preferences or introducing dual
SIM handsets for such segment.

From the results of the study it is clear that Chinese handsets do not present an
imminent threat to the present familiar brands, but still all the major brands can
jointly take legal action against the replica Chinese phones that use their
trademarks/intellectual properties illegally.

56
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

This study provides a number of insights into the factors that has the most influence
on the choice of a mobile handset but this is just the tip of an ice berg, the work is not
comprehensive enough so that its findings can be generalized but still it can be a premier
report on the mobile phone handset market in Pakistan. There are numerous studies
conducted on mobile phone service providers in Pakistan but research on the handset
market in general and in the case of Pakistan in particular is insufficient.
An important and major limitation of this report was related to its sample range which was
relatively small and a big chunk of the sample was taken from university students who had
unique demographic characteristics and it may be noted that only 4% of the people of
Pakistan manage to study in universities, so a large number of population is still there to
be studied for the phenomenon under investigation. The sample was not diversified enough
to include people from all parts of the country especially people belonging to rural areas
that constitute majority of the population of Pakistan. Because of such limitations in the
sample the findings cannot be generalized.
Furthermore, many of the attributes in a mobile phone like MMS, SMS, camera,
multimedia features, WIFI connectivity, dual SIM support etc. were combined as new
technology features but they can themselves be studied as individual factors and how
much an individual value them compared to each other.

57
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

References:

Ansari, S. and Khan, A. (2009), Telecommunication Trends in Pakistan. Market


Forces, pp. 213-217.

Batra, R. and Ahtola, O.T. (1990). Measuring the hedonic and utilitarian sources of
consumer attitudes. Marketing Letters, 2 (2), pp. 159-170.

Bhatti, B. (2007), Cell Phone Users in Pakistan Prefer Style over Features.
Telecompk,

Retrieved,

24

November,

2010

from

<

http://telecompk.net/2007/03/28/cell-phone-users-in-pakistan-prefer-style-overfeatures/>

Bhatti, B. (2007), Top Reasons for Selecting a Mobile Provider in Pakistan. State
Of Telecom Industry Pakistan Blog. Retrieved, 24 November, 2010 from
<http://telecompk.net/2007/06/26/top-reasons-for-selecting-a-mobile-provider-inpakistan/>

Chernev, A. (2003). When more is less and less is more: The role of ideal point
availability and assortment in consumer choice. Journal of Consumer Research, 30
(2), pp. 169-184.

Dorsch, M.J., Grove, S.J. and Darden, W.R. (2000). Consumer intentions to use a
service category. Journal of Services Marketing, 14 (2), pp. 92-118.

Hassam (2010), China Mobile Phones. Hubpages, Retrieved, 11 December, 2010


from < http://hubpages.com/hub/China-Mobile-Phones>

Johansson, Johny K., Susan P. Douglas, and Nonaka, I. (1985), Assessing the
Impact of Country of Origin on Product Evaluations: A New Methodological
Perspective. Journal of Marketing Research, pp. 388-396.

Karjaluoto, H., Karvonen, J., Kesti, M., Koivumaki, T., Manninen, M., Pakola, J.,
Ristola, A. and Salo j. (2005). Factors Affecting Consumer Choice of Mobile
Phones: Two Studies from Finland. Journal of Euromarketing, Vol. 14(3), p-66.

Karjaluooto, H., Karoonen, J., Pakola, J., Petila, M., Salo, J. and Syento, R. (2003).
Exploring consumer motives in mobile phone industry: An investigation of Finnish
58
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

mobile phone users. International Conference on Business Economics,


Management and Marketing (Athens, Greece), pp. 335-342.

Kerr, D. and Harris, S. (2008), Pakistan Mobile Handset Market Outlook.


Retrieved,

22

November,2010from<http://www.strategyanalytics.com/default.aspx?mod=Repor
tAbstractViewer&a0=3844>

Khan, M. (2010), Mobile Phone Imports Increased by 55 Percent. Retrieved, 20


November, 2010 from <http://propakistani.pk/2010/04/28/mobile-phone-importsincreased-by-55-percent/>

Laroche, M., Kim, C. and Matsui, T. (2003). Which decision heuristics are used in
consideration set formation? Journal of Consumer Marketing, 20 (3), pp. 192-209.

