This research was undertaken to establish the factors which determine the consumer behaviour in the retail market of the United Kingdom: a study of Sainsbury's. The objectives of the study were to determine the major issues faced by the UK retail market, establish the impact of business issues on overall performance of Sainsbury’s, find out the consumer buying behaviour towards UK retail brands as well determining the factors affecting consumer buying behaviour in Sainsbury’s. Questionnaires were administered on 100 consumers of Sainsbury’s products and the findings revealed that consumer behaviour in the of the United Kingdom retail market is influenced by physiological, psychological and social factors.
According to Solomon et al. (2014, p.13), consumption behaviour is described as the purchasing behaviour of customers who purchase goods and services for household consumption. Every consumer who purchases goods and services for such purposes is a participant in the consumer market. There are many demographic factors which influence the consumer behaviour such as age, income, education, religion, culture, values and taste. Consumption of goods and services varies from one consumer to another. Moreover, in the process of making consumption decisions, industrial buyers may have many influences. In this view, industry vendors should focus on delivering economic benefits to buyers which satisfy consumer needs (Carrington, Neville & Whitwell 2010, p.141).
1.2 Background of the Study
Vendors and buying agents are quick in response to personal motivation, seeking help, attention, or opportunity to reduce risk. According to this view, Krishna (2011, p.93) states that industry vendors should focus on the human and social factors of the purchase situation. Purchasing agents often respond to both economic factors and personal factors. The satisfaction of the organization's goals can be achieved with the help of any supplier: personal factors can enter the business. Companies are willing to buy and maintain large quantities of materials that affect buyers of industrial goods and environmental factors such as scientific and technological advances, political events, and competitors' activities (Ali, Kapoor and Moorthy 2010, p.110). On the other hand Musasa (2016, p.17) argues that to understand consumer behaviour, the following questions should be answered: What do you buy? Why do you buy it? How do you buy it? Where do you buy it? How much do you buy? How often? How do you use it?
1.3 Problem Statement
There are several studies conducted on determining the factors influencing consumer behaviour in the retail market, but there is no particular study conducted for determining the factors influencing consumer behaviour in the region of United Kingdom specifically in the context of Sainsbury’s. This raises the need to conduct this study that has a particular context and focus which will better help in understanding the factors responsible for the buying decisions of consumers in the United Kingdom. Therefore, this research is aimed at investigating the factors influencing the customers’ consumption behaviour in the retail market of the United Kingdom particularly in the context of Sainsbury's.
1.4 Research Aim
The aim of the study is to examine the factors influencing the consumers’ consumption behaviour in the United Kingdom retail market particularly in the context of Sainsbury's.
1.5 Research Objectives
To determine the major issues faced by the UK retail market
To determine the impact of business issues on overall performance of Sainsbury’s
To determine the consumer buying behaviour towards UK retail brands
To determine the influences of consumer buying behaviour in Sainsbury’s
1.6 Hypothesis
To validate the factors influencing the consumption behaviour in the retail market of the UK: a study of Sainsbury’s, various hypotheses were tested;
H1: Post Brexit obstacles are among the major challenges being faced by the UK retail market.
H2: Issues like the decline in sales will negatively impact on the overall performance of Sainsbury’s.
H3: Brand loyalty level is high among consumer which creates positive behaviour towards UK retail brands.
1.7 Research Question
What are the major issues faced by the UK retail market?
How do business issues impact on overall performance of Sainsbury’s?
What is the consumer buying behaviour towards UK retail brands?
What are the factors affecting consumer buying behaviour in Sainsbury’s?
1.8 Variables
1.8.1 Dependent Variable
Dependent variables have the capacity of taking various values only in response to a variable which is independent that is often referred as a presumed effect (Rossi and Merenda 2010, p.35). Consumer Behaviour is the dependent variable for this study.
1.8.2 Independent Variable
Independent variables reserve the capability of taking various values and making analogous variations in the dependent variables that are often referred as the presumed cause (Rossi and Merenda 2010, p.36). Independent variable includes the Factors which influence the Consumer Buying decision in Sainsbury’s for example, culture and cultures, social status, social groupings, household, personal influences, situational determinants etc.
