A

Project Report on

“Impact of influencers on online purchase”

Submitted to

Savitribai Phule Pune University

In Partial Fulfilment of the Degree of

Master of Business Administration (MBA)

By

Karishma Rajput

Roll No. 18

Under the guidance of

Prof. Vikas Dole

Through

MODERN EDUCATION SOCIETY’S

NEVILLE WADIA INSTITUTE OF MANAGEMENT

STUDIES & RESEARCH, PUNE – 411011

YEAR: 2018-2020

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 DECLARATION

I, the undersigned, hereby declare that the field project entitled

“Impact of influencers on online purchase”

Witten & submitted to the Savitribai Phule Pune University, it is a record of an original study
done by me, true to my knowledge & research under the guidance of Prof. Vikas Dole,
Master Of Business Administration (MBA), Neville Wadia Institute Of Management Studies
& Research, Pune.

This research project is submitted in the partial fulfilment of the requirement for the award of
the degree Master Of Business Administration. The result of the survey has not been
submitted to any other University or Institute for the award of any degree or diploma.

Place: Pune Signature Of Student

Date: Karishma Rajput

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 ACKNOWLEDGEMENT

I would like to express my sincere thanks to the Savitribai Phule Pune University and the
Neville Wadia Institute Of Management Studies & Research for giving me the opportunity to
prepare and present this report. A project usually requires a lot of hard work and persistent
efforts, but it is the guidance provided by the right person at the right time, good direction,
and efficient supervision and the most valuable internal guidance.

I would like to express my sincere thanks to the Director of the Neville Wadia Institute Of
Management Studies & Research, Dr. A. B. Dadas for granting me the permission to make
this report and for providing me with the required facilities.

I express my deep gratitude to our Prof. Vikas Dole who provided me with a lot of support,
constant supervision, constructive criticism, encouragement and whole hearted co-operation
throughout the process, thereby expanding horizon of my knowledge.

I would like to extend my sincere thanks to my teachers & friends for their motivation &
direct or indirect support for completion for this project. A management student requires this
type of experience in order to excel in the future.

Thanking everyone once again.

Yours Sincerely,

Karishma Rajput

MBA II Roll No. 18

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 Table of Content

Sr. No. Title Page No.

1 Introduction 5

2 Conceptual Theory 10

3 Literature Review 17

4 Objectives of the study 24

5 Research Methodology 26

6 Data Interpretation 29

7 Findings and Conclusion 39

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Chapter 1: Introduction

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Introduction

The world is getting more and more interconnected. People from all ages and countries are
using the internet for access to information, as a networking source, as an alternative for the
traditional shopping by conducting a purchase online, also for socializing. Approximately
two-thirds of the internet users have made an online purchase, with the majority being in the
age groups of 16- 24 and 25-54. Furthermore, the emergence of social media transforms the
communication between companies and consumers; the latter compare prices, check for
coupons and deals, search for product information, look up opinions on products, or for
example book hotels directly on the hotel website or via various booking platforms, thus
making the word of mouth (WOM) marketing a powerful tool for advertising. Recognizing
this growing trend marketers started to reach out to influential consumers, hoping to benefit
from their ability to convince by sharing the consumption experience with others.

The markets emerge, and the now existing ones transform, with the consumers taking more
pro-active role, being it driven by their love for a certain brand, or just to defy the market. A
number of studies have shown the important and rising role of family, friends, neighbours
and colleagues play in affecting the choices of the individual. And nowadays we are all quite
aware with celebrity endorsements- Hritik Roshan and Mountain Dew, Aishwarya Rai and
Lux, Yami Gautam and Fair and Lovely- these are just a few examples. While some 2
consumers find it favorable and positive to see a celebrity advertise products or services, it is
not always the case when a celebrity endorsement will drive brand resonance or revenue, as
70% of teenagers say they trust influencers more than traditional celebrities. 40% of people
say they have purchased a product online as a result of seeing it being used by an influencer
on social media. 49% of consumers rely on product recommendations shared by influencers
for their purchase 72% of customers trust a business more after it is recommended by an
influencer Consumers Trust Influencer. So here come in the digital influencers those who
create content and share it on YouTube, Facebook, Instagram, Twitter, blogs, Snapchat, etc.

These powerful everyday consumers have the ability to change opinions, to raise brand
awareness or ruin it, and they are able to achieve such outreach or status by constantly
showing they attempt to stay true to their culture.

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1.1. Background

Whether it is for the brand or the consumers, marketers are always looking into the future to
anticipate the upcoming trends in the market. People are believed to be the ones who will
mostly influence the marketing and advertising world right now, as they are able to offer a
credible prediction to the trends that will change the way brands connect, and the way
innovative firms will work in within the next few years. Thus, people who have the power to
affect the purchase decisions of others due to their real or perceived authority, knowledge,
position, or relationship are identified as influencers. An influencer doesn’t necessarily have
to be some sort of celebrity, journalist, or blogger, they are a form of social micro-celebrity
and this is where the focus is in this thesis- the micro-influencers. They can be an ordinary
person with the right connections and social pull, and not inevitably a celebrity, even though
they are the first that come to mind when discussing social influence. Ordinary people who
communicate with their friends or social circle can also be identified as influencers but so can
be journalists, experts, public figures with different types of visibility- highly visible as in
celebrities and politicians, or low visible as every-day bloggers.

