Analysing Impact of Packaging Design on Impulsive Buying using Regression Model

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1 Volume-7, Issue-1, January-February 2017 International Journal of Engineering and Management Research Page Number: Analysing Impact of Packaging Design on Impulsive Buying using Regression Model Deepak Dhariyal 1, Manoj Singh Negi 2, Dr. Hem Chandra Kothari 3 1,2,3 Assistant Professor, Amrapali Group of Institutes, Haldwani, Uttarakhand, INDIA ABSTRACT Packaging has an important role in marketing communication and it has a significant influence on consumer buying decision. Manufactures and marketers have set the packaging as a part of their marketing strategy. Generally unplanned buying denotes impulse purchase decision which is crucial aspect of buying behavior especially when discussing about FMCG sector. Every manufacturer and marketer puts all its efforts to attract buyer s attention and converts it into sale whereas the buyer never intended to buy that particular product. This study aims to investigate the impact of packaging design on impulsive buying of Cadbury Chocolates at Vishal Mega Mart, Nainital Road Haldwani, Uttarakhand. Total 239 samples have been collected and data analysed using factor analysis and regression model. The result of the research shows that the packaging design affects impulsive buying. Two factors i.e. brand name and colour significantly influence the impulsive buying of Cadbury chocolate by the customers. Keywords-- Packaging, Impulsive Buying, Factor Analysis, Regression. I. INTRODUCTION Packaging is one such tool where the marketers can convey their message straight to its potential customers. For many brands the packaging leads the way to a successful integral branding communication effort and establishing the brand image. This study indicates the atmosphere of the store directly affected the mood of the consumer, which became a big factor in their purchasing behavior. The results suggested customers in a pleasant store atmosphere are likely to spend more money on the products they liked. This effect was only due to the customer s mood during the time of purchase. Vishal MegaMart is a leading Mall situated in Nainital Road, Haldwani having strong number of customers. In its early days, Vishal s annual profit was up to the mark, and it kept increasing ever since. The profit increase shows that, although Vishal is not a common store in city, Vishal sale goes high and high every year. This indicates a positive response from consumers. The most enchanting concept of marketing is to identify the understanding of the logic of consumers. Despite costly hazards of impulse shopping, buyers are increasingly making their buying decisions in markets. The competitive markets depend on the significant role of package as one of the tools of the sales promotion. Packaging design appeals consumer s attention to a special trade mark and encourages the product image, and affects consumer s views about product. Visual elements such as the color, the quality and the overall attractiveness play a major role in influencing the customer. The visual elements connote the product for many customers in situations where they have low information or when they are hard pressed for time. In such cases, the consumer totally relies on the recall value of the packaging and makes the decision in an impulsive manner. The big challenge that a marketer in today s word faces is to translate the attraction from the packaging to a purchasing decision. In a modern retail store, consumers directly face a meeting point where various brands are displayed. Packaging plays an important role at this meeting point which is known as the point of purchase, as this is the most important point of interaction between brands and consumers; it is at this stage that consumers decide which brands to purchase. Packaging is the main instrument of communication with which companies can deliver brand messages. The main aim of this research is to examine the relationship between consumer buying behaviour during the presence of attractive packaging in an impulse purchasing situation. The study is limited to Cadbury Chocolates in Vishal retail store situated in Haldwani. This research topic will heavily focus on identifying the different aspects of packaging and factors associated in impulse buying decision and exploring how marketers capitalizes on those aspects in formulating the marketing campaign to grab its market share. 200 Copyright Vandana Publications. All Rights Reserved.

