CHAPTER 3 RESEARCH METHODOLOGY 3.1 CONCEPTUAL FRAMEWORK

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1 CHAPTER 3 RESEARCH METHODOLOGY 3.1 CONCEPTUAL FRAMEWORK The framework of this research seeks to understand perceptions of various value dimensions of branded gold jewellery and its impact on buying decisions. The first part gives an idea of general definitions of concepts and the models which help in understanding and deriving the factors to be studied in this research. This research explores to understand the factors that influence the perception of women when they want to buy branded gold jewellery, their awareness levels about gold brands in Bangalore. Four key psychological processes motivation, perception, learning and memory fundamentally influence consumer responses. This study focuses on perception factors. Below model were used as framework for the research purpose. Consumer Decision Model The Consumer Decision Model (also known as the Engel-Blackwell-Miniard Model) was originally developed in 1968 by Engel, Kollat, and Blackwell and has gone through numerous revisions; Problem / Need Recognition Information Search Evaluation of Alternatives Purchase Post-purchase Evaluation Consumer buying decision process 70

2 The following flow diagram narrates how a consumers buying decision happens when a perceived need arises. Problem / Need Recognition - Perceiving a Need Information Search Seeking - Value Evaluation of Alternatives - Assessing Value Purchase - Buying Value Post-purchase Evaluation - Value in Consumption or Use When a brand is notified in the minds of consumers and when there is harmony between the content of the message and its perception, a marketing message reinforces the organizations or Brand Trust. Problem / Need Recognition Memory Search Intention Feedback Purchase Problem solving behaviour A satisfied customer may take a shorter route while repeating the purchase. Above is the stages. Need recognition leads to memory search which reveals clear intentions to buy on account of previous satisfaction. Ultimately, it leads to purchase. There is an element of brand loyalty here, which gets reinforced by continued satisfaction since quality/ trust is maintained. Problem / Need Recognition Purchase Decision Brand Evaluation Brand beliefs formed by learning from various sources 71

3 The consumer involvement is high, but in his/her perception, there are minor differences between the competing brands. Certain set of perceptions are strong and when this is aligned with the marketer efforts, it can create a strong influence to buy from same seller. Hence it is important to understand the factors which influence their perception which ultimately leads to buying decisions. Schiffman and Kanuk (2007) defines consumer behaviour: the behavior that consumers display in searching for, purchasing, using, evaluating, and disposing of products and services that they expect will satisfy their needs A genuine brand, according to Duane E Knapp, has three basic characteristics: (1) The internalized sum of impressions as received by the consumers (2) leading to a distinctive position in their mind space (3) based on emotional and functional benefits Perception is important because people selectively perceive what they want and it affects how people see risks in a purchase Howard-Sheth Model on Consumer Behaviour The model clearly states that the Perceptual constructs are strongly influenced by Input variables like: Significative, Symbolic and Social. These concepts were used while framing the questionnaire. 72

4 Fig 3-1: Howard-Sheth Model on Consumer Behaviour Input variables are the environmental stimuli that the consumer is subjected to, and is communicated from a variety of sources. Significative stimuli are actual elements of products and brands that the buyer confronts (Loudon & Della Bitta 1993), while Symbolic stimuli refers to the representations of products and brands as constructed by marketers through advertising and act on the consumer indirectly (Foxall 1990) (Howard & Sheth 1969). Social stimuli include the influence of family and other peer and reference groups. The influence of such stimuli is internalised by the consumer before they affect the decision process. As shown in Model the Hypothetical Constructs (or Intervening Variables) can be classified in two categories: those described as Perceptual constructs, and those described as Learning constructs. Perceptual constructs include: Sensitivity to information the degree to which the buyer controls the flow of stimulus information. Perceptual bias distortion or alteration of the information received due to the consumers fitting the new information in to his or her existing mental set. Search for information the active seeking of information on consumption choices. In combination these perceptual constructs serve to control, filter and process the stimuli that are received. The model draws heavily on learning theory concepts (Loudon ANDDella Bitta1993), and as such six learning constructs are represented: Motive described as either general or specific goals impelling action. Evoked Set the consumers assessment of the ability of the consumption choices that are under active consideration to satisfy his or her goals. Decision mediators the buyer s mental rules or heuristics for assessing purchase alternatives. Predispositions a preference toward brands in the evoked set expressed as an attitude toward them. 73

