The Effect Of Packaging On Consumer Buying Decision

Project and Seminar Material for Marketing

Abstract

The project examines the effect of packaging on consumer buying behaviour with reference to Unilever Company. The study main objective is to know the impact of product packaging on consumer buying decision and also to know whether consumer rely on product packaging in necessary information concerning the use of the product. The primary source of data collection was used in gathering data from respondents. A structure questionnaire was designed by the researcher and validity by two experts from the statistics department was used to obtain data Chi-Square (X2) was used to test hypotheses formulated. It was discovered that package can attract with simple readable message about the product. The study concludes that cost of production has been as problem in production but, packaging without a quality, proper pricing, appropriate advertising and sound marketing plan is of little value. And recommends amongst others that they should be locked at as profit building of sales innovation rather than a cost cutting tool. In this sense, producer of omo should manage it and improve on their package design and package materials for the products.

Chapter One

Introduction

1.1 Background to the Study

The importance of packaging goods in product marketing has made it indispensable despite the high cost.
A package keep a product intact to final consumer package is very important even for perishable goods such as tomatoes. The importance of packaging can not be over emphasized, especially when one consider the severed function it performs in consumer attraction and satisfactions. The detergent industries represent a typical example of an important in the purchase decision. The package can be designed in such a way to attract attention in the shelves of supermarkets or stores.

Excellently designed packages are directly translated into difference in sales appeal. The study will examine the effect of packaging on consumer buying decision.

Product packaging influences consumers buying behavior by persuading them to buy the product. Companies that do not bother much about packaging because they believe once the product is of good quality, consumers will buy, perform abysmally because of lack of patronage from customers. Some firms think that they can cut corner by going for cheap and unattractive packaging. These type of firms soon realize after the costly mistake has been made that it is better to use good and attractive packaging. This Luke-warm attitude towards adhering to proper packaging has sent many companies into oblivion, because of low patronage from customers. This occur mostly when they fail to project the value of their products through attractive packaging. Poorly packaged products dissuades consumers from buying the product no matter the price. Poorly packaged products poses serious problem, since it will require enough explanation to persuade the customer to buy the product. Poorly packaged product is rated low and affects consumers, when considering values and price of the products. According to Lifu (2003), shabbily packaged product affects consumer buying decision and it does not appeal consumers. Packaging influences consumers to the extent that it determines whether a consumer comes back for more products or not.

Attractive packaging calls for repeated patronage from consumers, which enable the firm to generate profit. In the view of Best (2002), attractive packaging creates value by helping consumer decision process.

Product packaging is an essential marketing mix that projects firm brand image, which is designed to convey image of high quality (Ulrich, Campana & Malkewitz, 2010).Product packaging is the final stage of production and plays vital role in production activities. Attractive packaging can also induce impulse purchasing. Scot (2008) states that attractive packaging can attract customers to try product at first sight.

1.2 Statement of Research Problem

Packaging is a very important element in marketing the product especially in the detergent industry.
This research will sensitize firms in the importance of adhering to good and alterative packaging and the consequences of not using them. When firms are sensitized on the importance of using attractive packaging, they will start packaging with outstanding design, which will easily draw customers attention. Firms will start to use vivid colour and pictures to convey appeal to customers in their product packaging. This action of the firm in using high quality attractive packaging will call for repeated purchase from customers and thus enable the firm to remain in business. Products with attractive packaging create market for firm than its promotional activities. Consumers most times are attracted at first sight to the packaging style of a product (Terblanche, 2006). This research will enable firms to create value on their products by using attractive packaging which will in turn influence customers purchasing choice. This study will also create awareness on the need for periodic assessment or reappraisal of packaging materials and design with respect to the present day need of the consumers. This will be done by firms product development section under marketing to suit consumers desire. Packaging materials become obsolete overtime and needs upgrading to current customer preference. When this critical aspect of projecting the value of product is ignored, it could lead to low sales turnover and back log of unsold inventory. This can strangulate the activities of the firm and lead to worm up of close shop. This will be a bygone after implementation of this research report. Apart from the vital function of upgrading the product value periodically, firms will come to recognize product packaging as an advertising medium and save money meant for advertising

The strategies importance of packaging has been in area of improving the product performance. Despite the indispensable value of packaging. The research is faced with the problem of knowing why money products are sold unpacked or poorly packed in our markets

1.3 Objective of the Study

The objectives of this study work (study) are as follow;

To know the impact of product packaging on consumer buying decision.
To find out the effect of packaging on the total profit of the company.
To identify what variable the consumer refers most in packaging in term of shape, size and colour.
To know whether consumer rely on product packaging in necessary information concerning the use of the product.
To study the strategies areas of information in designing product packaging.
To understand consumer behaviour with regards to a product package. Packaging of product provide source of guide for the consumer in purchase process.

1.4 Research Questions

Having sported the problems of study, remedies lies on how the research works of those question that affect the packaging of “OMO”.

How does packaging affecting consumer buying decision.
To what extent is packaging of a product important as a means of identification that companies have adhered to?
To what extent can packaging help a company to achiever her profit sale goods.
What are those intrinsic value consumer preferred most in package?
Do consumer rely on product package for necessary information about the products content and usage.
How does the packaging of product protect it from damage in shipping and spoiled in storage?

1.5 Statement of Hypothesis

Hypothesis One

Ho: A good package does not affects consumer buying decision.
HI: A good package affect consumer buying decision.

