Factors Affecting Consumer Purchasing Decision in Kenya’S Motor Industry: Case of Toyota Kenya Customers

FACTORS AFFECTING CONSUMER PURCHASING DECISION IN KENYA’S MOTOR INDUSTRY: CASE OF TOYOTA KENYA CUSTOMERS

HITESH MEHTA

UNITED STATES INTERNATIONAL UNIVERSITY AFRICA

SPRING 2015

FACTORS AFFECTING CONSUMER PURCHASING DECISION IN KENYA’S MOTOR INDUSTRY: CASE OF TOYOTA KENYA CUSTOMERS

HITESH MEHTA

A Project Report Submitted to the Chandaria School of Business in Partial Fulfilment of the Requirements for the Masters of Business Administration (MBA)

UNITED STATES INTERNATIONAL UNIVERSITY AFRICA

SPRING 2015

STUDENT’S DECLARATION

I, the undersigned, declare that this is my original work and has not been submitted to any other college, institution or university other than United States International University.

Signed: ______Date: ______Mehta Hitesh Nitin (625367)

This research report has been presented for examination with our approval as the appointed supervisors.

Signed: ______Date: ______

Dr. Peter Kiriri

Signed: ______Date: ______

Dean Chandaria School of Business

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COPYRIGHT All rights reserved including rights of reproduction in whole or part in any form without the prior permission of the author or United States International University or Office of the Deputy Vice Chancellor Academic Affairs. © 2015

ABSTRACT

The general objective of the study was to examine factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. The study was guided by the following specific objectives: to determine the economic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry; to examine the psychological factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry; to examine the social-cultural factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry, and; to analyze the demographic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry.

Descriptive research design was employed in the study. The target population included all 2,913 customers of Toyota Kenya in Nairobi. Simple random sampling techniques was employed while data collection was conducted with the help of a questionnaire. The data was analyzed using descriptive and inferential statistics with the help of the Statistical Package for Social Sciences (SPSS). The results were then presented in tables and figures.

The study revealed that there was a positive significant relationship between economic factors and purchasing decision. Implying that the consumer purchasing decision is influenced by economic factors such as level of income, price, quality of car, maintenance costs, resale value of the car, payment options, ease of finding a mechanic to repair the specific car brand, interest rates as well as fuel prices.

The study further revealed there was a positive significant relationship between psychological factors and purchasing decision. This findings imply that the consumer purchasing decision is influenced by psychological factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

It was also revealed that there was a positive significant relationship between Social-cultural factors and purchasing decision. This finding implies that the consumer purchasing decision is influenced by Social-cultural factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

Finally the study revealed that there was a positive significant relationship between demographic factors and purchasing decision. This finding implies that the consumer purchasing decision is influenced by demographic factors such as demographic factors such as personality, gender, Age, Changing life, level of education, lifestyle, lifecycle status and occupation.

The study concludes that psychological factors, social-cultural factors, economic factors, as well as demographic factors affect consumer purchasing decisions in Kenya’s motor vehicle industry in Kenya.

The study recommends that firms dealing with motor vehicle need to consider the various economic factors that influence consumer decision making such as interest rates, income as well as rising fuel prices. In this regard they need to design motor vehicle for different categories of customers in different income brackets in Kenya. There is a need to make sure that investments in quality occur in areas that will resonate with customers.

Finally it was important to understand the little things that consumers use as the basis for making a judgment of when it comes to purchasing decisions. The study recommends the need for automobile companies to consider consumers’ demographic characteristics such as age, gender, marital status, occupation, education and income when designing the products to offer into the Kenyan market. This is because demography factors are vital and measurable statistics of a population that helps to locate target market, they are easier to measure and are suitable for psychographic and socio-cultural studies. Additionally demographic factors have a huge impact on the assessment of different features which are generally associated with consumer behaviour. vi

ACKNOWLEDGMENTS I wish to acknowledge my Supervisor for his guidance throughout my research and my parents for their support.

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DEDICATION This study is dedicated first and foremost to God for seeing me through, to my family and my friends.

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TABLE OF CONTENTS

STUDENT’S DECLARATION ...... iii

ABSTRACT...... v

ACKNOWLEDGMENTS ...... vii

DEDICATION ...... viii

TABLE OF CONTENTS ...... ix

LIST OF TABLES ...... xii

CHAPTER ONE ...... 1

1.0 INTRODUCTION ...... 1

1.1 Background to the study ...... 1

1.2 Problem Statement ...... 5

1.3 General Objective ...... 5

1.4 Specific Objectives ...... 5

1.5 Significance of the Study ...... 6

1.6 Scope of the Study ...... 6

1.7 Definition of Terms ...... 7

1.8 Chapter Summary ...... 8

CHAPTER TWO ...... 9

2.0 LITERATURE REVIEW ...... 9

2.1 Introduction ...... 9

2.2 Economic Factors Affecting Consumer Purchasing Decisions ...... 9

2.3 Psychological Factors Affecting Consumer Purchasing Decisions ...... 14

2.4 Social-Cultural Factors Affecting Consumer Purchasing Decisions ...... 18

2.5 Demographic Factors Affecting Consumer Purchasing Decisions ...... 22

2.6 Chapter Summary ...... 26

CHAPTER THREE ...... 27

3.0 RESEARCH METHODOLOGY ...... 27

3.1 Introduction ...... 27

3.2 Research Design ...... 27

3.3 Population and Sampling Design...... 28

3.4 Data Collection Methods ...... 30

3.5 Research Procedures ...... 30

3.6 Data Analysis Methods ...... 31

3.7 Chapter Summary ...... 31

CHAPTER FOUR ...... 32

4.0 RESULTS AND FINDINGS ...... 32

4.1 INTRODUCTION ...... 32

4.2 Background Information ...... 32

4.3 Economic Factors and Purchasing Decision ...... 38

4.4 Psychological Factors and Purchasing Decision ...... 40

4.5 Social-Cultural Factors and Purchasing Decision ...... 43

4.6 Demographic Factors and Purchasing Decision ...... 45

4.7 Chapter Summary ...... 49

CHAPTER FIVE ...... 50

5.0 DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS ...... 50

5.1 Introduction ...... 50

5.2 Summary ...... 50

5.3 Discussion ...... 52

5.4 Conclusions...... 57

5.5 Recommendations ...... 58

REFERENCES ...... 61

Appendix 1: Questionnaire ...... 65

LIST OF TABLES Table 4.1: Gender of the Respondents ...... 32 Table 4.2: Age of the Respondents ...... 33 Table 4.3: Level of Education ...... 34 Table 4.4: Number of Years using Toyota Cars ...... 34 Table 4.5: Cross Tabulations for Gender and Number of Years Using Toyota Cars ...... 35 Table 4.6: Cross Tabulations for Education and Number of Years Using Toyota Cars ...... 35 Table 4.7: Cross Tabulations for Age and Number of Years Using Toyota Cars ...... 36 Table 4.8: Correlation Analysis ...... 37 Table 4.9: Economic Factors ...... 38 Table 4.10: Economic Factors and Purchasing Decision ...... 39 Table 4.11: Psychological factors ...... 41 Table 4.12: Psychological Factors and Purchasing Decision ...... 41 Table 4.13: Social-cultural factors ...... 43 Table 4.14: Social-Cultural Factors and Purchasing Decision ...... 44 Table 4.15: Demographic Factors ...... 46 Table 4.16: Demographic Factors and Purchasing Decision ...... 46 Table 4.17: Multiple Regression ...... 48

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CHAPTER ONE

1.0 INTRODUCTION

1.1 Background to the study

Consumer behavior is regarded to be that particular the action which an individual takes in the process of purchasing and using products and services. This process also includes the mental as well as the social processes which come before these actions. It means therefore that one of the biggest challenges facing businesses is the process of predicting and understanding consumer behavior. At present, the competitive market forced producers to produce goods based on customer needs (Tafler, 2014). The study of consumer purchase behavior, which was initially known as consumer behavior, offers relevant information regarding consumers and their consumption patterns.

An organization can actually survive if it can be able to supply consumer needs and demands with a comprehensive understanding of them. This means therefore that there is need to study consumer behavior. In this regard, there is need to understand consumer behavior which is not so simple. Customers likely do not know their own deeper inner motivation or they are likely therefore to react to affecting factors in the last moment, and this can simply change their mind. However, marketers need to consider their customers’ requests, intakes and buying behaviors (Kotler, 2009).

Knowledge of consumer behavior is therefore considered to be very essential if organizations seek to gain commercial success. The relationship between consumer behavior as well as marketing strategy is very much emphasized since the success of companies’ marketing strategies depends on how well managers’ understand of consumer behaviour (Kotler, 2009).

Consumer buyer behavior is regarded to be the multi-step decision-making process where people take part in it and it also include the actions consumers take to satisfy their needs and wants in the marketplace. The study of customer behaviour is therefore mainly focused on consumer buying behaviour, in that the customer plays three essential roles: user, payer as well as buyer (Kotler, 2009).

According to previous studies conducted on consumer behavior it has not been easy to predict what goes through the mind of the consumers during the purchase decision. This is because it involves the psychological processes which consumers undergo in recognizing their needs, while seeking ways to solve these needs, making purchase decisions, interpreting information, making plans, and finally implementing these plans.

One of the most fundamental assumptions in the study of consumer behaviour is that indeed individuals often buy products on the basis of their perceived values as compared to their primary functions (Stávková, Stejskal & Toufarova, 2009). This however is not to say that that the main functions of the products are not essential. However it simply means that the contemporary duty of a product is more when compared to its basic use-value. In most cases, consumers do not rate products in relations to their core attributes but, rather according to the so-called real product as well as the extended product, which simply represents a set of intangible factors, which confer a desired perceived advantage on the consumer and which includes; image consultancy, and after-sale service (Foret & Procházka, 2009).

Consumer buying behavior is often unconsciously affected by some factors. For instance social factors play an essential role when it comes to the decision of buying certain products, including the most sensitive products such as cars. The important social factors are: reference groups, family, role and status. There are four important psychological factors

2 affecting the consumer buying behavior: perception, motivation, learning and beliefs and attitudes. The economic factors that most commonly affect consumer behavior include occupation, economic situation and personality (Blythe, 2009).

Successful businesses are well aware of how to leverage the different factors that influence consumer buying behavior in order to effectively market their products and as such maximize sales. Studies have revealed that there are generally four main factors that play a role in the consumer's buying behavior. The factors include cultural factors, social factors, personal factors and psychological factors (Blackwell et al., 2001). This study therefore sought to explore of the four main factors that influence consumer buying behavior of the automotive.

A study done by Havkinze, Roger & Kenth (2009) was able to establish that the consumer’s disposable income is indeed very essential when it comes to determining what to buy and in what quantities, however this mostly depends on the income elasticity of a certain product. In the event that the consumers disposable income increases and that the income elasticity of demand for that good is greater than one then the proportional rise in the demand for that product is greater than the rise in income levels. Their study also reported that the influence of culture on buying behavior varies from country to country therefore marketers have to be very careful in analyzing the culture of different groups, regions or even countries.

