Effect of Advertisement On Consumers' BuyingBehaviour of Real Estatesin Tanzania
Effect of Advertisement On Consumers' BuyingBehaviour of Real Estatesin Tanzania
Effect of Advertisement On Consumers' BuyingBehaviour of Real Estatesin Tanzania
Abstract
The article examines the influence of advertisement elements—namely television,
radio, print media and online advertisements—on consumers’ buying behaviour of
real estate products in Tanzania, using evidence of the National Housing Corporation
(NHC). Informed by the positivist and deductive paradigms, as well as theoretical lens
of the AIDA model, the study used structured questionnaires to gather quantitative
data from 103 conveniently sampled NHC customers based in the Tanzania’s
sprawling city of Dar es Salaam. These were complemented by in-depth information
from 3 key informants. Data were subjected to multiple regression analysis. The
findings indicate that of all the four constructs, only two—television, and radio—
advertisements were the major shakers as they emerged as significant predictors with
53% and 27% contribution to changing the consumers’ buying behaviour, respectively.
Print and online media, on the other hand, insignificantly contributed 13% and 7% to
influencing consumers’ buying behaviour respectively. These findings have
implications for policy makers and real estate companies seeking to make the most
from advertising of real estate products through the media.
Key terms: advertisement, consumers’ buying behaviour and AIDA
Introduction
Consumer behaviour is related to how organisations, groups or individuals choose,
buy and utilise ideas, experience, goods or services for their needs satisfaction
(Thangasamy & Patikar, 2014). In fact, the behaviour that a customer exhibits is
not the only focus of consumer behaviour. Tobergte and Curtis (2013) suggest that
at the macro level, officers who deal with marketing place their emphasis on the
demographic shift and practices, beliefs and values, which have effects on their
interaction with customers in the market. On the other hand, at the micro level,
the focus is on human behaviour and their associated reasons; communication
inclusive. In this regard, how customers choose, buy, and utilise certain products
or services can be influenced significantly by the way in which communication,
largely through advertisement, is conducted (Haider & Shakib, 2017).Information
needs and behaviour that customers tend to portray in their buying process differ
depending on the product type, and the nature of the customer.
Purchasing products that are bought frequently, and costing less—such as sugar
and coffee—do not require deep search for information compared to other products
that are not frequently bought and are of higher costs, such as real estates.
According to Tobergte and Curtis (2013), transactions involved in these latter
*
University
of Dar es Salaam Business School - Tanzania, mburao@yahoo.com
†
Makerere University Business School - Uganda, thumakago@gmail.com
have ranked the Internet as the top most media in the persuasion of consumers
towards buying products or services (Rasool et al., 2012). Yet, this assertion
regarding the Internet is not absolute as other researchers have come up with
competing explanations. Researchers such as Bansal and Gupta (2014) contend
that the application of the print media in advertising is much more significant than
other types of media. On the other hand, Arshad et al. (2014) underscore television
advertisements as the most effective method of influencing consumers’ buying
behaviours. On the whole, these findings bring about inconclusive and
contradictory findings; thus, necessitating the need for a deeper understanding of
advertisements tools and their implications on consumers’ buying behaviour.
The article attempts to ascertain the roles of television, radio, print media and
online advertising in influencing consumers’ buying behaviour justified by the view
that consumer expectations of information from various media—such as TV, radio,
newspapers, magazines and the Internet—are entirely different (Sama, 2019). The
article uses the NHC as a study platform. The NHC in Tanzania is under the
Ministry of Lands, Housing and Settlements Development. According to the NHC
Strategic Plan (2015), its core functions includes housing construction for sale,
construction of buildings as part of approved schemes, and management of houses
for rent. The rest of the paper covers theoretical discussions, empirical support,
methodology, findings, discussion, conclusion, policy implications, and
recommendations.