Hypothesis Two

Ho: Package does not quickly identify the product by using trade name or trademark.
HI: Package quickly identify the product by using trade name or trademark.

Hypothesis Three

Ho: A good package does not creates impact on consumer buying decision.
HI: A good package creates impact on consumer buying decision.

Hypothesis Four

Ho: A good product does not necessary concern the information of product.
HI: A good product is necessary concern the information of product.

1.6 Significance of Study

The importance of packaging and it effect on the consumer can not be over emphasized. One thing is for a company to invest so much on packaging and another thing is to receive the returns in increase sales due to user and so on.

Therefore researcher intends to identify and highlight those factors that are necessary in soap package design and their effect on consumer buying decision.

On completion of this study, the report would be of immense value to detergent company and researcher in the field.

1.7 Scope of the Study

The study shall dive into the impact of packaging on buying decision in the attainment of sales profit quotes and the impact of packaging goods. A case study of omo product of Unilever Nigeria Plc.

1.8 Limitations of the Study

Due to the shortness of time and limited period allocation for the writing of the project, the researcher could not thoroughly carryout a more detailed and elaborate work.

Beside, continued lecture, assignment and test did not make it an easier task.

Finance is another limiting factor which hindered and travelling to universities and polytechnics, in search for effective work.

Absence of current published materials, such as journal and publication related to the effect of the research. With all these put together, there was no way the research could escape any of this project work. Nevertheless, the best was still put in place in using the available materials.

1.9 Operational Definition of Terms

The following words are some of the terms used in this project work.

Packaging:

This can be seen as a process designing and producing a container or a wrapper for a product.

Consumer:

These are individuals who purchase or buy product or goods and service for personal use or household use.

Wrapper:

Design the out line from which the container may be made.

Mass Marketing:

This is the major portion of the population made up of a large number of usually middle class and working class.

Data Analysis:

This is the selection of the instrument you need to carryout research by separating into part and interpreting figures.

Brand:

This is the name or mark intended to identify a product of one seller or groups of seller and differentials product from competing products or competitors.

Labelling:

This is the part of product that carries information about the product.

Price:

This is the value agreed upon by the member in the exchange processes. It is a means that allows product and services to get value in the eye of both buyer and sellers.

Promotion:

This can be seen as one of the market mix (4ps) that communicate with individuals or groups or organization directly or indirectly to facilitate exchange by influencing audience, member to accept an organization product.

Product:

A product is any thing favourable and unfavourable, tangible or intangible attraction, attractors acquisition use or consumption that includes packaging colour, price, manufacturer, and retailer.

Trade Mark:

This is a legal designation indicating that the owner has exclusive use of brand or part of a brand and that law from using it prohibits others.

Trade Name:

This is selecting a legal name of an organization rather than the name of a specific product i.e, the name under which a company operates.

Chapter Five

Summary of Findings, Conclusions and Recommendations

5.1 Summary of Findings

Considering the result obtained in table 3, the individual coefficient β in each and every variables indicates a positive result with the exception of shabby packaging positive relationship lies between the independent variable attractive packaging and the dependent variable consumer buying behavior. This is consistent with the researches of Lifu (2003); Terblanche (2006), where they found that consumers are attracted at first sight to packaging style of product.

Positive relationship also exists between the independent variable value and quality of packaging and the dependent variable consumer purchasing behavior. This result is consistent with the researches of Best (2002); Lifu (2012), where they found that packaging creates values and quality to product which helps consumers decisions process.

However, a negative relationship exists between the independent variable shabby packaging and dependent variable consumer buying behavior. This is consistent with the research of Lifu (2003) where he showed that poorly packaged product dissuade consumers from buying product irrespective of its quality.

Positive relationship exists between the independent variable impulse purchasing and the dependent variable consumer buying behavior. This is consistent with the researches of Stilley et al (2010) Laforet (2011); Lifu (2012). Their study revealed that product packaging induces impulse purchasing, which perhaps leads to the purchase of products not initially planned for.

The whole analysis show that the independent variables attractive packaging, value and quality of packaging, shabby packaging and impulse purchasing influences consumer buying behavior and gives significant result at p<0.01, F = 61.12 and R2>60, whereas the standard error is less than 1. R2 .642 shows that the model has a good goodness of fit and that 64.2% variation in the consumer buying behavior is accounted for by variation in explanatory variables, suggesting that the model has good explanatory power on the changes in consumer buying behavior among variables. Adjusted R2 .636 supported that the model has good goodness of fit with value of 0.636 or 63.6%. F-statistics 61.52 at 1% level indicates that the model has over all significant at traditional 1% level of significance.

5.2 Conclusion

It is concluded that the predictor variables, attractive packaging, value and quality of packaging and impulse purchasing has positive relationship with consumer buying behavior. Shabby packaging do not have positive relationship with consumer buying behavior. Most of the results are consistent with the literature.

5.3 Recommendations

Based on the research findings, the following recommendations are made.

When designing product package for sell, attractiveness of the packaging and quality of the product must be taken into consideration to avoid the consequences associated with poor product packaging.
To be able to be sustainable in present day competitive and computerized market, firms should be able to balance both packaging and quality to meet the level of cost they want as well as building customers confidence and loyalty.
Packaging and quality of product as a matter of necessity should be included as a major policy decision in organization.

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