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THE EFFECT OF BRANDING AND PACKAGING OF LOCALLY MADE COSMETIC PRODUCTS ON THE BUYING DECISION OF CUSTOMERS: A CASE STUDY OF COSMETIC PRODUCTS IN KUMASI, GHANA

ABSTRACT

Much has been discussed in the academic field with a greater inclination of packaging from the point of view of the producer (manufacturers, retailers, product designers etc.). However, less has been done with respect to packaging from the point of view of the final consumer. The purpose of this study is to therefore focus on the consumer, and how the efforts put behind product packaging technology of locally made cosmetic products influence consumer purchase decision. This study was governed by three specific objectives; the assessment of graphics (colour and artwork), package dimension (shape and design) and information (labels), and how these key areas of packaging influence consumer buying decision of locally made cosmetic products. Ultimately, these aspects ought to reveal a general perspective of the impact of packaging on consumer buying decision of locally made cosmetic products. The research employed a descriptive design and respondents were drawn from hair saloons in the Kumasi Central Market(KCM) as the population for this study. A sample size of 100 respondents were selected through a probability sampling design (stratified and systematic sampling), and was furnished with questionnaires to facilitate data collection. The information was then analysed and subjected to interpretation to further understand the association between product packaging and consumer buying decision of locally made cosmetic products. An analysis of the responses received by the sample population was subjected to various measures of description and inference to determine the said association, ultimately setting the direction in which the research inclined to. Statistically, this study has endorsed the purpose of the research set out by indicating the existence of an association between product packaging and consumer buying decision of locally made cosmetic products. It was concluded that in support of the of the existing relationship between product packaging and consumer buying decision of locally made cosmetic products, firms in the cosmetic industry are justified in their efforts of designing attractive packaging in a bid to attract consumer interest and evoke purchase decision. The packaging variables have shown their importance both independently and cumulatively in communicating product quality and features in a manner that is competitive. A major recommendation emanating from this study is an academic inquisition into the role of package technology on consumer buying decision. Alternatively, would be the option of looking into other consumables that highly depend on packaging for their marketing functions, especially those restricted from certain promotional efforts like alcoholic products and tobacco related brands. Aside from packaging, other marketing areas that strongly came out in the course of this study was the role of positioning strategies on consumer buying decision.

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

According to the Department of the Environment of Northern Ireland, packaging may be defined as “all products made of any material of nature to be used for the containment, protection, handling, delivery and preservation of goods from the producer to the user or consumer”, (Department of the Environment, 2010).This definition holds a level of truth; that of the package being a product and as such ideally different from the product it contains. However, contrary to this, the view of a package as a product independent of the actual substance it bears is of little significance to consumers; theirs is a subconscious assumption of a synonymous nature between the package and the product contained within. As such it would therefore imply a linkage where a highly efficient and well-designed package would ultimately translate into a product of superior quality, yet researches have rarely isolated the cause of product satisfaction to the product’s package (Hess, Singh, Metcalf, & Danes, 2014).On the other hand, consumer buying decision, derived from human behaviour has been viewed as a volatile concept, difficult to measure and predict. The burden of the success of a product has fallen into the hands of the marketer, who observes consumer behaviour to create an ‘appealing’ package, consequently manipulating packaging elements in order to turn the once ‘volatile concept’ into a predictable and economically measurable outcome(Levin & Milgrom, 2004). However, as the consumer changes in need, awareness and choice, and as competition grows to attempt to level the playing field, so must the marketer adapt their strategies accordingly.

The cosmetic market in Ghana, over the past few years, has experienced an influx in the number of products available within the industry. From fragrances to skin care ranges, the consumer is spoilt for choice every time they walk into a retail store seeking for these items. Though top global brands such as Revlon, L’Oreal, Estée Lauder, Nivea, Avon and Oriflame (Rooney, 2011), have a presence in the country’s market, there is still cut throat competition from local players scrambling for a piece of the market (Situma, 2013). Gone are the days when a package was merely just a container that protected the product through various stages within the supply chain (Kotler & Armstrong, 2010), it is now also the last marketing communication tool that a company can use to advertise its product on the shelf of a retail store (Rundh, 2009).

Competition within this industry has forced local company stakeholders to invest in more attractive and innovative packaging to appeal to the consumer. A package is therefore highly instrumental in aiding a company’s positioning strategy as they target the consumer market. How the consumer places the value of the product within their mind, has quite a bit to do with the product packaging strategy in use (Ampuero & Vila, 2006). Since the consumer is faced with so many products every single time they visit a retail store, it is paramount that the package stands out from the rest of the array of similar products, and is attractive enough to evoke a choice. The package should be convincing, bringing together all its elements to appeal to the consumer’s need (Rundh, 2009, Kotler & Armstrong, 2010).

Cosmetic consumers in Ghana enjoy a wide range of products that are attractively designed and packaged to appeal to their tastes and preferences. Local companies are bringing to the table various components of interest when it comes to the graphics, dimensions and information included in the package. Attempts are made at ensuring that the package meets the changing nature of preference of consumers, how they use the product, when they use it, and why they use it.