2 II. REVIEW OF LITERATURE Smith, Pual Russell and Taylor, Jonathan (2008) Examine that words must be transformed into images. Color often gives the viewer a secret and can control the emotions. Russia s Pedagogical Institute has found that most people can feel color and can create a physiological response. Color is considered as one of the package graphics elements. According to Rettie and Brewer (2000) the layout has many problems as they reported the recollection of packaging parts. As a reason, Rettie and Brewer discovered that packaging parts were remembered in a different way according to their placement on the packaging design. MacInnis and Price (1987) assumed that consumers prefer to see a product image on a package more than imagine how a product looks, tastes, feels, smells, and sounds. In ancient world, illustration were the essentially method of featuring an image on packaging. In contrast, the invention of photography, and the development of printing technologies resulted in illustration being used less repeatedly. Silayoi and Speece (2004) believe that lack of graphics in package can waste the sale for many customers. As well as appealing graphics increases the sales as much as possible. For example, the colorful package can appeal consumers to buy. According to Rook, D. W. (1987) Typography considers the heart of packaging design as a result; it is primarily concerned with giving out information. In addition to products have names, description, uses, instructions, customer care information, and ownership details. The designer s skill lies in matching typeface selection to function. Bone, P. F., & France, K. R. (2001) classified the size and shape as the second kind of Visual components. According to the authors, the size and shape of package attract consumer evaluation and decisions, such as graphical components, but not as usual in easily uncovered ways. The size and shape are much associated to usability. According to Beatty, S. E. and Ferrell, M. E. (1998) the product information is considered the most essential core that customers are looking for in many different sources. Customer is always expected a valuable and rich information to make purchase decision. III. OBJECTIVE This study aims to examine the association between packaging design of Cadbury Chocolates & impulsive buying of customers. HYPOTHESIS: To attain the set objective of the study the following null hypothesis has been formed and tested: Ho: There is no significant influence of packaging design on impulsive buying. Ha: There is significant influence of packaging design on impulsive buying. IV. METHODOLOGY The study uses the quantitative approach. Respondents are walk in customers of Vishal Mega Mart at Nainital Road, Haldwani, who have purchased Cadbury Chocolates impulsively in the past ten days. A questionnaire has been developed that consists two sections- section A contains demographic variables and section B contains a Likert scale and administered on the customer. The samples are collected using the convenient sampling method. Customer s response on packaging design and impulsive buying have been taken in five point likert scale ranging from 1 for strongly disagree to 5 for strongly agree. V. DATA COLLECTION AND STATISTICAL TOOLS Data collected through the questionnaire has been given a proper code in MS Excel sheet and processed through the statistical software SPSS-22. Proper statistical tools i.e. factor analysis and regression has been worked out. VI. DATA ANALYSIS, RESULT AND DISCUSSION This section of the study deals with data analysis, interpretation of results and discussion in following lines: IDENTIFICATION OF FACTORS: A FACTOR ANALYSIS Factor analysis has been worked out to reduce the dimension of the data, where total 12 variables included in the questionnaire and divided in to four factors named brand name, color, shape & size and product information. Description of the factor analysis, sample adequacy and significance of Sphericity test is given below: Table 1: Factor Analysis Sl No. Variables of the Study Factor Loading Packaging Design Variable 201 Copyright Vandana Publications. All Rights Reserved.

3 Brand name 1 Brand name of Cadbury Chocolates packaging draws attention Brand name of Cadbury Chocolates packaging reflects global presence Brand name of Cadbury Chocolates packaging is better if compared to others.700 Brand name of Cadbury Chocolates packaging is easily readable from 5-meter distance 5 Brand name of Cadbury Chocolates inspires trust for the product.653 Color 6 Packaging color on Cadbury Chocolates draws attention.676 Packaging color composition on Cadbury Chocolates is very easy to remember 7 every time Packaging color composition stands out on the best compared to others Colored chocolate bar image on Cadbury Chocolates often seeks your attention.727 Shape & Size 10 Packaging shape of Cadbury Chocolates always seeks attention Packaging sizes of Cadbury Chocolates suits your needs.529 Product Information On Packaging Label Product information on Cadbury Chocolates packaging is mentioned and 12 described clearly.934 Table 2: KMO and Bartlett's Test Kaiser-Meyer- Olkin Measure of Sampling Adequacy..775 Bartlett's Test of Sphericity Approx. Chi-Square Df 66 Sig..000 Table 3: Total Variance Explained (Packaging Design Variable) Compone nt Total Initial Eigenvalues % of Variance Cumulative % Total Extraction Sums of Squared Loadings % of Variance Cumulative % Total Rotation Sums of Squared Loadings % of Variance Cumulative % Copyright Vandana Publications. All Rights Reserved.

4 Fig1: Scree Plot INFLUENCE OF PACKAGING ON IMPULSIVE BUYING: After identifying four factors of packaging then next their influence on impulsive buying has been tested using following multiple regression model: Y= α + β 1 X 1 + β 2 X 2 + β 3 X 3 + β 4 X 4 Where Y stands for Impulsive Buying β 1 = Coefficient of Factor X 1 β 2 = Coefficient of Factor X 2 β 3 = Coefficient of Factor X 3 β 4 = Coefficient of Factor X 4 α = Constant X 1 = Brand Name X 2 = Color X 3 = Shape & Size X 4 = Product Information Results / Output of the regression analysis are presented in following tables: Table 4: Regression Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate a Copyright Vandana Publications. All Rights Reserved.