Social media introduced new opportunities for brands to connect with people and has the
ability to link people who influence or exert influence and even transmit influence. For
example, an endorsed celebrity exerts a different type of influence than a trusted friend or
neighbour endorsing the same product, and they, in turn, exert a different type of influence
than a renowned expert. By incorporating social network information into influence strategies
and marketing design, the brands and marketers make it possible to diminish unused
resources and simultaneously achieve bigger sales. One of the places where such strategy is
used are the blogs- places on the internet, where different people publish and share
experiences, stories, 3 pictures, opinions on products and services, with their popularity
grown rapidly in the last years due to them actually offering information in a synthesized and
quite well functional form. Furthermore, in the blogosphere users and consumers can ask and
receive information about products and services, and henceforth being influenced by that
same information by the bloggers while making decisions- an illustration are the fashion
blogs. The readers of the fashion blogs and the fashion bloggers stipulate blogs to be actually
more authentic in their content, whilst delivering more independent view than the traditional
fashion media, like Vogue or Elle magazines.

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Hence, the fashion blogosphere is viewed as a democratic place where everyone can fit, no
matter the size, social status, sexuality, or gender. At the same time, it has also been disclosed
that a substantial number of famous influencers and bloggers are working with brands and
getting compensated in money or products, so that raises the question about their credibility,
trustworthiness, and authenticity. The increased commercialization brings out some
controversies and criticism in the influencer marketing. Are the bloggers or influencers
honest when giving an opinion about a product? Is this honesty actually paid for, or are they
authentic in their core? Does it depend on the amount of compensation they receive when
blogging or advertising a product?

Finding convincing and powerful influencers is at the base of the success of viral marketing
or WOM marketing. To be able to identify these people who can, and whose role is to
influence, is very important, as by influencing they play a significant role in the buying
decisions of the consumers, and in setting the new trends and preferences. Moreover, trust
plays a major role in influencing the consumers' behavior, as it is a two-way relationship
building block. From the one side there are the producers, vendors, and suppliers, and from
the other side there is the consumer, who doesn’t want unpleasant surprises after receiving a
product or service. The purchasing behaviour is therefore influenced by multiple factors, for
example online advertising. Users exposed to banners are usually more prone towards
purchasing, meaning increased purchasing intent, and followed by repeating purchase
probabilities. Expanding on the behaviour of the consumers, it has been shown that
consumers actually integrate their real life into their online behaviour, and vice versa. This
leads to the reasoning that being influenced online will affect the purchase intent in real life,
as well being influenced in general will affect the purchase intent and perception of products
and services. Nevertheless, it remains important to find out what are the real factors that can
influence the consumer in such commercialized exposure. People usually don’t want to be
lied to, especially in the role of consumers- no one wishes to lose money by buying a non-
functional product or unsatisfactory service, due to misleading advertising.

1.2. Research problem

The thesis blends two areas, influencers in influencer contemporary marketing, and online
purchase intent. But understanding if there is a connection between influencers and the online
purchase intent of the consumers appears to be connected with what actual features these
influencers have, and how they are perceived by their peers. Much of the research on

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influencers has been conducted with viewing them as “brand enthusiasts” , in the context of
influencers as brand advocates, exploring their success and growth as they are viewed as
personal brands. The influencers and their credibility and authenticity have been researched
in the context of brand messaging and awareness, or in the context of fashion bloggers. At the
same time, how popular and influential the influencers are has been of interest for different
researchers. Trust has substantiated to have a considerable effect on purchasing intention.
Furthermore, in an online environment consumers play a significant role via their
interactions, which influences how trust is generated and consequently led to purchase
intention.

Meanwhile, the consumer purchasing decision is influenced by the electronic WOM, which
in turn affects the purchase intent in two ways- positive or negative way. It has also been
noted that brand attitude has a positive impact on purchase intention, for instance when the
consumer shows a desire to buy a specific brand this intent is invigorated when the consumer
has a positive attitude towards it. Also, brand equity contributes to customer's’ purchase
intention, and brand loyalty has a direct positive role in affecting both of brand equity and
purchase intention. The influencers have the ability to affect purchasing decision in their roles
of experts, which shows the connection between influencers and purchasing behaviour, while
at the mean time it infers an implicit connection to authenticity, credibility, trustworthiness,
and other features an influencer might possess, as the main reason for trust in experts.
Therefore, we can relate our research problem to the interconnection between influencers and
online purchase intent. In this thesis the focus will be on exploring this interrelation from the
point of view of the consumers 6 themselves, as existing research does not address
adequately the question of what are the actual features of the influencers that influence the
online purchase intent.

1.3. Purpose and research question

The purpose of this thesis is to explore the features that an influencer possesses or should
possess and their impact on online purchase intent for consumers. Therefore, this thesis will
combine influencers marketing and online purchase intent in one framework. Hence, we have
the following research question: What are the main features of influencers that have an
impact on consumers’ online purchase intent?

