ANALYSIS ON FACTORS THAT INFLUENCE BRAND SWITCHING OF PEPSODENT (Case study: tooth paste consumers in Bandung, Jawa barat)

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ANALYSIS ON FACTORS THAT INFLUENCE

BRAND SWITCHING OF PEPSODENT

(Case study: tooth paste consumers in Bandung, Jawa barat)

By

A. Feiral Rizky Batubara 19004004

Undergraduate Program

School of Business and Management

Institut Teknologi Bandung

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VALIDATION PAGE

ANALYSIS ON FACTORS THAT INFLUENCE

BRAND SWITCHING OF PEPSODENT

(Case study: tooth paste consumers in Bandung, Jawa barat)

By:

A. FEIRAL RIZKY BATUBARA

ID No: 1900 4004

Undergraduate Program

School of Business and Management

Institut Teknologi Bandung

Validated By

(Drs. Herry Hudrasyah, MA)

NIP : 131914187

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v ANALYSIS ON FACTORS THAT INFLUENCE

BRAND SWITCHING OF PEPSODENT

(Case study: tooth paste consumers in Bandung, Jawa barat)

A. FEIRAL RIZKY BATUBARA 19004004

Examination Date : 6 August 2007 Graduation Date : 27 October 2007

Undergraduate Program, Institut Teknologi Bandung, 2007 Thesis Advisor : Drs. Herry Hudrasyah, MA

ABSTRACT

Pepsodent is one of the Unilever tooth paste brand, which is the first flouridated tooth paste in Indonesia. It is also known as the family tooth paste brand. As the market leader of its segment, Pepsodent is always make improvement for their product to fulfill the needs of Indonesian consumer. Pepsodent has achieved on superiority and dominance in the market. It is indicated by high level of brand awareness (81.3%) and market leader (65-70%) of the market.

Consumer goods market especially tooth paste is become one of the most potential industry in Indonesia since most of Indonesian people brushing their tooth everyday. It also indicated by there are more than 10 tooth paste brands which enter this industry. Each producers create variety of products which supported by the exceptional marketing strategy to educate and to attract consumers. They also creating and improving their distributions channel to maintain their product availability. Consumer will face a wide variety of product with different features and functions to be choosen. Because of that condition, the possibility of brand switching occured. Brand switching is the phenomenon of selecting and sifting the brand, in a certain period of time.

Because of a high possibility of brand switching, it will be possible for Pepsodent users to swith their tooth paste brand to other brands. As the market leader, Pepsodent want to maintain their market leadership in the middle of brand switching phenomenons.

The findings of this research are 11 possible factors from 6 dimensions that would be the factors resulting brand switching of Pepsodent.

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vii ANALISA FAKTOR-FAKTOR YANG MEMPENGARUHI

PERALIHAN MEREK PEPSODENT

(Studi kasus: Pengguna pasta gigi di Bandung, Jawa barat)

A. FEIRAL RIZKY BATUBARA 19004004

Tanggal Ujian Akhir : 6 Agustus 2007 Tanggal Wisuda : 27 Oktober 2007

Program Sarjana, Institut Teknologi Bandung, 2007 Pembimbing : Drs. Herry Hudrasyah, MA

ABSTRAK

Pepsodent adalah salah satu merek pasta gigi produksi Unilever yang merupakan pasta gigi berfluoried pertama di Indonesia. Pepsodent juga dikenal sebagai pasta gigi keluarga. Sebagai pemimpin pasar di kelasnya, Pepsodent selalu melakukan pengembangan produk agar senantiasa dapat memenuhi kebutuhan konsumen. Pepsodent telah mencapai puncak keunggulan dan mendominasi pasar pasta gigi di Indonesia. Hal ini dapat dilihat dari tingginya tingkat kesadaran masyarakat akan Pepsodent yakni 81.3% dan menjadi pemimpin pasar dengan menguasai 65-70% pangsa pasar.

Pasar kebutuhan konsumen terutama pasta gigi menjadi salah satu industri paling potensial semenjak hampir seluruh masyarakat Indonesia menyikat giginya setiap hari. Hal ini dapat dilihat dari adanya lebih dari 10 merek pasta gigi yang ada di pasaran. Setiap produsen merek-merek tersebut membuat variasi-variasi produk yang didukung dengan strategi pemasaran yang sangat baik untuk mengedukasi dan menarik perhatian konsumen. Selain itu, mereka juga membuat dan mengembangkan jalur distribusi untuk menjaga ketersediaan barang dipasar. Oleh karena itu konsumen akan menjumpai berbagai merek pasta gigi dengan keunggulan masing-masing untuk dipilih. Dikarenakan oleh kondisi tersebut, maka peristiwa peralihan merek terjadi. Peralihan merek adalah peristiwa dimana konsumen akan dapat memilih dan berganti merek dalam waktu yang tidak dapat ditentukan.

