Consumers Perception of the Effectiveness of Short Message Service (SMS) and Multimedia Message Service (MMS) as Marketing Tools

Transcription

1 Consumers Perception of the Effectiveness of Short Message Service (SMS) and Multimedia Message Service (MMS) as Marketing Tools Nattharika Rittippant, Jedsada Witthayawarakul, Patchrabhon Limpiti, and Nathadej Lertdejdecha Abstract Increased use of short message service (SMS) and multimedia message service (MMS) as marketing tools by several companies leads to an interesting question about their effectiveness. This study investigates the SMS/MMS marketing and the consumers perception regarding these marketing tools. We proposed that demographics, relevance to advertisement, brand familiarity, and attitude toward SMS and MMS have significant effects on the consumers response to the business SMS/MMS. The questionnaires were used to collect the data from consumers in different demographic groups. Multiple regressions (SPSS 16.0) were used to interpret the data. According to the results from 342 respondents, brand familiarity and attitude toward SMS and MMS have significant effects on the consumers response to the ads. Based on the statistical analysis, we provide general guideline for an effective SMS/MMS marketing. Keywords SMS, MMS, Marketing Tool Effectiveness, Consumer s Perception. I. INTRODUCTION OWADAYS mobile phone plays the key role in N communication in many countries including Thailand. It seems like the fifth factor that everyone has to have it. Besides the convenience of usage in anywhere or at any time, the user can also listen to music, play games or surf the internet. Another increasingly popular function is the message services in forms of short message service (SMS) and multi-media service (MMS). AIS, which is one of the largest mobile phone service providers in Thailand, indicates that Thai people sent 41 million of SMSs and 7.5 hundred thousand of MMSs in the range of date between 31 of December in 2007 and 1 of January in Based on the statistics, it emphasizes on the dramatic rate of using SMS and MMS. Because of its popularity, marketers now discover a chance to advertise their products via SMS/MMS. The marketers hope that this new method, also known as wireless advertisement through SMS and MMS, will effectively and efficiently promote their products or services. However, it seems that Nattharika Rittippant is with the Sirindhorn International Institute of Technology (SIIT), Thammasat University, Pathumthani Thailand (phone: ext. 2103; fax: ext. 2101; natthari@siit.tu.ac.th). Jedsada Witthayawarakul, Patchrabhon Limpiti, and Nathadej Lertdejdecha were undergraduate students at the Sirindhorn International Institute of Technology, Thammasat University, Pathumthani Thailand. They have recently graduated with Bachelor of Science in Management Technology. This study is an SIIT undergraduate senior project. their strategies of message receivers are quite random and convenience-based. Because of the relatively low cost to advertise via SMS and MMS, companies now send their advertisements to the mass market without considering the receivers personal details. As a result, most people tend to be irritated and annoyed by these careless marketing tactics. Therefore, the purpose of this study is to investigate Thai consumers response to SMS and MMS ads in order to provide a general guideline on how businesses can utilize these tools more effectively. This paper studies influential factors of the responses on SMS and MMS advertisements from Thai people. The factors considered are demographics (i.e., age, gender, education, and occupation), brand familiarity, relevant on advertisement, and attitude toward SMS and MMS. II. LITERATURE REVIEWS The mobile advertising is another complementary marketing communications instrument, much of the theorising about why consumers accept or do not accept SMS advertising is speculative. SMS location-based services are likely to become increasingly valued as a marketing tool (Ververidis and Polyzos, 2002). Via the mobile channel, the response can be nearly immediate, interactive and the consumer can be reached everywhere at anytime because the service is typically ubiquitous (Jelassi and Enders, 2004). Dickinger et al. s (2005) model of success factors for SMS marketing are divided into two categories: the message and the media. Message factors include: message content, Krishnamurthy (2001) found that the factors affecting consumer willingness to give permission to receive advertisement were: message relevance (e.g. message fit and advertiser attractiveness), and special offers; personalisation according to time (i.e. time of day and frequency of advertisements), location (including real-time location-specific offers) and consumers preferences; and consumer control, permission and privacy, which has been identified as the strongest negative influence on consumer attitudes toward SMS advertising. Moreover, Akaah et al. (1995) found that the factors that influence attitude toward direct marketing most are the volume of advertisements and past direct experience. Media factors include issues regarding the device, transmission, product fit (the media appears to better suit low budget items, young people and services rather than goods), and media cost 815

