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Int. J. Management and Decision Making, Vol. 7, Nos. 2/3, 2006 143

Marketing strategy based on customer behaviour

for the LCD-TV

Yu-Jing Chiu
Department of Business Administration, Chung Yuan Christian
University, 200, Chung Pei Rd., Chung Li 32023, Taiwan
E-mail: chiou.yu.jing@yahoo.com.tw

Institute of Management of Technology, National Chiao Tung

University, 1001, Ta-Hsueh Rd., Hsinchu 300, Taiwan
E-mail: yujing.mt89g@nctu.edu.tw

Hsiao-Chi Chen
Institute of Management of Technology, National Chiao Tung
University, 1001, Ta-Hsueh Rd., Hsinchu 300, Taiwan
E-mail: angela77.mt90g@nctu.edu.tw

Gwo-Hshiung Tzeng*
Institute of Management of Technology, National Chiao Tung
University, 1001, Ta-Hsueh Rd., Hsinchu 300, Taiwan

Kainan University, No.1, Kainan Rd., Luchn,

Taoyuan County 338, Taiwan
E-mail: ghtzeng@cc.nctu.edu.tw
*Corresponding author

Joseph Z. Shyu
Institute of Management of Technology, National Chiao Tung
University, 1001, Ta-Hsueh Rd., Hsinchu 300, Taiwan
E-mail: joseph@cc.nctu.edu.tw

Abstract: Manufacturers of LCD-TV tend to focus on technology with little

consideration for customer needs. We have researched customer behaviour in
order to learn more about customer needs in an effort to reduce the gap
between technology and customer-needs. Customer behaviour is defined in this
study as buying behaviour. The traditional concept of marketing strategy is not
multi-dimensional, so we employed the Decision Making Trial and Evaluation
Laboratory (DEMATEL) method. The DEMATEL method is used to detect
customer buying-decision-factors. The relative relationship supports strategic
planning in actual situations and the competitive environment. Results show
that customer buying-factors include price, quality, resolution of kinescope,
low radiation, and the relationship between these factors. Quality is a powerful
factor affecting others with advertising as a prime example. The marketing
strategy planning framework is proposed according to the relationship of

Copyright © 2006 Inderscience Enterprises Ltd.

144 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

decision factors. This study provides relationships and marketing strategy

planning for firms in the LCD-TV market to meet customer needs.

Keywords: LCD-TV; customer behaviour; market marketing strategy.

Reference to this paper should be made as follows: Chiu, Y-J., Chen, H-C.,
Tzeng, G-H. and Shyu, J.Z. (2006) ‘Marketing strategy based on customer
behaviour for the LCD-TV’, Int. J. Management and Decision Making, Vol. 7,
Nos. 2/3, pp.143–165.

Biographical notes: Yu-Jing Chiu received her BS in Business Administration

from Chung Yuan Christian University, Taiwan, and her PhD Degree from
Institute of Management of Technology, National Chiao-Tung University,
Taiwan, in 2000 and 2005, respectively. She is currently an Assistant Professor
in Business Administration at Chung Yuan Christian University, Taiwan.
Her primary research interests include consumer behaviour, marketing, and
technology management.

Hsiao-Chi Chen received a BS in Business Administration from Chung Yuan

Christian University, Taiwan, in 2001. She is presently a PhD candidate at the
Institute of Management of Technology in National Chiao-Tung University,
Taiwan. Her research interests include industry analysis, platform structure,
and strategic management. Her major subject is Strategy Planning.

Gwo-Hshiung Tzeng received his BS Degree in Business Management from

the Tatung University; Taipei, Taiwan, his MS Degree in Urban Planning from
Chung Hsing University; Taipei, Taiwan, and his PhD Degree in Management
Science from Osaka University, Osaka, Japan, in 1967, 1971, and 1977,
respectively. He was a Visiting Professor in the Department of Engineering and
Economic System, Energy Modelling Forum at Stanford University, from
August 1997 to August 1998 and a Professor at Chaio Tung University from
1981 to the present. He has achieved the position of National Distinguished
Chair Professor. He is a member of IEEE, IAEE, ISMCDM, and World
Transport. His current research interests include multivariate analysis, routing
and scheduling, multiple criteria decision making, and fuzzy theory.

Joseph Z. Shyu is now a Professor at the Institute of Management of

Technology in National Chiao-Tung University, Taiwan. His professional
specialty is Science and Technology Policy, Industry Analysis, and Analytical
Chemistry.

1 Introduction

A new application for Thin Film Transistor Liquid Crystal Display (TFT-LCD) is LCD
Television (LCD-TV). LCD-TV has become popular in consumer electronics within the
household television market, as a result of rapid technology development. Display
Search (2002) forecasts that LCD-TV demands will expand quickly at a compound
annual growth rate of 104% from 2002 to 2007. LCD-TV has huge potential for the
future. However, manufacturers of LCD-TV focus on technology with little regard for
customer needs. Therefore, we attempt to study customer behaviour in order to reduce
the gap between technology and customer-needs. Customer behaviour is defined in this
study as buying behaviour.
 Marketing strategy based on customer behaviour for the LCD-TV 145