1.9 Outline of the Study
This paper contains five chapters. In chapter one, the research topic is introduced; that is “To Investigate the Factors Influencing the Consumer Behaviour in the UK Retail Market: A Study of Sainsbury's”.
The second chapter demonstrates all the pertinent literature from the previous research aimed at meeting the goals of the study and backing up the results of the study.
The third chapter; methodology, focuses on presenting the tools, techniques, approaches and methods used in achieving the objectives of this study
The fourth chapter discusses and analyses findings conveniently by using the appropriate methods and tools aimed at to drawing a logical conclusion.
The last chapter presents conclusion and recommendations which summarise the context of the study and provide limitations of the research including the recommendations about the study
CHAPTER 2: LITERATURE REVIEW
2.1 Introduction
Hassan and Raha (2013, p.6) postulate that the retail market often has multiple people with varied status, different powers, and different skills to bring themselves to another and different persuasion abilities. Industrial merchants rarely have the opportunity to learn about the dynamics of their group behaviours in the purchasing decision process, although information is provided to the members of the purchasing centre and their interpersonal relationships. Acknowledging that the customer is core in every marketing activity, there is no qualm about the significance of understanding how the customers are motivated, how they purchase as well as use the goods procured.
2.2 Theoretical Framework
2.2.1 Major Issues Faced by the UK Retail Market
Bruce, Daly and Towers (2004, p.154) claim that post Brexit challenges is one of the greatest issue that is currently being faced by the retailers in the United Kingdom retail market. There are three parts that Brexit can affect in the medium to long-term: changing consumer sentiment and behaviour, changing employment and immigration law and altering input costs. On the other hand, customer acquisition and retention is another major issue that is created due to the downfall of the market is not a new problem for retailers (Jones et al. 2004, p.136).
2.2.2 Impact of Business Issues on Overall Performance of Sainsbury’s
According to Rodionova et al. (2017, p.218), Sainsbury's warned of "challenging" markets and price pressure due to an 8.2% drop in profit. The retailer posted a pre-tax profit of £503 million for March 11, down from £548 million last year. Same-store sales for the year fell 0.6%. Retailers expect a tough time amid the rise in costs due to the slowdown after Brexit in the value of the Pound.
2.2.3 Consumer Buying Behaviour towards UK Retail Brands
According to Pivato, Misani and Tencati (2008, p.9), brand loyalty is a core component of a brand and contributes positively to the brand that is directly affected. Under the effect of product loyalty, customers continue to purchase the product, irrespective of the superiority, price, and expediency of its rivals. In this case, the consumer is assured of purchasing the product if a friend or relative recommends the product in the same fashion. This shows that word of mouth is the most effective tool in the market (Moore 2001, p.44).
2.2.4 Factors affecting Consumer Buying Behaviour in Sainsbury’s
Pivato, Misani and Tencati (2008, p.9), elucidates that consumer behaviour depends on physiological and psychological characteristics. First, physiological Characteristic are the basic needs of consumers. It is necessary to be able to live analysing the physiological changes which are the first thing to consider because they play a very important role in consumer decisions. Secondly, psychological conditions refers to the nature of the need. Individuals born with different mental states may be related to consumer behaviour as a whole.
Additionally, the family is a source of knowledge, training and experience of different people. Inheritance of the family is so influential and affects consumer behaviour. Fourthly social factors such as the social system is about the individual, which result in the person who will comply with the characteristics of the society. Each class will have different consumption behaviours. Also, culture is a way of life that the people in society accept and willingly behave concurrently.
Moreover, economic condition is all about the determinants of the power and characteristics of consumer purchases. When consumers demand the product and when prices are higher, they will not be available. It determines the demand behaviour (Pickett-Baker and Ozaki 2008, p.6). Besides, family responsiveness business units must understand that the family system is part of the social process. The family is the basis for life to the consumer (Pickett-Baker and Ozaki 2008, p.6). Alongside, social Group has great impact on the consumer behaviour. Society consists of life, values, society, and trust. Business units must look at the influence of society on the coexistence, specifically, the system. The norm is that what is acceptable to society and what is not acceptable to society (Pickett-Baker and Ozaki 2008, p.7).