Peter & Olson (2009) are of the opinion that customer possesses specific belief and attitude towards various products. This is because such beliefs and attitudes are what comprises brand image and therefore affect consumer buying behavior. In this regard, it is important for marketers to change the beliefs and attitudes of customers through the launch of special campaigns.

The Automotive industry in Kenya is primarily involved in the retail and distribution of motor vehicles. The motor industry in Kenya contributes to at least 6% to the GDP. There are a number of motor vehicle dealers operating in the country, with the most established being Toyota (East Africa) Cooper Motor Corporation, General Motors, Simba Colt and DT Dobie. There are also three vehicle assembly plants in the country, which concentrate on the assembly of pick-ups and heavy commercial vehicles.

The established dealers face intense competition from imported second-hand vehicles, mainly from Japan and United Arab Emirates. These imports now account for about 74% of the market (Mwangi, 2013). The last ten years for instance has witnessed a significant decline when it comes to the number of new vehicles being sold in the Kenyan market. This therefore indicates a steady recovery in the last four years, however these numbers are still fall far short of the numbers recorded a decade ago.

The main brands category from Toyota Kenya sold in Kenya are; Corolla, Rav 4, Hilux, Fortuner, Prado and Land Cruiser. The company mostly sell salon cars, buses and trucks. Increased demand for buses and trucks helped Toyota Kenya to become the country’s largest car dealer by unit sale. Toyota Kenya employs approximately 5000 employees in the various branches Data from the Kenya Motor Industry Association (KMI) shows that Toyota’s market share is more than 50 per cent.

1.2 Problem Statement There are a number of research and studies that have been conducted to examine factors affecting new motor vehicle sale in America, Europe, India, China and even South Africa. Locally, Ndungu (2008) conducted a survey of the vertical integration strategies used in the automotive industry in Kenya while Kipchirchir (2008) carried out a survey on the Kenyan Motor Vehicle Industry.

However, studies done in Kenya did not establish the factors affecting new vehicle sale in the Kenya. This study, therefore sought to fill this information gap by investigating the factors that influence customer buying behavior of the motor industry.

1.3 General Objective The general objective of the study was to examine factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry.

1.4 Specific Objectives The study was guided by the following specific objectives: 1.4.1 To determine the economic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry 1.4.2 To examine the psychological factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry 1.4.3 To examine the social-cultural factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry 1.4.4 To analyze the demographic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry.

1.5 Significance of the Study

1.5.1 Automotive Companies

The study is important in order to provide information to automotive Companies in Kenya especially when it comes to selling their automotive products; this automatically taps into their strategic goals.

1.5.2 Consumers

This study will also be beneficial to the consumers in that they will have more knowledge about motor vehicle products and the importance of motor vehicles, they will also learn about the different factors affecting their buying decisions.

1.5.3 Researchers and Academicians

This study will also be helpful to other researches and academic institutions to learn about Kenya’s motor industry. This study will also be the centre piece idea to other students willing to pursue a research on a similar field. This is so because the final draft of the completed research will provide further areas of research.

1.6 Scope of the Study The study was conducted on consumer buying behaviour of motor vehciles in Kenya. This study was based on Toyota Kenya customers in Nairobi Kenya. It included a target market of people ranging from ages 19 – 60 who have disposable income to spend on motor vehciles, it targeted both walk in clients and existing clients.

The study was conducted in October 2014 to April 2015, and was limited to the activities of this year. The limitations of the study was the fear of ananymity on the side of the respondents. This was however eliminated by the assurance that the study was for academic purposes and that the findings was not to be shared to any other party.

1.7 Definition of Terms

1.7.1 Consumer buyer behavior

This refers to the multi-step decision-making process people engage in and the actions they take to satisfy their needs and wants in the marketplace (Kotler, 2008).

1.7.2 Economic Factors

According to Brassington (2011), economic factors include among others; the level of income, credit availability, attitude towards spending, liquid assets.

1.7.3 Socio cultural factors

Social cultural factors include a number of factors that characterize the relationships and activities of a group of people within a particular set environment (Jones, 2007).

1.7.4 Psychological factors

The term psychosocial refers to the psychological and social factors that influence mental health (Smith, 2009).

1.7.5 Demographic Factors

This includes age, occupation, family size and family life cycle and sex of the individual (Kotler, 2008).

1.8 Chapter Summary

This chapter provides a background of the problem followed by the statement of the problem. Thereafter, research objectives are provided, followed by significance of the study in that order. Chapter two will provide literature review organized in terms of the research objectives. In chapter three, research design, methodology, as well as the data type and the data collection instruments are explained. Chapter four will provide the study findings in terms of descriptive and logic regression results based on the study objectives. Chapter five will provide the summary as well as conclusions and recommendations.

CHAPTER TWO

2.0 LITERATURE REVIEW

2.1 Introduction

In this chapter, literature is reviewed based on research objectives. To start with, reviewed relevant literature relating to the economic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry then the psychological factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry as well as the social-cultural factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry and finally the demographic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry.

2.2 Economic Factors Affecting Consumer Purchasing Decisions

2.2.1 Level of Income One essential economic factor that influences consumer buyer behavior is income. This mainly because the amount of goods bought by a consumer as well as the type bought differs depending on the wage which a consumer earns. In the event that a buyer has greater income, chances are very high that such a consumer will go for more luxury goods like high- end cars. Taylor (2011) is of the opinion that a reduction in income shifts purchasing behavior from buying normal goods to inferior goods. This simply means that as consumers buy fewer specialty items, such as shoes and clothing, and buy more store-brand items.

Mogridge (2009) posits that the main essential concept when it comes to consumer buyer behavior is that the average person of a given income level is likely to spend a given quantity of money on the purchase of cars. He therefore goes ahead to argue that there is a function which gives, for every income level, as well as an average expenditure on a car

9 purchase. More recent studies that have been conducted in this area have shown that there is a positive relationship between income levels and vehicle purchase decisions by individuals (Feng, Wang & Zeng, 2011). For example, a study conducted by Nagai, Fukuda, Okada, and Hashino (2013) revealed that two- and four-wheeled vehicle ownership in Thailand depends largely on the income levels of individuals.

In another similar study Diaz-Olvera, Plat & Pochet (2008) and Blumenberg & Pierce (2012) established that income or lack of it influences how a household purchases their mode of transportation as well as the way in which individuals choose to travel. They therefore are of the opinion that indeed low-income households are less likely to own cars (Rahman, 2011) and more likely to travel by other modes of transportation other than motor vehicle. This therefore means that the income level of an individual has a positive relation with buying decision. It also means that individuals who have high income are likely to buy expensive products.

Mathios (2012) on his part argues that family income level influences ones decision on the choice of a motor vehicle to purchase. This indeed is a reflection of a high efficiency in collecting information on motor vehicles. Such individuals are likely to posses the financial support to purchase such vehicles and this therefore influences them to buy more expensive cars whose price is higher. Gould and Lin (2014) on his study established the level of income for an individual relates positively with health knowledge, especially when it comes to choosing and potentially using motor vehicles (Cotugna et al., 2012).

Some studies have shown that indeed income level plays a role in predicting consumer awareness related to a person’s attitude contraction. This is mainly because there is a positive relationship between income growth and quality of car. This is therefore a fundamental issue when it comes to consumers purchasing decision. The level of income of an individual influences the willingness to pay marginally higher prices as a social responsibility towards the motor vehicle. In other empirical studies carried out in jurisdictions with low income per capita do not show any improvement in the willingness to

10 spend more on vehicles (Bloom & Sevilla, 2014). Therefore, the income level moderates the relations between consumers behavior towards purchase decisions of motor vehicles.

Gronmo (2008) has opined that individuals who are not able to fulfill their primary needs, especially regarding self-esteem or self-actualization, are likely to compensate these desires through alternative means . This means therefore that low-income households, or those facing racial or ethnic discrimination, are more or less likely spend heavily on socially visible products so as to make up for their lack of status in society. In the event that traditional indicators of social status, such as wealth or occupational prestige, are not accessible, people will without doubt resort to the consumption of status products that are easily seen as symbols of a higher class (Fontes & Fan, 2006).

2.2.2 Interest Rates Interest rates are among one of the most influential factors when it comes to purchasing decision for consumers. This is mainly because financial contracts for consumer durables are mainly made up of multiple terms and conditions that include a price (interest rate) as well as a payment period, which therefore makes it unlikely that the financial costs of different contracts are exactly the same. Dasgupta, Siddart & Silva-Risso (2009) carried out an analysis of the behaviour of consumers with regards to the choice of the funding method for automobiles (Banerjee, 2010).

They were able to compare the credit and leasing options. This study revealed that consumers are very myopic and will therefore prefer contracts that come with lower payment streams, even when they have higher total costs. They also established that indeed most consumers are more likely to lease than to finance cars with higher maintenance costs. This is simply because these options provide consumers with the option to return the car before maintenance costs become too high. Wonder et al., (2009) on the other hand opined that respondents preferred low interest rates, a high rebate, and down payment. This view is contrary to that held by Doyle (2007) who argues that an interest rate increase is likely not affect real motor vehicle sales if the automakers are able to counteract the rate increases with lower prices.

2.2.3 Fuel Prices McManus (2009) conducted a study to examine the link between fuel prices and sales of cars and trucks in the U.S. In the analysis, He was able to show that economic theory predicts a direct link between fuel prices and SUV sales, and more broadly between fuel prices and vehicle sales. He therefore concluded that for an individual to make a rational choice at the time of purchase, the shopper requires a prediction (simple or sophisticated) of what future fuel prices are likely to be. He further concluded that indeed a significant portion of changes in vehicle prices is likely to be explained by changes in fuel prices. In effect, rising fuel prices lower the prices of automobiles. This specifically, includes the negative impact of rising fuel prices on vehicle prices is greater for less fuel efficient vehicles than for more fuel efficient vehicles.

2.2.4 Price of the Car Pricing is considered to be one among the four P's of the marketing mix (Brassington, 2011). It is therefore the manual or automatic process of applying prices to purchase and sales orders, on the basis of factors such as a fixed amount, quantity break, promotion or sales campaign, specific vendor quote, price prevailing on entry, shipment or invoice date, combination of multiple orders or lines, and many others. Automated systems therefore need to have more setup and maintenance but this is likely to prevent pricing errors. The pricing technique used by most retailers is cost-plus pricing. This involves adding a mark-up amount (or percentage) to the retailers cost. This simply involves charging the amount suggested by the manufacturer and usually printed on the product by the manufacturer (Jones, 2007).