Dikarenakan sangat tingginya kemungkinan untuk peralihan merek, maka kemungkinan ini dapat pula tejadi pada pengguna Pepsodent sehingga pada akhirnya akan beralih ke merek lain. Oleh karena itu, Pepsodent sebagai pemimpin pasar tentunya ingin mempertahankan prestasi mereka sebagai pemimpin pasar.

Penemuan yang didapat dari riset ini adalah 11 faktor dari 6 dimensi yang menyebabkan peralihan merek dari Pepsodent.

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PREFACE

The research of “Analysis on Factors that Influence Brand Switching of Pepsodent” is a study of identifying factors that result brand switching phenomenon towards Pepsodent in Indonesia. This research is a final project research which is one of the graduation criteria for final year student at SBM ITB 2007 enrollment.

The topic was chosen by researcher because of phenomenon found in a brainstorming phases. Research found that most of the people reminded Pepsodent as their top of mind tooth paste brand, but it doesn’t indicate that they will use Pepsodent for their daily uses. The topic will be useful for Unilever, as the producer of Pepsodent, as the inputs for their business strategy improvement.

Researcher wants to thank to all parties that support the project completion: Allah SWT for unlimited paths, energies and spirits.

Researcher’s mother, Mimi Indayu, Researcher’s brother, Fiza Putera, Researcher’s family who gave unlimited support for researcher study in SBM ITB.

Researcher’s final project counselor, Mr. Herry Hudrasyah for the guidance of final project completion.

Researcher’s lecturer, Mr. Budi Permadi, Mr. Harimukti Wandebori, Mr. Reza Ashari Nasution, Mr. Deddy Pri, Mr. Dwi Larso who gave inputs and recommendations.

Mrs. Irwanti Barianita & Ms. Felicia julian from Unilever Indonesia.

Researcher’s “brainstorming” mate, Faried Caesar, Wildan Kesuma, Nalendra, Meilida Nadia, Khrisna, Dicky, Intan Pramesthi, Ardhi, and Riri Heryanti.

Researcher’s colleague, all SBM ITB enrollments 2007.

Researcher’s colleague, SBM ITB enrollment 2008 & 2009 for the support. Mr. Subhan and Ms. Farrah dilla who helped spreading questionnaires.

Other parties that can’t be mentioned who gave support.

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LIST OF CONTENTS

VALIDATION PAGE ... iii

ABSTRACT ... v

ABSTRAK ... vii

PREFACE... ix

LIST OF CONTENT ... xi

LIST OF FIGURES... xv

LIST OF TABLES ... xvii

LIST OF APPENDIX ... xix

CHAPTER I – INTRODUCTION ... 1

1.1 Background of problem ... 1

1.1.1 Pepsodent in a brief ... 1

1.1.2 Pepsodent as the Best Brand for tooth paste brand in Indonesia ... 2

1.1.3 Pepsodent as the TOP Brand for tooth paste brand in Indonesia ... 2

1.1.4 Pepsodent as the market leader ... 3

1.2 Problem identification ... 3

1.3 Research objective ... 4

1.4 Research scope and limitations ... 5

1.5 Writing systematic ... 5

CHAPTER II – THEORITICAL FOUNDATION ... 7

2.1 Concept of consumer buyer behavior ... 7

2.1.1 Internal factors ... 8

2.1.2 External factors... 8

2.1.3 Other external factors ... 9

2.2 Model of customer decision making ... 10

2.3 Consumer perceptions ... 11

2.4 Concept of brand switching ... 12

2.5 Market positions and strategies concept... 13

2.5.1 Market leader strategies ... 13

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2.5.3 Market follower strategies ... 14