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Chapter 2: Conceptual Theory

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2.1. Influencer marketing and influencers

The Internet has changed the traditional ways of conducting business and establishing
consumer’s relationships, the way companies and customers interact and the transactions.
Online shopping is gaining a vast popularity and is becoming broadly accepted as a
purchasing tool for products and services. With the emergence of the e-commerce online
purchasing emerges as a new phenomenon, becoming the future of commerce in the digital
world. Therefore, social media has become a crucial source for communicating marketing
messages globally, making the organizations, researchers and marketers be more interested in
the value of advertising and the possibility to influence on the multiple platforms. Hence,
influencer marketing is a practice, which is extremely hyped lately, and can be defined as a
form of marketing that involves activities aimed towards identifying and building relationship
with individuals who have the capability to influence over potential buyers. It follows the
concept of a “trusted advisor”, as defined by Brown and Hayes (2007), and is perceived as a
resemblance to the older TV commercials, where celebrities are featured to leverage their
popularity and advertise a brand. Producing a content, that can go viral and achieve
substantial marketing success, is considered to be the most difficult.

By tapping into influencer marketing the companies are able to stimulate the consumers to
buy their products, and create a significant retail lift. Brown and Hayes postulate three
patterns to tap into influencer marketing. First, marketing “to” influencers- increasing the
brand’s awareness within the community of the influencer. Second, marketing “through” the
influencer by using the influencers to surge the brand’s awareness amid target consumers;
and third, by marketing “with” influencers by transforming the influencers into brand
advocates. But what are influencers?

There are a few definitions of what influencers are, but for the purpose of this thesis we focus
on the following definition of influencers, as an extremely popular multimedia form of
microcelebrities. Influencers are people who operate on numerous types of social media, and
often simultaneously on few platforms, such as Instagram (known as Instagrammers),
YouTube (known as YouTubers), Tweeter (known as Tweeters), and different professional
and or commercial bloggers, who are famous “to a niche group of people”, unlike the
mainstream celebrities. Marwick describes the micro-celebrities as regular people drawing on
the culture of celebrities to boost their popularity within a network, using online tools. They
do not do this just out of nowhere, it includes wary curation of” self conscious, carefully

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constructed personas”, empowered by strategically sharing of information, and aimed at
building a specific relationship with followers. This specific relationship is para-social-
giving the illusion of having an actual face-to-face relationship between the follower/fan and
the influencer. Para-social communication can create the feeling of intimacy and relationship
as it would be in real life conditions with interpersonal communication. By commenting on
the different social media where they have account the micro-celebrities are expanding the
para-social relationship. It is argued, that by staying in touch and having direct interaction
with their followers and supporters they are able to maintain and grow their popularity. In her
study on the micro-celebrities in Singapore’s lifestyle and fashion area states that these
micro-celebrities, whom she calls influencers, are giving the impression of intimate
interaction, or communicative intimacy. They do that by utilizing different techniques-
posting rawer and not highly photo shopped pictures, asking for comments in order to
improve content, or showing they are down to earth personas with everyday problems.

2.2 The role of the influencers

In the WOM marketing nowadays the influencers play a very important role, and at the same
time their recognition is fast growing due to them offering synthesized information in various
forms and functionality. The main factors defining the consumer’s propensity of being
influenced by a specific influencer are highly dependent on the right information, at the right
time, on the right place and from the right person. The influencers withstand a special part in
the virtual community - they spread information via various social media channels, such as
blogs and social networks; 9 they share stories and pictures; they relate to their experiences;
they express different opinions about numerous subjects, services and products; they are an
illustration of the particularly important phenomenon of influencing. Contrasting the
celebrities who are usually public figures with vast amount of flowers and fans, influencers
are creating advertorials on social media or on blogs. Sometimes they receive payment in
exchange for writing or promoting products and/or services. Bloggers have an audience that
is interested in specific topics for discussions, and the popularity of online blogs is not
unrecognized by the marketers- after all 77% of all internet users read blogs. Accordingly,
marketers have started using bloggers as endorsers, as they may be perceived as more
credible than celebrities.

Hence, the connections forged by the internet mean that brands wanting to be perceived as
authentic will turn their marketing efforts towards seeding information or products with

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influencers, relying on their ability to provide the consumers with the feeling of “people like
me” - cited as the highest form of influence by the consumers themselves. This means that
brands have to carefully look for influencers who generate genuine interest, and these
influencers can differ from the traditional celebrities and paid endorsements.

2.3 Factors influencing the purchase intent and the online purchase intent

There are different factors that affect purchasing intent and the intention to purchase online,
other than those related to the influencers’ features. They include brand awareness, perceived
quality, customer loyalty, perceived value, and others, which are explained further in this
subchapter. The consumer's’ ability to organize and recall a brand is known as brand
awareness. A product with high brand awareness will attract more consumer and retailers,
because of its high market share and the quality beliefs attributions. Store brand awareness
has found to have a positive and significant impact on purchasing intent.

