Consumer Buying Behaviour: The Cosmetics Industry

Consumer Buying Behaviour The Cosmetics Industry vellicateWomen start disclose an inherent love of peach. The rapid stinting growth, coupled with the big development of nonfunctionals diligence in China, endures to the significant changes of enhancives consumer doings. Cosmetics countenance become a routine tool to fasten women more than presentable. Understanding deportment of consumers is a key to the success of business. As a huge potential consumer assembly, understanding of their attitudes and purchasing manner towards augmentatives seems to be necessary. This study foc utilize on investigating and analysing the purchasing principles for female college students. Via the systemic study, companies will be beneficial to know a ruin understanding of college females in terms of cosmetics purchasing.The field was conducted with focus convention and questionnaires. The leads of questionnaires will be canvass by using SPSS and entropy were discerpd by frequen cy compendium, cross-tab analysis and multi-respond analysis. presentment1.1 Research backgroundWith the expansion of social group and rising incomes, beauty consciousness among women has changed. Cosmetics encloseed into womens lives on a daily basis. The act of beautifying sensible appearance non only becomes a distinct way to register sensations image but also a pattern to show respect to other people (Choi, Kim, Kim, 2007). pursuance decade of years tremendous economic development, the Chinese cosmetics industry is undergoing fast changes and advancement. It further enhances the utilisation level of urban and rural residents, improve the utilisation environment, optimize consumption structures, and contribute to expansion of the fields of consumption (Tao, 2005). Consumer categories such as cosmetics benefited from the rapid growth in consumer spending, and have become a huge pure tones maker. Meanwhile, the increasing fashion and beauty consciousness, as a natural o utgrowth of rising incomes, diversify consumers demands. Obviously, this potential has not only attracted international cosmetics companies, but also led to more interior(prenominal) cosmetics producers trying to enter the merchandise. As a consequence, argument will be further intensified among inappropriate and house servant companies. anterior look for indicated that females spending on cosmetics still making up of the main income for the complete cosmetics groceryplace. An increasing descend of female college students starting to show strong interest in enhancing their appearance through make-up (Huang, 2003). With a high school level of interests in appearance, they have revealed a great potential. College students represent not only the unpar entirelyeled consumption potential but also the future mainstream. Thus, the female college students patterns of consumption gradually become a major concern (Choi, Kim, Kim, 2007). Studying consumer behavior enables companies to understand why consumers make the purchase decision and look to how they will react to promotional messages. On the purpose of maintaining and expanding market sh be, understanding of consumer behavior will be required to display case their changing needs. Therefore, explore need to be conducted to depict cosmetic companies with basic data required in establishing trade st identifygies for advancement into Chinese market to tailor consumption patterns of female college students.1.2 backcloth and objectives of studyWhen reviewing the literatures on the cosmetic and toiletry industry, the existing inquiry tie in to Chinese cosmetic consumer is typically concern with the entire market. Not umpteen studies be available limitedally focus on college students purchasing behavior. In the regard, considering the massive size of China, the present study limits itself to the female college students. By and large, this dissertation makes an attempt to check into and analyse pu rchasing pattern of female college cosmetic consumers. In event, this study aims to achieve the following objectivesTo mote and obtain a general picture of the cosmetics industry in China. On completion of this objective, the intention would be to sit an insight into the cosmetics environment and the rapid growth trend of the industry so as to have a good noesis base that can support the study throughout the dissertation.To investigate and analyse cosmetics purchase behavior of female college students in China. The intention of this objective would be to a) understand how college student embrace cosmetics, b) identify their characteristics in terms of cosmetics purchase, and c) develop a greater understanding of motivation for purchasing, different factors tangled in purchase decision of cosmetics and how product attribute, such as price, quality etc, effects purchasing patterns, thereby mapping out a model for female college students purchasing behavior.Based on the analysi s of the research carried out, briefly propose a topic of key recommendations enable companies in the industry to target their trade strategies at college cosmetics consumers.The data that plan to be gathered for this research will be obtained from both primordial and secondary resources. The secondary sources of data will be derived from published articles from internet database, journals and magazines, theses, and related studies on cosmetics. On the other hand, the primary source of info regarding the study will be gathered from focus groups and questionnaires, inclined(p) by the researcher, which will be delivered to the respondents of the research.1.3 Significance of studyThe boom of cosmetics industry in China has brought most changes in consumer behavior. The importance of the study cannot be understated. It is anticipated that the outcome of this study will certainly contribute towards a breach understanding of the changing perception and behaviour of cosmetics buyers .Furthermore, there