Factors Affecting Consumer’s Buying Behavior on Selected

Milk Tea Stores in Iligan City

In Partial Fulfilment
of the Requirement of
Applied Research

Erika Jea Kilat

Janifah Lalanto
Diane Lapenoria
April Ann Maglapid
Charme Ann Pagente

Accountancy, Business, and Management (ABM)

Ms. Hazel G. Marasigan

October 2019

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 CORPUS CHRISTI PAROCHIAL SCHOOL OF ILIGAN, INC.
Corpus Christi Village, Tubod, Iligan City

SENIOR HIGH SCHOOL DEPARTMENT

CERTIFICATE OF APPROVAL

The research proposal attached here to entitled, “ Factors Affecting Consumer Buying
Behavior on Selected Milk tea Stores in Iligan City. “ prepared and submitted by Kilat, Erika Jea
U.,Lalanto, Janifah P.,Lapenoria, Diane H., Maglapid, April Ann C., Pagente, Charme Ann
Q.partial fulfillment of the requirements in PRACTICAL RESEARCH 2: QUANTITATIVE
RESEARCH, is hereby recommended for approval and acceptance.

HAZEL G. MARASIGAN
Research Adviser

This paper is approved and accepted by the panelists in Oral Defense with a remark of_______.

STEFANIE LORAINE D. SAYCON STIPHANIE PORLARES

Panelist Panelist

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 ACKNOWLEDGEMENT

We wish to express our sincere gratitude to those who contributed in the completion of

this study.

To Ms. Hazel G. Marasigan, for the continuous support of our Research Proposal. Her
guidance helps us in knowing what we need to do for our research.

To our co-classmates and schoolmates for their insightful comments and their
encouragement on our research. They are the one who motivate us and gave us strength to
continue the research we’re conducting.

To our fellow researchers for their support and help on doing our research. For giving

their ideas and critique in our research.

To our parents, that supported us in every sleepless nights we've done just to finish this

Research study and for supporting us morally and financially.

And above all, to the great Almighty God/Allah, for his countless love and guidance.

Our Loving Father/Allah, thank you for being our refuge and our strength. That no matter what

circumstances, we can count on you to shelter us and giving us strength. Thank you that even if

things around us seem to crumble, you are still there with us, always loving us and always

helping us.

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 TABLE OF CONTENTS

Title Page………………………………………………………………………….........i
Approval Sheet………………………………………………………………………... ii
Acknowledgement……………………………………………………………………..iii
Table of Contents……………………………………………………………………... iv

Chapter Page
I THE PROBLEM AND ITS BACKGROUND 1
Statement of the Problem 2
Significance of the Study 2
Scope and Delimitation 2
Conceptual Framework 3
Definition of Terms 4

II REVIEW OF RELATED LITERATURE AND STUDIES

Foreign Literature 5-6

Local Literature 6-7
Foreign Studies 7-8
Local Studies 8-9
Synthesis 10

III RESEARCH METHODOLOGY

Research Design 11
Population and Sample 11
Research Instrument 11
Data Gathering Procedure 12

References 13 – 14

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 CHAPTER 1

1.1 The Problem and Its Background

There are numerous milk tea shops in Iligan city because milk tea is one of the commonly
purchased beverage by consumers. In this study the researchers assessed the factors affecting
consumer’s buying behavior. Consumer buying behavior is the sum total of the customer’s
attitude, perceptions preferences, needs, wants, and decision regarding the consumer’s
behavior in the market place when buying a product.

Every business wants to know how a customer or consumer ticks so that they could attract
customers in buying their product and by buying their product the business’s sales will increase,
but then every business is not that perfect and successful because there are problems that a
business might encounter and one is the customers. There are many factors that could affect
consumer buying behavior if the business owner does not know this then its business might not
be successful. Understanding the factors that could affect consumer buying behavior will help
the business owner understand the consumer’s taste and preferences and by doing this the
business owner could revamp their product so that they could meet the customer’s satisfaction.
Knowing the factors affecting consumer buying behavior will help the business owner
understand its consumer’s or customer’s needs and wants.

Consumer buying behavior is important because it helps the business understand how the
customers or consumers decide and how they look for the product. This information helps the
businesses and business owners to know the reasons behind the purchase and rejection of a
product by the customer or consumer.