A well-chosen price needs to be able to achieve the financial goals of the company such as profitability. It should also fit the realities of the marketplace while at the same time support a product's positioning and be consistent with the other variables in the marketing mix. Price is largely influenced by the type of distribution channel used, the type of promotions used, and the quality of the product. Price therefore needs to be relatively high if costs incurred are high, distribution will without doubt be exclusive, and the product is supported by extensive

12 advertising and promotional campaigns. In this regard therefore a low price can be a viable substitute for product quality, effective promotions, or an energetic selling effort by retailers (Jobber, 2010).

In Turkey, Alper & Mumcu (2009) carried out an estimate on the demand for new automobiles using quarterly data on price, quantity, quality, country of origin, and product characteristics of the new automobile sales market demand during the period 1996-1999. He therefore established that the demand for new automobiles is price inelastic in the short run. Similarly, Zhan & Vrkljan (2013) in South-Western Ontario carried out a study on the older drivers’ (70-90 years old) perceptions of vehicle safety and how they influence their vehicle purchase.

The findings revealed that safety was superseded by other purchasing considerations - most notably, price. Price was therefore identified and emphasized as the key factor that influenced vehicle purchase decisions. Fuel efficiency, which participants considered in their overall cost of the vehicle, was also listed as an important consideration in the vehicle purchase decision process.

East (2014) argues that in traditional economics prices are simply treated as a cost. This is because the recognition that a price merely serves to inform the consumer about the good is more of recent origin. Price, one of the non-product attribute of brand associations where it can be an important associations in the formation of brand perceptions, particularly with regard to value and desirability and is a criterion by which consumer often segment their knowledge of a market or category (Batey, 2009). High quality products, as well as fancy packaging, exclusive store locations, high retail margins, expensive promotions, advertising campaigns, notwithstanding brand names are all seen to be the contribution to the higher prices of luxury goods. Companies therefore go ahead to make large investments into these components in order to make their products instantly recognizable and familiar. The luxury products are also likely to lose their rarity and exclusivity characteristics if they are not priced high.

2.3 Psychological Factors Affecting Consumer Purchasing Decisions

2.3.1 Perception Perception is regarded to be the energy that simply makes us aware of the world around us and also goes ahead to attach a meaning to it after a sensing process. Human beings in particular are able to view their surroundings differently. This is because different people have the different ideas about a specific event. It means therefore that no one can see or feel the 100% of all things. Ever wonder why people buy certain products? It is all about perception. Perception is considered to be how consumers understand the world around them on the basis of the information they receive through their senses. In response to stimuli, consumers are likely to subconsciously evaluate their needs, values and expectations, and then they use that evaluation to select, organize and interpret the stimuli (Connolly, 2010).

The marketplace’s perception of a brand or industry is considered to be very essential which is why big brands work so hard to ensure that the general perception surrounding them and their industry is as positive as possible. As a result, companies like Gillette, will pay David Beckham to ‘model’ their products. By aligning the way people feel about Beckham, with the Gillette brand, Gillette can improve the perception of their brand or reinforce what’s already positive about it (Taylor, 2006).

A study carried out by Hawkins & Mothersbaugh (2010) was able to show that perception begins with consumers’ exposure and attention to marketing stimuli and thereafter ends with their interpretation of the stimuli. Etzel, Walker & Stanton (2014), on their side believe that consumers’ perception is not only determined by the characteristics of the stimuli, but it is also determined by the characteristics of the consumer him or herself. It is therefore important for that marketers obtain a thorough understanding of their target markets as well as how consumers will perceive various marketing-related stimuli.

For example, Etzel et al., (2007) argues that the four elements of the marketing mix, namely product, place, distribution and promotion, are likely to influence consumers’ perceptions of

14 the business, and therefore their selection. Manning & Reece (2007) also opines that customers are likely to perceive the product’s value on the basis of its benefits which, in turn, is greatly influenced by the product’s performance, features, quality, warranties, packaging as well as labelling.

2.3.1.1 Perceived Quality In Kenyan markets, customers look for product quality and features that will satisfy their needs. For example a vehicle is no longer seen to be just a means of transport but has to emphasis on safety, durability, among other features like space, seating capacity, 4WD or engine power and reliability among other features. The massive literature has emphasized on actual quality and this has gone further to conspire against what we describe as the neglected frontier of quality: an outside-in perspective driven through the customer-centric perception of quality by intrinsically dealing with the voice of the customer. The perception of the consumer regarding quality of products has its own distinct definition and form of measurement. It therefore goes a long way to touch on subjectivity, and is the level of perceived value reported by the customer who benefits from a process or its outcome (Cronin & Taylor, 2012).

Perceived quality is in the mind of the believer, and is a poor offspring because our methods of today are all focusing attention on the business and not to the customer outside of the business. Perceived product quality is therefore considered to be one of the most important constructs in marketing. In recent years, for example perceived quality has been seen to be the subject of considerable interest by both practitioners and researchers, mainly in services marketing (Cronin & Taylor, 2012). However, work that integrates the role of perceived product quality within the context of other marketing variables like product involvement, consumer satisfaction and purchase intentions has received less attention.

Indeed, the belief that high perceived quality leads to repeated purchases is the bedrock of any business. It means therefore that it is important to achieve perceptions of quality however this requires the quality claim to have substance. It also means that it is important to generate an understanding of what quality means to customer segments, as well as a

15 supportive culture and a quality improvement process that will enable the organization to deliver quality products and service (Gronmo, 2013).

Additionally the creation of a quality product or service is only a partial victory; perceptions must be created as well. Perceived quality may differ from actual quality for a variety of reasons. First, consumers may be overly influenced by a previous image of poor quality. Because of this, they may not believe new claims, or they may not be willing to take the time to verify them. Thus it is critical to protect a brand from gaining a reputation for shoddy quality from which recovery is difficult and sometimes impossible (Parasuraman, Zeithaml & Berry, 2009).

Second, a firm may be achieving quality on a dimension that consumers do not consider important. For example when Citibank dramatically increased back-office efficiency by automating its processing activities, the expected impact on customer evaluations was disappointing. Customers, it turned out, either did not notice the changes or did not recognize any benefit from them. There is a need to make sure that investments in quality occur in areas that will resonate with customers (Parasuraman et al., 2009).

Third, consumers will in very few circumstances have all the information required to make a rational and objective judgment on quality and even if they do have such information, they may not be having the time and motivation to process it. In the end such consumers rely on one or two cues that they associate with quality; the key to influencing perceived quality is the mere understanding and managing these cues properly. Thus, it is important to understand the little things that consumers use as the basis for making a judgment of quality (Parasuraman et al., 2009).

Similar to brand awareness, perceived quality is determined by a number of factors. To be more specific, perceived quality can further be classified into product quality and service quality. Regarding product quality, there are seven dimensions which affect the consumers’ perception, namely performance, features, conformance with specifications, reliability, durability, and serviceability as well as fit and finish. Service quality, on the other hand, is

16 judged by its corresponding tangibles, reliability, competence, responsiveness and empathy (Aaker, 1991). As mentioned by Srikatanyoo & Gnoth (2012), consumers are inclined to develop stereotypical beliefs about the products from particular countries. Hence, consumers could have their preferences for products made from one country over another (Papadopoulos et al., 2011).

2.3.2 Learning Learning is mainly associated with changes in an individual’s behavior that come about from experience. In every circumstance an individual’s perception is conditioned by his or her prior experience, for it is this which constitutes our preparatory set or expectations and the framework into which we seek to place and organize new stimuli. In other words, we have learned from our earlier experience and seek to maintain balance or consistency by relating to and interpreting new stimuli in terms of past or learned stimuli (Blythe, 2008).

The most important part about this is that marketers can build demand for a product by associating it with strong drives, using motivating cues, and to the same drives as competitors and providing similar cues because buyers are more likely to transfer loyalty to similar brands then to dissimilar ones (Lamb, 2010).

Learning can take two forms: Experiential Learning and Conceptual learning. Experiential learning occurs when an experience changes your behavior. Conceptual learning on the other hand is not acquired through direct experience.

2.3.3 Related Utilities Enjoys related utilities are considered to be having a relationship with practical and effective sides and are therefore not based on objective sides of products (Samuel, 2014). Usually consumers are seen to achieve enjoys related utilities that include entertainment, exploration, as well as self-expression. Buying enjoys on the other hand are made up of consumer’s personality traits that they strive to enjoyable buying and experience more buying enjoys. Entertainment enjoys are important for peoples who enjoy from buying, and they achieve

17 buying related extra advantage with lower price. Therefore these efforts lead to increasing people’s utilities.

On the other hand exploration utility is related to characteristics such as innovation, Variety seeking, and impulsiveness (Ailawadi et al., 2011). Innovative consumers may have desirable tendency to products drives, so these efforts could motivate them to achieving novel products.

Ailawadi et al., (2011) believes that there are impacts of information exploring in consumer’s reaction to price discounts could characterize as perceived explored profits. It means that such consumers are exploring resources when products buying help consumers to satisfy their main needs about diversity information or innovation.

2.4 Social-Cultural Factors Affecting Consumer Purchasing Decisions

Consumer decisions are likely to be influenced by a number of socio-cultural factors. This section presents a detailed literature review of how these factors come into play in light of the consumer buying decisions.

Hofstede (1980) demonstrates that there are national and regional cultural groupings that affect the behavior of organizations. Hofstede looked for national differences between over 100,000 of IBM's employees in different parts of the world, in an attempt to find aspects of culture that might influence business behavior.

Hofstede identified five dimensions of culture in his study of national influences: Power distance; the degree to which a society expects there to be differences in the levels of power. A high score suggests that there is an expectation that some individuals wield larger amounts of power than others. A low score reflects the view that all people should have equal rights (Hofstede, 1980).

Uncertainty avoidance: reflects the extent to which a society accepts uncertainty and risk. Individualism vs. collectivism; individualism is contrasted with collectivism, and refers to the extent to which people are expected to stand up for themselves, or alternatively act predominantly as a member of the group or organization. However, recent researches have shown that high individualism may not necessarily mean low collectivism, and vice versa. Research indicates that the two concepts are actually unrelated. Some people and cultures might have both high individualism and high collectivism, for example. Someone who highly values duty to his or her group does not necessarily give a low priority to personal freedom and self-sufficiency (Hofstede, 1980).

Masculinity vs. Femininity; refers to the value placed on traditionally male or female values (Hofstede, 1980). Male values for example include competitiveness, assertiveness, ambition, and the accumulation of wealth and material possessions. This area will look at the external factors that contribute to an organizations’ corporate culture. This can be influenced by the industry, competition among other (Hofstede, 1980).

Culture is part of the external influences that impact the consumer. That is, culture represents influences that are imposed on the consumer by other individuals. The definition of culture offered in one textbook is “That complex whole which includes knowledge, belief, art, morals, custom, and any other capabilities and habits acquired by man person as a member of society (Kileba, 2011). Culture is the complex of values, ideas, attitudes and other meaningful symbols that allows human to communicate, interpret and evaluate as members of society (Blackwell et al., 2011).