2.5.4 Market nicher strategies ... 14

CHAPTER III – RESEARCH METHODOLOGY ... 17

3.1 Problem identification ... 17

3.2 Explorative research ... 17

3.2.1 Literature studies ... 18

3.2.2 Expert in-depth Interview ... 18

3.2.3 Consumer in-depth Interview ... 18

3.3 Descriptive Research ... 18

3.3.1 Questionnaire development ... 18

3.3.2 Pre-test ... 18

3.3.3 Define the sampling method... 19

3.3.4 Define the sampling size ... 19

3.3.5 Distribution of Questionnaire ... 19

3.4 Data gathering (Tabulation) ... 20

3.5 Data Analysis (Tabulation) ... 20

3.5.1 Reliability and validity analysis ... 20

3.5.2 Frequency analysis ... 20

3.5.3 Cross tabulations analysis ... 20

3.6 Data conclusions and report ... 20

CHAPTER IV – DATA ANALYSIS ... 21

4.1 Explorative research ... 21

4.1.1 Expert in-depth interview ... 21

4.1.2 Consumer in-depth interview ... 22

4.2 Descriptive research ... 23

4.2.1 Ambiguity test ... 23

4.2.2 Pre-test ... 23

4.2.3 Quantitative research (Questionnaires) ... 25

4.2.3.1 Validity and Reliability analysis ... 25

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4.2.3.3 Frequency analysis ... 30

4.2.3.4 Recapitulations from frequency analysis ... 43

4.2.3.5 Cross tabulation analysis ... 44

4.2.3.6 Recapitulation of cross tabulation analysis ... 50

CHAPTER V – CONCLUSION AND RECOMMENDATION ... 51

5.1 Conclusion ... 51

5.2 Recommendations ... 52

5.2.1 Recommendation for missed perception... 52

5.2.2 Recommendation for factors of Brand switching... 53

5.2.3 Recommendation for brand switching factors relationship ... 54

5.2.4 Recommendation for missed the detergent issues ... 54

REFERENCES ... xxi

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LIST OF FIGURES

Figure 1.1 – The illustration of market situation ... 4

Figure 2.1 – Factors influencing consumer behavior ... 7

Figure 2.3 – Model of consumer decision making ... 10

Figure 3.1 – Research methodology diagram ... 17

Figure 4.1 – Respondent Profile: Gender ... 27

Figure 4.2 – Respondent Profile: Occupation ... 27

Figure 4.3 – Respondent Profile: Age ... 28

Figure 4.4 – Respondent Profile: Monthly income ... 28

Figure 4.5 – Respondent Profile: Education ... 29

Figure 4.6 – Respondent Profile: Area of residence ... 29

Figure 4.7 – Question No 1 ... 30 Figure 4.8 – Question No 2 ... 31 Figure 4.9 – Question No 3 ... 31 Figure 4.10 – Question No 4 ... 32 Figure 4.11 – Question No 5 ... 33 Figure 4.12 – Question No 6 ... 33 Figure 4.13 – Question No 7 ... 34 Figure 4.14 – Question No 8 ... 34 Figure 4.15 – Question No 9 ... 35 Figure 4.16 – Question No 10 ... 35 Figure 4.17 – Question No 11 ... 36 Figure 4.18 – Question No 12 ... 37 Figure 4.19 – Question No 13 ... 37 Figure 4.20 – Question No 14 ... 38 Figure 4.21 – Question No 15 ... 39 Figure 4.22 – Question No 16 ... 39 Figure 4.23 – Question No 17 ... 40 Figure 4.24 – Question No 18 ... 41 Figure 4.25 – Question No 19 ... 41 Figure 4.26 – Question No 20 ... 42

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LIST OF TABLES

Table 1.1 – Best Brand Index ... 2

Table 1.2 – TOP BRAND tooth paste ... 2

Table 2.1 – Marketing Position Strategy ... 13

Table 4.1 – Result of in-dept interview ... 22

Table 4.2 – Missed perception of Pepsodent ... 23

Table 4.3 – Pre-test data reliability ... 24

Table 4.4 – Pre-test data validity... 24

Table 4.5 – Pre-test data reliability after adjustment ... 25

Table 4.6 – Data reliability ... 25

Table 4.7 – The recapitulation of validity and reliability ... 26

Table 4.8 – The recapitulation of mean from each category ... 43

Table 4.9 – The recapitulation of cross tabulation ... 50

Table 5.1 – The missed perception of Pepsodent ... 51

Table 5.2 – Factors result brand switching ... 51

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LIST OF APPENDIX

APPENDIX A – Pepsodent Product... xxv

APPENDIX B – SOP for dental health ... xxviii

APPENDIX C – Previous research (market share) ... xxxiii

APPENDIX D – Guidance for In-Depth interview ... xxxv

APPENDIX E – In-Depth interview summary ... xxxvi APPENDIX F – The Questionnaire ... xIvi APPENDIX G – Validity ... xIvii