Additionally, customer loyalty as the tendency to favor a certain brand or product over other
product, and it assures 12 customer the repurchase of constructive brand on mind in the
future. Furthermore, they revealed a significant impact of brand awareness, perceived quality
and customer loyalty on purchase intention. Moreover, there is a positive significant relation
between dimensions of brand equity, brand preference and purchase intention. Perceived
value is defined as a “customer’s overall assessment of the utility of a product (or service)
based on perceptions of what is received and what is given”. Consumers will buy a product
with high perceived value, as the higher perceived value is, the higher purchase intention is.

Website quality is a substantial factor in electronic commerce as customers’ perceptions of

website quality positively influence their intentions to use the website. Website quality
directly affects purchase intentions. A study indicate that perceived trust is positively
influenced by website quality, and purchase intention is positively influenced by perceived
trust. Furthermore, the availability of useful and pertinent information online positively
influences customers’ purchasing intention and subsequently leads to the actual purchase.
Past online experience is one of the predecessors of online purchase intention. Moreover,
customer’s experiences via online blogs’ involvement significantly 13 increases the effects of
customer experiences on purchase intention. Additionally, the consumer purchasing decision
is influenced by the electronic WOM which affects the purchase intention either in a positive
or negative way.

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The product browsing and word of mouth intention are inextricably linked, which enhance
the probability of conducting a purchase. Naturally, the consumer willingness to share his/her
information over the Internet dictates the purchase decision, as some researches addressed
privacy as a factor that influences the online purchase intention. Endorsers and their expertise
regarding the product, trustworthiness and their physical attractiveness are some additional
influencing aspects. The more the person who endorses a product or brand fits these criteria,
the more likely they are to positively influence the purchase intent, and vice.

2.3. Theoretical framework

The theoretical framework in this master thesis is based on the literature used previously, and
the conducted pre-study before the main study. Countless brands have engaged influencers in
their attempts to reach out more consumers and influence their purchasing behavior. These
brands vary from small and not so famous ones, to Gucci, Canon, KLM. Multinational
corporations (MNCs), government and nongovernment (NGOs) organizations, education and
political entities have realized the extensive popularity and fame bloggers are gaining, and
invite them for promoting causes or raise publicity to their projects. Their ability to influence
is connected with the features they possessauthenticity, credibility and trustworthiness,
competence and independence.

2.4 Influencers and features of the influencers

The concept of authenticity is one of the most important in marketing nowadays, and the
increasing commercialization altered the way consumers perceive authenticity in the
contemporary world. Since bloggers usually write about topics that are interesting to them
they are engaged and seen by the readers as already experts, making them look as more
credible, and having a better expertise than the celebrities. However, when consumers see a
celebrity promoting a brand they connect that with the possibility that the celebrity is engaged
due only to the monetary binding (being paid to advertise), unlike the majority of the
bloggers. Authenticity forms the uniqueness of the influencer, as consumers seek authenticity
in both companies and brands. Consumers want an authentic experience, not a powdered
replication of an imaginary experience as sometimes is the case with celebrity endorsers.
Authenticity is viewed as the ability to be true to one’s self. Credibility and perceived
trustworthiness of influencers are found to be two of the features making the influencers
effective brand promoters.

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Credibility is one of the main protruding factors in persuasion, especially in online setting
when the consumer doesn’t have the possibility to actually feel and touch the product.
Moreover, credibility is important for the bloggers and microcelebrities as it nurtures their
effectiveness, and boosts their own media image and self-brand. When an influencer is seen
as more credible the purchase intents of the target groups are higher, as he/she is seen as
having higher expertise, trustworthiness and attractiveness. Thus they augment the
contemporary marketing strategies, as consumers might still feel distant from the celebrities,
but closer to the influencers, making them more likable.

Trustworthiness is foreseen as an imperative variable in an online environment. Consumers

perceive trust as “the degree of confidence that a source is motivated to communicate valid
assertions” meaning that even though companies might be experts in their areas they might
not be perceived as trustworthy. Nonetheless consumers will read blogs, or see a review by
an influencer who is confident, and will judge it as more trustworthy. The influencers are
seeming as giving honest opinions about the products/services. Thus their followers identify
more with them than with the manufacturers, and subsequently trusting the product
information better. Competence is the extent to which a source is deliberated as expert,
making it trustworthy, depending on the knowledge and proficiency about a topic. The
concept of competence relates to the ability of the influencer to endorse certain intents, as
competence is a dimension of human social cognition. Furthermore, it echoes “traits that are
related to perceived ability, including intelligence, skill, creativity and efficacy. By self
proclaiming their expertise people aim at constructing the impression that makes them being
perceived favorably and in better light by others, and perhaps increasing their persuasion
traits.

Furthermore, competence is directly linked with 17 credibility and the ability of the
influencer to make valid statements. Since communication is two-sided it is essential to
provide accurate information, as it leads to higher competence perception. In this research
context, independence is defined as a condition in which an individual is able to use their
mind and body, regardless of social constraints or conscience. Independence is an element of
authoritarianism that making a person to act on his authority without doubting or inquiring
their ethics, morality and integrity. Independence is a tool for measuring the consumer’s view
to influence in the context of social influencers. That leads to the suggestion that the higher
the independence individual possess, the higher his/her abilities are to use opportunistically
his/her influencing powers.