It is the primary reason behind a person’s wants and behavior. Although, different societal groups have their own culture that affects consumers buying behavior, the extent to which it influences the behavior might vary from country to country. Each cultural group can be divided into groups consisting of people with common life experiences and situations, also known as subcultures (Kotler et al., 2005) such as nationality, racial groups, religion, and geographical areas. The third cultural factor is social class, which is constituted of other variables: occupation, income, education, and wealth (Blackwell et al., 2011).

The knowledge and belief are important parts of culture, in Kenya it is a common believe that person with quick learning ability and sharp brain will do better in study, similarly hardworking and a skilled guy will be successful while, in most of the developing countries Kenya included luck is believed as important as hard work. The culture varies with region and religion. Every culture has smaller groups with shared values and beliefs due to common life experience and situations. These groups are very important to marketers since many of these subcultures make up important market segment (Kotler et al., 2011). Every society in Kenya has some form of social class structure; this class system is different for every country in point of distribution and ratio.

Brands are also considered to be symbols used to convey meanings to consumers, some brands for instance Mercedes Benz convey meanings of prestige and quality. On the contrary, there are also brands that convey meanings relating to low price such as Virgin Airlines. It means therefore that brands help consumers to minimize and provide a sense of familiarity, which further reduces the purchasing risk involved (Lehmenn & Winer, 2007) an aspect that appeals to consumers who poses high uncertainty avoidance.

A study by Bao, Zhou & Su (2013) revealed that indeed the Chinese were less brand conscious despite being a culture that places high emphasis on ‘saving face’ according to Hofstede’s (2001) scores.

A study by Mitchell and Walsh (2014) compared the decision-making styles of male and female shoppers in Germany. The study confirmed the construct validity of all eight CSI factors for female shoppers as well as four of the factors for male shoppers. They therefore came to a conclusion that indeed male individuals are slightly less likely to be perfectionists, somewhat less novelty and therefore fashion conscious, and further less likely to be confused when it comes to making purchases as compared to their female counterparts.

Bakewell & Mitchell (2006) carried out a similar study in the UK, where he made use of a sample of 480 male and female undergraduate students, which he established that indeed nine decision-making styles were common to both genders. Additionally, three new male traits (store-loyal/low-price seeking, confused time-restricted and store-promiscuity) and three new female traits (bargain seeking, imperfectionism and store loyal) were also identified in their study.

Hanzaee & Aghasibeig (2008) in a study on the Iranian setting established that Generation Y male and female consumers are different in their decision-making styles. However, of the 10-factor solution, it was confirmed for males and 11-factor solution for females, nine factors were seen to be common to both genders. The authors therefore concluded that this similarity is as a result of the changing gender roles in modern Iran.

2.4.1 Religion

Regarding religion, Clement & Nyovani (2014) study revealed that religion was associated with choice of consumer products. The study revealed that Christians in Zimbabwe were significantly using different products than those from other religions. Although from the foregoing discussion religion was found to choice of consumer products and services, it was not clear how the inference was arrived at. Religion will be considered in the current study as a variable. The aim is to examine how different religious background affects the choice of motor vehicles.

In the study by Clements & Nyovani (2014), various factors including religion, educational level, age and residential areas had significant effects on the consumer choice of products and services. In the current study, these variables were considered among other demographic, socio-economic and facility factors to examine their effect on the choice of motor vehicles. Unlike Clements & Nyovani (2014), who based their analysis on secondary data, the current study will use primary data. Similarly, as a departure from Clements & Nyovani (2014), a theoretical model will be developed in the current study.

2.4.2 Family

Previous research on corporate culture has showed that the element of family has a relationship with consumer choice. Van der Post et al., (1998) examined the relationship between family and consumer choice in South Africa. The results showed that family has a positive relationship with the consumer choice of certain products and service. The results of the study also showed that individuals are more likely to purchase goods and services based on how they have been brought up. This means that their family backgrounds have dictated their purchase decisions (Rashid, Sambasivan & Johari, 2013).

A research by Denison (2009) revealed that the strength of the culture was predictive of short-term individual purchase decisions. Gordon & DiTomaso (1992) in a follow-up study found supporting evidence that a strong family tie was predictive of an individual’s purchase behaviour. In an attempt to replicate Denison’s (2009) study, they also defined cultural strength using the inverse of standard deviations across the scales in their instrument. They found that a strong family tie, regardless of content in which a substantive value was placed on adaptability, was associated with consumer choice, at least in the preceding three years. More importantly, they found that adaptability to changes in purchase decisions was also predictive of family links

2.5 Demographic Factors Affecting Consumer Purchasing Decisions

Apart from external situational contexts that affect consumer choices, there are a number of essential internal factors, which are recognized as influential to buying behavior. Among these internal factors are consumers’ demographic characteristics that include age, gender, marital status, occupation, education as well as income. Demography can be described as the vital and measurable statistics of a population, demographics helps to locate target market, they are easier to measure and are suitable for psychographic and socio-cultural studies.

Demographic variables go a long way to reveal ongoing trends that include a shift in age, gender and income distribution that signal business opportunities. The demographic factors are seen to have a huge impact when it comes to the assessment of different features which are generally associated with clothes. Consumers who belong to a higher social class are likely to prefer a certain type of vehicles which they would feel would cater their needs. Similarly the purchasing decisions of such consumers would also be depending on the age group. The features younger consumers are most likely to look for in cars may not be the same with older consumers. Other demographic variables include income, education and occupation.

2.5.1 Gender Differences According to nature: the past, present, and paradisal future of consumer gender identity by (Kacen, 2010), consumption has always been gendered. Most of the available products in the market these days do have a specific gender type, some are made with masculine features while some are made with feminine features. Products’ gender are therefore created and sustained by marketers for example; princess phones, Barbie dolls.

Research suggests that shopping is a more exciting activity for women with respect to men. Female consumers feel more independent when they do shopping in accordance with men. Another point that men and women present differentiation is women consider shopping is a social need whereas male consumers pay importance to main function of a product instead of secondary function. Gender has an important role in consumer behavior, this for the reason that there are differences between men and women about expectation, want, need, life-style etc. reflect to their consumption behaviour (Akturan, 2009).

Davis & Rigaux (2009) established that women were are always dominant during the problem recognition and information search stage for “traditional” female products that include home furnishing, appliances, cereals among others. On the other hand men were seen to be more dominant in the information search stage for male dominated products like automobiles, television sets, razors, among other. Gender has therefore been identified as a

23 factor that largely influence information search as well as other meaningful consumer behavior constructs (Putrevu, 2011).

Men are also known to have a tendency of going to the most salient cue while women in most cases tend to comprehend all information available (Ailawadi et al., 2011). Additionally women are seen to more subjective, intuitive, comprehensive, as well as relational processing while men on the other hand are viewed as being more logical, analytical, selective as well as item-specific processing.

It means therefore that males’ selectivity and item-specificity predict that they may search less comprehensively than females and focus on certain information sources and topics. When it comes to decision making women use other people’s opinions to help make their own decision while men use other people’s decisions to help them form their own opinion. According to the French study done on more than 700 adults (Helga, Karen, & Rosie, 2014) women were seen to be as much stronger buying involvement than did men, particularly in terms of emotional involvement whereas men were high on quality and efficiency. Block & Morwitz (2009) also established that the probability that a purchased product was on a planned list was higher for females than for males.

2.5.2 Age Differences Age differences are considered key to purchasing decisions. Many marketers have today curved themselves a niche in the market place by concentrating on some specific group base on demographic variables. Marital status has traditionally been the focus of most marketing. For majority of products and services, age differences continues to be the relevant consuming unit, marketers are interested in the number of and kinds of household that own and/or buy certain products, more so, marketers have discovered the benefits of targeting specific marital status groupings.

Studies have shown that for the elderly, then, habits are more likely to be activated and relied on (Ailawadi et al., 2011). This therefore means that age can be proxy for the amount

24 of associate reinforcement. Indeed, research indicates that age is associated with reductions in the individual tendency to generate uncommon free associates and increases in the tendency to repeat a behavior (Drolet et al., 2007). Aging goes a long way to bring about certain cognitive deficits that can be related to the increased development of and reliance on more automatic, habit-driven behavior. Although cognitive and behavioral performances tend to slow with age, field studies show that the real-world performance of elderly adults is usually on par with that of young adults.

The development of habits goes a long way to equalize performance. Ironically, then, older are likely to be wiser despite the fact that older adults expend fewer cognitive resources because they can rely on habits. Age is a variable that captures many socioeconomic and individual difference characteristics. Interestingly, despite an average age difference of nearly 50 years, research shows that elderly and young adults generally agree as to what habits are “good” versus “bad” (Drolet & Suppes, 2009).

However, it can be argued that there are differences between age groups in terms of the kinds of habit behaviors reported. For example, compared to young adults, the elderly emphasize habits related to interpersonal relationships, such as friend behaviors like giving and helping. This shift in the kind of habits elderly versus young adults report is seen to be very much consistent with the qualitative shift in how older versus younger adults process information and make decisions. Specifically, the elderly tend to focus more on personal experiences and emotion. This qualitative shift appears adaptive for elderly adults.

2.5.3 Changing Life Events Changing life events are very instrumental to consumer purchasing decisions. This is mainly because such coping mechanisms and their relationships with goods and services exhibit an increased propensity for coping mechanisms to change consumer behaviour. The increased propensity to purchase implies a relationship between coping mechanisms and the need for a product or service.

Further it also means that exploration in the marketing discipline regarding this relationship is required because coping mechanisms present a trigger, or aroused need, for altered purchasing behaviour. In this regard therefore the mere understanding how the process is triggered and the resultant changes in decision making variables would benefit marketing research in terms of effectiveness and efficiency of sales and communications mechanisms.

It also means that life events change consumer behaviour (Mathur, et al., 2012) and that many coping mechanisms exhibit similarities with consumer decision-making, it can be assumed that individuals experiencing life events can undertake a decision-making process. Nevertheless, how the life event affects the decision-making process is still a topic under research by a number of scholars and forms the central point of this research. Before life events and decision-making are discussed in more depth another stream of research, role transition must be discussed. Role transition has also been found to influence changes in consumer behaviour. It requires consideration to gain a complete picture of the main area of interest; life events and changes in consumer behaviour.

2.6 Chapter Summary This chapter summarizes the literature review in relation to the objectives raised above. The first section provided literature on how economic factors influence consumer decisions. The second section explores how psychological factors influence consumer decisions. The third section explored how socio-cultural factors influence consumer decision and the final subsection looked at how demographic factors affected consumer buying decision. The next chapter will look at the research methodology.