are a number of literatures that have discussed the female consumer behavior with regards to the purchase of cosmetics. This study will combine the pertinent literature with admit findings from primary research to provide an in-depth discussion. Therefore, the study will be significant in terms of better positioning of products and more effective marketing communication to tailor the demand of college females. This means that the findings will not only be able to benefit both foreign and domestic companies who have the willingness to enter the market but also various retailers who want to expand gross revenue.Literature reviewMany theories have been proposed to let off consumer behaviors indoors certain industry area. Understanding todays consumer is the key to realising the future needs and expectations of beauty consumers, and is potentially relevant to improving marketing effectiveness (Tang, 2008). Previous studies hold that knowing the psychological pro cess by which consumers make purchasing decisions enables marketers to grasp opportunities and even predict the shifts and future development trend of the consumer markets. Additionally, it observes positive impact on improving cosmetics sales (Yau, 1994).Previous studies regarding the patterns of purchasing cosmetics display 2.1 Relationships between cosmetics and females-- consumer behaviorkerala300-Few positive studies have examined that - -In this generation, cosmetics are used by women of practically all walks of lifeHigh-end cosmeticsThe desire to be beautiful could be considered a human tendency, as it is exhibited by almost every culture all around the world.KIRARA(PDF)Research suggests that beauty consciousness among people in general is changing. Vigneron and Johnson (1999) reported that peoples needs for appearances and philistinism were increasing.That is human beings wanted to satisfy the need to look and feel good. This created a boom in the cosmetic and toiletrie s domain across the world. Chambers Encyclopedia defines cosmetics as (a) articles intended to be rubbed, poured, sprinkled or sprayed on, introduced into or differently applied to the human body or any part thereof for cleaning, beautifying, promoting attractiveness or altering the appearance and (b) articles intended for use as a component of such articles. Now a conformation of cosmetic and toiletries ranging from natural to sophisticated items are available in the market. The pattern and preference of use of these items transfer according to different segments of gender, age and socio-economic class. When we review the literature on the cosmetic and toiletry industry, not many studies are available especially about Indian scenario.2.2 Patterns of women purchasing cosmeticsMost early theories of consumer behavior were touch with the purchasing characteristics and influential factors. Schutte and Ciarlante (Schutte Ciarlante, 1998)argued that in China the purchase decision is typically based on the public-service corporation of the product such as its physical characteristics and price value. However, recent studies outlined by Liang (Liang, 2008) suggested that womens purchasing pattern differs with men. Their buying decision tend to influenced easily by the purchasing environment, and have more impulse purchase. Besides, generally speaking, females have strong self-awareness when purchasing, which means majority of the decisions were made on the basis of personal preference or subjective impression, sensation.2.2.1 Characteristics of purchasing cosmeticsIn general, female invest more money on various cosmetic products and even spared no expense because they pay more attention to appearance than men (Huang, 2003). The characteristics of new-made Chinese females regarding cosmetics purchase can be summed up in three pointsEasily affected by market atmosphereNormally, products promotion, advertising and other factors can easily tempt three-year-old females to make irrational purchases. In a research by Cong (Cong, 2008), results showed that 56% of females bought unneeded or unexpected cosmetics products as a result of discount, followed by the purchase due to interests aroused by shop environment and sales exhibition (40.8%). Accounts for 22.8% of females who bought ineffectual products or had irrational consumption were affected by advertisement. Thus, compare with men, female is prone to be promote over-consumption by commercial appeals.Mood consumptionFemale tend to have more generous sentiments in the process of purchase. Their certain desires are prone to be roused and affected by mental activities. Oliver Yau (Yau, 1994) contended that mood consumption normally occurs in two bits. One of which might be triggered by delusion under particular retainer. For example, lots of females had encountered situation that unexpected spending happens after being paid out the salary. Another circumstance that contributes to mood co nsumption is likely to happen in the case of that female with unusual mood. such as, a considerable number of female go shopping when they feel frustrated and happy.Relatively low shipment to marksChinese cosmetics consumers show less passion on being loyal to brands. They would like to try several(prenominal) brands to compare them rather than be from the kindred brand (Labbrand, 2009). Besides, another reason that contributes to low brand fealty is seasonal consumption of Chinese consumers due to the significant difference in climate between spend and winter (Mo, 2008). Customers have to change their purchase habit to suit the season. For instance, customer tends to use more sunblock to protect their skin and less oily cream in summer than they do in winter.2.2.2 buying influencesAs established by Access Asia Limited (Access Asia Limited, 2008), Chinese consumers heavily rely on products, stores and work they know and trust. The same philosophy is applicable equally to pr oduct brands, with word-of-mouth