Furthermore, culture provide the basic values, perception needs and behaviours, which are the learning system of family members and society. Culture is also a way of life that the majority of the people accept. Business units must recognise that the culture of each society is different (Pickett-Baker and Ozaki 2008, p.8). Finally, business contacts may also affect the consumption behaviour of customers. Consumers will find the products they want. If any product is often seen by consumers, often familiar consumers, the business activities must focus on the implementation of the product. Brand identity or brand contact is to bring products to consumers, to experience the taste (Pickett-Baker and Ozaki 2008, p.8).
2.3 Literature Gap
This study does lacks an explanation on how competition in the UK retail market affects the overall performance of the market. Also, the measures to be undertaken in addressing the issues facing the retail market also have been omitted in the study. Moreover, it is not clear on how to predict with certainty whether the impact of the Brexit on the economy is likely to be significant, especially if it is unclear in terms of output.
CHAPTER 3: METHODOLOGY
3.1 Introduction
The tools and techniques that are discussed in this chapter are sued for investigating the factors influencing the customers’ consumption behaviour in the United Kingdom retail market in the context of Sainsbury's. This thesis focuses on the onion study background, which will assist with adequate research. This is the most suitable means of conducting a study since it includes the choice of policies, processes, prospects, time and methods (Wei, Liu & Koong 2006, p.112).
Figure 1 Onion Research Framework | Source: (Wei, Liu and Koong 2006, p.112)
3.2 Research Approaches
Christensen (2004, p.13) mentioned that research approaches can be defined as the basic determinants that will assist in making the decisions necessary for educational placement while inference methods and inductive methods are two main approaches widely used by most researchers and scholars for data analysis. Inference methods were engaged in gathering results, such as factors influencing consumer behaviour, as well as the willingness and ability to retail in the UK, particularly in Sainsbury's.
3.3. Research Methods
As per Creswell and Clark (2007, p.5), research methods can be defined as the most important aspect of research that directly affects the outcome of a study. Quantitative research method has been implemented that is based on collecting the information through survey questionnaire from 100 Sainsbury’s customers in the UK retail market sector (Neuman 2013, p.110).
3.4 Research Design
According to Lewis (2015, p.473), research design is a plan of action in the course of research. Both qualitative and quantitative methods of research have been embraced in conducting this particular research, since the study aims to investigate the factors influencing the consumers’ consumption behaviour in the United Kingdom retail market particularly in the context of Sainsbury's.
3.5 Data Collection Methods
For this specific study, data was obtained via the primary and secondary methods of gathering data.
3.5.1 Primary Data
Primary data refers to first-hand information which has not been presented in any research. Examples of qualitative methods of gathering primary data include interviews, questionnaires, and expert panels, among others (Wei, Liu and Koong 2006, p.112). In the case of this study, the questionnaire technique has been used in collecting quantitative data. A survey was conducted on 100 Sainsbury’s customers whereby they were required to complete a detailed questionnaire by providing relevant information. The information was then compiled for analysis of findings and recommendations. On the other hand, interview method was used as a tool of collecting qualitative data.
The questionnaire has been used as the appropriate tool because of its advantages. First, compiling and analysing data collected through this method is easier compared to verbal surveys. Also, this method is cost-effective since the research entails collecting vast information about factors affecting the consumer behaviour in the retail market of the UK from Sainsbury’s 100 customers. However, this method may lead to collection of biased data since the respondents may be objective while responding to the research questions.
The questionnaire is divided into two major parts. This first portion entails data regarding the demographic details of the consumers while the second portion involves information that seeks to investigate the factors that affect the consumer behaviour in the retail market of the UK. Questions are designed in such a way that they relate to factors that are likely to influence the consumption behaviour among the customers of the retail market of UK. The interview method is used in collecting qualitative data, and the respondents are the UK retail market customers. The customers will be interviewed using face-to-face interview or via telephone. The availability of the customers will determine the methods of interviewing and participation.