CHAPTER THREE

3.0 RESEARCH METHODOLOGY

3.1 Introduction This chapter is mainly concerned with the analysis of the research method which was used in the study. The chapter mainly focused on the study population, sampling design, sampling techniques, sampling frame, sample as well as the sample size that was used in the study. It also focused on the data collection methods, research procedures as well as the data analysis techniques that were employed in the study. Information regarding the presentation of the findings will also be provided in the chapter.

3.2 Research Design The study made use of the descriptive research design with the view of getting access to the data to be analysed. Burns and Bush (2010) describes a descriptive research design to be one where methods as well as procedures are used to describing variables. Cooper and Schindler (2001) on the other hand argues that a descriptive study basically investigates these variables by answering who, what, where, when and how questions.

Sloman (2010) further defines a descriptive analysis as one which involves direct observation of behaviour in a natural environment and therefore it normally provides a means to gather baseline rates of the problem behaviour. The dependent variable of the study was consumer choice, while the independent variables were the economic factors, physiological factors and the socio-cultural factors.

3.3 Population and Sampling Design

3.3.1 Population

Population is described as that total collection of elements on which a researcher seeks to make inferences while conducting the study (Saunders, Lewis and Thornhill, 2009).The target population in the study was 2,913 Toyota Kenya customers in Nairobi. It was however not possible to meet all the customers at one place. It meant therefore that the researcher needed to strategically position himself at a point where he could be able to interview them.

3.3.2 Sampling Design

3.3.2.1 Sampling Frame

Sampling frame can be defined to be the list of elements where the researcher can actually pick the actual sample (Cooper & Schindler, 2000). The sample frame is also known as the working population. The sampling frame in this study included a list of all Toyota Kenya customers. This information was acquired from the customer relationship managers at the company headquarters in Nairobi.

3.3.2.2 Sampling Technique

The technique that was selected for this study was simple random sampling technique. This methodology was considered to be very good for the study. This is because it gives all the members of a population an equal chance of being selected to participate in the study. Saunders, Lewis and Thornhill (2003) argues that this technique involves one selecting the sample at random from the sampling frame. Simple random sampling was mainly focused on the concept of random selection-a controlled procedure that assures that each population element is given a known nonzero chance of selection.

3.3.2.3 Sample Size

Churchill (2003), states that a sample size needs to be adequately and accurately selected so as to make sure that the sample is indeed a representative of the whole population under study in order to provide reliable and accurate information needed. The sample size is a representation of the whole population from which the researcher can indeed make inferences on the whole population by use of the sample. The sample was therefore selected in a way that increases reliability and validity. In order to obtain the sample size the following statistical formula borrowed from Saunders et al. (2003) was used.

2  z  p%  q%    n =  e% 

Where: n is the minimum sample size required; p% is the proportion belonging to the specified category in this case Kenyans using Toyota Kenya products; q% is the proportion not using Toyota products; z is the z value corresponding to the level of confidence required in this case 1.96 for a 95% level of confidence, while e% is the margin of error that can be tolerated. In the study, p and q was assumed to take the value of 0.2 and 0.8, respectively.

2 1.96  n = 0.2  0.8    = 96.04  0.08 

In order to cater for problems of response rate, 100 respondents were targeted. The researcher is of the opinion that this size is accommodative enough to give views that could be generalized to the whole population given that Toyota is known to have a large customer base. 29

3.4 Data Collection Methods In order to acquire accurate information the study relied mainly on primary sources of data. This type of data was collected using questionnaires which were formulated by the researcher on the basis of the research objectives. According to McNabb (2008) a questionnaire is considered to be the best tool for collecting data in a descriptive design and when accessibility to the respondents is challenging. The questionnaire was divided in three main sections, the first section was made up of questions seeking background information of the respondents. The second part of the questionnaire had questions with regards to the four research objectives. The questionnaire had both open and closed ended questions, all designed on a likert scale.

3.5 Research Procedures The researcher conducted a pilot study to test the reliability and validity of the research. According to Churchill and Brown (2003), a pilot test helps to test the reliability and validity of data collection instruments. Since the company headquarters is a security controlled area, the researcher first sought permission for conducting the study on the company premises or on its customers. This was of course accompanied with a brief introduction of the aim of the study and its significance.

The researcher was able to identify the respondents with the help of the Toyota brand managers whom the researcher sampled and called them to introduce the study and request their participation in the study. A questionnaire was then delivered and collected back. The mode of delivery of the questionnaires was either by emails or one on one delivery to the respondents depending on the respondent’s preference. Questionnaires were thereafter collected after completion and taken for analysis. In order to ensure a high response rates, follow ups were made to the respondents, especially to those who were sent questionnaires via mail.

3.6 Data Analysis Methods The collected data was coded and cleaned before being analysed. The study adopted quantitative methods of data analysis. The study used descriptive statistics such as frequencies and percentages. This was to enable the researcher reduce, summarize, and describe quantitative data obtained from empirical evidence. Additionally the study also used inferential statistics specifically regression analysis. This was analyzed using Statistical Package for Social Sciences (SPSS) program which is a program that helps interpret data to understandable format. The analysed data was thereafter presented in form of tables and figures.

3.7 Chapter Summary The chapter provides a detailed report on the methodology adopted in the study. It describes the population under study, sampling technique, sample size and sampling frame. The study will make use of a descriptive approach and the data was collected using a questionnaire. The analysis was by use of Statistical Package for social sciences. The next chapter presents a results and findings of the study.

CHAPTER FOUR

4.0 RESULTS AND FINDINGS

4.1 Introduction This chapter presents a summary of findings with regards to the four objectives of the study. The first subsection presents findings with regards to how economic factors influence purchasing decisions for motor vehicles, followed by findings on how psychological factors influence consumers’ decisions to purchase motor vehicles. The third subsection presents findings with regards to how socio-cultural factors influence consumers’ decisions to purchase motor vehicles and finally the last subsection presents findings with regards to how demographic factors influence consumers’ decisions to purchase motor vehicles.

4.2 Background Information This subsection presents findings with regards to the background information of the respondents. Specifically on gender, age, level of education and number of years using Toyota cars.

4.2.1 Gender of the Respondents

Table 4.1 presents findings with regards to the gender of the respondents. As seen in the table majority of the respondents were female (54 percent), followed by men who were 46 percent. It is interesting to see that women motorists are more than their male counterparts especially with regards to Toyota motor vehicles. This finding could imply that more women prefer Toyota cars as compared to their male counterparts.

Table 4.1: Gender of the Respondents Gender Frequency Percent Male 46 46.0 Female 54 54.0 Total 100 100.0

4.2.2 Age of the Respondents Age is critical to the choice of motor vehicle one purchases and as such it was important for the study to include it among the variables under study. As seen in table 4.2 majority of the respondents involved in the study were between the age of 31-35 years (69 percent), followed by 15 percent who were at the age of 36 years and above thereafter 14 percent of the respondents between 26-30 years and finally 2 percent between 20-25 years. It is expected that at the age of 31-35 years most people would be in a position to own a motor vehicle, and therefore it is not surprising that majority of the respondents were in this age bracket. It can also be concluded that people at the age of 30 years and above would go for Toyota cars unlike the younger group of people who would go for speeding car brands such as Subaru and Mitsubishi.

Table 4.2: Age of the Respondents Age of Respondents Frequency Percent Between 20 and 25 Years 2 2 Between 26 and 30 Years 14 14.0 Between 31 and 35 Years 69 69.0 36 Years and Over 15 15.0 Total 100 100.0

4.2.3 Level of Education Table 4.3 presents findings with regards to the level of education of the respondents. As presented in the table 66 percent of the respondents had undergraduate qualifications followed by 16 percent with Masters Degrees and 11 percent with diplomas and only 7 percent with Doctorates. This findings imply that indeed most of the respondents were equipped with relevant academic qualifications which is likely to have influenced their choice of motor vehicles.

Table 4.3: Level of Education Level of Education Frequency Percent Diploma 11 11.0 Undergraduate 66 66.0 Masters 16 16.0 Doctorate 7 7.0 Total 100 100.0

4.2.4 Number of Years using Toyota Cars Table 4.4 reveals that majority of the respondents involved in the study (43 percent), have used Toyota cars for more than 10 years, followed by 29 percent who have used Toyota cars between 6-10 years. Additionally 16 percent of the respondents have used Toyota cars for less than 3 years and finally 12 percent of the respondents between 3-5 years. This finding confirms the previous finding on the age of the respondents implying that indeed have been using Toyota cars long enough to understand the benefits and demerits of such cars.

Table 4.4: Number of Years using Toyota Cars Number of Years using Toyota Cars Frequency Percent Less than 3 Years 16 16.0 3-5 Years 12 12.0 6-10 Years 29 29.0 More than 10 years 43 43.0 Total 100 100.0

4.2.5 Cross Tabulations for Gender and Number of Years Using Toyota Cars In order to test how gender and number of years using Toyota cars relate, table 4.5 shows that in most cases women have been more loyal to using Toyota cars as compare to their male counterparts. This findings could implicate that men are always trying out new car brands and therefore the reason why more women have used Toyota cars for long. Table 4.5: Cross Tabulations for Gender and Number of Years Using Toyota Cars Number of Years using Toyota Cars Gender Total Male Female Less than 3 Years 9.0% 7.0% 16.0% 3-5 Years 12.0% 12.0%

6-10 Years 14.0% 15.0% 29.0% More than 10 years 23.0% 20.0% 43.0% Total 46.0% 54.0% 100.0%

4.2.6 Cross Tabulations for Education and Number of Years Using Toyota Cars As seen in the table 4.6, it is interesting that as the level of education increases the loyalty to Toyota cars goes down. This is because most respondents with Masters and Doctorate Degrees have few years of using Toyota cars as compared to those with Diploma and Degrees.

Table 4.6: Cross Tabulations for Education and Number of Years Using Toyota Cars Number of Years using Level of Education Total Toyota Cars Diploma Undergraduate Masters Doctorate Less than 3 Years 2.0% 7.0% 6.0% 1.0% 16.0% 3-5 Years 1.0% 10.0% 1.0% 12.0%

6-10 Years 3.0% 21.0% 3.0% 2.0% 29.0% More than 10 years 5.0% 28.0% 6.0% 4.0% 43.0% Total 11.0% 66.0% 16.0% 7.0% 100.0% 4.2.7 Cross Tabulations for Age and Number of Years Using Toyota Cars

Table 4.7 reveals that majority of the respondents between 26-30 years had used Toyota cars for long followed by those at the age between 31-35 years, followed by those with the age between 20-25 years and finally those above 36 years of age.

