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  • Subject area(s): Marketing
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  • Published on: 14th September 2019
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ABSTRACT

Social media has rapidly risen in popularity as a new advertising platform that allows users to connect with one another and engage with brands. Companies increasingly see Internet advertising as an important medium in reaching out to consumers in 21st Century. The number of Internet users around the world including Malaysia in today's world are increasing as almost all the transactions can be done through online. Thus, online advertisers need to understand the consumers' attitude towards online advertising in order to create effective online advertising.

The main aim of this research is to identify the influence of Youtube advertising on consumer purchase intention. This research is to investigate independent variables, which comprise hedonism/pleasure, informative, and credibility that have impact on dependent variable on consumer purchase intention towards Youtube advertising.

Keywords: social media, advertising, Internet, Youtube advertising, purchase intention

CHAPTER 1

 Research Introduction, Background and Problem identification

 1.0 INTRODUCTION

The purpose of this research paper is to study the influence of Youtube advertising on consumer purchase intention. In this section, the report includes background of the study, problem statement, research objective, research question, scope of the study, limitation and the constraints of the study. The chapter ends by addressing the conclusion of the research study.

1.1 BACKGROUND OF THE STUDY


According to Bennett (1995) in American Marketing Association, advertising is the placement of announcements and persuasive messages in time or space purchased in any of the mass media by business firms, nonprofit organizations, government agencies, and individuals who seek to inform and/or persuade members of a particular target market or audience about their products, services, organizations, or ideas. Morever, it is also paid, nonpersonal communication through various media by business firms, nonprofit organizations, and individuals who are in some way identified in the advertising message and who hope to inform and/or persuade members of a particular audience; include communication of products, services, institutions, and ideas (Bennett, 1988).

There are several medium of advertising such as direct mail, newspapers and magazines, radio advertising and the well-known one in this century, online advertising. According to dictionary, online advertising is a marketing strategy that involves the use of the Internet as a medium to obtain website traffic and target and deliver marketing messages to the right customers. Online advertising is geared toward defining markets through unique and useful applications.

There are medium to choose to advertise products pr services. The most suitable advertising option for business usually will depend on the target audience and what is the most cost effective way to reach as many of them as possible, as many times as possible. The advertising option chosen should also reflect the right environment for the product and service. For example, if the target markets usually watch videos on Youtube, the company should advertise their product or service on Youtube.

According to Creative Commons licnese (ford.digitalsnippets.com,2010), YouTube has leveraged their native sharing properties and making all content digitally available to everyone. More over, being on the Internet can be a cost-effective way to attract new customers and also existing customers. By using a famous platform such as Youtube, it helps to reach a global audience at a lower cost compared to other medium of afvertising. Nowadays, people tend to use Youtube platform as online advertising to promote their products and services. As there is a rapid increase in the number of people communicating via online social media, it is crucial for companies to understand how people interact with their brands online. In addition, people tend to be with their phones and laptop compared to spend their time sitting in front of television.

In fact, the use of online advertising such as Youtube, as a major marketing communications tool is proven popular among majority of the businesses in various industries. According to YouTube statistics (2009), several hundreds of millions of videos are watched in a day. The important fact is that 51% of users visit the website at least once a week 52% of users between 18 and 34 share videos with others (YouTube, 2009). Also with that, 77% of users tend to watch only one video, but they end up watching more (Clean Cut Media, 2009).

Some of the advantages of Youtube advertising are as follows:

• Youtube for a great way to create brand awareness. Advertisers can also use YouTube for product advertising. This requires a more direct approach, although it is still important to make the video informative, educational, or entertaining. 


• Youtube for Retail Promotion. YouTube is a terrific channel for generating direct sales for products and services. All businesses have to do is show the product in action or provide a clip of the service in question, and then ask for the sale by directing the viewer to the company‟s website. 


1.2 PROBLEM STATEMENT


This research studies on Influence of Youtube Advertising on Consumer Purchase Intention. This is a very important way for a brands especially the new brand to grab consumer's attention while advertised on Youtube. It is also based on the experience of the consumers when watched the advertising on Youtube. Nevertheless, consumers are the one who will make the purchase. Furthermore, if the advertising are hedonism/pleasure, informative and credibility, consumers will absolutely make a purchase without hesitation.

1.3 RESEARCH OBJECTIVE

• To identify what are the factors that influence purchase intention on Youtube advertising.