This study shows the factors affecting consumer’s buying behavior on selected milk tea
stores in Iligan City. It starts through influencing consumer purchases, information search,
problem recognition, and lifestyle of the consumers, age, and perception, social and personal
factors. This study will show the consumer buying behavior as the conduct of individuals
regarding on the decisions of goods and services.

The researchers have chosen to conduct this study because of the curiosity on why
people suddenly indulge with this kind of beverage in fact it existed before. Also, the

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researchers will have a great contributions not only to the selected shops but also to the person
who wants to start a milk tea business.

1.2 Statement of the Problem

This study aims to assess the knowledge regarding the factors affecting consumer’s
buying behavior on selected milk tea stores in Iligan city. This research aims to answer this
following questions;

1. What are the factors that affect the consumers in buying milk tea?
2. How do these factors affect the consumer’s buying behavior?
3. What are the customer’s preferences in buying milk tea?

1.3 Significance of the Study

The outcomes of the study are the personal insights and intuition of entrepreneur on what
are the factors that can affect the consumer’s buying behavior and what are the benefits that
they can get in applying this factors which may work for as an assessment or basis to have
progress that will arise to more revenue for the business. This research will be beneficial to the
following:

Students. The outcomes of the study may be used in similar studies and can get
additional information for students.

Business Owners. This study may benefit the milk tea owners to increase their sales,
evaluate the convenient promos to their business, and enhance the state of their business.

Future Researchers. This study may serve as a guide or an additional information to

those researchers that would conduct a similar research in the future.

1.4 Scope and Delimitation

This study is focused and limited on the evaluation of the factors affecting consumer’s
buying behavior on selected milk tea shops in Iligan City which will determine and assess the
different opinions of respondents. The results of this research will only be administered once the
researchers will provide research instruments to the respondents which will be used in

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conducting the study. The researchers will assess nine milk tea shops in Iligan city and the
selected consumers will be the respondents in this study.

1.5 Conceptual Framework

Factors Influencing the

Consumer’s Buying
Behavior:
Consumer
 Social Influence
Buying  Marketing
Behavior Campaigns
 Purchasing
Power
 Preferences

Figure 1. Schematic diagram of the study showing the relationship of variables.

This study aims to assess the factors affecting consumer's buying behavior in terms of
buying milk teas. As seen on the schematic diagram, it shows the relationship of the variables.
These variables are the consumer buying behavior and the factors affecting their buying
behavior. Under the factors affecting their buying behavior are social influence, marketing
campaigns, purchasing power, and preferences, are some of the factors that influence an
individual in buying milk tea.

Social influence will affect consumer’s buying behavior because every individual has
someone around them influencing their buying decisions this social influence could be the
consumer’s reference groups, family, role and status. Purchasing power will affect consumers
buying behavior by attracting consumers to buy the product by using marketing strategies such

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as promos, sales or discounts, price sensitivity and etc. Marketing campaign will affect
consumer buying behavior by promoting their product by using social media, flyers,
advertisement, and posters. Preferences is knowing and understanding the customer's
preferences before they buy the product, these preferences could be the taste, location, store
ambiance and etc. This could also mean that the factors could and could not affect the
consumers buying behavior.

1.6 Definition of Terms:

Consumer’s Buying Behavior. The sum total of a consumer's attitudes,

preferences, intentions, and decisions regarding the consumer's behavior in the marketplace
when purchasing a product or service.

Social Influence. The change in behavior that one person causes in another,
intentionally or unintentionally, as a result of the way the changed person perceives themselves
in relationship to the influencer, other people and society in general.

Marketing Campaigns. An organized course of action to promote and sell a product

or service.

Purchasing Power. Is the value of a currency expressed in terms of the amount of

goods or services that one unit of money can buy.

Preferences. Is defined as the subjective tastes of individual consumers,

measured by their satisfaction.

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 CHAPTER 2
REVIEW OF RELATED LITERATURE AND STUDIES

This chapter includes the review of related literature that the researchers investigate
and get some information that are connected to the study. The purpose of this literature review
is to provide the reader with a general overview of the factors affecting consumer buying
behavior. This chapter gives a brief description of past and current literature and studies on
consumer buying behavior. It represents the related literature and studies which all have a direct
manner on this study. The review of related literature is done to find out the ways, needs and
further wants of users. This section also consist of the related studies that serves as the
proponent's guide toward the possible completion of this study.