Table 4.7: Cross Tabulations for Age and Number of Years Using Toyota Cars Number of Years using Age Total Toyota Cars Between 20 Between 26 Between 31 36 Years and 25 Years and 30 Years and 35 Years and Over Less than 3 Years 4.0% 11.0% 1.0% 16.0% 3-5 Years 10.0% 2.0% 12.0%

6-10 Years 3.0% 22.0% 3.0% 1.0% 29.0% More than 10 years 8.0% 26.0% 8.0% 1.0% 43.0% Total 15.0% 69.0% 14.0% 2.0% 100.0%

4.2.8 Correlational Analysis

Table 4.8 shows that there was a positive significant relationship between purchasing decisions for motor vehicles and economic factors (.606, at the 0.01 level), psychological factors(.719, at the 0.01 level),, social-cultural factors(.201, at the 0.05 level), as well as demographic factors(.401, at the 0.01 level).

Table 4.8: Correlation Analysis Economic Psychological Social- Demographic Purchasing Factors Factors Cultural Factors Decision Factors

Pearson 1 .468** .326** .293** .606** Correlation Economic Sig. (2- Factors .000 .001 .003 .000 tailed) N 100 100 100 100 100 Pearson .468** 1 .597** .672** .719** Correlation Psychological Sig. (2- Factors .000 .000 .000 .000 tailed) N 100 100 100 100 100 Pearson .326** .597** 1 .801** .201* Social- Correlation Cultural Sig. (2- .001 .000 .000 .045 Factors tailed) N 100 100 100 100 100 Pearson .293** .672** .801** 1 .401** Correlation Demographic Sig. (2- Factors .003 .000 .000 .000 tailed) N 100 100 100 100 100 Pearson .606** .719** .201* .401** 1 Correlation Purchasing Sig. (2- Decision .000 .000 .045 .000 tailed) N 100 100 100 100 100 **. Correlation is significant at the 0.01 level (2-tailed). *. Correlation is significant at the 0.05 level (2-tailed).

4.3 Economic Factors and Purchasing Decision

The first objective of the study was to determine the economic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. As seen in the table 4.9it is evident that the following economic factors influence purchasing decision below: Price of the car, location and accessibility, level of income, the relation between income growth and quality of car, maintenance costs, the resale value of a car, payment options (such as hire purchase, lease), the ease of finding a mechanic to repair the specific car brand, low interest rates and fuel prices influence my choice of motor vehicle.

Table 4.9: Economic Factors

Economic factors Mean

ngly

agree

Agree

Neutral

Strongly Strongly

Disagree

Stro disagree Price of the car 31.7 35.0 13.3 13.3 3.3 3.74

Location and accessibility 36.7 26.7 16.7 13.3 1.7 3.42

Level of income 25.0 35.0 25.0 10.0 0 3.61

The relation between income growth and 23.3 35.0 26.7 5.0 1.7 3.61 quality of car Maintenance costs 30.0 35.0 23.3 10.0 1.7 3.51

The resale value of a car 30.0 33.3 26.7 6.7 1.7 3.5

Payment options(such as hire purchase, lease) 18.3 23.3 31.7 13.3 6.7 4.04

The ease of finding a mechanic to repair the 31.7 35.0 13.3 13.3 3.3 3.62 specific car brand Low interest rates 36.7 26.7 16.7 13.3 1.7 3.55

Fuel prices influence my choice of motor 25.0 35.0 25.0 10.0 0 3.61 vehicle

Table 4.10 (a) shows that the R square value of the model was .367 indicating that 36.7 percent of the consumer purchasing decision is influenced by economic factors such as level of income, price, quality of car, maintenance costs, resale value of the car, payment options, ease of finding a mechanic to repair the specific car brand, interest rates as well as fuel prices.

Table 4.10: Economic Factors and Purchasing Decision

(a) Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate 1 .606a .367 .361 1.52790 a. Predictors: (Constant), Economic Factors

(b) ANOVA Table 4.10 (b) reveals that there was a significant relationship between economic factors and consumer purchasing decision with the F value of 56.913.

Model Sum of Squares Df Mean Square F Sig. Regression 132.861 1 132.861 56.913 .000b 1 Residual 228.779 98 2.334 Total 361.640 99 a. Dependent Variable: Purchasing Decision b. Predictors: (Constant), Economic Factors

The coefficients table 4.10 c), shows that there was a positive significant relationship between economic factors and purchasing decision with a beta of .395 and a T-value of 7.544. This findings imply that the consumer purchasing decision is influenced by economic factors such as level of income, price, quality of car, maintenance costs, resale value of the car, payment options, ease of finding a mechanic to repair the specific car brand, interest rates as well as fuel prices

(c) Coefficients Model Unstandardized Standardized T Sig. Coefficients Coefficients B Std. Error Beta (Constant) 1.723 1.290 1.336 .185 1 Economic .395 .317 .606 7.544 .000 Factors a. Dependent Variable: Purchasing Decision

4.4 Psychological Factors and Purchasing Decision

The second objective of the study was to determine the psychological factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. Table 4.11 further shows that indeed the following psychological factors influence the purchasing decisions of motor vehicles, these include: Perception about the car and brand, motivation from friends and family on a specific brand, consumer attitude towards the brand of car, innovative of the car and brand, personal beliefs, knowledge sharing from friends and colleagues, and finally motivation from friends and family on a specific brand influences my purchase decision for the motor vehicle.

Table 4.11: Psychological factors Psychological factors Strongly Disagree Neutral Agree Strongly Mean disagree agree Perception about the car and 70.1 20.9 5.0 2.0 2.0 3.68 brand Motivation from friends and 60.1 11.9 20.0 8.0 0 3.6 family on a specific brand Consumer attitude towards the 55.0 35.0 5.0 5.0 0 3.61 brand of car Innovative of the car and 72.0 15.0 3.0 5.0 5.0 3.61 brand Personal beliefs 69.0 24.0 7.0 0 0 3.51

Knowledge sharing from 74.0 23.0 3.0 0 0 3.91 friends and colleagues Motivation from friends and 67.0 23.3 1.7 1.3 7.0 4.08 family on a specific brand influences my purchase decision for the motor vehicle

Table 4.12 (a) shows that the R square value of the model was .516 indicating that 51.6 percent of the consumer purchasing decision is influenced by psychological factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

Table 4.12: Psychological Factors and Purchasing Decision (a) Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate 1 .719a .516 .511 1.33596 a. Predictors: (Constant), Psychological Factors

Table 4.12 (b) reveals that there was a significant relationship between psychological factors and consumer purchasing decision with the F value of 104.624.

(b) ANOVA Model Sum of Squares df Mean Square F Sig. Regression 186.731 1 186.731 104.624 .000b 1 Residual 174.909 98 1.785 Total 361.640 99 a. Dependent Variable: Purchasing Decision b. Predictors: (Constant), Psychological Factors

The coefficients table 4.12 c), shows that there was a positive significant relationship between psychological factors and purchasing decision with a beta of .911 and a T-value of 10.229. This findings imply that the consumer purchasing decision is influenced by psychological factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

(c) Coefficients Model Unstandardized Standardized t Sig. Coefficients Coefficients B Std. Error Beta (Constant) 3.356 1.112 3.017 .003 1 Psychological .911 .285 .719 10.229 .000 Factors a. Dependent Variable: Purchasing Decision

4.5 Social-Cultural Factors and Purchasing Decision

The third objective of the study was to determine the Social-cultural factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. Table 4.13 shows that the following socio-cultural factors influence purchasing decisions of consumers: Different cultures, shared values, the social class, status in the society, buzz marketing and social media influences the brand of motor vehicle, reference groups like motor vehicle forums that form attitudes and behavior like “top gear”, membership groups such as “4X4 enthusiast groups, aspirational groups, religion as well as the country of origin of the motor vehicle

Table 4.13: Social-cultural factors Socio cultural factors Strongly Disagree Neutral Agree Strongly Mean disagree agree Different cultures 60% 31% 5% 2% 2% 4.25

Shared values 60% 20% 12% 9% 0 4.45 The social class 75% 18% 3% 5% 5% 3.91 Status in the society 65% 28% 7% 0 0 3.15 Buzz marketing and social 75% 24% 3.0 0 0 3.62 media Reference groups like motor 62% 29% 1% 2% 7% 4.09 vehicle forums Membership groups such as 60% 43% 7% 0 0 4.11 “4X4 enthusiast groups:” Aspirational groups 57% 34% 10% 3% 0 4.23 Religion 55% 44% 6% 2% 1% 3.96 The country of origin of the 58% 42% 6% 0 0 4.19 motor vehicle

Table 4.14 (a) shows that the R square value of the model was .400 indicating that 40 percent of the consumer purchasing decision is influenced by Social-cultural factors such as different cultures, shared values, the social class, status in the society, buzz marketing and social media, reference groups like motor vehicle forums that form attitudes and behavior like “top gear”, aspirational groups, religion and finally the country of origin.

Table 4.14: Social-Cultural Factors and Purchasing Decision

(a) Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate 1 .401a .400 .031 1.88182 a. Predictors: (Constant), Social-Cultural Factors

Table 4.14 (b) reveals that there was a significant relationship between Social-cultural factors and consumer purchasing decision with the F value of 4.122.

(b) ANOVA

Model Sum of df Mean Square F Sig. Squares Regression 14.597 1 14.597 4.122 .004b 1 Residual 347.043 98 3.541 Total 361.640 99 a. Dependent Variable: Purchasing Decision b. Predictors: (Constant), Social-Cultural Factors

The coefficients table 4.14 c), shows that there was a positive significant relationship between Social-cultural factors and purchasing decision with a beta of .594 and a T-value of 4.030. This findings imply that the consumer purchasing decision is influenced by Social- cultural factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

Model Unstandardized Standardized t Sig. Coefficients Coefficients B Std. Error Beta (Constant) 3.716 2.089 1.778 .001 1 Social-Cultural .594 .588 .401 4.030 .004 Factors a. Dependent Variable: Purchasing Decision

4.6 Demographic Factors and Purchasing Decision

The fourth objective of the study was to determine the demographic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. Table 4.15 shows that the following factors influence consumer purchase decisions: Personality, gender of consumers, age of consumers, changing life events, level of education, lifestyle, lifecycle status, occupation as well as personality.

Table 4.15: Demographic Factors Demographic factors Strongly Disagree Neutral Agree Strongly Mean disagree agree Personality 77% 15% 2% 2% 4% 4.15

Gender of consumers 77% 12% 4% 5% 2% 4.01 Age of consumers 66% 18% 4% 5% 7% 3.97 Changing life events 72% 5% 12% 6% 5% 3.99 Level of education 65% 15% 11% 4% 5% 3.86 Lifestyle 78% 12% 2% 4% 4% 4.17 Lifecycle status 68% 15% 4% 3% 10% 3.98 Occupation 81% 8% 2% 4% 5% 4.20 Personality 77% 15% 2% 2% 4% 4.15

Table 4.16 (a) shows that the R square value of the model was .400 indicating that 40 percent of the consumer purchasing decision is influenced by demographic factors such as personality, gender, Age, Changing life, level of education, lifestyle, lifecycle status and occupation.

