Regression Analysis And Linear Models: A Study Of Chinese Consumers’ Switching Intentions From Domestic To Foreign Brands

Research Design

Discuss about the Regression Analysis and Linear Models.

The intensity of competition between international and local brands is high in China. According to the changing trend, many respondents are favoring foreign brands and proportion of supporting local brands is increasing rapidly. The transform in Chinese trend preferences deserves further attraction and attention.

Customers’ experience of current materials influences their intensions to switch. Numerous studies have effectively detected satisfaction of customer, variability of cost and availability of attractive alternatives. The report elaborates how customers perceive the relevance to a service or product as essential external factors.

Consumers’ decision-making methods are related to the attitudes of customers. The attitudes appear to influence the intention to stay with or switch from product or service brands. The report highlights the impacts and decision-making styles of Chinese consumers’ intentions to switch from domestic brands to foreign brands and the related questions.

1. Objectivity: The findings found in the research should be objective. It is possible by permitting more than one person to agree between the final scores and conclusion of the research.
2. Precision: Precision in statistical (Qualitative and Quantitative) surveys relates the variation of a survey estimator for a population parameter to have a full population of interest using a specific probability-based sampling design.
3. Reliability: If the similar research is handled out of time and in a similar setting again, it must provide same results. Therefore, researcher must frame the research questionnaire to make it reliable and provide similar outcomes (Wickson, Carew, and Russell 2006).
4. Generalization: The data gathered from given sample must be utilized for providing a common application to the large group of which sample is drawn.
5. Validity: Any kind of measuring device can be said to be valid if it calculates the proper expected measure. To transform a research valid, the questionnaire framed before research must be framed accordingly.

The research design provides us how the further method would be taking place and how would research study carry into classification, interpretation and suggestion.

The cross-sectional and longitudinal case study allows the researcher to study the attitude of people with time. The environment of research is called the open-source research. In this data analysis, the researcher plans how to take data for research. In this case-study, the researcher deigns how the research is going to be incorporated. The case study also relies upon the use of statistical tools and decision-making. The data of customer satisfaction and switching of China interprets that it has proper objectivity of detecting the trend of switching in case of cell phones and sports shoes. The case study is reliable as the conclusion drawn from the case study is truly reflecting the scenario of Chinese population. The sample of undergraduate students of Chinese population and their response used in the case study is same as of Chinese population analysis and analysis of other samples in this regard. The report also elaborates that the sampled case study is a generalized version of the analyses in the subject of switching towards the foreign brands of Cell phones and sports shoes. The validity of the research report is quite good as we found our likely conclusions of switching same as our expectation.

The precision in this Chinese case study of switching indicates to the size of deviations from a sample estimates such as percentage calculation, frequency or mean that occurs over repeatedly application of same sampling methods using the same sampling frame and sample size. When precision is a measure of the variation among sampling estimates over repeated application of the same sampling techniques using the same sampling frame and sample size. The precision factor of the case study refers that the sampling in Chinese peoples’ switching has enough significant variation in terms of precision. The researcher randomly assigns participants to various situations, measures the variables of interest and tries to control confounding variables. These confirmatory research tests the priori hypotheses. The necessary tests for example t-test, rank test, chi-square test and logistic regression could be measured in these research models.

Evaluation of Secondary Data (Literature Review)

The design is not sufficient to research objectives because the analysis needs more use of calculations such as Logistic regression or Wilcoxon signed rank t-test (Davis 2003). The design does not allow for more freedom during the data collection method.

The other types of design that could be used for research design that could be used for case study is descriptive and Correlational design. The qualitative data is converted here into quantitative research design. In the fixed designs, the design of the study is fixed before the main stage of data collection. In these research designs, fixed data sets are normally theory-driven; otherwise, it is impossible to know in advance, which variables need to be measured and controlled (Marshall 1996). In this method, the variables in the case study are measured quantitatively. These research designs are flexible in nature. The reason design has flexibility, as the variable of interest is not quantitatively measurable.