Little attention has been given to how customers evaluate products resulting
from the convergence of television sets (Roberts et al., 2002). Hultink et al. (1995) noted
that pricing and skimming strategies are used to successfully launch high-tech products.
Previous studies show that marketing strategies of high-tech products are interesting
issues, and have been in high demand. This is particularly true when customer behaviour
and market strategy extend to the next generation product, making LCD-TV a critically
important issue for high-tech manufacturers.
Marketing strategy is critical to corporate planning and is dependent on the study of
technology, product, channel, customer behaviour and so on. When suppliers consider
increasing their investment in customer relationships, principal concerns include
potential benefits from such an investment (Anderson et al., 1991) and the likelihood of
receiving rewards from customers for collaborating in product development. This
illustrates how product and market strategies of a corporation are influenced by customer
behaviour. As this supply-side-driven trend occurs, consumer perspective becomes
critical in evaluating the likely market acceptance of new product categories, giving
individual buyers a complex behavioural role. Managers should be acquainted with
customer needs in order to effectively stimulate additional market needs. Burger and
Cann (1995) found that improving customer satisfaction and adding value to customers
in high technology purchases are very important factors for technology-based
organisations. We propose customer-orientated thinking for technology-based firms and
marketing strategy planning based on research of customer behaviour.
Managers usually make strategic decisions according to a single purpose or
dimension. However, strategy is influenced by many corporate factors, especially
marketing strategy. The traditional concept of strategy lacks a multi-dimensional
emphasis. In this paper, the DEMATEL method is used to build the relative relationship
of decision factors for customer buying behaviour. The relationships support a
multi-level viewpoint for planning strategy.
This paper is organised as follows. Section 2 introduces the TFT-LCD industry
development, LCD-TV, and a brief review of customer behaviour researches. The model
construction and implementation are shown in Section 3. An empirical study of LCD-TV
in Taiwan is presented in Section 4. Finally, conclusions and recommendations are
presented in Section 5.

2 TFT-LCD industry and customer behaviour reviews

This section presents the TFT-LCD industry development, LCD-TV, and a brief review
of customer behaviour researches. The TFT-LCD industry development and LCD-TV
can assist us in understanding the big picture and environment of this industry.
In addition, we discuss customer behaviour trends to describe the importance of customer
needs.

2.1 TFT-LCD industry development and LCD-TV

The Liquid Crystal Display (LCD) industry has made significant advances in technology.
Market share and applications of LCD have grown steadily since the 1970s. LCDs are
widely used in notebook PCs, mobile phones, Personal Digital Assistants (PDAs) and
soon-to-be TVs currently. However, thin film transistor (TFT) technology that allowed
146 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

for improving colour quality and faster refresh rates was first commercialised for
large-sized displays in the early 1990s. The TFT-LCD market is segmented by
panel size into small, medium and large. The large-sized segment is defined by
DisplaySearch (2000) as panels that are ten inches and above in diagonal measurement,
representing the largest part of market value. Large-sized TFT-LCD panels are primarily
used for notebook computer screens and computer monitors with a new application of
LCD-TV, designed in size, from thirteen to over forty inches in diagonal measurement.
The LCD-TV offers a different technology from the traditional Cathode Ray Tube
(CRT) with advantages of low radiation, low power consumption, slim size. A
comparison table of LCD-TV and CRT’s characteristics is provided below (Table 1).

Table 1 Comparisons of TFT-LCD and CRT to TV applications

Products Characteristics Weak points

TFT-LCD High contrast ratio Higher cost than CRT
Good luminance
The quality of resolution close to CRT
Slim
Low radiation
Low power consumption
CRT Good luminance Heavy
High contrast ratio and resolution power consumption
Low price Radiation problem

LCD-TV has been unable to increase its market share due to its high price.
However, there is growing evidence of a trend that LCD-TV will replace CRT-TV
(DisplaySearch, 2004). Technology advance of large TFT-LCD panels and the glass
substrate’s broadening tendency will reduce manufacturing cost (Deutsche Bank Group,
2004). DisplaySearch (2002) proposes that the LCD-TV market will increase as
TFT-LCD producers build fifth and sixth generation factories, which can reduce
large-area display costs. ING estimates (2003) that the driving factors of LCD-TV
adoption are:
• lower prices
• regulations enforcing the migration of broadcast TV from analogue to digital
• proliferation of personal TVs used as supplements to the household TV.
Tracey et al. (1999) studied the relationship between firms with a high level of advanced
manufacturing technology and greater customer satisfaction. Technology should be
studied while analysing high-tech products, as extensive strategy distribution depends on
technological intellectualism. Diagonal technology, size, resolution, aspect ratio, contrast
ratio, luminance, frame rate per second (fps), interface type, power consumption, and
viewing angle are critical technological issues in the LCD-TV industry. Therefore, slim
size, low radiation, and low power consumption are advantages of the LCD-TV.
Diagonal technology, resolution, aspect ratio, contrast ratio, and luminance are the result
of resolution of kinescope. Frame rate per second in kinescope is another technological
 Marketing strategy based on customer behaviour for the LCD-TV 147

indicator for the TV user, as well as a satisfactory size. Additionally, inner functioning,
product design, and other functions of LCD-TV are included. Resolution of kinescope,
frame rate per second, size, inner functioning, product design, and added functions are
six key criteria for consumer buying behaviour applied to technical aspects of this study.