3.5.2 Secondary Data
Secondary data refers to information that already exists in literature; information that has already been published. This information can relate to the study topic or the organization that has been used as a case study. In this study, various sources such as published articles, websites as well as scholarly sources have been used to gather secondary data. This information has been used to explicate the literature behind this study as well as explaining the findings.
3.6 Sampling Techniques and Sample Size
“The primary concern of research is of the statistical sampling that is obtained from the entire population and must be representative of the same population,” (Ott and Longnecker 2015, p.17).There are two skills of sampling namely; probability and non-probability. In probability sampling, every component has equal chance unlike in non-probability sampling where every element has different probability of being chosen.
In the particular study, convenience sampling was used. The researcher hang around the entrance of the company during the evenings, since this is the time most households purchase their products. The researcher requested the customers to take some time filling the questionnaires and later on asked them to respond to some interview questions. A sample of 100 Sainsbury’s customers filled the questionnaires.
3.7 Data Analysis Methods
Ott and Longnecker (2015, p.17) states that data analysis is used to analyse collected data, which is why it is necessary to use the most appropriate analytical methods. This research uses Microsoft Excel to present the data collected in a suitable table format and analyse it through charts and tables, and interpret it by supporting the findings of previous studies.
3.8 Ethical Considerations
Informed consent was obtained from each participant because ethical standards of research demands so. Also every participant's credentials and information was kept secure and confidential throughout the research process as postulated by Smythe and Murray (2000, p.328).
CHAPTER 4: DISCUSSION AND ANALYSIS
4.1 Introduction
This part will focus on presenting the results and explanation of the research question: “To Investigate the Factors Influencing the Consumer Behaviour in the UK Retail Market: A Study of Sainsbury's”. Secondary data has been collected from credible literature sources and the primary data has been collected through survey questionnaire among 100 Sainsbury’s customers in the UK retail market sector. However, due to inappropriate input by some respondents, only 96 questionnaires were valid for consideration during the research.
4.2 Quantitative Analysis
Demographic data
What is your gender?
Gender
No. of respondents
% of respondents
Male
58
60%
Female
38
40%
Total
96
100%
Table 1: Gender
What is your age?
Age
No. of respondents
% of respondents
25or under
24
25%
26 – 40
38
40%
41-55
25
26%
56 or older
9
9%
Total
96
100%
Table 2: Age
What is your employment status?
Employment Status
No. of respondents
% of respondents
Jobless
21
22%
Working
57
59%
Student
18
19%
Total
96
100%
Table 3: Employment Status
Research Question 01: What are the major issues faced by the UK retail market?
Post Brexit obstacles are among the major challenges being faced by the UK retail market.
No. of respondents
% of respondents
Very True
25
26%
True
33
34%
Neutral
17
18%
Untrue
12
13%
Very Untrue
9
9%
Total
96
100%
Table 4: Post Brexit Challenge
Research Question 02: How business issues impact on overall performance of Sainsbury’s?
Issues like the decline in sales will raise and impact negatively on the overall performance of Sainsbury’s.
No. of respondents
% of respondents
Very True
19
20%
True
41
43%
Neutral
13
13%
Untrue
14
15%
Very Untrue
9
9%
Total
96
100%
Table 6: Decline in Sales
Research Question 03: What is the consumer buying behaviour towards UK retail brands?
Brand loyalty level is high among consumer which creates positive behaviour towards UK retail brands.
# of respondents
% of respondents
Very True
26
27%
True
31
32%
Neutral
15
16%
Untrue
13
14%
Very Untrue
11
11%
Total
96
100%
Table 8 High Brand Loyalty
4.3 Qualitative Analysis
After filling the questionnaires, the customers were requested to respond to some interview questions:
Research question 04: What are the factors affecting consumer buying behaviour in Sainsbury’s?
The customers responded that their consumption behaviour is influenced by physiological, economic, social and psychological factors. Specifically, the factors that were mentioned by most customers are the basic needs, affordability including availability of commodities, family, social status, including attitudes towards brands and products. However, some respondent were unable to highlight some of the factors affecting their consumption behaviour.
