Without getting a full understanding of the problem, we will not be able to identify the right direction or strategy for the business. In an effort to deal with those problems, car companies developed a new hybrid technology, Toyota Prius was introduced to the Thai market. The results show that demographic aspects have positive correlation with decisions to buy the Toyota Prius.
Honda also made a similar move, with the introduction of the Honda Jazz in the small car segment (priced below 1 million baht) in 2013. Seventeen years after it was first launched, over six million units of the Toyota Prius have been sold worldwide (Toyota Europe). As mentioned earlier, although hybrid cars appear to be a good choice for Thai consumers with concerns about fuel economy, prestige and the environment, sales of the Toyota Prius are now significantly lower.
The objective of this research is to focus on the factors that influence consumer decision making regarding the purchase of the Toyota Prius. This research aims to identify the motivation that influences consumers to purchase and the demographics of Toyota Prius drivers in the Bangkok area.
Research objectives
Research scope
Expected Benefit
LITERATURE REVIEWS & PROPOSED FRAMEWORKS
Theoretical Foundation
- Demographic influencing car-purchasing decisions
- Consumer motivation
- Consumer decision-making (consideration set)
An analysis of car purchase decisions in terms of demographics indicates that the largest percentage of Toyota Prius buyers in Bangkok are women between the ages of 25 and 40 with a high income. Additionally, existing Toyota Prius customers in Bangkok tend to be well educated and are generally early adopters of technology. By looking at consumers' psychological decision-making processes, previous research in Europe and the US has shown that the motivation to purchase hybrid vehicles can be categorized as intrinsic or extrinsic. In line with increasing concerns about global warming since the 1970s (Minton and Rose, 1997; Pelletier, 1998), consumer behavior has changed over the past 40 years, and rather than paying for luxury and convenience items, consumers are more interested in purchasing green products that have a low impact in terms of resource utilization, show increased efficiency and result in less damage to the environment.
This means that consumers are aware of environmental change and are willing to make changes in support of a sustainable environment (Chan, 1996; Bamberg, 2003). Regarding the automotive industry, the Toyota Prius is a green product that was introduced to the Japanese market in 1997 and achieved cumulative global sales of approximately three million units by June 2013 (www.csmonitor.com). However, research has revealed that there is only a low to moderate relationship between intrinsic motives and consumers buying environmentally friendly products (Chua, Lee and Sadeque, 2013).
However, because Thailand is a developing country, Thai consumer behavior in terms of education level, technology adoption and environmental concern may differ from that of developed countries or continents such as Japan, Europe and the US. The hypothesis of this study is based on predictions compared to previous research, taking into account factors such as demographic differences in consumer behavior, environmental concerns, government regulations, the economy and technology adoption levels (Gallagher and Muehlegger, 2008). Consumers are therefore more likely to make car purchase decisions based on product specifications, price, salespeople, after-sales service and product promotion, rather than on the basis of intrinsic and extrinsic motivation.
When purchasing a product, consumers are required to search for product information and evaluate the product in terms of price, durability and range to assist them in the decision-making process. The most common determining factors include cost, practicality, performance, design, fuel consumption, lifestyle, image considerations and even social impact (Griskevicius et al., 2010). Some may buy a car based on intrinsic motivation, for example, a hybrid vehicle to protect the environment.
The predictions of consumer decision making in this study show that Thais prioritize specification, price, personal preference and brand.
Proposed Framework
Based on this study's hypothesis, the demographic factor should correlate positively with consumer decision making. It is assumed that Prius buyers range in age from 25 to 40, have successful careers, a high level of education and income, and a small family (if applicable). The Toyota Prius is positioned in the mid-range PC segment and boasts advanced technology with optimal fuel consumption; it is also in the upper price range of its class.
METHODOLOGY
Research setting
The questionnaire containing 16 questions based on independent variables such as demographic factors, consumer motivation and consumer decision making will be administered online using non-probability sampling method for convenience. After respondents complete the questionnaire, they will receive follow-up questions to gain insight into their views on purchasing a Toyota Prius. The information obtained here will be used as supporting information for the study and the process will be done over the phone or face to face.