2 (which suggests that the medium is cheaper and more effective than other alternatives). Xu et al. (2003) identified three consistent success indicators for SMS messaging: (1) the cost-effectiveness and interoperability of the wireless infrastructure; (2) the high penetration of mobile phones (ubiquitous penetration levels of over 80% in some countries); and (3) the relatively low cost of the SMS messaging service. Also, some research believe meaningly interprets that cost of SMS does matter to consumptions (Joost Wouters and Martin Wetzels, 2006). For the case of demographic, some research believe that age, mobile phone users 16 to 45 years old are receptive to experience SMS marketing (Pastore 2002), and gender, females have more likely to respond SMS ads (Trappey, Randolph J.; Woodside, Arch G., 2005), play the critical role of response to SMS ads. In addition, there are 6 external factors; simplicity of input method or input language, economic development which substitute for less developed information structure, cultural difference, marketing competition which substitute for pricier voice service in a noncompetitive market, business model which enhance information richness and benefit from positive feedback in value web, and political censorship (Xu Yan, Min Gong; James Y.L. Thong, 2006). However, most of the people still have the negative attitude toward SMS ads (Fatim Bamba, Stuart J. Barnes 2007). Besides advertisings, SMS can be the powerful tool for do a survey because it collects information quickly, as the average speed of response (3.3 days) is better than for other survey modes (Balabanis, George; Mitchell, Vincent-Wayne; Heinonen-Mavrovouniotis, Sarah, 2007). This paper focuses on examining the factors that influence Thai consumers intentions to accepting SMS advertising. III. METHOD This research examines the hypotheses which are based on the research model that distinguish vary response from various group of customers. All of sample customers are defined in group, which are age, sex, relevance to ads, brand familiarity, ads interested, occupation, attitude toward SMS ads, and types of product ads. Sampling This research tends to do examination about response to SMS advertisement in Thailand. The samples to focus will be randomly opted from different group of people from factors of model those are suggested to influence to construct several of outcome. The number of sampling planed is conducted by Taro Yamane s formula. It recommends that the sample size should be 400 to get more reliable data. Survey questionnaire The survey questionnaire will interpret the response of customers to SMS and MMS ads into two sections. The first section will distinguish acceptance response to SMS and MMS ads which are separated by the period that customers spend to decide whether he or she would accept that ad or not. This section expresses that conscious factors and unconscious factors would matter on reflections. The questions in this part concern brand familiarity, demographic, relevant to advertisements, and attitude toward SMS and MMS ads. They are measured in the scale. Moreover, it measures the responses of customers after receiving SMS and MMS ads in the scale. At the second part, after they accepted SMS or MMS ads, this segment concerns about the response of customers, if customer accepted ads and read it, he would or not to be attracted. To illustrate, for ringtone download ads, did he download that ringtone or not after he has read. In this section, it is the opened-ended question, the answerer need to specify his or her opinion. Focus group A field survey was constructed in January 2009 in Thailand to test hypotheses regarding factors relevant advertisement, brand familiarity, attitude toward SMS and MMS, and demography-that will influence on the consumers response. To be reliable, the data will be collect from 400 Thais separated into 5 groups of age-6-14 years old, years old, years old, years old, and above 50 years old-as statistics of Fig. 3 from national statistics office of Thailand. As Fig. 3, it indicates recently that the age of years old has the highest percentage of using mobile phone. And the average using mobile phone in Thailand is 40 percent approximately. The questionnaire is separated into 5 parts. The first part is related to the information of demography and frequency of using SMS and MMS. Secondly, this part asks interviewees for answering the question about relevant advertisement on SMS and MMS. Thirdly, interviewees need to answer the questions regarding to brand familiarity. Next step, interviewees will answer the questions about attitude toward SMS and MMS advertisements. Lastly, interviewees can give any suggestion about the approach which is likely to increase the consumers response toward SMS and MMS advertisements IV. RESEARCH MODEL Most prior researches indicate attitudes toward SMS ads. Bauer et al. (2005) test a model, based on the theory of reasoned action (Ajzen, 1991), and find that the most important factors that affect attitude toward mobile marketing are: consumers attitudes toward advertising in general; perceived utility (in terms of information, entertainment, and social aspects); perceived risk (in terms of privacy and data security); consumers knowledge about the technology; and social norms that impact on consumers behaviour. Yet, little do research about the relationship between both demography and attitude. This paper applies the model from Fatim Bamba and Stuart J. Barnes model which indicates that attitude toward SMS ads, relevance to ads, and brand familiarity have strong effect to response to SMS ads. And this study also wants to know whether demography has effect to response to SMS ads or not. To easily understand, the factors identified can be classified into two categories; (1) Unconscious factors include attitude towards SMS ads which indicates that what is the consumers perception toward SMS ads, and demography. For these variables, the 816