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2.5 Purchase intent and factors, influencing the purchase intent

The rise of technology and the Internet advancement have led to the expansion of different
firms and business online, causing a number of studies to take a closer look at the consumer’s
online purchasing intention - when customers intend to search, select and purchase products
over the Internet. Hence, the Internet affects the customer decision-making behavior in all
stages of their purchase- the pre-purchase, purchase and postpurchase. The structure of the
website, being it wellorganized and attractive is what is important during that stage of
purchasing decision makingthe pre-purchase stage. During the purchasing stage the most
valuable points forwarding the consumer towards buying are the information quality and sale
services of the merchant. And in the post-purchasing stage the ability to return or exchange a
product when there is a concern or problem with it is considered to be the most important.
From the discussion above the features of the influencers might have an impact on
consumers’ purchase intent when buying from online retailers. Therefore, a conceptual model
for this study is developed and illustrated in Figure 1 below.

Fig: Theoretical frame: Consumers’ online purchase intent toward online retailers and
the role of influencers.

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Chapter 3: Literature Review

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Review of Literature

A literature review discusses published information in a particular subject area and

sometimes within a certain time period. A literature review can be just a simple summary of
the sources, but it usually has an organizational pattern and combines both summary and
synthesis. The purpose of literature review is to provide a backdrop of the present study; a
context to which our presents study can be referred to determine its relevance.

3.1 Social Influencer Marketing

An introduction to Influencer Marketing Influencer Marketing is a form of “stealth”

Marketing. Social influencer marketing can be define as “operating on a market in a
deceptive, covert, furtive, imperceptible and disguised manner to purposefully influence
audiences without the audiences being aware of these activities”. An interesting concept here
is an “advertorial”, which is a combination of “advertisement” and “editorial”. These are
personalized promotions of products (or services), posted by an opinion leader, which is “a
person who offers informal advice or information about a specific product or product
category, such as which of several brands is best or how a particular product may be used”.
These posts appear to be spontaneously experienced by these influencers, but in fact, they are
remunerated.

Moreover, these advertorials have been found more effective 5 than classic advertisements,
since they take the form of a personal narrative and incorporate Influencers’ perspectives of
having experienced the product or service themselves. SI is “a state of being famous to a
niche group of people”. It is about an Social Media user that has established credibility in a
specific niche, sector, or industry, because of his or her reach and authenticity. This user has
access to a large audience, can persuade others, and creates trends on social media. It is also
called “efluencer”. Hence, for these people, taking pictures of their daily life has become a
commercial business. They do this on blogs, but nowadays, increasingly on Social Media.
Commercial lifestyle bloggers are in general young women, between 18 and 35 years old.
Their followers are on average 70% female, between 15 and 35 years old.

3.2 Influencers influenced by other influencers

Influencers are inspired by other influencers, as 83% of these influencers say they purchased
a product they saw on social media within the last month. Influencer Marketing is top-of-

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mind for today’s marketers. According to eMarketer, nearly half of marketers have upped
their investment in Influencer Marketing in 2017. Brands and marketers understand that the
voices of authentic, trusted profiles are much more likely to break through the ad blockers.
As influencers can have a real impact on followers and can be effective in developing the
digital presence of a brand, B2C brands should certainly consider SI Marketing. A lot of
companies use Influencer Marketing not to sell a product, but rather to get consumers
exposed to the brand and its story. That is why we see a lot of lifestyle brands using this tool.
Moreover, this type of Marketing is also very effective for a brand wanting to (re)introduce
itself or strengthen its position in a particular market. SI Marketing is most effective for
brands wanting to reach a “younger” audience, as mentioned above. This is because
millennial consumers are turning away from the traditional media. They are moving online
and grouping around some selected and trusted influencers who share their interests. In a Key
Findings Report of April 2016 of the ANA (The Association of National Advertisers), 86%
of brands are using Influencer Marketing as part of their content strategy. Only 0,6% finds
influencer content not valuable at all, while 53% of brands thinks it is valuable, and 36%
finds it very valuable.

3.3 Advantages of Influencer Marketing

Linqia’s research of 2016 provides answers to surveys completed by 170 American

marketers. 89% of marketers believe that creating authentic content about a brand is the most
important advantage. The second most essential advantage is driving engagement around a
product or a brand. After that comes the fact that Influencer Marketing drives traffic to a
brand’s website or landing page (Linqia, 2016).

Fig: Top Benefits of Influencer Marketing

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3.4 Consumer purchase behaviour

Kotler and Keller define consumer behaviour as “the study of how individuals, groups, and
organisations elect, buy, use and dispose of goods, services, ideas or experiences to satisfy
their needs and wants”. This thesis focuses on one aspect of this definition: everything that
revolves around the purchase itself. Consumer purchase behaviour first refers to the act of
buying a certain product or service. But this is not the only mean of the concept. It includes
for instance the search of relevant information to a purchase decision, selections and other
actions performed before, during and after a purchase. It is an observable event that takes
place in a certain context and at a given point in time. Moreover, it comprises four elements:
an action, a target, a context (for instance online) and a time. The first element, the action, is
for example: buying, but also searching for information. The second element is the target at
which the action is directed (a brand or a product category). What other factors influence
buying behaviour?