1.2 Statement of the Problem

In 2010, McKinsey Global Institute, the economic research arm of McKinsey and Company, put together studies that revealed the potential of Ghana as the economic haven of the 21st century. As of 2008, Ghana’s collective Gross Domestic Product (GDP) amounted to $1.6 trillion, combined consumer spending estimated at $860 million and 52 cities within the region having a minimum population of 1 million. Within a decade from 2008, these figures are forecast to escalate to a combine continental GDP of $2.6 trillion under the control of four key industries within the region (consumer-based products, infrastructure, agriculture and resources), consumer spending rising to nearly $1.4 trillion and half of the Ghanaian population residing in developed cities. That said, it is impossible to ignore the potential wielded by the African continent within the global economic sphere. Even more compelling, is the role played by the local consumer retail sector (under which the cosmetic industry exists) that has registered a growth rate of 6.8% between 2002 and 2007. Ghanaian consumers are now more educated and exposed to global trends and as such their demand for more value from corporates has caused a spur in the retail circles of consumable products (McKinsey Global Institute, 2010).

Another dynamic angle that comes into play is internationalization and the concept of the global village which have become widely embraced phenomena, sipping under the consumer’s aesthetics and consequently causing a product’s package to become somewhat of a volatile concept for every market player (Rundh, 2009). As cosmetic manufacturers reach a stalemate on consumer satisfaction where the parity among products is getting smaller and smaller, the package comes in as the final and most valued tool in determining consumer purchase decision (Rundh, 2009; Shah, Ahmad & Ahmad, 2013).

Ghana’s cosmetic industry faces immense competition both from local manufacturers and global giants who have now found the Ghanaian turf rather lucrative to invest in and as such are bringing their products and services closer to the Ghanaian consumer (Situma, 2013). With the increase in competition, researchers have acknowledged the effect of product packaging on corporate investment with respect to capital and human labour. However the issue arising, and that which has informed the undertaking of this study, is to determine whether the efforts put behind a cosmetic product’s package affects the Ghanaian consumer’s decision to actually purchase cosmetic products.

1.3 General Objective of the Study

To analyse the impact of cosmetic packaging on the Ghanaian consumer buying decision with respect to locally made cosmetic products.

1.4 Specific Research Objectives

1.4.1 To assess the influence of graphics (colour and artwork) on consumer buying decision.

1.4.2 To analyse the role of package dimensions (shape and design) on consumer buying decision.

1.4.3 To measure the influence information on a package bears on consumer buying decision.

1.5 Research Hypotheses

H01: There is no significant relationship between an attractive nature of a package colour, and its artwork on consumer buying decisions.

H02: There is no significant relationship between an attractive nature of a package dimension and consumer buying decisions.

H03: There is no statistically significant relationship between product information provided on the package and consumers buying relationship.

H04: There is no statistically significant relationship between information and graphics on products and consumer buying decisions.

H05: There is no relationship between product branding and packaging and consumer buying decision of locally made cosmetic products

1.6 Significance of the Study

This study will test the relationship between a product’s package and a consumer’s decision to purchase based on the package. The information emanating from this research will be of benefit to the following;

1.6.1 Corporates

Cosmetic manufacturers and dealers with presence in the Ghanaian market or future intention of the said, who are keen on market information with respect to product packaging and consumer buying decision, which may inform their strategies.

1.6.2 Researchers

Every study is of benefit to the realm of research in terms of knowledge addition and expansion. This study would be of benefit to researchers seeking information on marketing strategy of the cosmetic market in Ghana, with a focus on product packaging and consumer buying decision.

1.7 Scope of the Study

This research will look into the aspects of product packaging that may have an effect on consumer buying decision of the cosmetic products available in the Ghanaian market. The study will be primarily carried out in Kumasi among respondents of Kumasi Central market, Kumasi Ghana and as such may face a broad geographic representation of Ghanaian youth local cosmetic consumers. Another limitation worth noting would be a demographic factor of the sample population with respect to age and income as respondents will generally be within the youth bracket and of moderate income status.

1.8 Definition of Terms

Some of the terminologies used herein and what they refer to will be as follows;

Packaging: The art and science behind the container that carries a product (Department of the Environment, 2010).

Consumer buying decision: The buyer’s/user’s decision to actualize purchase intent into purchase decision (Miller , 2009).

Limitations and delimitation of the study

This study is undertaken to examine the effect of branding and packaging; however, the study is bordered on locally made products. This locally made products were restricted to cosmetics. The rationale behind this delimitation was to draw a concise and precise findings to specific products as regarding the effect of its branding and packaging. Also, due to the size of market, the Kumasi market was selected amongst several markets in Ghana. This is because, the market holds the best prospect for this study and it is accessible to the student. Finally, this study concentrated on branding and packaging and not other forms of products promotion. It is also pertinent to state that the findings of this study may not be applied on non-cosmetics products across Ghana.

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