3 consumer is not aware of the effects on his/her decision to give permission. These factors indirectly influence the decision to give or not to give permission. (2) Conscious factors include the relevance of SMS ads which is the product consumers are interested or SMS ads is all about consumers needs, and brand familiarity which is consumers are likely to respond to SMS ads. Here, consumers can analyze factors before making their choices. These factors directly influence the decision to give or not give permission. Fig. 1 Research Model Response refers to consumers reaction to the SMS or MMS ads sent. It means that consumers make an action such as either opening the message up and read the content of the message or sent another SMS to confirm your participation, not just ignore and leave it when it sent to. Some research says that Permission marketing refers to the asking of consumers consent to receive commercial messages while giving the individual and opportunity to stop receiving them at any time (Tezinde et al., 2002). Bellman et al. (2001) affirm that: Using the right combination of question framing and default answer, an online organisation can almost guarantee it will get the consent of nearly every visitor to its sites. Unfortunately, some marketers manipulate consumers inattention and cognitive laziness to get their consent. This paper would like to know which factors have influence on the response dramatically in Thailand. In addition, a study also indicates that consumers perception have negative attitude toward SMS ads so the marketers should avoid to ask personal information (Fatim Bamba, Stuart J. Barnes, 2007). Life style and media habit may cause the attitude. There is a negative relationship between the volume of ads received and the attitude towards direct marketing (Phelps et al., 2000). If the consumer is interrupted during his or her daily activities this can severely damage brand image (Hoyer and MacInnis, 2004). Petty (2000) describes this cost as an involuntary cost borne by the consumer who faces an unselected exposure. Another paper say that the innovation attributes- relative advantage, compatibility, complexity, and trialability- in the diffusion of innovation perspective are important belief characteristics in explaining consumer attitudes towards SMS ads (Muk, Alexander, 2007). In this case, one would like to know Thai consumers perception toward SMS ads. The first hypothesis developed for this research; H 1 : Attitude toward SMS ads will influence on responses of Thai The second hypothesis is about occupation. Few studies examines whether the occupation of consumers has effect on the response of SMS or MMS ads or not. The occupation which involve high technology or work with technology may be likely to respond SMS ads because they have knowledge about technology and know how to use the technology, SMS ads, to get more benefit. For example, they always realize them as alternative information channel. They can receive information or special offers from sender in SMS ads. They at least open up the message and read it but they may not ignore it. Otherwise, the result is reversed by occupation which not involve with technology. It is reasonable to believe whether people whose work involve with IT are more likely to respond to SMS ads than other occupations. H 2 : Occupation will influence on responses of Thai Thirdly, this studies what degree of education has more chance to respond to SMS ads. The people who have high degree of education may have the information or knowledge about SMS ads which may have bad intention hidden in SMS ads sent. Consequently, they do not want to respond the SMS ads sent. Some may delete whenever they receive them. On the other hand, people who have low education may an action. Therefore, this paper would like to know the degree of education. H 3 : The degree of education will influence on responses of Thai Consumers in age categories that range from 18 to 44 years are the most likely to engage in SMS TV messaging behavior (Trappey III, Randolph J., Woodside, Arch G., 2005). Teenagers are likely to respond SMS ads because this age is in the period of liking to learn a new thing so they are interested in new technology. On the other hand, most of adults are lazy to learn new thing. They always think that it is high technology which is not proper to them. However, adults who face a lot of things in their life may not want to respond SMS ads because it may be the deception as