5 Inhibitors environmental forces such as limited resources (e.g. time or financial) which restrain the consumption choice. Satisfaction represents a feedback mechanism from post-purchase reflection used to inform subsequent decisions Another theoretical model of Determinants of a consumers luxury value perception from Wiedmann, Hennigs, Siebels - Measuring Consumers Luxury Value Perception: A Cross-Cultural Framework was used to support the research which included: FINANCIAL DIMENSION OF LUXURY VALUE PERCEPTION The financial dimension addresses direct monetary aspects such as price, and best value for money. FUNCTIONAL DIMENSION OF LUXURY VALUE PERCEPTION The functional dimension of brands refers to the core benefit and basic utilities that drive the consumer based luxury value such as the quality, uniqueness, usability, reliability, and durability of the product INDIVIDUAL DIMENSION OF LUXURY VALUE PERCEPTION The individual dimension focuses a customer s personal orientation on luxury consumption and addresses personal matters such as materialism self-identity value SOCIAL DIMENSION OF BRAND The consumption of luxury goods appears to have a strong social function. Therefore, the social dimension refers to the perceived utility individuals acquire by consuming products or services recognized within their own social group(s) such as conspicuousness and prestige value, which may significantly affect the evaluation and the propensity to purchase or consume brands Luxury brands have three components: the objective (material), the subjective (individual) and the collective (social). Above models contributed in the Conceptualization for the research. The section C part of the questionnaire is strongly driven from the factors from these models to study the determinants of a women consumers value perception of branded gold jewellery like price, resale, functional aspects, status etc., 74

6 3.2 OPERATIONAL DEFINITIONS A. General Definitions Brand can be defined as a "name, term, symbol, logo, design, or combination of them, aims at identifying a product or service of either one seller or a group of sellers, and distinguishing these products or services from those of competitors". Brand further can refer to "set of expectations and perceptions that rose from the experience of the product or the organization" (Davis, 2002). Jewellery is literally any piece of fine material that someone uses to adorn themselves. Derived from the word jewel, which was anglicized / in English idiom from the old French Jouel in around the 13th century. In Old English gelo, stands for yellow. Perception : the act or the effect of perceiving These factors reside: i) In the perceiver ii) In the Object or target being perceived or iii) In the context of the situation in which the perception is made. According to Al Ries and Laura Ries (1998), a brand is a singular idea or concept that you own inside the mind of the prospect. Luxury is particularly slippery to define. A strong element of human involvement, very limited supply and the recognition of value by others are key components (Cornell 2002, p. 47). Defined as goods for which the simple use or display of a particular branded product brings esteem for the owner, luxury goods enable consumers to satisfy psychological and functional needs. B. Operational Definitions Assay: To test a metal for purity. Assaying: The method of accurate determination of the gold content of the sample expressed in parts per thousand (%). Bullion Coin: A legal tender coin whose market price depends on its gold content, rather than its rarity or face value. 75

7 Bullion: Refined gold that is at least 99.5% pure, usually in the form of bars, wafers or ingots. Carat: One-twenty fourth part by mass of the metallic element gold. Consumer demand: The sum of jewellery and total bar and coin purchases for a country (i.e. the amount of gold acquired directly by individuals). Fabrication: Fabrication is the first transformation of gold bullion into a semifinished or finished product. Fine Gold: It is gold having fineness 999 parts per thousand and above without any negative tolerance. Gold is produced in bars up to a purity of (often referred to as four nines ). Gold Standard: A monetary system based on convertibility into gold; paper money backed and interchangeable with gold. Gold: The metallic element gold, free from any other element. Grades: Gold and gold alloys shall be classified in accordance with the following grades depending upon Grain: One of the earliest weight units used for measuring gold. One grain is equivalent to grams. Hallmark: Mark, or marks, which indicate the producer of a gold bar and its number, fineness, etc. Karat: Unit of fineness, scaled from one to karat gold (or pure gold) has at least 999 parts pure gold per thousand; 18-karat has 750, parts pure gold and 250 parts alloy, etc. Gold Bar: A Gold bar weighing one kilogram approximately troy ounces. 76