2.1 Foreign Literature

Simonson (2001) mentioned that one of the most essential and influential areas within
consumer buying behavior is the consumer decision making process. In recent decades, during
the initial stages of the conception of the consumer buying behavior paradigm, various
consumer decision making models were proposed. However the theories proposed by the
researchers were not specific and considered an overall view of the consumer decision making
process.

Theron and Terblanche (2015) identified that the orientation of consumers to a product
depends positively on the dynamic relationship between the buyer and seller. The relationship
improves profitability and customer satisfaction plays a major role in equity returns of a
company, where studies in this field have suggested that there is a positive correlation between
customer satisfaction and profitability. The measure of the impact of marketing actions on the
level and the heterogeneity of customer satisfaction. The results relating to customers show
these aspects affect the performance of a long term. The orientation of customers to a product
can depend on their satisfaction of needs that can give a long-term effect to the customers. This
will help the business owner to grow their sales through financial gain and returning the
profitability of the company. The orientation of customers to a product can depends on their

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satisfaction of needs that can gives a long-term effect to the customers that can grow their sales
through financial gain and returning the profitability of the company.

Islam Md. Monirul Jang Hui Han (2012) mentioned that the main purpose of this study is to
determine the consumers’ perception and attitude toward Tea and Coffee. Total 100 South
Korean consumers participated as respondents in this study. Fishbien’s Multi-attribute attitude
model and t-test were used to measure hypothesis and compare attitude toward Tea and
Coffee. Findings indicate that consumer attitudes toward Coffee and Tea differed significantly
among consumers in Korea. Consumers had an overall more positive attitude towards Coffee
compared with Tea with regards to availability, different flavor, and environment of shop
attributes. In contrast, mean value and t-value indicate that there were no significant differences
in aspects of freshness, habitual facts, and status, but correlation value indicate that there were
some differences with regards to freshness and status. Findings of this study are only related to
the consumers from South Korea, study period was September 2010 to January 2012, and
maybe it is not generalized to other nationalities or countries. The research hints that the Tea
Company should give attention to its marketing strategy on enhancing the attributes of “different
flavor”, “availability” and "good environment of shop". This study fills a gap in the literature on
coffee and tea in business research.

2.2 Local Literature

by Wang & Waller (2006) as consumer vanity: the

underlying consumer value orientation wherein consumer behavior is influenced by a fixation
with
physical appearance and success, thus making consumers spend more for aesthetics than for
function or need. Personal preference scales substantially in decision-making for consumers.
The
global market has been segmented into different groups, labeled by their preferences, guiding
producers on how to sell to their consumers. This study aims to substantiate the manifestations
of
consumer vanity and its relation to materialism and whether anxiety can be seen as an
explanation
of the relationship
The perception of Solomon (1996) deals with recognizing, selecting, organizing and
interpreting stimuli to make sense of the world. Consumers tend to use perceptual filtering
whereby they only pay attention to stimuli deemed relevant to existing needs, wants, beliefs and
attitudes and disregard the rest. This study interprets that consumer consider present and
current stimuli that would attract the consumer’s attention. This study interprets that consumer

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consider present and current stimuli that would attract their attraction and the shortage of time
can affect the consumer buying behavior in terms of purchasing a product.

Baryla and Zumpano (1995) asserted that time constraint reduces the level of the external
information search by the consumers. This situation reduces the extent of external information
which the customer can obtain. Time can affect the consumer buying behavior in terms of
purchasing a product because the time needed in deciding in purchasing a product can affect
the consumer’s buying behavior.

The insight of Ben Paul B. Gutierrez (2004) regarding the “Determinants of Planned and
Impulse Buying: The Case of the Philippines”, This study utilizes a behavioral measure, rather
than an attitudinal measure of planned or impulse purchase. Data consist of 982 product
purchases of 502 consumers in urban Philippines. Results show that product category,
purchase frequency, brand comparison, and age are significant factors influencing planned and
impulse purchases. There is no relationship found between planned/impulse purchases and
attitudinal shopping values, surrogates for retail search strategies. Implications for retail
management are identified.