The necessity of evaluation of data is to find out the reasons behind switching intention of Chinese people from Chinese brand to foreign brands or vice-versa. The decision-making styles of Chinese customers to choose their preferable brands are also discussed in this segment of report.

Consumers’ brand selection changes in both developing and developed countries. Foreign products are considered superior in the developing countries like China. It indicates that consumers believe that products from less-developed countries have low quality and high probability of poor performance with customers’ dissatisfaction. They believe in reliability of trusted brands manufactured in developed countries. Consumers’ evaluation by direct and indirect contact with the bank influences positively or negatively on the trust of brand.

From the wide study about the preference of Chinese consumers, it is seen that Chinese brands struggle to develop brand trust and face intense competition and product surpluses in their domestic market. On the other hand, Chinese consumers are retaining their firm preference for foreign brands. The German and French brands have significant effect to reduce the popularity of Chinese brands among Chinese people. As China is developing fast and their consumers need diversity, variety and sophistication in products, Chinese people are showing interest in the Chinese brands. The three causes behind preference of foreign products are superior quality, superior brands and better design. The presence of these three factors naturally demands more cost. Therefore, low-income Chinese people prefer affordable Chinese brands. If the quality of Chinese products enhances, consumers of China irrespective of all socio-economic background would start to prefer the local brands rather than foreign brands.

Switching intention is a customers’ psychological tendency to terminate using a brand and start using other brands. Clients’ retention helps businesses boost and sustain gain. Companies do not want to lose customers and switching reasons generate strategies to combat them. Satisfaction, costs and alternatives are the influencing switching intention that face some challenges. Surprisingly it is often seen that unsatisfied customers keeps their brands unaltered, as they do not expect better service elsewhere. It is concluded that highly commoditization, homogeneous market value and a lower price drive the customers to switch. Attitude toward brands, loyalty and other value-related aspects of the customers hamper their intention of switching. Oppositely, some highly involved customers become more loyal to the brand, more committed towards their own judgment, and less focused on the failure of services.  

The strength of the evaluation of secondary data is that Chinese customers have a tendency to maintain a brand relationship because of the legacy of religion. In terms of switching intention, Chinese customers perceive their relationship with services and products meaningfully. Consumers’ decision-making approach influence shopping attitudes even when it is applied to different goods, services or purchasing decisions.

The weakness of the evaluation of the secondary data indicates that the future of Chinese companies is not much smooth. The evaluation shows that decision-making styles are related to preference for foreign or local brands rather than independent of foreign factors. Many of the consumers of Beijing, Shanghai and Guangzhou focus on brand, quality and fashion of Western countries – the anxiety grows for local companies.

The research process is important to research because we can interpret the role of different factors and their significance to switch Chinese people to accept products of foreign country. The analysis is incorporated with the data of preference of mainly two products such as cell phone and sports shoe of undergraduate Chinese students.

The below tables indicate that almost 64% of 584 response providers of China have foreign phones and 89% of them need it. Correspondingly, 45% of 584 response providers have sports shoes of foreign brands and 79% of them want to have them. The situation interprets a high tendency of Chinese people towards foreign products.

Quality (36.19% for cell phones and 55.40% for sports shoes) is the main reason behind preference and switching. Price is also a significant effect behind the preference of cell phones (24.13%) and sports shoes (20.16%). Multifunction (12.22%) and Brand (13.33%) are the prominent reasons behind preference of cell phones. Promotion (2.86%) and after sale service (1.11%) are insignificant two reasons. Promotion (9.37%) is not an insignificant factor in case of sports shoe. However, Brand (0.48%) and Multifunction (1.59%) are the main two insignificant factors of the preferences behind sports shoes.