The original purpose of the AIDA model was to optimize sales calls and
advertisement, specifically the interaction between a seller and a buyer pertaining
to a product. Accordingly, a successful advertisement should always follow a
specific logical pattern for it to attract a reader to look and start reading the product
advertisement; then interest him/her enough to continue reading it; then convince
him/her so that when s/he has read the advert s/he will believe it, and subsequently
act by searching for, and buying the product. Similarly, Hackley and Hackley
(2021) advocates that the AIDA model aims to ensure that effective advertisements
create awareness, stimulate interests and, finally, direct customers’ desire to act
by purchasing a particular product having been stimulated by a much more
enlightening advertisement.
The act of purchasing has been referred to as consumer-buying behaviour (Khan et al.,
2021; Song et al., 2021; Ofosu-Boateng, 2020; Sadikoglu, 2017) that entails buying
action of products or services by households and individuals. Thangasamy and Patikar
(2014) detail consumer-buying behaviour as a study of the ways through which an
organisation, a group, or an individual gets involved in the selection, buying, and using
of ideas, services, experience and/or goods for the satisfaction of their wants and needs.
Aided by AIDA model we propose in this paper that one way to enable target audience
to positively get involved in buying particularly real estate purchase is through
effective advertisement. This proposition is shared by In the Hadiyati's (2016) who
opines that AIDA model envisages to attract potential customers’ attention, to increase
the customers’ interest and desire to do the last act of fully engagement through
purchasing a product or service.
The four attributes applied in the AIDA model can de described thus. The first
letter ‘A’(‘awareness’ or ‘attention’) refers to the ability of the advert to grab the
attention of a customers In this regard, managers in real estate firms are expected
to develop a message that communicates and stimulates this intent to customers:
be it on television, radio, print media, or online media. The second letter
‘I’(‘interest’) demands managers to create an advert capable of stirring and raising
the interests of customers by communicating the salient features, benefits,
advantages and other attributes of the products. The third letter ‘D’(‘desire’) refers
to the strong want among consumers that emerges when they perceive that a
service or product advertised will satisfy their wants and needs as a result of the
communication made. In this regard, managers in real estates have to send
messages that communicate the uniqueness of the benefits, brand image and
features attached to the products or services that differentiate them from those of
their competitors. It is this ‘interest’ of customers that generates a desire for them
to satisfy their needs by purchasing the advertised products or services.
The fourth and last letter ‘A’(‘action’) refers to the ultimate outcome of the
communication facilitated by the advert. After attention, interest and desire have
been created, what follows is the decision of consumers to act by purchasing the
particular product or service. In this case, the actions included in the realm of real
estate involve the decision by a potential buyer to purchase land or a house.
However, the decision to purchase a product is highly associated with the amount
of disposable income. In a study by Das and Datta (2021), it was established that
present price of real estate was one of the major factors that influences customers
to invest in real estate.
The AIDA model was relevant in this study as it links advertisement and the
consumer behaviour in enhancing sales in real estate business. Specifically, it
illustrate how the advertisement media—such as TV, radio, print media and online
media—can be used to create awareness, generate interest, and stimulate target
customers to make a purchasing decision in favour of the advertised product or
service.
A study by Malik et al. (2014) in Pakistan examined the impact of advertisements and
perception of a customer on the consumer purchasing process. Random sampling
technique was used in selecting 150 respondents. The study confirmed a positive and
significant relationship between advertisements and consumer purchasing behaviour.
The study detailed that the quality of advertisement and positive perception by
customers play significant roles in influencing consumers’ purchasing behaviour.
Further, Arshad et al. (2014) in Pakistan assessed the effects of effective advertisement
on consumers’ buying behaviour. Through regression and correlation analyses it was
revealed that the most persuasive ways for customers to buy a product is
advertisement. Nevertheless, the study failed to address ways through which
consumers’ purchasing behaviour may be influenced by adverts.
Also, in a study by Sama (2019) in the state of Gujarat in India, it was revealed
that magazines and newspapers were the effective media in influencing purchase
and post-purchase behaviours of consumers; while the TV, radio, and the Internet
had insignificant influence on the same. Still in India, Neupane (2019) conducted
a study to ascertain whether demographic background (i.e., Age, gender, education
and occupation) of ultimate consumer had a varying effect on the media preference
due to advertisements. The results indicated TV advertisements to be more popular
as compared to the radio, print and other media regardless of the demographic
contexts of the respondents.