communication proving to be a pervasive reason for consumers to change brands and most potent marketing tools in China. This is supported by Xuecai Liang (Liang, 2008) who claimed that among the females, friends group plays a very essential role on learning communicating about different brands of cosmetics. around people will only buy products that they have been recommended by friends. However, the increasing effects of advertising on the urban and younger Chinese buyer cannot be neglected as their media exposure increases (Yang, 2004).In addition, the physical characteristics like reliability, innovative technology and high brand profile are the important factors when make a cosmetic purchase, a study by Yuyuan Huang suggested that (Huang, 2003). Taking different attitudes towards local and foreign brands as example, Huang explained that foreign brand represent high quality and status at the Chinese consumers view, while local brand are perceive d as shortage of these selling advantages, even both product sold at the same price. Besides, it worth to notice that local cosmetics consumers now are prepared to pay more for better quality, service, and convenience.The variety of choice is seen as another factor. match to Shen, Liu and Huang (Shen, Liu, Huang, 2005), majority of the consumers will prefer to shop in large stores when they can easily reach such places, whereas finding the leave out of product choice in little stores (especially in terms of range of price) to be embarrassed. It can be argued that larger stores will provide more bargains, which means the products tend to have higher price value. Such stores are also considered as being more convenient to shop in, contributing to the flourishing development of the discount retailing sector over recent years (Access Asia Limited, 2008).Moreover, in the eyes of Chinese consumer, the depth of communication brands had with their customers is vital. According to survey conducted by Labbrand (Labbrand, 2009), Chinese consumers have a strong demand to communicate with brands. For instance, they would like to receive head from brand concerning their feeling about the products they use, or to be informed in time when brand have special events. Besides, consumers considered that from communicating with brand they can better compare and finally find the most equal cosmetics for their specific needs and desires. Thus, it can be argued that companies who kept contact with consumers tend to have higher sales and brand loyalty.Industry reviewThe huge advances witnessed over the past two decades have improved the vivacious standards of millions of Chinese citizens. With the upgrade of living standards, one-on-one consumption among expenses has reached a higher level. The rise in private consumption translated into greater spending on personal accusation products in the booming cosmetics industry (Tao, 2005). In China, the development of the cosmetic in dustry has been to a new stage and it shows a sound momentum of growth. marketplace potential Chinese cosmetic market continues to surgeIn recent year, the continuous rapid economic growth generates good environment and favorable development space for cosmetics industry maintaining a rapid rate of growth. In 2003, china had become the second-largest cosmetics market in Asia after Japan, and was the eighth largest in the world (Li, 2005). According to National Bureau of Statistics (NBS) of China, the Chinese cosmetics market generated center revenues of RMB488.3 billion in 2007, representing annual sales grew by 26.3 percent over the same period last year. In 2008 and 2009, the sales grew by 22.2% and 17.2%, respectively, over the same period, to reach respective values of RMB596.5 and RMB348.2 billion in 2008 (HKTDC, 2009). At the same time, it has also been taken note that the performance of the market is forecast to decelerate, but still increase by approximately 13% per year ( entropymonitor, 2009). Overall, the cosmetics industry is surely faster than the economic growth which means the long term potential of the Chinese cosmetic market is fairly vast.Additionally, given its population of approximately 1.3 billion, China has the largest market potential. Chinas share of the orbicular cosmetic market may seem hand almost compared to huge markets like the US and Japan, but with a population of over a billion people, the growth potential there is staggering, said Lenka Contreras, vice electric chair and head of the Consumer Products practice for Klines research division (Pitman, 2005). Chinas cosmetics market is still far from saturation.HKTDC-xxdatamonitorCharacteristics of chinas cosmetics marketThe consumer market development is vigorousWith economy expanding and mass livelihood improving, awareness of personal salubrious-being prompts strong and continuous growth in the consumer market. It not only reforms the consumption pattern but also drive the sales (Asia consulting, 2008). In that sense, it is predicted that the Chinese cosmetic consumer market is dynamic.Women stimulating the market growthFemale is still an of the essence(p) part of Chinese cosmetics market, especially those office ladies. As Chinese women are now increasingly beauty consciousness and awareness, the use of cosmetics has become a part of their daily routine (Fung, 2005). Accordingly, the rising proportion of young females in white-collar jobs has formed the loyal customer basis for this market, and the cosmetics sales have been driven. Their spending on cosmetic is outgrowing over other areas. National Bureau of Statistics has come up with data that shows women ages from 20-54 account for 27.21% of the total population. Being more economically independent, the enormous number of consumers in the group will generate huge demands than ever (HKTDC, 2009).The famous-brand effect appears day by day on the marketThe rising sales of famous-brand products refle cted that customers attitudes concerning cosmetics