8 Marking : The gold, gold alloys, jewellery/artifacts shall be stamped with the Standard Mark in this case known as the Hallmark by BIS recognized assaying and hallmarking centers only. Physical bar demand: Global investment in physical gold in bar form. Recycled gold: Gold sourced from previously fabricated products which has been recovered and refined back into bars. Technology: This captures all gold used in the fabrication of electronics, dental, medical, industrial, decorative and other technological applications, with electronics representing the largest component of this category. This includes gold destined for plating jewellery. Tonne: 1,000 kg or 32,151 troy ounces of fine gold. Troy Ounce: The word ounce when applied to gold, refers to a troy ounce. 1 troy ounce is equivalent to grams. Chapter note no. 12 of Central Excise Tariff provides that, brand name or trade name, whether registered or not, is a name or a mark, such as symbol, monogram or label which is used to indicate a connection, in the course of trade, between a product and some person using the name or mark with or without indicating the identity of that person. Exclusive Outlet : where only one brand of jewellery is sold and mostly these outlets are spread in many places with their branches. Speciality Stores: Outlets which are popular for particular designs or stlye of jewellery. General Jeweller : Any seller who owns the business individually, mostly caters to smaller needs and works on personal customer network. 77

9 3.3 HYPOTHESIS DEVELOPMENT With regard to the objectives mentioned, the following null hypotheses were developed. Hypothesis H1: The perception of various value dimensions is same across the age levels of respondents. H2: The perception of various value dimensions is same across the education levels of respondents. H3: The perception of various value dimensions is same across the occupations of respondents H4: The perception of various value dimensions is same across religions of respondents. H5: The perception of various value dimensions is same across the income levels of respondents H6: The perception of various value dimensions is same across the buying preferences of respondents H7: There is no linear relationship existing between social status, quality oriented value and branded gold jewellery decision making 3.4 SOURCES OF DATA DATA SOURCES: This is a combination of descriptive and analytical research. Data was collected from both primary and secondary sources. Primary source of data was majorly through questionnaires and interviews with gold industry experts, Designers and Faculty teaching at Vogue Institute of Fashion Technology, Bangalore were consulted to collect the primary data. 78

10 Secondary Data was from various Reports from world gold council, KPMG, Jewellery research organizations were studied for the research. Numerous Journals, Case Studies, Newsletters, Bulletins, Newspaper, Magazines and website information were studied to collect the data for the research. Primary Data collection instrument: Since the study demands the collection of customer perceptions of women, a detailed questionnaire was prepared for collecting data which contained the following aspects : Demographic details Preferences during buying gold jewellery Role of brand perception in choosing branded gold jewellery Influencers during buying decisions of branded gold jewellery Occasions of gold purchase Frequency of purchase Brand awareness and marketing efforts by brands etc., Types of Gold jewellery purchased Assess various well known brands The questionnaire is divided into Section A, B and C to collect data about the above listed factors as follows : SECTION A - Profile of the Respondents SECTION B - Purchase Behaviour SECTION C - Perception towards Branded Jewellery over Unbranded Constructs in section C were measured on Five-point Likert scales, ranging from 1(strongly disagree) to 5 (strongly agree). Before the questionnaire was finalized, academic professionals reviewed the questionnaire to assure content validity. Revisions and corrections were made 79