On the whole, previous research offers a positive direction regarding the influence of
advertising on consumers’ buying behaviour. However, most of the studies have been
conducted outside Tanzania. Moreover, these studies, including the few based on
Tanzania; do not offer insight regarding how each of the elements of advertising would
have greatest impact on envisaged outcome. This is despite different potentials offered
by each media on organization performance especially so in the real estate. Corollary
to this, a need to have effective advertisement budget decisions in line with different
media has been anchored in several studies. According to McMeekin (1988) optimum
advertisement budget can be optimized by allocating advertisement budget to different
media since each has its unique potentials.
Conceptual Framework
Advertisement may be designed in different media. In this article four
Advertisement media namely televisions, radio, print and online advertisement
explained thereafter are used as predictor variables as they influence consumer
buying behaviour of Real Estate. These are presented beneath in the depicted
conceptual framework in figure 1.
Television
advertisement
Radio
advertisement
Consumers’ buying
Behaviour
Print Media
Online
advertisement
On the other hand, Radio advertisement is perhaps the commonly used form of
advertisement media employed by most of the companies in Tanzania to
communicate their products to the customers. In order to reach a multiple
audience, this method is credited for being highly flexible, timely and affordable to
most of the people in the country. It is also helpful when it comes to areas of which
other forms of media cannot reach easily such as Television, Internet and
newspapers like in villages and is less expensive (Stone, 1982). It was therefore
hypothesized that:
The higher the Radio advertising budget the more positive is the consumer
behaviour
Finally, online advertisement media popularity has been highly attributed to the
technological advancement. In today’s business it is perhaps the less expensive
form of advertisement. Different videos, words, pictures and ideas on the new
product can be communicated via Internet. One of the major advantages of this
method is that the response, attitude and reaction of readers may be gained at a
point of time for action by management (real estate clients inclusive). This is also
a widely accepted method today for it is flexible in communicating the message and
any changes can be made for improvement. Prior authors argue that the
application of online advertisement for promotions is growing rapidly given its
advantages in attracting well-educated communities to use their internet-based
applications to buy their products as opposed to physical shopping (Lim et al., 2021;
Qalati et al., 2021; Maliket al., 2013). It is therefore hypothesized that:
The higher the online advertising budget the more positive is the consumer
behaviour
Methodology
This paper is based on primary data obtained by a survey carried out from
conveniently sampled 103 NHC customers in Dar es Salaam, which is the main
business city in Tanzania. The survey was premised on the positivist and deductive
paradigms to cushion the use of quantitative and qualitative data analysis. It
deployed structured questionnaires to gather quantitative data from NHC
customers (NHC, 2017). According to Rajasekar et al. (2006), for the generalisation
of the findings, a large sample needs to be of not less than 30 participants,
especially for a deductive approach. The biggest NHC projects during the study
period, namely Victoria Place in Victoria area, Mwongozo in Kigamboni district,
and Shekilango projects were employed to gather data from the customers
associated with these projects. In addition, purposive sampling was used to select
5 key informants to gather in-depth qualitative information through interviews
(Creswell, 2013; Mondal & Das, 2021; Utari, 2021). Multiple regression analysis
with the aid of the SPSS, version 22 was used to ascertain the most influencing
advertising media on the consumer buying behaviour of the real estate.
According to Kombo and Tromp (2006), data analysis is the process through which
the researcher examines the collected data and makes deduction and inference
from the named data. In this study, data were analysed through descriptive
statistics, reliability analysis and Regression analysis with the aid of SPSS version
22. In this case, the tables were used in presentation of descriptive findings and
the regression summary was analysed by taking the four independent variables in
relation to one dependent variable. Kothari (2004) states that multiple regression
analysis is significant in showing the relationship between more variables
(independent) and dependent variable
Before actual data analyses, the data collected through structured questionnaire
were subjected to reliability and validity test. In the former case, Cronbach’s Alpha
was employed as a technique to measure the reliability of data, and determine
whether the instruments used met the criteria, hence robust enough to yield the
necessary data (Graham et al., 2021; Tavakol & Dennick, 2011). As for validity, a
pilot survey to 10 people was used to test the instrument and anomalies were
corrected before the instrument was finally used for wide survey.