According to Keller and Kotler (2016)), buying behaviour is impacted by three factors. To
begin with: the cultural factor, which is the primal causal factor of a person’s desires and
behaviour. In addition to that, social factors such as reference groups, social roles, and family
affect buying behaviour. This factor is essential when it comes to Influencer Marketing, as it
contains among others: “opinion leaders”, which has been presented above And thirdly, the
consumer’s personal factors, including age, stage in the life cycle and the consumer’s
occupation.

4.1 The 5-Stage Decision Making Model

Engel, Blackwell and Miniard developed a comprehensive model that shows the components
of decision-making and the interactions among them. According to this model, a consumer
typically passes through five stages, which are presented in Figure 8. However, consumers
may reverse or skip a few stages, they do not always pass through all five of them (Keller &
Kotler, 2016). The 5-Stage Decision Making Model (Blackwell, Miniard and Engel, 2006, in
Sinigaglia, 2016)

► Problem recognition

The first step in a consumer’s decision process, is the recognition of a problem or need,
triggered by internal or external stimuli. Internal stimuli rise a person’s ‘normal’ needs, as for

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instance: being hungry. Influencer Marketing can be an example of an external stimulus: a
person admiring someone else’s new possessions, which inspires that person about making
the same purchase. Marketers must identify the sources that trigger a particular stimulus for a
need, by gathering information about the targeted customers. Especially when it comes to
discretional buys, such as lifestyle products (which are part of this thesis’ subject) and luxury
goods, marketers must increase the consumer’s motivation (Keller and Kotler, 2016).
Influencer Marketing is a good example of the application of a pull strategy. Instead of
pushing the consumer to buy the company’s products, it is going to make the consumer
‘want’ and ‘search for’ the product. Because the SI is showing and recommending the
product, some followers with the same interests as the influencer, are going to want the
product as well. The pull strategy refers to a process that starts from the audience and goes
towards the company: demand requests supply and ‘pulls’ it out of the company.

Fig: The 5-Stage Decision Making Model

► Information search

The model claims the second step is the search of information. When the consumer is
executing this second phase, he or she is usually going to traverse two sub-states. Firstly, the
consumer becomes more receptive to information about a product. This is called “heightened
attention”, and it is a milder state of engagement in the search. In the second state, the
consumer may enter an “active information search”. The person is going to start reading
about the product, ask friends, visit stores, and search online, to gather more information on
the product (Keller and Kotler, 2016). Problem recognition Information search Evaluation
alternatives Purchase decision Post purchase behaviour Keller and Kotler divide the major
information sources into four groups: personal, commercial, public, and experiential sources.
A SI is often considered as a personal friend to their followers. But their content is shared on
social media, which makes SI Marketing a combination of a personal and a public

21
information source. Consumers are appealing to social media channels for their information
search, which is why search through social networking sites is on the rise. How are
individuals processing and selecting information on social media before buying something?
Social media provides a new channel to acquire product information through peer
communication.

By collecting information, the person learns about competing brands and their specifications.
The market offers a ‘total set’ of available brands. After gathering information, this will be
reduced to the ‘awareness set’, the person now knows about some existing brands on the
market. After that, some of the brands of the awareness set will meet the initial buying
criteria. Together, these brands form the ‘consideration set’. After getting to know even more
about these brands, only few will enter the ‘choice set’. The consumer will in all probability
make a final choice out of this last set (Keller and Kotler, 2016).

► Evaluation of alternatives

Subsequently, the consumer will evaluate alternatives. Many alternative options are
constantly evaluated every minute by consumers. There exist several processes, and most
recent models claim that individuals form judgments largely on a rational and conscious
basis. Consumers see each product as a bundle of (un)interesting attributes. They will pay
most attention to the attributes that convey the sought benefits (Keller and Kotler, 2016). A
consumer’s beliefs and attitudes also impact their evaluation of alternatives. A belief is “a
descriptive thought that a person holds about something”. Attitude is discussed further in the
fifth chapter. An interesting model here is the “expectancyvalue model”, which presupposes
that consumers evaluate products (or services) by combining their brand beliefs, according to
importance. This tool helps marketers to predict consumer’s choices more reliably. This is a
compensatory model, which claims that recognized good things about a product can help to
overcome its perceived negative attributes. User Generated Content (content produced by the
user himself, used in Influencer Marketing) and Marketer Generated Content often influence
the evaluation of alternatives. Consumers are influenced by other consumers on social media,
through visual stimulations and reviews. They seem as “more objective” sources to them.
Thus, WOM and e-WOM play an important role here (Moustakas, 2015).