Table 4.16: Demographic Factors and Purchasing Decision (a) Model R R Square Adjusted R Square Std. Error of the Estimate 1 .401a .361 .353 1.75945 a. Predictors: (Constant), Demographic Factors

Table 4.16 (b) reveals that there was a significant relationship between demographic factors and consumer purchasing decision with the F value of 18.822.

(b) ANOVA

Model Sum of df Mean Square F Sig. Squares Regression 58.266 1 58.266 18.822 .000b 1 Residual 303.374 98 3.096 Total 361.640 99 a. Dependent Variable: Purchasing Decision b. Predictors: (Constant), Demographic Factors

The coefficients table 4.16 c), shows that there was a positive significant relationship between demographic factors and purchasing decision with a beta of .305 and a T-value of 4.338. This finding implies that the consumer purchasing decision is influenced by demographic factors such as demographic factors such as personality, gender, Age, Changing life, level of education, lifestyle, lifecycle status and occupation.

Model Unstandardized Standardized t Sig. Coefficients Coefficients B Std. Error Beta (Constant) .577 1.971 .293 .770 1 Demographic .305 .508 .301 4.338 .000 Factors a. Dependent Variable: Purchasing Decision

Table 4.17 further presents multiple regression results showing that the R square value of the model was .723 indicating that 72.3 percent of the consumer purchasing decision is influenced by economic factors, psychological factors, social-cultural factors as well as demographic factors.

Table 4.17: Multiple Regression (a) Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate 1 .850a .723 .711 1.02666 a. Predictors: (Constant), Social-Cultural Factors, Economic Factors, Psychological Factors, Demographic Factors

Table 4.17 (b) reveals that there was a significant relationship between, economic, psychological, social-cultural as well as demographic factors and consumer purchasing decision with the F value of 62.026.

(b) ANOVAa Model Sum of Df Mean Square F Sig. Squares Regression 261.508 4 65.377 62.026 .000b 1 Residual 100.132 95 1.054 Total 361.640 99 a. Dependent Variable: Purchasing Decision b. Predictors: (Constant), Social-Cultural Factors, Economic Factors, Psychological Factors, Demographic Factors

The coefficients table 4.17 c), shows that there was a positive significant relationship between all demographic factors with a beta of .456, economic factors with a beta of .523, psychological factors with a beta of .779 and finally social-cultural factors with a beta of .248. This findings imply that the consumer purchasing decision is influenced economic factors, psychological factors, social-cultural and demographic factors.

(c) Coefficientsa Model Unstandardized Standardized t Sig. Coefficients Coefficients B Std. Error Beta (Constant) 3.123 1.312 2.381 .019 Demographic .456 .545 .265 2.674 .009 Factors Economic Factors .523 .243 .385 6.259 .000 1 Psychological .779 .321 .686 8.663 .000 Factors Social-Cultural .248 .545 .546 5.963 .000 Factors a. Dependent Variable: Purchasing Decision

4.7 Chapter Summary This chapter presented a summary of findings with regards to the four objectives of the study. The first subsection presented findings with regards to how economic factors influence purchasing decisions for motor vehicles, followed by findings on how psychological factors influence consumers’ decisions to purchase motor vehicles. The third subsection presented findings with regards to how socio-cultural factors influence consumers’ decisions to purchase motor vehicles and finally the lasts subsection presented findings with regards to how demographic factors influence consumers’ decisions to purchase motor vehicles. The next chapter will look at a summary of the findings, as well as discussions, conclusions and recommendations.

CHAPTER FIVE

5.0 DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS

5.1 Introduction

This chapter consists of four sections, namely summary, discussion, conclusions, and recommendations following that order. The first section provides a summary of the important elements of the study which includes the study objectives, methodology and the findings. The second section discusses the major findings of the study with regards to the specific objectives. The third section discusses the conclusions based on the specific objectives, while using the findings and results which are obtained in the fourth chapter.

5.2 Summary The general objective of the study was to examine factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. The study was guided by the followed by the following specific objectives: to determine the economic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry; to examine the psychological factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry; to examine the social-cultural factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry, and; to analyze the demographic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. Descriptive research design was employed in the study. The target population included all 2,913 customers of Toyota Kenya in Nairobi. Simple random sampling techniques was employed while data collection was conducted with the help of a questionnaire. The data was analyzed using descriptive and inferential statistics with the help of the Statistical Package for Social Sciences (SPSS). The results were then presented in tables and figures.

The study revealed that there was a positive significant relationship between economic factors and purchasing decision with a beta of .395 and a T-value of 7.544. This findings imply that the consumer purchasing decision is influenced by economic factors such as level of income, price, quality of car, maintenance costs, resale value of the car, payment options, ease of finding a mechanic to repair the specific car brand, interest rates as well as fuel prices.

The study further revealed there was a positive significant relationship between psychological factors and purchasing decision with a beta of .911 and a T-value of 10.229. This findings imply that the consumer purchasing decision is influenced by psychological factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

It was also revealed that there was a positive significant relationship between Social-cultural factors and purchasing decision with a beta of .594 and a T-value of 4.030. This findings imply that the consumer purchasing decision is influenced by Social-cultural factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

Finally the study revealed that there was a positive significant relationship between demographic factors and purchasing decision with a beta of .305 and a T-value of 4.338. This findings imply that the consumer purchasing decision is influenced by demographic factors such as demographic factors such as personality, gender, Age, Changing life, level of education, lifestyle, lifecycle status and occupation.

5.3 Discussion

5.3.1 Economic Factors influencing Consumer Purchase Decision

The study affirms that indeed one essential economic factor that influences consumer buyer behavior is income. This mainly because the amount of goods bought by a consumer as well as the type bought differs depending on the wage which a consumer earns. In the event that a buyer has greater income, chances are very high that such a consumer will go for more luxury goods like high-end cars. Taylor (2011) is of the opinion that a reduction in income shifts purchasing behavior from buying normal goods to inferior goods. This simply means that as consumers buy fewer specialty items, such as shoes and clothing, and buy more store-brand items.

The findings agree with Mogridge (2009) posits that the main essential concept when it comes to consumer buyer behavior is that the average person of a given income level is likely to spend a given quantity of money on the purchase of cars. He therefore goes ahead to argue that there is a function which gives, for every income level, as well as an average expenditure on a car purchase. More recent studies that have been conducted in this area have shown that there is a positive relationship between income levels and vehicle purchase decisions by individuals (Feng, Wang, and Zeng, 2011).

The findings also agree with Dasgupta et al., (2009) who carried out an analysis of the behaviour of consumers with regards to the choice of the funding method for automobiles (Banerjee, 2010). They were able to compare the credit and leasing options. This study revealed that consumers are very myopic and will therefore prefer contracts that come with lower payment streams, even when they have higher total costs. They also established that indeed most consumers are more likely to lease than to finance cars with higher maintenance costs. This is simply because these options provide consumers with the option to return the car before maintenance costs become too high. Wonder et al., (2009) on the other hand opined that respondents preferred low interest rates, a high rebate, and down payment. This view is contrary to that held by Doyle (2007) who argues that an interest rate increase is likely not affect real motor vehicle sales if the automakers are able to counteract the rate increases with lower prices.

5.3.2 Psychological Factors influencing Consumer Purchase Decision

The findings agree with a study by carried out by Hawkins & Mothersbaugh (2010) who were able to show that perception begins with consumers’ exposure and attention to marketing stimuli and thereafter ends with their interpretation of the stimuli. Etzel et al., (2014), on their side believe that consumers’ perception is not only determined by the characteristics of the stimuli, but it is also determined by the characteristics of the consumer him or herself. It is therefore important for that marketers obtain a thorough understanding of their target markets as well as how consumers will perceive various marketing-related stimuli.

The findings also affirm that similar to brand awareness, perceived quality is determined by a number of factors. To be more specific, perceived quality can further be classified into product quality and service quality. Regarding product quality, there are seven dimensions which affect the consumers‟ perception, namely performance, features, conformance with specifications, reliability, durability, and serviceability as well as fit and finish. Service quality, on the other hand, is judged by its corresponding tangibles, reliability, competence, responsiveness and empathy (Aaker, 1991). As mentioned by Srikatanyoo & Gnoth (2012), consumers are inclined to develop stereotypical beliefs about the products from particular countries. Hence, consumers could have their preferences for products made from one country over another (Papadopoulos et al., 2011).

Finally the findings affirm that indeed people have attitudes regarding religion, politics, clothes, music, food, etc. Attitude of consumer also influences the consumer behavior. If consumer’s attitude towards a product is favorable, then it will have positive effect on consumer behavior. The marketers discover prevailing attitude towards their product and try to make it positive, and if it is already positive, then try to maintain it (Hoyer & Deborah, 2008).

5.3.3 Social-Cultural Factors influencing Consumer Purchase Decision

The study findings show that indeed brands are also considered to be symbols used to convey meanings to consumers, some brands for instance Mercedes Benz convey meanings of prestige and quality. On the contrary, there are also brands that convey meanings relating to low price such as Virgin Airlines. It means therefore that brands help consumers to minimize and provide a sense of familiarity, which further reduces the purchasing risk involved (Lehmenn & Winer, 2007) an aspect that appeals to consumers who poses high uncertainty avoidance.

The findings also agree with a study by Clement & Nyovani (2014) which revealed that religion was associated with choice of consumer products. The study revealed that Christians in Zimbabwe were significantly using different products than those from other religions. Although from the foregoing discussion religion was found to choice of consumer products and services, it was not clear how the inference was arrived at. Religion will be considered in the current study as a variable. The aim is to examine how different religious background affects the choice of motor vehicles.

The findings are also in line with a study by Bakewell & Mitchell (2006) carried out a similar study in the UK, where he made use of a sample of 480 male and female undergraduate students, which he established that indeed nine decision-making styles were common to both genders. Additionally, three new male traits (store-loyal/low-price seeking, confused time-restricted and store-promiscuity) and three new female traits (bargain seeking, imperfectionism and store loyal) were also identified in their study.

Finally the findings align with Van der Post et al., (2008) who examined the relationship between family and consumer choice in South Africa. The results showed that family has a positive relationship with the consumer choice of certain products and service. The results of the study also showed that individuals are more likely to purchase goods and services based on how they have been brought up. This means that their family backgrounds have dictated their purchase decisions (Rashid et al., 2013).

5.3.4 Demographic Factors influencing Consumer Purchase Decision

Finally the study revealed that there was a positive significant relationship between demographic factors and purchasing decision with a beta of .305 and a T-value of 4338. This findings imply that the consumer purchasing decision is influenced by demographic factors such as demographic factors such as personality, gender, Age, Changing life, level of education, lifestyle, lifecycle status and occupation.