2.2 A brief review of customer behaviour researches

Market orientation has been adopted by managers, and long been defended by marketing
academics (Lear, 1963; Levitt, 1960). It first appeared in the 60’s management theories,
and was promoted in firms during the 90’s.
The four components of market orientation include customer orientation, competitor
orientation, inter-functional coordination, and customer focus-one of two long-term
decision-criteria l (Kohli et al., 1990; Narver et al., 1990). Market orientation has been
correlated with profitability and other measures of corporate success (Narver et al., 1990;
Liu et al., 1997; Wang et al., 1993). ‘Market orientation’ and ‘customer orientation’ are
terms that have been used to describe the implementation of the marketing concept
(Kohli et al., 1990).
The customer-oriented marketing concept presented by Kotler (1967) is no longer a
mirage. Da Silva et al. (2002) showed that customer orientation is a central factor in
market orientation, but despite the importance of customer and market orientation, there
has been little research into how well suppliers understand their customers in a
commercial context. Additionally, Gruner et al. (2000), using empirical study, pointed
out that collaborating with financially attractive customers, or customers exhibiting
lead-user characteristics increases new product success. These literatures show that the
consumer plays a critical role in market strategy planning.
Companies therefore, need to position customer orientation accordingly and analyse
consumer buying-behaviour. Sheth (1994) has described relationship development as an
evolution from ‘normal buying and selling’ to a new state where the customer is so
satisfied that he/she becomes another marketing arm for the seller. In addition,
Assael (1987) distinguished four types of consumer buying behaviour such as, complex,
dissonance-reducing, habitual, and variety-seeking, based on the degree of buyer
involvement and differences among brands. There are many variables that shape the
consumer’s decision-making process, including individual differences, environmental
influences, and psychological processes (Engel et al., 1995). Peter et al. (1993) studied
consumer behaviour as a means to improve marketing strategy and to assist product
promotion, pricing and channel strategy planning. This paper designed a questionnaire
based on the consumer decision process model with the idea that knowledge about
consumer buying behaviour will help firms in planning their marketing strategy. The
research shows some important factors about how customers make decisions.

3 Model construction and implementation

The concept of model and implementation are proposed in this section.

The implementation process is illustrated in Figure 1.
148 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

Figure 1 Implementation process

The implementation process includes four steps. They are data collection, customer
preference analysis, measuring the relationships among customer decision factors, and
marketing strategy planning. The details about the four steps are as follows:
Step 1: Data collection.
The data is collected from questionnaires. The questionnaire is designed to match the
research objective. A random sampling is adopted in this study.
Step 2: Customer preference analysis.
We can know the customers’ preference by analysing the collected data. Data regarding
their comprehension levels of LCD-TV, willingness to buy, information source, preferred
brand, possession rate, motive, buying place, etc are collected by asking the customers,
relevant questions. Through these questions, we can illustrate customer preference and
basic information.
Step 3: Measuring the relationships among customer decision factors.
The DEMATEL method is used to analyse the customers’ decision factors. It is a kind of
structural modelling approach. It is a comprehensive method for building and analysing a
structural model involving causal relationships between criteria. The special questions
formed are designed for DEMATEL. An example is shown in the appendix.
Step 4: Marketing strategy planning.
When we know the customers’ preference and relationships among customer decision
factors, we can make intelligent marketing strategy plans. We must integrate the above
information to provide a synthesised marketing strategy plan.

4 An empirical study of LCD-TV market

There are five subsections of customer behaviour that provide clues to marketing strategy
in the LCD-TV market. The subsections include a questionnaire and data sampling,
customer preference analysis, measuring the relationships among customer decision
factors, and marketing strategy planning.
 Marketing strategy based on customer behaviour for the LCD-TV 149

4.1 Questionnaire and data sampling

The purpose of this empirical study is to understand customer behaviour with regard to
the LCD-TV through a questionnaire survey. The questionnaire includes three parts; the
first part is used to measure the relationships among decision factors; the second part
investigates the customer’s preference; the third part includes socio-economic data.
The population of this study is defined as persons over twenty years of age, living in
Taiwan. The sample size is at least 385 according to the two principles – Mc Clave and
Dietrich (Hill et al., 1962) and Roscoe’s seven criteria (1975). A total of 1500
questionnaires were delivered, 779 returned, with 430 considered effective.
The Cronbach reliability α coefficient of the questionnaire is 0.8320. We concluded that
the Cronbach reliability α coefficients of this questionnaire are reliable. Table 2 shows
the collected sample according to gender, family life-cycle, age, income (monthly),
qualifications, and occupations.

Table 2 LCD-TV potential customers: questionnaire profile

LCD-TV questionnaire Sample Percentage

Gender
Male 320 74.4
Female 110 25.6
Family life-cycle
Singles 170 39.5
Couples 84 19.5
Younger parents 176 40.9
Age (years)
21−25 35 8.1
26−30 116 27.0
31−35 51 11.9
36−40 65 15.1
41−45 66 15.3
46−50 45 10.5
51−55 36 8.4
56−60 14 3.3
Over 60 2 0.5
Income (monthly)
Below 20,000 45 10.5
20,001−40,000 67 15.6
40,001−60,000 119 27.7
60,001−80,000 90 20.9
80,001−100,000 60 14.0
Over 100,001 49 11.4
150 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

Table 2 LCD-TV potential customers: questionnaire profile (continued)

LCD-TV questionnaire Sample Percentage

Qualifications
Basic education 0 0
Secondary school 8 1.9
HND diploma/ certificates 48 11.2
Degree 125 29.1
Graduate institute or above 249 57.9
Occupation
Service industry 32 7.4
Student 45 10.5
Farmer 0 0
Engineer 405 24.4
Businessman 27 6.3
Public official 70 16.3
Teacher 17 4.0
SOHO or Unemployment 6 1.4
Housekeeper 0 0
Military or Police 77 17.9
Retires 1 0.2
Others 50 11.6