• To determine the relationship between informative and purchase intention on Youtube advertising.

• To identify which factor is the most influential in purchase intention on Youtube advertising.

1.4 RESEARCH QUESTION

This research proceeds through asking the following research question:

• What are the factors that influence purchase intention on Youtube advertising?

• What is the relationship between informative advertising and purchase intention on Youtube advertising?

• Which factors contribute the most in purchase intention on Youtube advertising?

1.5 SCOPE OF THE STUDY

This study is going to involve individuals who are Internet users and have experience watching Youtube advertising. To go in-depth, this study will involve 200 respondents in age between 18-27 years old in Klang Valley area. It represents that respondents in that age are more into social media. This research uses survey method in this study because the purpose of the study is to generalize the findings from the sample to population. These individuals will be given online questionnaire, as they will have to give out their ratings on their experience and reaching out their opinions as individuals with experience.

1.6 LIMITATIONS AND CONSTRAINTS OF THE STUDY

During the research study conducted, there are several constrains and limitations of study that may be faced by the researcher.

1.6.1 Cooperation

First of all, the limitation comes from the respondents which some of them do not give good response as expected and full cooperation. Some respondent do not give accurate information regarding the study. They do not answer the questionnaire accurately and some of them only fill up the form without read and understand the questions given.

1.6.2 Time constraint

Time constraint is one of the limitations while doing this research. Researchers have to complete the research within 5 months and compulsory to go to the internship programme. The researcher has to multitask to complete the research study.

1.7 CONCLUSION

In conclusion of this chapter, the researcher explains the methodology of the research, which includes background of study, problem statement, research questions and research objectives. Other areas include the benefits of this research, and scope of coverage as well as the constraints that researcher may face while conducting this study.

CHAPTER 2

Literature Review and Research Framework

2.0 LITERATURE REVIEW


Literature review is an evaluative report of information gathered in literature related to the field of a research (CQ University Australia, 2005). Thereby, literature review means any secondary data from existing researches on related research and no brand new or recent information are listed in the literature.

In this chapter, explanations about the influence of Youtube advertising on customer purchase intention Klang Valley area. The purchase intention is the dependent variable while the independent variables are hedonism/pleasure, informative and credibility. Literature review from related expert scholars and past researchers review will be discussed in order to deeply understand this research study.

2.1 RESEARCH FRAMEWORK

2.2 HEDONISM /PLEASURE

Referring to O'Shaughnessy and Jackson O'Shaughnessy (2002), hedonism means pleasure, enjoyment or happiness. The hedonic dimension is concerned about the consumer's experience of pleasure and happiness with the product or service that makes consumer feel good and serves his or her pleasure needs (Batra and Antola, 1990; Tinkham and Weaver-Lansy, 1994). As cited by Bauer and Greyser (1968), hedonic advertisement can relate to consumer's emotion as well as it can be viewed as a feature of pleasure and delight (Alwitt and Prabhaker, 1992; Pollay and Mittal, 1993). The components of hedonism are enjoyable, pleasure, excitement and surprise, and containing funny characters.

As concluded by Tsang and Tse (2005), the process of enjoyment can be divided into three states which comprises of the ‘'actual state'', “desired state”, and “preferred state” and these states can influence the online users' motivation toward online advertisement. Online advertising can capture consumers' needs for aesthetic enjoyment or emotional release (Abdul Azeem and Zia ul Haq, 2012). Hedonic consumption can be satisfied through enjoyment perceived while viewing an online advertisement (Bowie and Chang, 2005). Moreover, online advertisement is more entertaining and enjoyable compared to other mass media such as print media and television advertising (Pollay and Mittal, 1993). Hoffman and Novak (1996) stated that advertising message contains with enjoyable elements are able to enhance the overall effectiveness of an online advertisement.

Hedonic advertisement always comprises pleasure, fantasy, and fun (Batra and Antola, 1990; Dhar and Wertenbroch, 2000; Holbrook and Hischman, 1982). According to Eze and Lee (2012), they stated that advertising is entertaining, delighting, and pleasurable. The purpose of pleasure seeking is for a quality of emotional experience (Campbell, 1987) and pleasure can make consumers feel good about an online advertisement.