This findings affirm that the past, present, and paradisal future of consumer gender identity by (Kacen, 2010), consumption has always been gendered. Most of the available products in the market these days do have a specific gender type, some are made with masculine features while some are made with feminine features. Products’ gender are therefore created and sustained by marketers for example; princess phones, Barbie dolls. Research suggests that shopping is a more exciting activity for women with respect to men. Female consumers feel more independent when they do shopping in accordance with men. Another point that men and women present differentiation is women consider shopping is a social need whereas male consumers pay importance to main function of a product instead of secondary function. Gender has an important role in consumer behavior, this for the reason that there are differences between men and women about expectation, want, need, life-style etc. reflect to their consumption behaviour (Akturan, 2009).

The findings also affirm that for the elderly, then, habits are more likely to be activated and relied on (Ailawadi et al., 2011). This therefore means that age can be proxy for the amount of associate reinforcement. Indeed, research indicates that age is associated with reductions in the individual tendency to generate uncommon free associates and increases in the tendency to repeat a behavior (Drolet et al., 2007). Aging goes a long way to bring about certain cognitive deficits that can be related to the increased development of and reliance on more automatic, habit-driven behavior. Although cognitive and behavioral performances

56 tend to slow with age, field studies show that the real-world performance of elderly adults is usually on par with that of young adults.

Finally the findings show that exploration in the marketing discipline regarding this relationship is required because coping mechanisms present a trigger, or aroused need, for altered purchasing behaviour. In this regard therefore the mere understanding how the process is triggered and the resultant changes in decision making variables would benefit marketing research in terms of effectiveness and efficiency of sales and communications mechanisms. It also means that life events change consumer behaviour (Mathur et al., 2012) and that many coping mechanisms exhibit similarities with consumer decision-making, it can be assumed that individuals experiencing life events can undertake a decision-making process.

5.4 Conclusions

5.4.1 Economic Factors influencing Consumer Purchase Decision

This findings lead to a conclusion that the consumer purchasing decision is influenced by economic factors such as level of income, price, quality of car, maintenance costs, resale value of the car, payment options, ease of finding a mechanic to repair the specific car brand, interest rates as well as fuel prices.

5.4.2 Psychological Factors influencing Consumer Purchase Decision

This findings also lead to a conclusion that the consumer purchasing decision is influenced by psychological factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

5.4.3 Social-Cultural Factors influencing Consumer Purchase Decision

This study concludes that the consumer purchasing decision is influenced by Social-cultural factors such as perception, motivation from friends and family, attitude towards the brand, innovative of the car and brand, personal beliefs as well as knowledge sharing from friends and colleagues.

5.4.4 Demographic Factors influencing Consumer Purchase Decision

Finally the study concludes that there was a positive significant relationship between demographic factors and purchasing decision. This findings imply that the consumer purchasing decision is influenced by demographic factors such as demographic factors such as personality, gender, Age, Changing life, level of education, lifestyle, lifecycle status and occupation.

5.5 Recommendations

5.5.1 Recommendations for Improvement

5.5.1.1 Economic Factors influencing Consumer Purchase Decision

The study recommends that firms dealing with motor vehicle need to consider the various economic factors that influence consumer decision making such as interest rates, income as well as rising fuel prices. In this regard they need to design motor vehicle for different categories of customers in different income brackets in Kenya. They should also come up with payment modes that are friendly to the consumer for instance payments through installments as well as car financing to clients. Price segmentation would also be key in enhancing consumers attraction and retention.

5.5.1.2 Psychological Factors influencing Consumer Purchase Decision

Study acknowledges that each human being in the world sees his/her surroundings differently. Several people have the same ideas about a specific event. As such, automobile companies need to evaluate consumer their needs, values and expectations, when they are designing automobiles meant for the Kenyan market. This can be enhanced when the company achieves quality on a dimension that consumers consider to be important. There is a need to make sure that investments in quality occur in areas that will resonate with customers. Finally it is it is important to understand the little things that consumers use as the basis for making a judgment of when it comes to purchasing decisions.

5.5.1.3 Social-Cultural Factors influencing Consumer Purchase Decision

The study has acknowledged that consumer decisions are likely to be influenced by a number of socio-cultural factors. In this sense brands are also considered to be symbols used to convey meanings to consumers. The study therefore recommends the need for automobile companies to consider social cultural factors when designing some of their products into the market. This is especially so for consumers who have deep roots in their culture and will therefore go for nothing less than what conforms to their cultural practices.

5.5.1.4 Demographic Factors influencing Consumer Purchase Decision

The study recommends the need for automobile companies to consider consumers’ demographic characteristics such as age, gender, marital status, occupation, education and income when designing the products to offer into the Kenyan market. This is because demography factors are vital and measurable statistics of a population that s helps to locate target market, they are easier to measure and are suitable for psychographic and socio- cultural studies. Additionally demographic factors have a huge impact on the assessment of different features which are generally associated with consumer behaviour.

5.5.2 Recommendations for Further Studies

The study recommends for additional studies on this area of study since the motor vehicle industry is one of the fastest growing industries in Kenya. Additionally it is important for other researchers to consider carrying out longitudinal studies in this particular area since the present research was merely cross-sectional. Finally it will be interesting to examine how the various factors examined in this particular study affect consumer purchasing decisions in other automobile brands such as Nissan, Mitsubishi, Mercedes Benz, Land Rovers, Volkswagen, Isuzu and many others.

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Appendix 1: Questionnaire Section A: Background Information

Kindly, fill all the questions either by ticking () in the boxes or writing in the spaces provided. NAME (Optional) …………………………………………………… 1. Gender? Male ( ) Female ( ) 2. Age? (years) 20-25 years  26-30 years  31-35 years  36 years and over  3. Level of education? 1. Primary 5. Masters 2. Secondary 6. Doctorate 3. Diploma 7. Others 4. Undergraduate 4. Occupation? ………………………………………………………. 5. For how long have you been using Toyota cars? Less than 3 years  3-5 years  6-10 years  More than 10 years 

Section B: The economic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry Kindly tick as appropriate in the spaces provided the extent to which you think the following factors influence consumer choice. . Strongly Dis Neut Agree Strongly The following economic factors influences my disagree agree ral agree decision to purchase motor vehicles I always go for a renowned brand of car 1 2 3 4 5 regardless of price I am influenced to buy a car based on the 1 2 3 4 5 location and accessibility My level of income is a critical factor 1 2 3 4 5 influencing my decision on the car to purchase Price is a determining factor on the choice of car 1 2 3 4 5 I’d buy The relation between income growth and quality 1 2 3 4 5 of car is a fundamental issue in purchasing decision.

One’s level of income influences the willingness 1 2 3 4 5 to pay marginally higher prices as a social responsibility towards the motor vehicle Maintenance costs influence my decision of the 1 2 3 4 5 motor vehicle to select to purchase The resale value of a car is critical factor I’d 1 2 3 4 5 consider when purchasing a motor vehicle Payment options(such as hire purchase, lease) 1 2 3 4 5 are a concern I’d consider when purchasing a motor vehicle The ease of finding a mechanic to repair the 1 2 3 4 5 specific car brand influences my motor vehicle purchase decision. Low interest rates are critical in influencing my 1 2 3 4 5 decision to purchase a motor vehicle Fuel prices influence my choice of motor vehicle 1 2 3 4 5

Please state any other economic factor that you think in your opinion influences consumer behavior……………………………………………………………………………………… …………………………………………………………………………………………………

Section C: The psychological factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry Kindly tick as appropriate in the spaces provided the extent to which you think the following factors influence consumer choice. . Strongly Dis Neu Agree Strongly The following psychological factors influences disagree agree tral agree my decision to purchase motor vehicles My perception about the car and brand 1 2 3 4 5 influences my purchase decision of a motor vehicle Motivation from friends and family on a specific 1 2 3 4 5 brand influences my purchase decision for the motor vehicle My attitude towards the brand of car affects my 1 2 3 4 5 purchase decision for the motor vehicle My attitude towards the brand of the car affect 1 2 3 4 5 my purchase decision for the motor vehicle Innovative of the car and brand is a concern I 1 2 3 4 5 consider when purchasing a motor vehicle

My personal beliefs are an important factor in 1 2 3 4 5 the purchase decision of a motor vehicle Knowledge sharing from friends and colleagues 1 2 3 4 5 influences my purchase decision of a motor vehicle There is a significant relationship between 1 2 3 4 5 psychological factors and consumer choice of motor vehicle

Please state any other psychological factor that you think in your opinion influences consumer behavior……………………………………………………………………………………… ………………………………………………………………………

Section D: the social-cultural factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry Kindly tick as appropriate in the spaces provided the extent to which you think the following factors influence consumer choice. . Strongly Dis Neut Agree Strongly The following social cultural factors disagree agree ral agree influences my decision to purchase motor vehicles

Different cultures have different buying 1 2 3 4 5 behavior decisions for motor vehicles Shared values with others influences my motor 1 2 3 4 5 vehicle purchase decisions The social class that I belong to influences my 1 2 3 4 5 motor vehicle purchase decisions My status in the society influences my motor 1 2 3 4 5 vehicle purchase decisions Buzz marketing and social media influences the 1 2 3 4 5 brand of motor vehicle that I would purchase Reference groups like motor vehicle forums that 1 2 3 4 5 form attitudes and behavior like “top gear” influence the choice of motor vehicle to be purchased Membership groups such as “4X4 enthusiast 1 2 3 4 5 groups:” influences my purchase decision for a motor vehicle Aspirational groups that we wish to belong 1 2 3 4 5 inspire the choice of motor vehicle that I would

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My religion would influence the choice of motor 1 2 3 4 5 vehicle that I would purchase The country of origin of the motor vehicle my 1 2 3 4 5 motor vehicle purchase decisions Please state any other psychological factor that you think in your opinion influences consumer behavior……………………………………………………………………………………… ………………………………………………………………………………………………… Section E: Demographic factors affecting consumer purchasing decisions in Kenya’s motor vehicle industry. Kindly tick as appropriate in the spaces provided the extent to which you think the following factors influence consumer choice.

. Strongly Dis Neu Agree Strongly The following demographic factors influences disagree agree tral agree my decision to purchase motor vehicles My personality would impact on my decision on 1 2 3 4 5 which motor vehicle to purchase My gender would influence the choice of motor 1 2 3 4 5 vehicle to purchase My Age would influence the choice of motor 1 2 3 4 5 vehicle to purchase Changing life events would influence the choice 1 2 3 4 5 of motor vehicle to purchase My level of education would influence the 1 2 3 4 5 choice of motor vehicle to purchase My lifestyle would influence the choice of motor 1 2 3 4 5 vehicle to purchase Lifecycle status if the motor vehicle model and 1 2 3 4 5 brand would influence my purchase decision My occupation would help me to make an 1 2 3 4 5 appropriate choice of what motor vehicle I’d purchase

Please state any other demographic factors that you think in your opinion influences consumer behavior……………………………………………………………………………………… ………………………………………………………………………………………………