4.2 Customer preference analysis

We obtained basic information about the customers (Table 3) and found that 97.7% were
familiar with LCD-TV, showing that LCD-TV has become popular in Taiwan. Where do
customers obtain information about LCD-TV? Primarily from television (21.45%).
A small percentage (4.2%) owns LCD-TV, while the majority (95.8%) does not.
The preferred brand among customers is BenQ. In addition to the brand factor, the
marketing channel is also considered. 51.6% of customers prefer to buy the LCD-TV
from electric appliance retailers. Therefore, we must pay more attention to this preference
and plan appropriate channel strategies.
Furthermore, 88.6% of customers are willing to buy the LCD-TV if the price is
reasonable. The main motive for buying is the size of the LCD-TV and customers prefer
the 30–40-inch size. Most manufacturers coincidentally produce LCD-TVs in
30–40-inches, but they must overcome some technical problems and cut to appropriate
sizes.
The most important issues are customer decision factors. These include price
(27.0%), quality (23.3%), resolution of kinescope (9.5%), and low radiation (8.7%).
Presently, each company producing LCD-TVs is making greater efforts to reduce cost to
increase their market share. But what is ‘reasonable price’? Take the 42-inch LCD-TV
for example. The accepted price is NT $50001 to NT $70000 (28.4%). From this data, we
can suggest that a reasonable price for a 42-inch LCD-TV can be between NT $50001
and NT $70000.
 Marketing strategy based on customer behaviour for the LCD-TV 151

Table 3 Customer preference analysis of LCD-TV

152 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

4.3 Measuring the relationships among customer decision factors

We not only want to find the important factors but also to measure the relationships
among these factors. Why is such a relationship so important? Because understanding the
relationship among decision factors can assist managers in making marketing strategies.
A manager usually makes strategic decisions according to one purpose or dimension.
However, strategy is an interactive decision making process and is influenced by many
corporative factors, especially marketing strategy. The traditional concept of strategy
lacks multi-dimensional interaction. In this paper, the DEMATEL method is used to
build a relative relationship of decision factors for consumer buying behaviour.
The relationships support a multi-level viewpoint to plan a strategy which conforms to
actual situations and a competitive environment.
Before analysing the use of the DEMATEL method, it is important to be aware of
customer decision criteria. In previous researches, buying behaviour was studied only for
the supply side. Weber et al. (1991) reviewed 74 papers published since 1966, which
researched criteria used in selection of suppliers by all types of industrial buyers. Criteria
included price, quality and service issues. Da Silva et al. (2002) used six attributes to
assess customer orientation in buying behaviour. The criteria are cost, work quality,
delivery time in buying behaviour, responsiveness to requests, innovative ability, and
good design ideas. Kotler (1988) indicated the importance of analysing buyer behaviour
in market management. He also proposed the concept of price, product, place and
promotion for marketing strategy. Besides the literature review, at the inception of this
research, many interviews were made with customers and LCD manufacturing firms to
test and confirm which criteria appeared to be the most important in this context.
We synthesised the literature review, interviews, and the technological characteristics of
the LCD-TV to illustrate customer decision factors. The customer decision factors are
shown in Table 4.

Table 4 Dimensions and decision factors of customers

Dimensions Decision factors

Product Price
Quality
After-sale service
Size
Brand
Function
Promotion Sales exposition
Advertising
Channel
Creativity Good design idea
Innovative ability
Technical capability Slim
Low radiation
Low power consumption
Frame rate per second
Resolution of kinescope
 Marketing strategy based on customer behaviour for the LCD-TV 153

Details about the DEMATEL method are introduced in the Appendix where we explain
the DEMATEL method step by step.
Step 1: Notations
Notations used in this section are as follows:

fi i-th decision factor for customer

S a set of elements S = {f1, f2, …, f16}
Z initial direct-relation matrix
X normalised direct-relation matrix
T total-relation matrix
D sum of rows for T
R sum of columns for T

Step 2: A customer evaluates the relationship between a pair of factors for decision
factors in the questionnaire. The initial direct-relation matrix Z is a 16 × 16 matrix
obtained by pair-wise comparisons in terms of influences and directions between
decision factors.
Step 3: The normalised direct-relation matrix X is obtained through equation (A2) and
equation (A3). The normalised matrix of direct relation is shown in the Appendix.
Step 4: The total-relation matrix T is calculated by using equation (A4). The matrix of
total relation is shown in the Appendix.
Step 5: Using the values of D (sum of rows) and R (sum of columns) in the matrix of total
relations, a level of influence and a level of relation are defined. Based on Definition 5
and Definition 6, a causal diagram is created through equations (A5), (A6) and (A7).
The features of each decision factor are visualised as the oriented graphs. In this study,
we adapt the threshold value (p) as 0.39 to obtain the total relationship. 0.39 is the most
appropriate value to acquire a suitable relationship from trying above and under 0.39.
The value under 0.39 gains too many factors and complex relationships in the whole
system; the relationship is not obvious above 0.39. The key decision factors and
relationships are obtained from the total-relation matrix (Table 5) and the influence
degree of customer decision factors (Table 6). The causal diagram of total relation of
customer decision factors is shown in Figure 2.
154 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

Table 5 The matrix of total relation

 Marketing strategy based on customer behaviour for the LCD-TV 155

Table 6 The influence of degree of purchasing concern factors

Symbols Di + R i Di – Ri
f1 9.868 1.124
f2 10.040 1.630
f3 10.114 –1.019
f4 9.979 –1.012
f5 9.898 0.902
f6 9.942 –1.043
f7 9.870 –1.333
f8 9.989 –1.974
f9 9.847 –1.069
f10 9.790 0.173
f11 9.814 –0.150
f12 9.702 0.165
f13 9.965 1.103
f14 9.908 0.328
f15 9.797 0.881
f16 9.819 1.294

Notation:

Symbols Contents
f1 Price
f2 Quality
f3 Brand
f4 Function
f5 After-sale service
f6 Size
f7 Sales exposition
f8 Advertising
f9 Channel
f10 Good design idea
f11 Innovative ability
f12 Slim
f13 Low radiation
f14 Low power consumption
f15 Frame rate per second
f16 Resolution of kinescope
156 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