happening in the present day, this not occurs with teenagers. Therefore, the fourth hypothesis is: H 4 : Age will influence on responses of Thai consumers significantly. In case of relevance of ads, it means SMS ads are fit and attractive to consumers (Fatim Bamba; Stuart J. Barnes, 2007). A prior research informs that SMS ads will have the efficiency when they are sent to consumers with the right information at the right time in the right place (Bert De Reyck and Zeger Degraeve, 2003). The message can be tailored for each customer to enable better targeting. Since, mobile phones are personal objects marketers can specifically address the person targeted, as well as recognising their social context, individual preferences, time, and location (Fatim Bamba; Stuart J. Barnes, 2007). They consumers are high likely to respond if the SMS ads are what they are interested. Hence, the fifth hypothesis is: 817

4 H 5 : Relevance to ads will influence on responses of Thai A findings show that the one of strongest determinant of multinational companies mobile advertisings adoption is brand familiarity (Shintaro Okazaki, 2005). An earlier pilot study conducted by Quios found that in mobile advertising the level of recognition was surprisingly high: 79 per cent of participants recalled 60 per cent of mobile advertising (Barnes, 2003). In addition, firms using mobile campaigns can attract consumer attention and produce consumer responses to a much greater degree than other direct marketing channels, because such firms can engage in one-to-one dialogue with customers (Kavassalis et al., 2003). An experimental survey by Ericsson indicates that 60 per cent of samples liked receiving mobile advertising (Barnes, 2003). Similarly, a survey using popular brands trial mobile advertising found that as many as 84 per cent of 500 young British adults are likely to recommend the service to their friends, while only 7 per cent are likely to abandon the service (Barwise and Strong, 2002). It means that consumers are likely to respond SMS ads if they are sent from the company that they know or are familiar. H 6: Brand familiarity will influence on responses of Thai A study shows Females show a higher likelihood of sending an SMS to TV compared to their male counterparts (Trappey III, Randolph J.; Woodside, Arch G., 2005). Because most of females always do the housework so they will have high chance or much more time to participate TV program with sending SMS. In case of being home, most is not in hurry and also have much time to open and read the SMS ads than males, most work outside house. It is reasonable to assume that females have more likely to respond to SMS ads than males. H 7 : Gender will influence on responses of Thai Questionnaires The questionnaires were conducted by the SIIT students and general people. They were allocated to many groups of people to answer them. It was not operated by the interview. The majority of collected data from teenagers group come from the SIIT students. They were delegate to 1 st, 2 nd, 3 rd, and 4 th year students. And the rest collected the data is the general people. However, the data was collected from a printer in the majority. Earlier the number of sampling expected is 400 respondents which follow Taro Yamane s formula. Nevertheless, the number of respondent collected is approximately 351 respondents. Some groups of people receiving the questionnaires did not send back. V. RESULTS The data from the surveys was analyzed by uni-variate of general linear model and multiple linear regression in the SPSS program version Since this paper would like to test whether each factor has the influence on the response. And there are several independent variables to test one dependent variable that why these programs were applied. The univariate of general linear model will show the relation between the independent and dependent variables. It indicates that which independent variables have the significance to the dependent variable. And the multiple regressions show the correlation between variables. Demographics TABLE I TESTS OF BETWEEN SUBJECTS BY UNI-VARIATE OF THE CASE OF DEMOGRAPHIC Sex Age Occupation Education Error Type III Sum of Squares R-square = 0.21, Adjusted R-square = -0.2 From identified demographic as 4 factors, those are gender, age, occupation, and education, results indicated that there was no significant factor from demographic which affect to attitude to shopping the products when those respondents received SMS and MMS ads. The data from survey were captured, coded and analyze using the statistic packages SPSS The data were interpreted by using tables of dependent variable to measure the significant value which can determine the relation of factor whether those demographic factors relate to response or not. Consequently, there is no significance in demographic to the response. And in case of relationship, there is quite weak relationship with the response. Pearson Correlation interpreted that there is a factor that have direct relationship to attitude to shopping which is age. Moreover, there are 2 factors those have inverse relationship to attitude to shopping: sex, occupation. As data setting, it was identified male as 1 and female as 2 for sex factor. So it means negative value means that male has more positive attitude to shopping than female. Beside for occupation, the answers of questionnaire are elements not in numbers, so it cannot be concluded. 818