Liu, C.M. (2002). The effects of promotional activities on brand decision in the
cellular telephone industry. The Journal of Product & Brand Management, 11 (1),
pp. 42-51.

Mobile handset import bill up 100 percent (2010). Daily Times, 5 September,
Retrieved, 22 November, 2010 from < http://www.dailytimes.com.pk >

Mobile phone users reach 100 million mark (2010, September 30). The Express
Tribune.

Moorthy, S., Ratchford, B. and Talukdar, D. (1997). Consumer information search


revisited. Journal of Consumer Research, 23 (4), pp. 263-277.

Najeeb, F. (2010, July 11). Chinese mobile phones gain higher market share. The
Express Tribune.

OKeefe, M. (2004). 2004 worldwide camera phone and photo messaging forecast.
Info Trends Research Group, Inc. Research Report.

Omar, A. (2008), Nokia's Best Hits and Flops in Pakistan, Telecompk, Retrieved,
24 November, 2010 from <http://telecompk.net/2008/11/26/nokias-best-hits-andflops-in-pakistan/>

59
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

Pakistan Telecommunication Authority, telecom indicators. Retrieved 14


September,
2010,from<http://www.pta.gov.pk/index.php?option=com_content&task=view&i
d=1413&Itemid=687>

Perner, L. (2009). Consumer Behavior: The Psychology of Marketing. Retrieved


10 November, 2010 from < http://www.consumerpsychologist.com/>

Riquelme, H. (2001). Do consumers know what they want? Journal of Consumer


Marketing, 18 (5), pp. 437-448.

Swait, J. and Adamowicz, W. (2001). The influence of task complexity on


consumer choice: A latent class model of decision strategy switching. Journal of
Consumer Research, 28 (1), pp. 135-148.

Syed, S. (2008), The State of Pakistans Handset Market An Analysis. State Of


Telecom Industry Pakistan Blog. Retrieved 10 November, 2010 from <
http://telecompk.net/2008/08/29/the-state-of-pakistan%E2%80%99s-handsetmarket-%E2%80%93-an-analysis/>

US$1b handsets imported in Pak in 2005-06. Retrieved 5 September, 2010, from


http://www.paktribune.com/news/index.shtml?160478

Wilska, T.A. (2003). Mobile phone use as part of young peoples consumption
styles. Journal of Consumer Policy, 26 (4), pp. 442-464.

60
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

ANNEXURE

61
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

QUESTIONNAIRE
Gender: (1) Male (2) Female

Age group A) 15 to 25 B) 26 to 35 C) 36 to 40

Monthly income/pocket money


A. 2000-5000 rupees

B. 6000-10000rupees

C.11000-15000rupess

D. 16000-25000rupees

E. 26000-40000rupees

F.Above 40000rupees

1. Do you own a mobile phone?


a. YES

b. NO

2. Do you see Chinese mobile phones as replacements for current well known
brands?
a. YES

b. NO

3. How many mobile sets do you use/have at present?


a. 1

b. 2

c. 3

d. 4 and above

4. Which companys mobile handset do you have?


a. Nokia

b. Motorola

c. Sony Ericsson

d. Samsung

e. Other
5. Which factor to you is the most important in purchasing a mobile phone
for yourself?
a. Brand Name.
b. Price.
c. New Technology Features.
d. Size/shape.
6. How often do you buy a new mobile phone for yourself?
A. Within 6 Months
B. Within an year
C. When new model of your present set arrives.
D. When the last one stops working.
7. Do you prefer Chinese mobiles over the branded ones?
a. Yes

b. No
62

A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

FSM - National University of Computer & Emerging Sciences, Islamabad

8. Do you believe cell phone is a status symbol?


a. Yes

b. No

9. In what price range does your current mobile phone lie?


a. 2000 to 5000 rupees
b. 6000 to 10000 rupees
c. 11000 to 15000 rupees
d. 16000 - 25000 rupees
e. 25000 onwards
10. Does a new model of your mobile phone motivate you to buy a new set for
yourself?
a. Yes

B. No

11. Rate price in order of importance to select a new mobile phone?


Most important factor --1----2-----3-----4-----5-----6-----7---Least important factor

12. A mobile phone is just a device for communication and thats it?
Highly agreed --1------2------3------4------5------6-----7---Highly disagreed

63
A study on the consumer behavior & factors affecting consumer choice - A case of mobile phone market in Pakistan

Você também pode gostar