have changed (Chen Xue, 2005). As the improving residents consumption level, people are willing to pay more attentions to those well-know cosmetic products which were considered with high grade, quality assurance and harmlessness. For example, customers will be highly delighted with brand-name products that can prevent wrinkles or book moisture balance in the skin. Due to the impression lifted in mind, its sales increased dramatically and gradually become the main growth point of the entire market. Instead, few shows interest in low-end cosmetic products (China Consulting, 2008).ConsumerIn Chinese cosmetics market, consumers ways of spending are undergoing a significant change. Dianyi Zhang, president of China Cosmetics Association, claimed that modern customers behave more independently on consumption. Consumers tend to utilize different channels and rely on various measuring standard to get a pleasing cosmetics, rather than depe ndent on advertising. In addition, changes also occur on consumer group. Depending on the difference in requests on brand, quality, price and personal affordability, consumers were separate into low, middle and high classes. And, every class has a great number of loyal customers (HKTDC, 2009).Women of all ages were concerned with their lifestyle. The rising purchasing ability of women serve uped them to spend more on personal grooming. This grooming consciousness was back up by womens active participation in advertisement or fashion shows, such as the favorite Fashion TV program (Pitman Simon, 2009). In china, consumption pattern of consumers is changing. The consumers have become globalized in their sentiment and are ready to enjoy with some impulsive shopping. Access to various brands and products give them better knowledge towards cosmetics, due to fast-flowing info (Tang, 2008). Therefore, as a cosmetics producer, motivations and type of products purchased should be diffe rent depending upon the segment of consumer targeted.Competitive situationThe business environment in China has been improving, especially since 2001, when the country joined the World Trade Organization. The commitment to opening its market in compliance with the WTO rules has further stimulated the market, with greater participation from international and domestic player. Consequently, competition between transnationals and local players is heating up across the country (Utsunomiya, 2003).3.4.1 Foreign Brands Continue to decree in the Chinese MarketInternational brands play a dominant role in the upper-end cosmetics market, such as PG (Olay), Unilever (Ponds), Shiseido, LOreal and Estee Lauder etc (See sidestep 1) , due to young womens pursuit of long-familiar brands in literary. These large multinational cosmetic players have entered the mainland market one after another to build their own manufacturing basis and sales network (Sunfaith China Ltd, 2005) and many of those player s have been operating successfully in the China market, making their brands well-known and occupy about 80% of the total market share. According to certain statistics, the world top 15 brand of cosmetics had set up own specialty stores (HKTDC, 2002).Even so, those cosmetics magnates have accelerated expansion into low-end products. For example, Avon and LOreal launched low-end cosmetics one after another to suit the changing customers needs and purchasing behavior, and expand the market share (HKTDC, 2009).Table 1 Top Ten Preferred Colour Cosmetics Products, 2006 (Access Asia Limited, 2008)Brand% ShareMaybelline10.3LOreal9.9Shisiedo8.0Lancme7.3Avon6.6Este Lauder5.5Yue Sai5.1Revlon4.7Amway3.8 pee3.2Others35.6TOTAL100.03.4.2 Transformation of local Chinese companies is under wayCompared with foreign companies domestic players have smaller market share due to several weaknesses. For instance, weak financial ability, lack of research and development capability, and lack of experience in brand management and marketing. Therefore, most of those players produce low-end product with only a small number making high-end product that can compete with foreign players (Li, 2005). Nonetheless, as the economic growth domestic companies has undertaken a transformation, gradually changed the impression with low quality and price, and entered into high-end market so as to become more competitive (Ocn, 2008).Facing with the open markets and trade liberalization in China, the previous mentioned increasingly fierce competition is inevitable. On the purpose of responding to the changing customer demands, market players have devised a variety of marketing strategies so as to create impressive product image in customers mind and drive them to spend more money on their own products.Distribution channelSWOT analysis of the female market emerging develop trendhttp//www.cosmeticsdesign.com/Products-Markets/Asian-cosmetics-players-opt-for-natural-and-organic-standardsCosmetics players opt for natural and organic standardsIn karara (PDF)the main reasons for boom in cosmetic industry as increasing fashion and beauty consciousness coupled with rising incomes and focus on health and fitness.A natural and holistic approach attracts these women, especially where there is an interest in completing health and in overall well being.Key issues SWOT analysis Summary of key issues related to your literature and industry reviewThe key issues section is where you, having completed the situation analysis consider what are the key issues facing the connection and the market. So in a sense it is a summary chapter at the end of the first section of your report. In this chapter you should give an indication of what you think are the most important issues facing the company and the market.