22
► Purchase decision

The second-last presented phase of this model is the “purchase decision”: executing a
purchase intention. We must mention here that purchase intentions and preferences are not
completely reliable predictors of purchase behaviour. A consumer can decide to modify or
postpone its purchase decision, because of several perceived risks, such as: a functional,
physical, financial, social, psychological, and time-linked risks (Keller and Kotler, 2016). In
the explanation of the previous phase, we mentioned a compensatory model. The buying
decision is an example of a non-compensatory choice, as positive and negative attribute
perceptions do not necessarily net out. Keller and Kotler explain three choice heuristics in
this context. The consumer can use the conjunctive heuristic, in which the person sets an
acceptable minimum level for each attribute and chooses the first brand that meets the
minimum standard for all attributes. When the person is executing the lexicographic heuristic,
he or she chooses the best brand, only regarding the most important attribute. If the customer
is putting the elimination-by-aspects heuristic into work, it means that he or she is eliminating
brands that do not meet the minimum acceptable level.

► Post-purchase behaviour

The final step in this process is consumer behaviour after the purchase. The consumer is
dissatisfied if the product’s perceived performance is not close to his or her expectations. On
the contrary, if this is close, the consumer is satisfied. If expectations are exceeded, the
consumer is delighted. These three post-purchase reactions make the difference whether the
consumer will buy the product again, and talk (un)favourably about it to others, and thus,
possibly influence the purchase decision of others (Keller and Kotler, 2016). 19 An important
notion here is ‘cognitive dissonance’, which Festinger defines as “a psychological
phenomenon that occurs when there exists a discrepancy between what a person believes in
and the outcome which questions a person’s belief”. In other words, this is the buyer’s
remorse, as he or she might question whether he or she has made the right decision when
buying a particular brand. Some companies engage their customers with post-purchase
communications to impact their feelings about their buy and future buys. If SIs keep on
posting pictures or recommendations of the brand the customer has bought, this might reduce
this cognitive dissonance, as it might reassure the consumer about his or her purchase
decision.

23
Chapter 4: Objectives of the Study

24
Objectives:

1. To identify how the businesses are currently using influencer marketing.

2. To study the impact of influencers on the consumers buying decision process.
3. To find out the influencer marketing techniques used by various businesses.
4. To identify consumers social media presence, their perception and attitude towards
social media influencers.

25
Chapter 5: Research Methodology

26
Research Methodology

 Research Design

Research design specifies the methods and procedures for conducting a particular study. A
research design is the arrangements of conditions for collection and analysis of data in a
manner that aims to combine relevance to their search purpose with economy of procedure.

 Qualitative Research Design

Qualitative research is designed to reveal a target audience’s range of behaviour and the
perceptions that drive it with reference to specific topics or issues. It uses in-depth studies of
small groups of people to guide and support the construction of hypothesis. The results of
qualitative research are descriptive rather than predictive. Qualitative research originated in
the social and behavioural sciences: sociology, anthropology and psychology. Today,
qualitative methods in the field of marketing research include in-depth interviews with
individuals, group discussions and in context observations.

Qualitative research often relies on technique such as:

• Secondary research – such as reviewing available literature and data.

• Qualitative approaches, such as informal discussions with consumers, employees,

management or competitors.

• More formal approaches through in-depth interviews, focus groups, projective methods,

case studies or pilot studies.

 Research Tool

• Microsoft excel

• Internet

 Research Type

Exploratory Research

Exploratory research is a research conducted for a problem that has not been clearly defined.
It often occurs before we know enough to make conceptual distinctions or to posit an

27
explanatory relationship. Exploratory research helps determine the best research design, data
collection method and selection of subject. It should draw definitive conclusions only with
extreme caution. Given its fundamental nature, exploratory research often concludes that a
perceived problem does not actually exist.

 Sample Design

A sample design is a definite plan for obtaining a sample from a given population. It refers to
the technique to the procedure adopted in selecting items for the sampling designs are as
below:

 Sample Size

Sample size: 20

 Sampling Method

In this marketing project, I have used Convenience Sampling Method. A Convenience

Sampling Method is one of the main types of non-probability sampling methods. A
convenience sampling is made up of people who are easy to reach.

 Data Collection Method

Primary Data

Primary data means data that are collected by differ techniques like Questionnaire, depth
interview, survey, schedules etc.

Secondary Data

Secondary data means data that are already available i.e. they refer to the data which have
already been collected and analysed by someone else. Usually published data are available in:
Various publications of the central, state/local governments or foreign governments, technical
and trade journals etc. The secondary data involved in this project has been gathered from the
internet.

28
Chapter 6: Data Interpretation

29
1. Do you have a Social Media Account?

Social Media Account

4

Yes No

16

Out of 20 respondents, there are 16 respondents who have their account on social media and
there are 4 respondents who don’t have social media presence.

Yes No
16 4

30
2. Approximately how long have you had your social media account for?

Number of years
8
8

6
5 5
5
Number of years

3
2
2

0
Less than 1 year 1-2 years 3-4 years 5+ years

Out of 20 respondents, there are 2 respondents who have their social media presence from
less than 1 year, whereas 5 respondents have their social media presence from 1-2 years.
There are 8 respondents who have their social media account from 3-4 years and 5
respondents have social media account from more than 5 years.

31
3. Do you follow any Social Media influencers?

SMI Followers

Yes No

16

16 of respondents follow Social media influencers and 4 respondents do not follow any
Social media influencer.