2.3 Foreign Studies

According to Shiau Pei Shih, Szuchiang Yu, and Hui Chin Tseng that the beverages
industry is the widest base compared to others. A consumer is anyone makes a purchases and
transaction decision of goods and services form a store or a company. This study wanted to
investigate the consumers' beverage purchasing behavior and their preference for different
beverage groups in Tainan City, Taiwan. Descriptive research method was used to survey 150
customers and data were collected through questionnaire administered. Descriptive statistic and
Pearson correlation coefficient was used as a method of data analysis. The result of the
analysis reveals a positive correlation between product attribute and consumer purchase
decision.

P.Kokila1 (2019) mentioned that the tea industry is biggest industry in the world because
almost 90 percent of people consume tea. The consumption of green tea had become popular
in the recent years. The purpose of this paper is to understand the factors which influence
customer satisfaction with regard to green tea. The independent variable is customer
satisfaction and the dependent variables are price, health and weight. This paper also explains

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how consumers have gained information about green tea. The statistical techniques like
descriptive statistics, percentage analysis and chi-square analysis have been implemented for
data analysis. It is found from the study that significant relationship exists between the
dependent and independent variables.

According to Rob Kim Marjerison, Zixuan Ricky Wang (2019) this article aims to identify and
assess the factors influencing consumers' purchase intentions towards made-to-order (MTO)
tea drinks. The made-to-order milk tea drink industry in China has generated over USD 14bn in
revenue in 2018. The size of the market, the nature of the preparation and delivery to
consumers, combine to create opportunities for individuals, entrepreneurs, investors, etc.
Relatively little is known about the drivers of purchase intentions for MTO milk tea drink
consumers. For the purposes of this research, the various options that influence purchasing of
tea drinks among Chinese consumers were classified into 10 factors, and data was collected
through online surveys. The results indicate the extent to which Chinese consumers' purchase
intentions are influenced by consumers' age, price of the drink, pursuit of a pleasant state of
mind, quest for social network interaction, search for novel experiences, and concern for health.

Yong Zhang, Jiayue Deng, Yuxin Xu (2017) mentioned that the Price promotion, as one of
the most popular promotions on the Internet, has a certain influence on consumers’ purchasing
intention. It is great significance to explore the relationship and related factors between price
promotion and consumers’ purchasing intention. The study explores the impact of two common
kinds of online price promotion on consumers’ purchasing intention, and examines the
moderating effects of product complementarity in the above relationship. The study finds that
the interaction between complementary products and price promotion has a significant impact
on consumers’ purchasing intention, mental account plays a mediating role in the process.
Under the condition that the product does not exist complementary, perceived promotional
benefit has greater effect on consumers’ purchasing intention, and consumers tend to choose
“unveiling promotion price” promotion. The conclusion of this study enriches the theoretical
research of the related online promotion, and also can help the network merchants to formulate
effective promotion strategies.

2.4 Local Studies

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 Dr. Fermin G. Castillo, Jr. (2018) studied that the consumer buying behavior of customer,
the marketers are able to find innovative and creative solutions in dealing with their target
market. Understanding their wants and needs are just the first step of the process that leads to
buying decision to brand loyalty. This paper provides an insight on the consumer buying
behavior the Filipino style as influence by colonial and foreign consumerism. The study of
consumer behavior helps businesses and organizations to improve their current marketing
strategies by applying new and unique selling proposition.

Noted by Tumanan and Lansangan (2016) that Emotions and attitudes were considered in
measuring the extent of attachment or non-attachment by the respondents to the coffee shops.
Interrelationships among indicators and dimensions of attachment together with characteristics
of a third place were measured through bivariate and canonical correlations.

Natasha Nicole Lee and April Therese Vega noted that this study aims to determine the
factors affecting consumer’s buying behavior of selected milk tea stores towards obtaining
sustainability. In this study, the researchers applied the descriptive type of research by using
percentage, weighted mean and Likert scale to analyze the data. According to the gathered
data, most of the respondents are high school and college students. Most of the respondents
consider milk tea as a refreshment to quench their thirst. More importantly, the consumers want
to have a wider selection of menu items that are both healthy and affordable. Based on the
results, the researchers recommend that the management of milk tea outlets to focus on
providing healthy alternative ingredients and include nutritional facts to inform the consumers of
the contents of their drink. The management should innovate exceptional tea products that are
affordable and reasonable yet high quality to achieve full customer satisfaction and loyalty.