11 accordingly. The instrument was pilot-tested with a sample of 100 and later used for the actual sample data collection. 3.5 STUDY PERIOD A Cross sectional study was chosen and data was collected from women in the age 18 years to 45 years. Data was collected at a stretch during month of July to August, SAMPLE DESIGN : With an estimated population of 8.5 million in Bangalore is the fourth most populous city in India and the 28th most populous city in the world. As the study pertains to women consumers in the age group of 18 to 45 years, precise data about women population in the age group of 18 to 45 years was not available. Sample size was arrived on the following basis : Sample Size Formulae found in most statistics textbooks, especially statistics dealing with probability. Sample Size Infinite Population ( where the population is greater than 50000) SS = Z 2 x (p) x (1-p) C 2 SS = Sample Size Z = Z value ( e.g 1.96 for a 95 % confidence level ) P = Percentage of population picking a choice, expressed as decimal C= Confidence interval, expressed as decimal ( e.g.,.04 = +/-4 percentage points ) 7 "Urban Agglomerations/Cities having population 1 lakh and above". Census India. The Registrar General & Census Commissioner, India. Retrieved 17 October

12 A Z-value ( cumulative Normal Probability Table) represent the probability that a sample will fall within a certain 95% confidence level and 5% confidence interval = (1.96) 2 x (p) x (1-p) C 2 = (1.96) 2 x.5 x (1-.5).05 x.05 = x.5 x = As per sample formula its Sloven s formula was used for calculating sample size to determine the ideal sample size for a population, as Slovin's formula is used when nothing about the behavior of a population is known at all. N n = ( 1 + (N*e^2)) 81

13 Where: n = number of samples N = total population e = margin of error If a sample is taken from a population, a formula must be used to take into account confidence levels and margins of error. When taking statistical samples, sometimes a lot is known about a population, sometimes a little and sometimes nothing at all. Population (18-40) Person/Male/Female//Total/Rural/Urban) in Bangalore District (Karnataka) District Total Rural Urban Persons Males Females Persons Males Females Persons Males Females Bangalore All ages Karnataka All ages Source : Datanet India Pvt. Ltd. As per above source women population in Bangalore is : So its N n = ( 1 + (N*e^2)) Where: n = number of samples N = total population = e = margin of error lets decide as 5% i.e.,.05 = x (.05) 2 82

14 = x = = = ie., 400 To achieve better accuracy a sample of higher value 400 was decided. Sample size : The sample size is decided as 400. The sample was covered in and around shopping malls, banks, corporate areas and commercial zones, made the sample more relevant to the objectives. The survey was conducted through personal interviews over a period of 40 days. Sample Method : Multi Stage Stage 1 Stratified Random sampling : Gender based Women population in Bangalore Stage 2 Judgement sampling: Women in the age group of years [ Source : Datanet and General formula ] 83

15 Collect samples using Judgment sampling i.e., women in the age group who have purchased both branded and unbranded jewellery are randomly selected from different zones of Bangalore and asked to distribute that questionnaires to people whom they know. Stage 3 is Snowball sampling [distributing questionnaires to people whom they knew ]. 525 questionnaires were collected and further incomplete questionnaires were eliminated and arrived at 500 samples. But the sample size required to represent the universe is 400 so selected only 400. To avoid biasness of selection, modern MS-excel tool rand( ) was used which generates random numbers, by sorting all 500 in ascending order and select top 400. Remaining 100 questionnaires were used for pilot study. Area : The study is conducted in Bangalore city. Respondents : Since the study focuses on perceptions of women in Bangalore city Women within the age group of 18 to 45 years were selected as respondents. 3.7 TOOLS USED FOR DATA ANALYSIS Descriptive and Analytical Techniques: Descriptive analysis was made through percentage, mean, standard deviation, Graphs and Tables. The following were the techniques used for analysis An elaborate spreadsheet was constructed for data entry. Data was coded and entered for analyses. 84

16 ANOVA was used to analyse the variances across various value dimensions across demographic factors. Reliability Test Cronbach s alpha value was Going by the thumb rule, alpha value of 0.8 α < 0.9 translates into Good internal consistency. Factor Analysis was done Section C part of questionnaire with 13 factors Correlation was done to know the relation between various value dimensions and identified attributes of Branded gold Jewellery Decision Making Regression Analysis was done to understand the impact of social status, quality oriented value (Independent Variables) on branded gold jewellery decision making ( Dependent Variables). 85