5 Table 5: Results of ANOVA Model Sum of Squares df Mean Square F Sig. Regression b Residual Total Table5: a. Dependent Variable: Impulsive Buying b. Predictors: (Constant), F4, F3, F2, F1 Model (Constant) Standardized Unstandardized Coefficients Coefficients B Std. Error Beta T Sig Brand Name X X X 3 X Table 6: Coefficients of Predictors VII. INTERPRETATION Table 4 shows that the prediction power of the model is 44.9% as the model summery shows R square value This shows that all four factors explain 44.9% variance of the dependent variable. Table 5 shows the F value along with P value This infers there is a significant difference among the factors for their predictability and also indicates that the model is statistically significant at 5 % level of significance. Table 6 presents the coefficient value of the factors including the model and their corresponding F and P value. Results show that Brand name and color factors have a significant influence on impulsive buying. Whereas, remaining two factors do not show any influence. On the basis of finding of regression analysis we can infer that 1% change on factor brand name will cause for a change of 0.452% in impulsive buying. Similarly 1% change in factor color will cause for a change of 0.255% in impulsive buying. VIII. CONCLUSION Packaging design play a vital role on the impulsive buying of the customer. To examine whether this relationship does exists or not in case of Cadbury chocolate, this study identify four variables as independent variables i.e. brand name, colour, shape and size, and product information and then checks their impact on impulsive buying (dependent show). On the basis of the findings, this study concludes that out of the four factors only two factors- Brand name (Underwood et al., 2001) and color (Smith & Taylor, 2004) factors have a significant influence on impulsive buying (Rita Kuvykaite 2009). Though, the findings are product and place specific therefore, can not be generalize even after the implications are of two folds. First, it will contribute to the existing literature on related field and second it will give a brief knowledge to the existing and potential producers in the market. REFERENCES 204 Copyright Vandana Publications. All Rights Reserved.

6 [1] Ampuero, O., & Vila, N. (2006). Consumer perceptions of product packaging. Journal of Consumer Marketing, 23(2), [2] Beatty, S. E. and Ferrell, M. E. (1998) Impulse buying: modeling its precursors. Journal of Retailing. Vol. 74 No. 2, pp [3] Bone, P. F., & France, K. R. (2001). Package graphics and consumer product beliefs. Journal of Business and Psychology, 15(3), [4] Cobb, C. J. and Hoyer, W. D. (1986) Planned Versus Impulse Purchase Behaviour. Journal of Retailing.Vol. 62 No.4, pp Retrieved, May 16, 2007, from [5] Hesse, F., Loesch, K., Spies, Kordelia. (1997) Store atmosphere, mood and purchasing behaviour. International Journal of Research in Marketing. Vol. 14, [6] Kollat, D. T, and Willett, Ronald. P. (1967), Customer Impulse Purchasing Behavior. Journal of Marketing Research. Vol. 4, pp [7] Kotler, Philip and Armstrong, Gary (2008) Principles of Marketing Publisher: Pearson/Prentice Hall. Edition: 12th [8] Lee, A., Monroe, Kent. (1999). remembering versus knowing: Issues in buyers processing of price information. Journal of the Academy of Marketing Science. Vol. 27, [9] Mantel, Susan Powell, and Frank R. Kardes. The Role of Direction of Comparison, Attribute-Based Processing, and Attitude-Based Processing in Consumer Preference. Journal of Consumer Research. March [10] Rook, D. W. (1987) The buying Impulse. Journal of Consumer Research. Vol. 14 (2), pp [11] Smith, Pual Russell and Taylor, Jonathan (2008) Marketing Communications: An Integrated Approach [12] Stahlberg, Markus and Maila, Ville, (2009) Shopper Marketing: How to Increase Purchase Decision at the Point of Sale, Publisher: Kogan Page Ltd. [13] Stern, H. (1962) The Significance of Impulse Buying Today. Journal of Marketing. Vol. 26 pp APPENDIX Questionnaire Kindly give your response for the following statements: S. No ITEMS SD D N A SA PACKAGING DESIGN 1 Brand name of Cadbury Chocolates inspires trust for the product 2 Packaging color on Cadbury Chocolates draws attention 3 Packaging color composition on Cadbury Chocolates is very easy to remember every time 4 Packaging sizes of Cadbury Chocolates suits your needs 5 Brand name of Cadbury Chocolates packaging draws attention 6 Brand name of Cadbury Chocolates packaging reflects global presence 7 Product information on Cadbury Chocolates packaging is mentioned and described clearly 8 Packaging color composition stands out on the best compared to others 9 Colored chocolate bar image on Cadbury Chocolates often seeks your attention 10 Packaging shape of Cadbury Chocolates always seeks attention 11 Brand name of Cadbury Chocolates packaging is better if compared to others 12 Brand name of Cadbury Chocolates packaging is easily readable from 5-meter distance IMPULSIVE BUYING 1 Decision to buy Cadbury Chocolates emerges unexpectedly 2 Interest to buy Cadbury Chocolates emerges suddenly 3 Cadbury Chocolates are purchased without thinking much 4 Packaging design of Cadbury Chocolates emerges urge to buy 5 Urge to buy after accidentally seeing Cadbury Chocolates 6 After visual contact, feeling that Cadbury Chocolates is the one what I need 7 Purchasing Cadbury Chocolates can improve my mood 8 Cadbury Chocolates is purchased without fear of toothache 9 No problem in adjusting other shopping plans in order to buy Cadbury Chocolates 10 Never feel guilt in buying Cadbury Chocolates SD- Strongly Disagree, D- Disagree, N- Neutral, A- Agree, SA- Strongly Agree 205 Copyright Vandana Publications. All Rights Reserved.

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