4.4 Summarised Findings
After the data was analysed it was established that Post Brexit obstacles are among the major challenges being faced by the UK retail market. Also, Issues like the decline in sales will raise and impact negatively on the overall performance of Sainsbury’s. Additionally, Brand loyalty level is high among consumer which creates positive behaviour towards UK retail brands. Finally, the research revealed that consumption behaviour in the retail market of the UK is influenced by basic needs, affordability and availability of commodities, family, social status, as well as attitudes.
4.5 Discussion
The aim of this study was to examine the factors influencing the consumer behaviour in the UK retail market: A Study of Sainsbury's. From the findings, it was established that consumer behaviour in the UK retail market is influenced by physiological, social and psychological factors. Consumers are always inclined to physiological factors which include the basic needs. Secondly, psychological factors such as consumers’ attitude greatly impact on the consumers’ consumption patterns, thus influencing the consumer behaviour in the UK retail market. Moreover, social factors such as the family, social group, social class, brand loyalty, economy as well as culture create a great impact on the consumer behaviour on the UK retail market.
CHAPTER 5: CONCLUSION AND RECOMMENDATION
5.1 Introduction
This section concludes and recommends in regard the findings of the study. The chapter also contains an objective discussion which proves that the objectives of this research has been achieved. Besides, the chapter highlights the limitations of this specific study, areas to improve in future studies including the practical implications.
5.2 Discussion
Deductively, Post Brexit obstacles are among the major challenges being facing the UK retail market as suggested by 60% of the participants. Some issues like the decline in sales are likely to raise and negatively influence the overall performance of Sainsbury’s as 53% of the engaged individuals prosed. Additionally, majority of the participants agreed that brand loyalty level is high among consumers which creates positive behaviour towards UK retail brands. Besides, physiological and psychological factors such as consumers’ attitude greatly impact on the consumers’ consumption patterns, thus influencing the consumer behaviour in the UK retail market. Moreover, social factors such as the family, social group, social class, brand loyalty, economy as well as culture create a great impact on the consumer behaviour on the UK retail market.
5. 3 Personal Reflections
According to my view, appropriate means of predicting with certainty whether the impact of the Brexit on the economy is likely to be significant, especially if it is unclear in terms of output should be put in place to curb Brexit issues in the UK retail market. Also, appropriate marketing strategies like advertisement and product promotion should be embraced to maximize the retail sales. To maintain customer loyalty, firms in the UK market should always focus on product development which aims at satisfying the consumer needs.
5.4 Practical Implications
This specific study is essential to learners, customers as well as policy makers in the retail market. The learners are able to understand why different individuals including households exhibit different consumption behaviour. The research is also helpful to customers in the retail market as it helps them to shift to consumption patterns that satisfy their needs. To policy makers, especially company managers in the retail market of the UK, the study enables them to come up with appropriate sales strategies that maximize sales revenue in their companies.
5.5 Limitations of the Study
Despite the findings, this study was faced by a number of limitations. First, the sample size was small (100 consumers) compared to the entire population in the retail market of the UK is a very insignificant number. Therefore these findings cannot be relied up since generalizations are made based on a small sample size. Secondly, these sample may not be representative since more men than women were engaged. Furthermore, people below 20 years were ignored yet they may have a great influence in the consumption behaviour of the UK retail market. In future, such study need to engage samples from all age groups that are capable of making consumption decisions. Finally, the findings from this study cannot be substantiated since they are based on a survey that was conducted only once. On the other hand, the study was cost- effective and time saving as it did not entail personal interaction with the participants.
5.6 Recommendations to Companies in the Retail Market
The following recommendations should be taken into consideration by companies in the retail market so that they can maximize their sales revenue. First, policy makers in the retail companies should come up with appropriate sales strategies that consider the consumer needs. Secondly, companies should engage is constant brand develop so that their products are always able to meet the consumer needs. Finally, companies should always set prices of products in regard to their location by considering the social status of the potential customers.
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