-- Consumer -Company -Research methods5.1 Approach5.2 Data gathering method5.3 Data touchhttp//ivythesis.typepad.com/term_paper_topics/sample_dissertation_research_problem_and_objectives/In this st udy, the self-administered semi-structured questionnaires will be used to collect quantitative data and the interviews will be used to provide qualitative insights into the data collected. The data will then be presented by means of graphical representations and illustration and the difference would be highlighted.- 38 -Research questionSecondary researchThe following information could be considered using desk research to give a general review and help to assist analysis of primary researchesCosmetics industry reviewThe purpose of this part is to find out important information concerning the entire cosmetics markets in china. Main issues that need to investigate includeMain characteristics of Cosmetics Industry in chinaWhat flow market development trend isWhat Competitive situation is within cosmetics marketDevelopment opportunities of the cosmetics market within chinaThis information will be helpful to better understand and form general perceptions of industry situation in ch ina.There are several ways to obtain required information above. Data sourcesInternet DatabasesGo to college library website and use its databases, such asMarketlineAcademic Search Premier blood line Insights Access Asia SeriesBusiness Source PremierTo look for industry reports and e-journals those contain information regarding the Chinese cosmetic market. Find out information about the current cosmetics market and even see what demographics suit Shiseido to introduce the product to.Applying databases is a good way to get information due to its huge information storage volume and reliability. Most of them are academic-based, and have a comprehensive understanding on specific field.WebsitesLook up necessary websites such as www.shiseidochina.com where might be viable to get some internal data sources. The use of this data is to define the competitive position of the firm, an evaluation of a marketing strategy the firm has used in the past, or gaining a better understanding of the co mpany. Even, their past researches on consumer behaviors. The internal data sources might be sales marketing reports and accounting financial reports of the company.Magazines NewspapersIt is also possible to look at some Chinese cosmetics industry magazines so that to acquire valuable industry information and some current cosmetic issues happened in china.Quantitative Qualitative methodsIn order to ascertain consumers cosmetics buying patterns and product satisfactions, quantitative and qualitative researches are both required to be implemented. It should be noticed that the understandings of consumers would observe significant impacts on companys marketing strategies. Besides, it is valuable for coming up with comments and suggestions to Client Company after analyzing Chinese customer.The main objectives of quantitative and qualitative research falls into several parts as followedMotive of get Cosmetic ProductMotives are defined as general drives that direct a consumers behavi or toward attaining his or her need and the motivational drive directly affects the specific benefit criteria consumers use to evaluate products. Thus, understand buying motivations will provide evidences to Client Company to better position its products.Information SourcesThere are differences in using information sources among various age groups. Knowing customers through what kinds of channels to get products information could help Shiseido sell products more effectively to target audiences.Evaluative Criteria for buying CosmeticsAs for criteria for purchasing cosmetics, the responses will be in order of quality, price and volume of content. It is crucial to see what element is more important to customers when buying cosmetics. This will do company a favor to develop products or marketing strategies.Place of Purchasing CosmeticsIn terms of the place of purchase, primary research should focus on finding out the reasons for selecting these places of purchase. Then, company can iden tify the perfect place to sell its products on the basis of information provided by survey.Satisfactions and dissatisfactionsIt is well known that satisfactions with a product will perform huge influences on its sales volume. This primary research should identify the level of satisfactions towards Shiseido and try to find out any aspects that consumers wish to see changes.Quantitative researchQuestionnairesAs the measuring tools of this study, questionnaire based on previous studies and results of preliminary research were used. In this case, this study was carried out in the country of China. Therefore, questionnaire in English should be translated into Chinese. To reach a variety of different customers, questionnaires are supposed to carry out at different city within china so that to get as many points of views as possible.Questionnaire is consisted of 3 main sectionsSection 1 is simply some questions on demographical characteristics of respondents like gender, age and occupation etc. to profile consumers.Section 2 emphasizes on customers buying behavior on cosmetics. As objectives mentioned above. For instance, purchase motivation information sources, evaluative criteria for purchasing basic skin care items and color make-up products, store type of purchasing cosmetic product and reasons for store selection persons to exert influence upon purchasing and satisfaction/dissatisfaction on cosmetics purchased.Section 3 focuses more on investigating customers perceptions concerning Shiseido products. Such as, customers brand awareness of Shiseido, brand image and brand position in customers mind.Additionally, the results of questionnaires will be analyzed by using SPSS. The analysis conducted in the study with SPSS statistics package includes frequency analysis, cross-tab analysis, analysis of variance and duplex Range test.SurveyIn order to keep questionnaire short enough to maintain respondents interests, there essential be some questions cannot be asked. Th us in this project, I will also consider conductin