2.3 INFORMATIVE

According to Rotzoll, Haefner, and Sandage (1989), advertising plays an essential and legitimate role in delivering information. Rubin (2002) also identified that one of the most vital functions of advertising is to provide information to the public. According to Abdul Azeem and Zia ulHaq (2012), they indicated that the level and quality of information provided in an advertisement is an important factor that impacts customers' perception of the company and the company's products. Besides, the company should ensure that the information delivered to public through online advertising is sufficiently informative.

Informative is defined as providing useful or interesting information (Ducoffe, 1996). According to Kottler and Keller (2008), it refers to the degree of usability and effectiveness of the information contained in an online advertisement. An informative online advertisement is an advertisement that consists of specific, relevant, and reliable facts about an advertised product. These are used in creating consumer's desire for the product (Marquez, 1977). The criteria of an informative advertisement are valuable sources of information, able to provide brand information, able to provide up-to-date information and the information provided are capable of assisting consumers in decision making processes.

Being informative indicates that the information in the online advertisement has to be a valuable source of information about the promotions that company offers. To be a valuable source of online information, the advertisement must be able to show some qualitative features, such as accuracy, timeliness, and usefulness for the consumers (Siau and Shen, 2003). This shows that an informative online advertisement is able to inform the potential consumers about news products or services that introduced into the market by providing quality information in the advertisement (Chen and Wells, 1999).

In addition, when customers required information about the company's product and services, an informative advertisement is able to tell the consumers the brands feature which they are looking for (Kwek et al., 2010). This means, the information is able to help the customer distinguish the company's product and services from others competitors.

Empirical research found that an informative online advertisement is relevant to purchase situations as it able to provide customers adequate information and thereby assist consumers in purchase decision making (Fernandezs, 2000). This is supported by Pollay and Mittal (1993) which clearly indicated that informative online advertisement is useful and able to help consumer in making the right purchase decision.

2.4 CREDIBILITY

According to Alder and Rodman (2000), credibility is the believability of the consumers towards an advertisement. Credibility can be defined as the level of reliability of a message or content to provide accurate and reliable information (Kelman and Hovland, 1953). Credibility plays an important role in advertising because it may lead to a higher perception of the promoted product and consumers may feel good and comfortable with the advertisement (Kwek, Tan, and Lau, 2010). The components of credibility are credible, trustworthiness, convincible, and believability.

Credibility deals with sources such as individuals, organizations, and the media. The person who brings the message plays an important role in the advertisement as that individual represents and appears as brand marketers (Ducoffe, 1996). In the research study of Aaker and Brown (1972), they also stated that different media will have different levels of credibility. Besides, according to Marchall and Na (2003), they identified that Internet media is less credible than traditional media outlets.

2.5 PURCHASE INTENTION

Purchase intention is a common measure used to assess the effectiveness of eliciting response behaviors (Li et al., 2002). The most important aim of sales websites is to convert awareness to actual purchases. Purchase intention can be said a plan to purchase or to buy a particular goods or services in the future. Halim and Hameed (2005) mentioned that purchase intention is considered by people who are planning to purchase a product or service in future through repeating purchase. It means people intend to buy some products in the future based on the previous purchased of that product or service.

IFandos and Flavin (2006) stated that purchase intention is a kind of behavior or attitude that will develop by the customer or consumer in a short period of time for repetitive purchase a product or service. It means purchase intention is a hidden interest of a consumer to purchase a product or services again if that people come at those stores. Miniard & Engel (2006) stated, purchase intention is like planned or intended behavior in the future and maybe that idea and attitudes will build up into an actual purchase. In other word, what the customers picture and think in their mind and what will be the product that they may buy in their mind correspond to the purchase intention as stated by Blackwell, Miniard, & Engel (2001).

CHAPTER 3

Research Methodology


3.0 INTRODUCTION

In this chapter, the research methodology will present how the researcher collects the date in order to find the answers for research questions and to fulfill the purpose of this study. Population and sample would the first presented, followed by data collecting method of this study and finally data analysis method would be the last presented. This area of the research paper defines the processes taken in obtaining relevant data to gain the research objectives. It must be consistent as it may disrupt the whole research paper by getting invalid data and hence making the research inapplicable (Hazman Shah Abdullah et al, 2016).

There are two types of research, which are quantitative research and qualitative research. Researcher is more preferred to conduct quantitative research because quantitative research is basically seeks to quantify the data and typically applies some form of statistical analysis. Qualitative research provides insights and understanding of the problem setting, which are more on interviews and observations.