We will convert the collected data into statistics, as this is the most convenient and appropriate method for understanding the entire issue.
Data collection
RESULT OF FINDINGS
Factor 1: Demographic factors
The majority of respondents are between 30 and 45, representing more than 76% of the total sample size; people under 29 are second at 8% and people over 50 represent 4%. A total of 88% of Toyota Prius consumers graduated at university level, while the remaining 12% obtained at least a postgraduate qualification. The questionnaire shows that people working for private companies and business owners account for 68% of the total, while management represents 16%, government employees 12% and salespeople 4%.
Demographic data is the most fundamental data marketers and product developers need to understand what the customer wants and how to design effective marketing strategies, and in the process properly communicate the utility, uniqueness and value of the product to consumers. The consumer demographics collected in the study are similar to the study's predictions, with the majority of respondents being women between the ages of 30 and 45, with high levels of income and education. The data also support the hypothesis that demographic factors are decisive in consumers' decisions to purchase a Toyota Prius.
Consumers’ motivation to purchase the Toyota Prius
Various demographic backgrounds tend to influence consumer product preferences based on consumer knowledge and budget. Each of the remaining motivating factors was selected by 5% of the respondents, that is, dealing in real estate, attractive promotion, suitable financial terms and style and design. The table above provides a cross-check of consumers' views compared to attributive statements about the Toyota Prius.
Most respondents strongly agree that social status is important and that the vehicle represents both the owner's and the manufacturer's image. They also agree that the hybrid performs well compared to conventional models, while most believe that price is more important than style and can be used as a leverage tool. To conclude this section on consumer motivation factors, it is clear that Thai consumers have similar attitudes towards vehicle attributes and social status as found in previous studies (see table showing consumer motivations for purchasing Toyota Prius).
In terms of the proposed framework for the study, the data results show that consumers care about social status and are also concerned with vehicle features, but are unlikely to be driven by intrinsic motivation (from an environmental perspective). In terms of the factors consumers consider in the decision-making process, this study predicts that Thai people mainly prioritize specifications, price, personal preferences and brand image. The top reasons why Thai people buy the Toyota Prius are product design, accounting for 28% of the total respondents, brand reputation, accounting for 20%, dealers, accounting for 16%, availability and after-sales service, accounting for 16%, and a reasonable price, payment terms and trade-in value representing the remaining 12%.
In terms of consumer opinions on the image of Toyota Prius, about 24% think it is economical, 16% perceive it as sporty, 12% consider it advanced and family-oriented, 8% admire its prestige and high performance, while the remaining 12 % perceive the Toyota Prius as calm, solid two drive and a leader. In conclusion, a comparison between the proposed framework of this study and the results shows that although consumers value the specifications and features of the Prius, they are less likely to care about the price, as the minority chose this alternative in their consideration of all factors.
DISCUSSION & CONCLUSION
Regarding the six factors listed in Figure 5.1, the survey results showed that 32% of consumers prioritize product and marketing, namely product design, financial terms, marketing campaigns and discount. A further 28% considered the utility and benefits they would get from buying a vehicle, for example in terms of fuel economy, family transport and work use. The overall findings support the hypotheses in the area of demographic and consumer factors.
The results show a positive correlation between age, income and education on the one hand and the purchase of a Toyota Prius on the other hand. The findings also support the hypothesis that consumers focus on vehicle features and design as well as extrinsic motivation to improve their social status, while Thai consumers are not overly concerned with intrinsic motivation such as environmental concern. This can be understood in the social context of the difference between developing and developed countries, along with differences in the level of education and regulation and concern for the environment.
Contribution of the study
Managerial implications and suggestions
Limitations
Future Research
Concerns about environmental issues and consumer purchase preferences: A two-country study. Journal of International Consumer Marketing.
APPENDICES
Social status Like the vehicle itself 7) What do you think of the image of Toyota Prius?. Resale value After sales service Part availability Repair part Brand reputation Dealers Convenience Sales person 9) Where do you always get information about Car?. Vehicle is symbol of social status Vehicle represents owners sense Price is more important than style Manufacturer image is important Hybrid performance is good compared to conventional vehicle.