Model Summary
The significance of the model was explained by using the regression model
summary; and the ANOVA results are as shown in Tables 1 and 2.
The regression results in Table 1 indicate that 74.1% of the variations in the
consumers’ buying behaviour are explained by the independent variables. This
shows that the multiple regression model adopted in this study is significant. From
the regression model, it is evident that the variation in the consumers’ buying
behaviour of real estate products is significantly explained by the independent
variables applied in the study.
The regression (prediction) equation of the regression model above is given by:
𝑌 = 𝛽0 + 𝛽1 𝑋1 + 𝛽2 𝑋2 + 𝛽3 𝑋3 + 𝛽4 𝑋4 + ⋯ 𝛽𝑛 𝑋𝑛 + 𝜖,
Where
𝑌 = Dependent variable which is the consumers’ buying behaviour (CBB).
𝑋1 – 𝑋𝑛 = Independent variables (television advertisement (TA), radio
advertisement (RA), print media (PM) and online advertisement (OA)),
𝛽1 – 𝛽𝑛 = Coefficients of independent variables
𝛽0 = Constant of the equation
𝜖 = Error term
Then, from Table 3 the regression equation is given by the following equation:
CBB = .041+0.534TA+0.129PM+0.268RA+0.07OA
The results also corroborate with those given by Arshad et al. (2014), and Sharma
and Singh (2021), who all argue that TV advertising is more persuasive than other
advertising avenues in convincing a customer to buy products.
Summary of Findings
This paper examined the role of advertisement in influencing consumers’ buying
behaviour of real estate products in Tanzania using the case of the National
Housing Corporation. It has measured the role of advertisement using four
advertisement media: TV, the radio, print, and online media. More specifically, it
has examined the influence of TV, the radio, print media and online advertisement
on the consumers’ buying behaviour of the real estate products. The regression
analysis results indicate a positive relationship between four adverts media used
in this study, and the consumers’ buying behaviour of real estate products. The
findings imply that, as a Real Estate entity such as NHC advertises its products
possibly through TV, the radio, print, and online media, it cultivates customer
awareness and interest on the real estate products available then creatively
arouses desire to go for the real estate products before finally acting by buying
desired product. Nevertheless, the current article indicates that only two
variables—namely TV and radio advertising – were found to be significant
predictors of buying behaviour in the real estate sector in Tanzania.
According to Belch and Belch (2003), the rapid evolution of online marketing media
is increasingly enticing more people into these kinds of internet-based advertising.
In addition, most firms – both in the public and private sectors—are aware that
the effective and efficient way of communication with target customers is related
to achievement of their goals (Belch & Belch, 2003) through positively influencing
consumer buying behaviour. However, this study found that it was TV and radio
advertisement that tramped all the other media reviewed since they were found to
be significant predictors of change in the buying behaviour among customers of
real estate products. Thus, despite the rapid evolution of the online media that has
swept through the globe, the real estate industry in Tanzania is advised—at least
for the time being—to use TV and radio advertisement to communicate to its
audience via advertising.
Recommendations
In view of the study findings, we recommend the following. First, real estate
companies—such as the NHC—should consider using TV media in communicating
their real estate products and services to their target audiences. Indeed, TV
advertisement has much more impact in influencing consumers’ buying behaviour
than other media currently in use in Tanzania. If used appropriately, TV
advertisement could be a reliable source of gaining a competitive advantage in the
real estate market. Secondly, radio advertisement is also the other media that has
a significant influence in changing the buying behaviour, especially for the widely
scattered audience, as it is much more flexible, cheap, and easily accessible,
currently even via electronic means. Therefore, real estate companies should
underrate and snub radio advertisement; rather, they should design adverts that
are easy to understand and remember among customers; and hence with a capacity
to influence their buying behaviour.
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