Figure 2 The causal diagram of total relation (p ≥ 0.39)

Results show that ‘Quality (f2)’ is a powerful factor and plays a main role, because
the value of (Di + Rj) and (Di – Rj) is very significant. On the contrary, ‘Advertising (f8)’
is negatively influenced by the other factors, because the value of (Di – Ri) is
negative and the value is also significant. At the same time, we find the causal diagram of
total relationship shows the same results – ‘Quality (f2)’ is a very powerful factor
affecting other factors and ‘Advertising (f8)’ is the factor which is intensely affected
by the others.
In view of the causal diagram of total relation, there are four main factors,
• Quality (f2)
• Advertising (f8)
• Sales exposition (f7)
• Brand (f3).
Quality (f2) plays the key role in total-relation, while the other three factors are intensely
affected by other factors. Quality (f2) directly affects Brand (f3), Function (f4), Size (f6),
Sales exposition (f7), Channel (f9) and Advertising (f8). Quality (f2) is the base on which
to develop Brand (f3). If the quality is good, Brand can be driven to be good;
simultaneously, it is bad. Function (f4) and Size (f6) are two parts of the whole product.
They are also developed, based upon quality. In addition, the marketing channel is
affected by quality. When there is good quality, there is a good channel. Each retailer
wants to sell good quality products. It is necessary to manufacture high quality products
to establish a good relationship with retailers. The same concept can be explained in the
relation between Sales exposition (f7) and Quality (f2).
 Marketing strategy based on customer behaviour for the LCD-TV 157

Furthermore, Advertising (f8) is influenced by six factors:

• Price (f1)
• Quality (f2)
• After-sales service (f5)
• Low radiation (f13)
• Frame rate per second (f15)
• Resolution of kinescope (f16).
As far as Price (f1) is concerned, it controls the attraction for consumers in advertising.
High or low price is dependent on product positioning in the market. Furthermore,
Quality (f2) can provide a guarantee of LCD-TV and avoid fraudulent advertising.
After-sales service (f5) is another factor affecting advertising success. Furthermore, Low
radiation (f13), Frame rate per second (f15), and Resolution of kinescope (f16) are special
characteristics of the LCD-TV. These technology factors are partially composed of
LCD-TV advertising. However, the styles, kinds, idiosyncrasies of customers and further
details of advertising are not discussed in this paper.
Moreover, Sales exposition (f7) is the second factor that is influenced by four factors:
• Price (f1)
• Quality (f2)
• Low radiation (f13)
• Resolution of kinescope (f16).
Price (f1) and Quality (f2) influence the degree of popularity degree to sell the product.
Price and quality are the most important factors for consumers. Sales can introduce
different levels of products with diverse prices and qualities to meet consumers’ various
needs. Sales must fully understand all kinds of price and quality levels, and knowledge of
Low radiation (f13) and Resolution of kinescope (f16) with regard to the LCD-TV is very
important for sales. Sales must have the ability to sell high-tech products. Sales with the
good exposition can catch consumers’ attention and help them choose suitable products.
Another influence factor is Brand (f3). It is separately affected by Quality (f2), Low
radiation (f13), and Resolution of kinescope (f16). High Quality (f2) can be a guarantee to
support brand. Low radiation (f13) and Resolution of kinescope (f16) are characteristics of
the LCD-TV. They affect the Brand image in the eyes of the consumers. In short, the
total relation is very important to help us understand the relationship of each key factor.
After understanding the complex relationship, we can then draft marketing strategy plans
on the basis of the causal diagram of the total relation in each section.

4.4 Mapping marketing strategy framework by decision factor relationship

A marketing strategy planning framework is illustrated, based on customer decision
factors relationship (see Figure 2) in this section. The perspective of decision factor
relationship shows the interactions among twelve decision factors. It is obvious that
Quality (f2) is a critical factor affecting the other eleven decision factors, so we put it as
158 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

central to the marketing strategy planning framework. According to the characteristics of

factors and interactive relationships, we induced three strategic clusters based on market
position and strategic operation concept. The three strategic clusters are product strategy,
sales strategy, and advertising strategy. Product strategy and sales strategy are named by
inducing the factors relationship. They are known as the Golden Triangle Strategies.
The marketing strategy framework is shown in Figure 3.

Figure 3 Marketing strategy planning framework

Brand (f3) plays the main role in product strategy. Other product characteristics are
included. They are Function (f4), Size (f6), Low radiation (f13), and Resolution of
kinescope (f16). Sales exposition (f7) is a key factor successfully affecting sales strategy.
Sales exposition (f7) has an interaction relationship with Price (f1), Low radiation (f13),
and Resolution of kinescope (f16). As Channel (f9) also affects sales strategy, we put it in
this cluster. Furthermore, advertising strategy includes Price (f1), After-sale service (f5),
Low radiation (f13), Frame rate per second (f15), and Resolution of kinescope (f16). They
are the distinguishing features of LCD-TV except for Price (f1); so it is clear that
adverting strategy should focus on the LCD-TV characteristics.
The framework explains noticeable issues and interaction in marketing strategy
planning which can help marketing managers to plan suitable marketing strategies with
limited resources. Correct strategic aspect in firms is adopted to support substantial
management in the future.