Romeen Anne Sangalang, Jocelyn Siochi and Melody Plaza (2017) studied that this study
assessed the factors that significantly influenced impulse buying and ascertained which among
these factors greatly influenced it. The study also determined the type of impulse buying
behavior the consumers have. Three hundred eighty-five consumers which were making
purchases at the time and place of the data gathering were the participants of the study.
Descriptive-correlational design was utilized. Frequency count, percentage, chi square test and
multiple regression analysis were used to analyze the gathered data for interpretation. The
findings revealed that both the internal and external factors have significant influence to the
behavior of the participants when buying impulsively. The study identified that age, marital
status, net monthly income, shopping enjoyment and promotional approach exhibit significant

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influence. The findings ascertained that the participants were planned impulse buyers.
Moreover, it identified that for internal factors the net monthly income has a great influence and
for external factors, shopping enjoyment greatly influence the impulse buying behavior of the
consumers.

2.5 Synthesis

With the above mention studies together with its literature by relating to consumer buying
behavior mentioned that the main intention is to identify the different factors of consumer’s
buying behavior, which will consider their perceptions and stimuli deemed. The most influential
areas within consumer buying behavior is the consumer decision making process, this process
helps the consumers decide on what product to purchase which is all about the young
consumer’s perception and their willingness to buy the product. It identified that the orientation
of consumers to a product depends positively on the dynamic relationship between the buyer
and seller, this will improve profitability and customer satisfaction in the business. This study
shows that costumers consider present stimuli that would attract their attention in purchasing a
product, it shows that the shortage of time can affect the consumer’s buying behavior in terms of
purchasing product.

Consumers have heterogeneous preferences that reflect their unique values and
preferences, and as of to Mesay Sata (2013), there are six important factors that could affect
consumer buying behavior such as price, social group, product, features, brand name, durability
and after sales services. Consumer expectations and the aspiration to fulfill the foundations of
all classical and modern marketing concepts. This study provides an insight on the consumer
buying behavior the Filipino style as influence by colonial and foreign consumerism and defines
the consumer behavior helps businesses and organizations to improve their current marketing
strategies by applying new and unique selling proposition. The researchers used a database to
increase the efficiency of the research. They also used it for purposes such as storing
information regarding consumer buying behavior.

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 CHAPTER 3
Research Methodology

This chapter presents the methods to be used in the study. It also describes the
research design, the population and sample, the instruments used, the data gathering
procedure, and the statistical treatment of the data.

This study will evaluate the factors affecting consumer buying behavior on selected milk
tea shops in Iligan city which will determine and assess the different opinions of respondents.

3.1 Research Design

The study will use descriptive and survey methods of research to evaluate the factors
affecting consumer buying behavior on selected milk tea shops in Iligan City. Descriptive
because this research attempts to know the factors affecting consumer buying behavior on
selected milk tea shops in Iligan City. Survey because this study will assess how the factors
affecting consumer buying behavior affects the consumers buying behavior on the selected milk
tea shops in Iligan city.

3.2 Population and Sample

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 In this study, 50 selected consumers and 9 selected milk tea stores in Iligan city will
partake in the process. The consumers will best asked regarding the researchers topic "factors
affecting consumer buying behavior" Milk Tea stores in the study will be selected according to
how well their business is in the milk tea industry.

3.3 Research Instrument

The research instrument that will be used in conducting the research are as follows:
Interview. The researchers will do an interview orally with the respondents regarding the factors
that affects consumer buying behavior.
Questionnaires. The questions that will be asked to the respondents will be designed by the
researchers and will be used in all the respondents. The researcher will be taking down notes to
the answers of the respondents.
3.4 Data Gathering Procedure

This study will consist four (4) stages:

Stage I deals with letter of request to the owner. The researchers will ask a permission to
the store owners to conduct a study through a letter signed by the research adviser.

Stage II deals with formulating the questions to be asked to the store managers. The
researchers will formulate a question regarding the factors affecting consumer buying behavior.

Stage III deals with interviewing the respondents.

Stage IV deals with analyzing, interpreting, and gathering the data that has been gathered.

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