Yes No
16 4

4. If yes, please indicate how many Social Media influencers you follow.

32
 Number of SMI Followers
5
2

1 to 5
6 to 10
11 to 15
7 15+

So, out of 20 respondents, there are 5 of respondents who follow 1-5 SMI, whereas there are
6 respondents who follow 6-10 SMI. 7 respondents follow 11-15 SMI and 2 follow 15+ SMI.

5. Please tick all that apply.

33
 6
5
4 6
3 5 5
4
2
1
0

Respondents purchased a product via a

social media link supplied by an influencer 4
Respondents purchased a product by
swiping up on an influencer’s Social media 6
story
Respondents purchased a product because
of an social media influencer promoting it 5
Respondents used Social media
influencer’s promotional codes to receive 5
discount on products

6. Please indicate all that applies.

 I make purchase decisions based on recommendations from Social media influencers

34
  I follow Social media influencers to discover new products on the market
 I actively seek out reviews from Social media influencers before making a purchase
decision
 If my favourite Social media influencers recommends a product, I am more likely to
try it

3 5
I make purchase decisions based
on recommendations from Social
media influencers
I follow Social media influencers to
discover new products on the
market
I actively seek out reviews from
Social media influencers before
making a purchase decision
7
If my favourite Social media
5 influencers recommends a product,
I am more likely to try it

7. What are your attitudes towards online influencers? Please indicate how much you agree
with the following statements.

35
 If

8.
I fo
un
d
ou
tt
ha
ta
n
in
flu
en
ce
rh
ad
be
en
pa
id
Th fo
eh r
igh thei
er re
th n
e a dor

Please indicate your gender.

m se
m
ou en
nt t, It
of it ru
fo wo
st
th
llo ul
we d er
rs n eg
ec
om
an ati
v I m
in ely fin en
flu
im d da
it

36
en tio
ce pa ea ns
rh ct sy
m t
0
1
2
3
4
5
6
7
8

of
as yp o in
,t
he re flu
er lat
m ce e en
4

pti to ce
55

or rs
el on in
33

ike of flue
7

ly nc
2

I w thei er
s
5

ill rc
3 3

tru re
st di
55

bi
th lit
y
4

eir
op
in
7

io
2

n
33 3 3
5

Agree

Disagree
Strongly agree

Strongly disagree
Neither agree nor disagree
 Gender

8 Male
female

12

Out of 20 respondents, 12 are female and 8 are male.

9. Please indicate your age.

37
 10
10

6 5
5 4
4

2 1
1

0
18 to 24 25 to 30 31 to 40 41+

It shows that the respondents of age group 18-24 are more influenced by the SMI than other
age groups. Whereas 5 respondents are from 25-30 age group, 4 are from 31-40 age group
and 1 respondent is from 41+ age group.

38
 Chapter 7: Findings and Conclusion

7.1 Findings

39
  There are many reasons why consumers follow influencers. Influencers motivates,
inspires, entertain, keep up with the latest news or because of interest in the products
of influencers use and advertise, and the content product, as well as the potential
future lifestyle that some consumers want to have and resemble to.

 The consumers care about the values and the principles of the influencers, this is the
reason as to why they like them and follow them.

 The reputation of the influencers is usually prevailing over the popularity, a good
reputation is perhaps showing more influential and having more impact than
popularity.

7.2 Conclusion

40
  The purpose of this study was to research the features that an influencer possesses or
should possess and their impact on online purchase intent for consumers.
 The reason for this exploration was to identify and gain understanding into how
influencers are managing to affect the online purchasing intent of the consumers.
 Therefore, this thesis by combining influencers marketing and online purchase intent
in one framework aims at answering the following research question: What are the
main features of influencers that have an impact on consumers’ online purchase?
 Authenticity is amongst the most significant feature that has an impact on whether the
respondents will listen to the influencers.
 The other features of significance are trustworthiness and credibility, competence and
expertise, legitimacy and honesty. Authenticity as stated by existential philosophers is
living one’s life honestly, coherently, sticking to the values of integrity.
 The respondents want the influencers to be honest with them, to disclose when they
are advertising a product, or put a disclaimer, as it is required by some platforms.
 Influencers are important and they are able to impact the online purchase intent to a
certain extent but not that big of an impact as most of the brands and marketers think
today.
 Naturally, only the features that an influencer possess are not enough to have a
significant impact and make a consumer buy a product without thinking or
contemplating about it. But it can be assumed that these features are a factor that
might enhance or diminish the purchase intent, when combined with other forces or
depending on the environment and settings.
 Furthermore, online purchase intent is found to be affected by a number of factors
different than the influencers’ features, including the need for the product, its price,
the recommendations, and some others

Bibliography

41
1. https://windycitycosmo.com/2015/11/20/howbloggers-and-brands-create-authenticity-
on-social-media/
2. http://www.dypatil.edu/schools/management/wp-content/uploads/2015/11/A-Study-
on- 49 Purchase-Intentions-of-Consumers-towards-Selected-Luxury-Fashion-
Products-withspecial-reference-to-Pune-Region-Rimpy-Goyal_.pdf
3. www.wikipedia.com
4. www.marketo.com
5. http://digitalcommons.unl.edu/textilesdiss/7

42