4.5 Marketing strategy planning

Television is a kind of product shopping (Kotler et al., 2001). When customers are in the
process of choosing and making buying-decisions, they will carefully compare
applicability, price, quality and styles. Marketing managers do not typically distribute
their products through numerous sales channels, but provide consulting services to assist
customers making decisions. Understanding the characteristics of television can help us
to make appropriate marketing strategy plans.
 Marketing strategy based on customer behaviour for the LCD-TV 159

Three marketing strategies are proposed in Figure 3. First, we discussed product

marketing strategy. A product’s strategic decision is achieved by considering: product
quality, function, size, and brand. Product quality is composed of performance quality
and conformance quality. Performance quality is the capability to implement LCD-TV
functions. Conformance quality encompasses quality control while conveying a stable
performance quality level to customers. High product quality then means high quality of
performance and conformance. Return on quality (ROQ) has been recently adopted in a
great majority of companies (Rust et al, 1995). Many decision makers regard quality as a
potential strategic weapon or a competitive requisite to create customer value and
satisfaction.
Product function is categorised as product characteristics. Each product can be given
a different level of characteristics. As the functions increase, the grade is higher.
However, the content of built-in functions is dependent on customer needs; it is also
valuable to customers and to the company’s technology. According to the analysis above,
the 30–32-inch size TV is the most popular, with the 35–40-inch being the second most
popular, showing the current preference for 30–40-inch LCD-TVs. The large size
LCD-TV can be produced using high technology levels. If companies are equipped with
both technology design and mass production capability to deliver a high-resolution large
size LCD-TV, they will have a competitive advantage in the market. Size is just one
factor of product design. Good product design can attract customer attention, improve
product performance, and reduce production cost. In the future, LCD-TV manufacturers
should pay more attention to product design to increase their market share. For example,
the frame colour can be designed to match living room décor. Individual style is
important for customers in this era, and conforming to current trends could increase
profits.
In addition to quality, brand is more important than product function and size
for product marketing strategy and branding can increase product value
(Kotler et al., 2001). In the LCD-TV market, most brands are owned by manufacturers.
In competing head-to-head with global customer electronics giants such as Sony,
Panasonic, and Samsung, brand name is no longer a panacea in the digital TV sector. But
brand is still a critical part of a product. At the same time, low radiation and high
resolution of kinescope must be considered when we make brand policy, as they are not
only the technology dimension factors but also product characteristics. With the causal
diagram of total relation, the two elements affect the brand. Brand image should be added
to the two technical elements to emphasise its importance. Customers still maintain a
high loyalty to home appliances, so it will be easier to contract with leading
manufacturers than creating a new brand. It means the well-known brand is a valuable
asset. Local manufacturers should heavily invest in brand name building and using that
brand image to gain more market shares.
Second, we will illustrate the sales and marketing strategy. Quality, channel, sales
exposition, price, and technical characteristics should be considered while formulating
sales and marketing strategy. Sales exposition is the most important factor in obtaining a
successful sales and marketing strategy. Many factors contribute to building up the high
performance of sales exposition, e.g., recruiting, sales training mechanism, cordial
service attitude and professional knowledge about selling skills and LCD-TVs.
Additionally, price and technical characteristics – low radiation and high resolution of
kinescope – still affect sales exposition. Pricing policy can be divided into three levels:
high-price, general-level-price, and low-price. Generally speaking, lower price is more
160 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

acceptable than higher price, so it is important in sales to be able to discriminate between

customers with different price demands. Regarding technology level, low radiation and
high resolution of kinescope are special properties of the LCD-TV. Sales needs to
understand technical knowledge and characteristics, and should highlight the benefits of
low radiation and high resolution. Essentially, quality is a forceful guarantee to sales and
customers. Product quality, sales quality, and channel quality control the success of a
sales marketing strategy. The collection data shows that 51.6% of customers prefer to
buy the LCD-TV from electric appliances retailers; 20% of customers buy the LCD-TV
from brand channels; 14.7% of respondents from the mart. Since marketing managers
provide professional consulting services to assist customers making decisions, the
marketing channel can be an electric appliance retailer, a brand agent, or the mart in
accordance with information from customers. It is important therefore for manufacturers
to maintain a positive relationship with marketing channels.
Third, advertising marketing strategy is presented. Quality, price, after-sale service,
mass media, resolution of kinescope, frame rate per second, and low radiation should be
considered in advertising marketing strategy. The first decision concerns the mass media.
Television, the internet, magazines, and newspapers are the most popular mass
media among customers. We should attract attention by using these popular mass media
avenues, especially the new medium- the internet. We must design various alternatives
according to different mass media. When we choose a medium, the message-marketing
strategy forms the basis for our decision. Advertising can transmit a company’s mission,
brand image, product characteristics, and sales and marketing strategy. It is an important
medium for a company to convey particular information. Advertising is affected by
quality, price, after-sale service, resolution of kinescope, frame rate per second, and low
radiation With the exception of quality, the five elements can be separated into three
dimensions:
• technology dimension (including resolution of kinescope, frame rate per second and
low radiation)
• service dimension
• price.
These can be regarded as advertising objectives to communicate with customers and be
classified into three kinds of advertisements. We can consider technology characteristics
as an informative advertising of a new product. High quality and after-sale service are
key elements for persuasive advertising. They tell customers that the company provides
the best quality and service. When we undertake promotion-marketing strategy, price
becomes the critical factor in marketing channels. We also can design different
advertising marketing strategies in accordance with product life cycle which can
co-operate with other factors to make a good advertising marketing strategy.
The whole concept of synthetic marketing strategy is illustrated above. In this paper,
we provided a strategic framework and an aspect of marketing strategy planning for the
manager in TFT-LCD manufactures or LCD-TV firms. However, there are different
resources and competitive situations in different firms. This research only gives a clear
marketing strategy planning framework for the LCD-TV industry. Marketing managers
will need to adjust this marketing strategy framework to fit the corporation strategy
planning of different firms.
 Marketing strategy based on customer behaviour for the LCD-TV 161

