Effects of Intrinsic and Extrinsic Product Cues on Consumers' Purchase Intention: A Study of Alcoholic Beverage Consumers in a Developing Country Metropolitan City

Abstract

ABSTRACTThis study examines the effect of intrinsic and extrinsic product cues on purchase intention of alcoholic beverages in a typical developing country metropolitan city. 300 consumers of alcoholic beverage were surveyed. Descriptive statistics and multiple regressions were used to analyze the data. This study found that seal of approval, alcoholic content, company name, advertisement, and price have significant effect on the purchase intention of alcoholic beverage brands, while packaging, brand name, and quality were found to have lesser effect. Based on the results, conclusions were made and management and firm implications highlighted. Possible areas for further research were suggested.Keywords: alcoholic beverage, intrinsic cue, extrinsic cue, Nigeria, purchase intention.INTRODUCTION:The discourse on rational decision making in a consumer purchase situations has been argued extensively in the literature (See for example: Shugan, 2006; Kirmani & Rao, 2000). However, the reality of globalization, which is manifesting in the global integration of culture and consumption, and forces in the global economy are combining to making consumer rational decision making more compelling even in previously isolated markets of developing economies (Nkamnebe, Idoko, & Kalu, 2009). Additionally, increasing sophistication in technology makes it even more challenging for consumers to rationally take decisions regarding product quality (Olson, 1972). The combined effect of all these being that products and in particular alcoholic beverages that are available in most developing country markets are increasing and they possess converging array of cues. The consumers' task of evaluating these increasingly homogenous cues in evaluating product quality in a buying situation is becoming rather difficult and challenging. In Enugu metropolitan city Nigeria that forms the context of this study, increase in population, improving economic environment among other factors have given rise to increasing number of imported and locally produced alcoholic brands. The resulting brands proliferation is heightening competition in a market that is offering virtually common product cues. On the part of consumers, they are becoming more discerning and savvy due to increasing education and income, thereby making it more difficult for firms to grow loyal consumers over time (Duncan, 2002). All these developments are making it increasingly difficult for managers to identify particular product cues that influence consumers buying decisions in the increasing undifferentiated Nigerian alcoholic beverage market. Previous studies on other contexts have documented the effects of intrinsic and extrinsic product cues on consumers' purchase intention of alcoholic beverages (See: Miyazaki, Grewal, & Goodstain 2005; Lockshin & Hall 2003); but till date, such studies are very limited in the isolated markets of most developing countries including Nigeria that provide the context for the present study. This obvious knowledge gap has brand management and firm implications. Accordingly, the present study seeks to investigate the effects of intrinsic and extrinsic product cues on consumers' purchase intention of alcoholic beverage brands in such developing country metropolitan city as Enugu metropolis in Nigeria. Arguably, marketers could leverage on the insights provided by this study, which is consistent with previous argument that such study could help managers to develop a hierarchy of product attributes that consumers use to evaluate quality (Veale, 2007).LITERATURE REVIEWCUE THEORY: INTRINSIC AND EXTRINSIC PRODUCT CUESPlethora of studies have established that consumers employ intrinsic and extrinsic product cues when forming their overall evaluation of product quality; although consumers' opinions and perceptions of quality levels are not totally objective as there appears to be traces of subjectivity (Bredahl, 2003). …

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