3.1 DATA COLLECTION TECHNIQUES

3.1.1 Articles and journals

Online journals and articles are obtained from JSTOR, Academia and Google Scholar to get information and relevant data regarding this study.

 3.1.2 Internet

Other related blogs and websites that related to the topic is taken to gain information and comparison between both Youtube advertising and television commercial in Malaysia.


3.1.3 Respondents

The respondents have to answer questinnaires provided by researcher. The questionnaire is basically responses to the study.

3.2 RESEARCH DESIGN

3.2.1 Descriptive Research

Descriptive research is widely used research design to gather the information about the present existing conditions by the use of questionnaire, personal interviews and observation. This research design is necessary for researchers to have a clear picture about the phenomenon on which they wish to collect data before collection of the data (Saunders et al., 2012). Hence, descriptive research enables researchers to better understanding on the consumers' attitude towards online advertising (Youtube) such as credibility, entertainment, informative due to the prior knowledge about this study is learned through the past studies.

3.2.2 Data Collection Methods

Primary data is the original data that has been collected by the researchers themselves specifically for the purpose of the research. Besides, primary data is the first-hand information, has not been published yet, it is more reliable as primary data has not been fixed or altered by human beings (Saunders et al., 2012). Therefore, its validity is greater than secondary data. The primary data can be obtained from questionnaire, observation, interview, survey, and experiment.

Since questionnaire is the most common method that used by most of the researchers, questionnaire survey method taken as the primary data collection method in this study. Besides, this study conducts questionnaire survey by delivery and collection questionnaire under self-administered method. It is because self-administered is simple and effective as well as efficient method in terms of faster and inexpensive method to collect data directly from respondents (Saunders et al., 2012).

3.2.3 Sampling Design

In order to get some info and knowledge on the whole population, the sampling method is employed non-probability sampling to conduct research.

3.2.4 Target Population

The significant target population for this study is those people who are the Internet users regardless of the races, ages, as well as occupations. These groups of population are suitable for this study as they are the Internet users and might have the experience in online advertising. Thus, by accessing into their knowledge and information about the independent variables of informative, credibility, and entertaining on the dependent variable of consumers' purchase intention towards Youtube advertising, this enables researchers to complete the research study more accurately.

3.2.5 Sampling Element

The targeted respondents of this survey are general public, which included self-employed, professional, housewife, students and staffs of colleges and universities and others. As the students and staffs of colleges or universities considered as heavy users of Internet because they are using campus website to transfer information and communicate among themselves, general public who rely on Internet in their daily activities due to the technology advance in today's world. Hence, they are the respondents who more appropriate in conducting this survey.

3.2.6 Sample Size

The sample size of this study is 200 where there are 200 respondents and 200 sets of questionnaires. Besides, response rate is 100%. All the respondents must answer the online survey, as it is more convinience.

3.2.7 Questionaire

The survey is conducted electronically with its research tool being an online questionnaire. Apart from cost constraints, there are several reasons for conducting the survey in digital space. Firstly, the physical presence of interviewers is not required, because the questionnaire is self-administered (Burns & Burns, 2008), thus, solving time constraints. Moreover, online questionnaires are also more superior to their electronic survey alternative, an e-mail survey.

It is also important to mention that conducting the survey in digital space is fitting given the population of the study - those being online video users in the same digital space. Using an online survey allows the respondents to come in contact with the questionnaire while surfing the Internet in the comfort of their own homes. Considering that the top two reasons people watch YouTube videos are relaxation and entertainment (Google, 2016), this method is desirable in creating an accurate simulation.

3.3 TIME FRAME OF STUDY

This research study takes around three (3) months to complete. The first two months are allocated to develop the research framework and structure. The final month is basically to conduct fieldwork where the distribution of questionnaires takes place and process the result to conclude the whole research.

3.4 DATA ANALYSIS

After all data for this research has been collected, the researchers analyse the data using various techniques to get data analysis. Data analysis is an on-going activity, which not only answer the question but also help to get directions for future data collection.

3.5 SUMMARY

In research of methodology section help to describe how this research study is carried out in terms of research design, data collection methods and sampling design. After all the appropriate methods being selected to analyzed the data, the results will be further explain and discuss in the next part.

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