5 Conclusions and recommendations

Customer needs should be highly regarded in new product development. In contrast to

supplier-side researches, we focus on the customer-side to explore customer preference.
According to our findings, the four most important customer decision factors are price,
quality, high resolution of kinescope, and low radiation. It is interesting that, no matter
whether customers prefer traditional TVs or LCD-TVs, they emphasise both ‘Price’ and
‘Quality’, rather than the technological aspect.
Measuring the relationships among customer decision factors can help us understand
the interactions. It not only provides critical decision factors but also illustrates
interactive relationships. Managers focus on a single critical purpose or central concept
of the corporation to make strategic decisions. But practically speaking, strategy is
influenced by many corporative internal actives and is interactive decision making.
Assisting the marketing manager in planning an overall marketing strategy is important.
The DEMATEL method provides a useful way to obtain knowledge of the relationships
among customer decision factors. Then, a marketing strategy planning blueprint is
illustrated in the base of total relations among customer decision factors. We also
proposed three main strategies- product strategy, sales strategy, and advertising strategy,
which together we call the Golden Triangle Strategies. Golden Triangle Strategies are in
the basic of Quality. Then we synthesise customer preference analysis, and mark
segmentation information to design marketing strategy planning.
This study provides relationships and marketing strategy planning framework for
firms in the LCD-TV market to understand customer needs and reduce the gap between
technology and customer-needs.

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Appendix

DEMATEL method
The DEMATEL method is based on a graph theory that enables us to plan and solve
problems visually, so that we may divide multiple criteria into a cause and effect group in
order to better capture causal relationships visibly. Directed graphs are more useful than
directionless graphs, because digraphs can demonstrate the directed relationships of
sub-systems. A digraph may typically represent a communication network, or a
domination relation between individuals, etc. Suppose a system contains a set of
 Marketing strategy based on customer behaviour for the LCD-TV 163

elements S = {f1, f2, …, fn}, and particular pair-wise relations are determined for
modelling with respect to a mathematical relation E. Next, to portray the relation E as a
direct-relation matrix that is indexed equally on both dimensions by elements from the
set S. Then, take out the case that the number is 0 appearing in the cell (i, j), if the entry is
a positive integral that has the meaning of:
• the ordered pair (fi, fj) is in the relation E
• it has the kind of relation regarding that element fi causes element fj.
The digraph portrays a contextual relation among the elements of system, in which a
numeral represents the strength of influence (Figure A1). The A, B, C, D and E represent
the factors which have relations in Figure A1. The number between factors is influence
or influenced degree. For example, an arrow from B to A represents the fact that B
influences A and its influenced degree is three. The DEMATEL method can convert the
relationship between the causes and effects of criteria into an intelligible structural model
of the system. In order to apply the DEMATEL method smoothly, we refined the version
used by Hori and Shimizu (1999) and made essential definitions as below.

Figure A1 DEMATEL digraph

Definition 1: The pair-wise comparison scale may be designated into four levels, where
the scores of 0, 1, 2, 3, and 4 represent ‘No influence’, ‘Low influence’, ‘High influence’,
and ‘Very high influence’ respectively.

Definition 2: The initial direct-relation matrix Z is a n × n matrix obtained by pair-wise

comparisons in terms of influences and directions between criteria, in which zij is denoted
as the degree of which the criterion i affects the criterion j.
 z11 z12 z1n 
z z22 z2 n 
Z =  21 (A1)
 
 
 zn1 zn 2 znn 

Definition 3: The normalised direct-relationmatrix X can be obtained through the

equations (A2) and (A3), in which all principal diagonal elements are equal to zero.
X=s⋅Z (A2)
164 Y-J. Chiu, H-C. Chen. G-H. Tzeng and J.Z. Shyu

1
s= n
(i, j = 1, 2,… , n) (A3)
max ∑ zij
1≤ i ≤ n
j =1

Definition 4: The total-relation matrix T can be acquired by using the equation (A4),
where the I is denoted as the identity matrix.
T = X + X2 + … = X(I – X)–1 (A4)

Definition 5: The sum of rows and the sum of columns are separately denoted as D and
R within the total-relation matrix T through the equations (A5), (A6), and (A7).
T = [tij ] (i, j = 1, 2,…, n) (A5)

 n 
D = ( Di ) =  ∑ tij  (A6)
 j =1 

 n 
R = ( R j ) =  ∑ tij  (A7)
 i =1 
where D vector and R vector denote the sum of rows and columns respectively.

Definition 6: Suppose Di. denotes the row sum of i-th row of matrix T. Then, Di. shows
the sum of influence dispatching from factor i to the other factors both directly and
indirectly. Suppose R.j denotes the column sum of j-th column of matrix T. Then, R.j
shows the sum of influence that factor i is receiving from the other factors. Furthermore,
when i = j, i.e., the sum of row sum and column sum (Di .+ R.j) shows the index of
representing the strength of influence both dispatching and receiving, that is, (Di + R.j)
shows the degree of central role that the factor i plays in the problem. If (Di – R.j) is
positive, then the factor i is rather dispatching the influence to the other factors, and if
(Di – R.j) is negative, then the factor i is rather receiving the influence from the other
factors (Tamura et al., 2002).