The strength of the data analysis is that we not only applied descriptive statistics and graphs, but also applied exploratory data analysis and logistic regression for more clarified and pinpoint results. We observe total five types of retention and defection that impact the strategy of switching-

1. Retention of domestic and foreign brands.
2. Retention of foreign brands.
3. Retention of domestic brands.
4. Defection from domestic to foreign brands.
5. Defection from foreign to domestic brands.

The weakness of evaluation of the data is that alone regression analysis and exploratory data analysis are not enough strong to infer the conclusion.

The data is secondary and already used by maker of paper. The focus group was mainly the people of urban area of China such as Beijing or Shanghai and the focus age young generation. For consideration of true evaluation of approach and tendency of Chinese customers, we collected secondary data from many regions and sectors of Chinese population.

Wang and Yang conducted the cross-city survey of auto brand preferences in China after interviewing 1200 respondents. In total 628 surveys of undergraduate students of China were collected. We have filtered the data and have chosen 584 questionnaires about cell phones and sports shoes. Ding investigated the preferences of urban adult Chinese customers for discrimination between foreign and Chinese brands.

Not only that an interview of 1200 respondents were undertaken for checking the significant effect of purchase intention of Chinese customers. Colgate et al. collected data from 24 interviews and nearly 700 questionnaires for proposing Chinese customers’ tendency to maintain a brand relationship. 431 out of 1628 respondents in Guangzhou, Beijing and Shanghai have given their responses about preference of western bands. Most of the data is gathered by question-answer method. The used data of the report is collected in the method of questionnaires.

The strength of data collection method is that different types of response providers and their variety of responses are enriching the data. Most of the data are collected by GroupWise questionnaire method. Therefore, the chance of error is comparatively less in this method. The face-to-face interview data is primary in nature and therefore accuracy is high. The data collection method is manual and more interactive than other methods.

The weakness of data collection method is that the people who are responding could give wrong quick responses according to the question of questionnaire. We need the information about their decisive expression. However, we get the information by these methods depending on primary expression. Besides, the information about quality of foreign and Chinese brand products and the data relating cost management of these brand products are absent in this dataset. We needed it very much for better analysis result.

Sampling strategy and procedure is one of the crucial segments of data analysis. The procedure of sampling is interview and questionnaire. The sampling method is random in nature and samples were chosen from undergraduate students’ community of urban China. The sampling process would help to consider different types of factors (categorical and numerical factor) from the tabulated values of input taken according to the questions.

In the survey of total 584 questionnaires, the male number of population is 294 and female are 290. According to the education level, we can divide these persons in four categories such as Senior (frequency=21), junior (frequency=183), sophomore (frequency=123) and freshman (frequency=257). The monthly disposable income is divided in four categories and their frequency as well as percent is calculated.

We list the respondents according to the cell phones to the willingness of purchasing foreign brands as high as 89%. In contrast, 46% of undergraduates used Chinese cell phones and 40% tended to buy Chinese cell phones. Only 45% respondents owned foreign sports shoes. The percentage of eagerness to buy foreign brands would increase to 79%. Although 69% of respondents have Chinese shoes, only 47% liked to stay Chinese brands. The quantitative factors that influence eagerness behind foreign companies are respectively, price, quality, multifunction, fashion, promotion, brand, sale service and others.

Among the various procedures of data collection for research purposes, many researchers due to its different advantages, benefits and strengths prefer the survey method. However, surveys also have their disadvantages and weak points under consideration.

The strength of the sample survey procedure is that it represents the large population. The process of gathering the data has low cost. The data gathering process is convenient in nature. The analysis of sample survey data by question-answer method shows good statistical significance towards the variables and attributes. Besides, we do not observe little or no subjectivity in case of observers to this type of sample survey method. The data is easy to collect.

The weakness of the sample survey of questionnaire procedure is that it incorporates inflexible design. Question bearing controversies are not ideal in case of controversial issues. The wrong sequence of questions and interference of inappropriate questions can affect the results regarding face-to-face interviews and focus groups. Sometimes answerers can avoid the problematic and uncomfortable questions. The wrong answers delivered by people could mislead the process.

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