Table A1 The matrix of direct relation

Factors f1 f2 f3 f4 f5 f6 f7 f8 f9 f10 f11 f12 f13 f14 f15 f16

f1 0.000 0.052 0.066 0.068 0.057 0.068 0.074 0.077 0.068 0.060 0.063 0.059 0.056 0.061 0.056 0.054
f2 0.057 0.000 0.070 0.072 0.060 0.073 0.078 0.082 0.073 0.064 0.067 0.063 0.060 0.064 0.060 0.057
f3 0.043 0.042 0.000 0.056 0.047 0.057 0.062 0.065 0.057 0.050 0.052 0.049 0.047 0.051 0.047 0.045
f4 0.044 0.042 0.056 0.000 0.046 0.056 0.060 0.063 0.056 0.049 0.051 0.048 0.046 0.049 0.046 0.044
f5 0.054 0.052 0.069 0.068 0.000 0.066 0.072 0.075 0.067 0.059 0.061 0.058 0.055 0.059 0.055 0.052
f6 0.044 0.043 0.056 0.055 0.045 0.000 0.060 0.063 0.055 0.049 0.051 0.048 0.045 0.049 0.045 0.043
f7 0.045 0.043 0.057 0.056 0.046 0.056 0.000 0.058 0.051 0.045 0.047 0.044 0.042 0.045 0.042 0.040
f8 0.042 0.040 0.053 0.052 0.042 0.052 0.051 0.000 0.049 0.043 0.045 0.042 0.040 0.043 0.040 0.038
f9 0.044 0.042 0.056 0.055 0.045 0.055 0.054 0.058 0.000 0.049 0.051 0.048 0.045 0.049 0.045 0.043
 Marketing strategy based on customer behaviour for the LCD-TV 165

Table A1 The matrix of direct relation (continued)

Factors f1 f2 f3 f4 f5 f6 f7 f8 f9 f10 f11 f12 f13 f14 f15 f16

f10 0.050 0.048 0.064 0.062 0.051 0.062 0.061 0.066 0.062 0.000 0.058 0.054 0.051 0.055 0.051 0.049
f11 0.049 0.047 0.062 0.061 0.050 0.061 0.060 0.065 0.061 0.054 0.000 0.052 0.049 0.053 0.049 0.047
f12 0.049 0.047 0.062 0.061 0.050 0.061 0.060 0.065 0.061 0.054 0.055 0.000 0.052 0.057 0.052 0.050
f13 0.056 0.054 0.071 0.070 0.057 0.070 0.068 0.074 0.070 0.062 0.063 0.063 0.000 0.060 0.055 0.053
f14 0.052 0.050 0.066 0.065 0.053 0.064 0.063 0.069 0.065 0.057 0.058 0.058 0.051 0.000 0.051 0.049
f15 0.054 0.052 0.068 0.067 0.055 0.067 0.066 0.071 0.067 0.059 0.061 0.061 0.053 0.057 0.000 0.053
f16 0.056 0.054 0.071 0.070 0.057 0.070 0.068 0.074 0.070 0.062 0.063 0.063 0.055 0.060 0.057 0.000

Table A2 The matrix of indirect relation

Factors f1 f2 f3 f4 F5 f6 f7 f8 f9 f10 f11 f12 f13 f14 f15 f16

f1 0.255 0.242 0.320 0.316 0.259 0.316 0.321 0.343 0.314 0.277 0.286 0.274 0.255 0.276 0.257 0.246
f2 0.267 0.260 0.340 0.335 0.275 0.335 0.341 0.364 0.333 0.294 0.304 0.291 0.271 0.292 0.272 0.261
f3 0.209 0.201 0.268 0.262 0.215 0.262 0.266 0.284 0.260 0.229 0.237 0.227 0.211 0.228 0.213 0.204
f4 0.206 0.198 0.262 0.261 0.212 0.258 0.263 0.281 0.256 0.226 0.234 0.224 0.209 0.225 0.210 0.201
f5 0.247 0.238 0.314 0.310 0.257 0.310 0.316 0.337 0.308 0.272 0.282 0.270 0.251 0.271 0.252 0.241
f6 0.204 0.197 0.260 0.256 0.210 0.259 0.261 0.278 0.254 0.224 0.232 0.223 0.207 0.224 0.208 0.199
f7 0.196 0.188 0.249 0.246 0.202 0.246 0.254 0.268 0.244 0.216 0.223 0.214 0.199 0.215 0.200 0.191
f8 0.184 0.177 0.234 0.231 0.189 0.231 0.236 0.254 0.230 0.203 0.210 0.201 0.187 0.202 0.188 0.180
f9 0.202 0.194 0.256 0.253 0.207 0.253 0.258 0.275 0.254 0.221 0.229 0.220 0.204 0.221 0.205 0.197
f10 0.229 0.220 0.290 0.287 0.235 0.286 0.292 0.312 0.285 0.254 0.260 0.249 0.231 0.250 0.233 0.223
f11 0.222 0.213 0.282 0.278 0.228 0.278 0.284 0.303 0.276 0.243 0.255 0.242 0.225 0.243 0.226 0.216
f12 0.226 0.218 0.288 0.284 0.233 0.284 0.290 0.309 0.282 0.249 0.258 0.249 0.229 0.248 0.231 0.221
f13 0.254 0.244 0.322 0.318 0.261 0.318 0.324 0.346 0.316 0.278 0.289 0.276 0.260 0.278 0.259 0.247
f14 0.235 0.226 0.298 0.294 0.241 0.294 0.300 0.320 0.292 0.258 0.267 0.255 0.238 0.260 0.239 0.229
f15 0.245 0.235 0.311 0.307 0.252 0.307 0.313 0.334 0.305 0.269 0.279 0.266 0.248 0.268 0.252 0.239
f16 0.255 0.245 0.323 0.319 0.262 0.319 0.326 0.347 0.317 0.280 0.290 0.277 0.258 0.279 0.259 0.251

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