5 TABLE II THE PEARSON S CORRELATION OF THE CASE OF DEMOGRAPHIC TABLE IV THE PEARSON S CORRELATION OF THE CASE OF BRAND FAMILIARITY AttShop SndrMmbr SndrFmlr SndrUnkn AttShop AttShop sex age Occuptn edu AttShop SndrMmbr SndrFmlr sex age occuptn edu Brand Familiarity Table below interpreted the significance factor that related to attitude that the consumers respond to a SMS or MMS advertisement which is sent from unknown senders. The significance of SndrUnkn is0.002 which is less than p-value (0.05).Thus in this calculated univariate analysis of variance table it measure out that SMS and MMS which are sent from unknown sender relate to attitude that the consumers respond to a SMS or MMS advertisement. TABLE III TESTS OF BETWEEN SUBJECTS BY UNIVARIATE OF THE CASE OF BRAND FAMILIARITY Type III Sum of Squares SndrMmbr SndrFmlr SndrUnkn Error Notice: SndrMmbr represents Sender which you are member with SndrFmlr represents Sender which you are familiar SndrUnkn represents Send from unknown sender. Dependent variable: Attitude at shopping R-square = 0.371, Adjusted R-square = The correlations table measured that all of factors has direct relation to attitude that the consumers respond to a SMS or MMS advertisement. Which SMS and MMS those sent from familiar sender has the highest relation to respond. SndrUnkn Attitude toward SMS and MMS advertisements From the Table V, it is the case of attitude toward SMS and MMS advertisements. The test used the significant level of 5% that means the confidence intervals are 95%. The variables in this test consisted of - AttAdv stands for attitude from respondents who would like to use SMS or MMS to promote a product. - AttAdlnt stands for attitude from respondents who think SMS and MMS advertisements are good idea. - AttFun stands for attitude from respondents who think receiving a SMS or MMS advertisement is fun. - AttAnnoy stands for attitude that annoys a SMS or MMS advertisement. - AttShop stands for attitude that the consumers respond to a SMS or MMS advertisement, such as the want of shopping after receiving one. TABLE V TESTS OF BETWEEN SUBJECTS BY UNIVARIATE OF THE CASE OF ATTITUDE TO SMS AND MMS ADS Dependent Variable:AttShop Model Type III Sum of Squares a Intercept E3.000 AttAdv AttAdInt AttFun AttAnnoy Error a. R Squared =.832 (Adjusted R Squared =.685) The result from the Table V indicated that there are two variables which there is no significance to the response if it was test in the individual variable. Therefore, there are two variables, AttAdv and AttFun, which are influent on the response on SMS and MMS advertisement. 819

6 Moreover, this finding is quite reliable because the value of R-square is It means that the independent variables in this issue cover the dependent variable 68.5%. TABLE VI THE PEARSON S CORRELATION OF THE CASE OF ATTITUDE TO SMS AND MMS ADS AttAnn AttShop AttAdv AttAdInt AttFun oy AttShop AttAdv AttAdInt AttFun In the case of relevant to advertisement, it indicated that the relevant to advertisement has the influence on the response. From the Table VII, the independent variable is AttIrtt meaning that feel irritated with the content in SMS and MMS advertisement and the dependent variable is the same (AttShop). The result shows that the relevant to advertisement has the significance to the response because its p-value is less than Moreover, there is direct relationship of between the dependent and independent variables. Therefore, it supports that the relevant to advertisement influences on the response of Thai consumers. TABLE VIII THE PEARSON S CORRELATION OF THE CASE OF RELEVANCE TO ADS AttShop AttIrrtt AttShop AttAnno y AttIrrtt The AttAdv, AttAdlnt, and AttFun have the direct relation to the AttShop (the response). And the AttAnnoy has the small direct relation to the AttShop. Attitude from customers who would like to use SMS and MMS advertisements to promote a product has the highest relationship with the response. Therefore, the consumers who have good attitude toward SMS and MMS advertisements have the high chance to respond. Relevance to advertisement TABLE VII TESTS OF BETWEEN SUBJECTS BY UNIVARIATE OF THE CASE OF RELEVANCE TO ADS Dependent Variable:AttShop Model Intercept AttIrrtt Error Type III Sum of Squares a E R Squared =.036 (Adjusted R Squared =.024) VI. CONCLUSION These findings have two implications. First, the marketers of many companies cannot select the target consumers to send the SMS and MMS advertisements on the basis of demographics alone. Second, the marketers must know the information about the target customers, such as preference or attitude toward SMS and MMS advertisements. Also the results from open-ended questions emphasized how to use SMS and MMS advertisement effectively. It showed that most respondents want the attractive content in the advertisement. Therefore, the message must be the relevant and interesting to the customers. It may seem that sending SMS and MMS advertisement is easy to use as a marketing tool to promote a product However, it is difficult to use it productively without tailoring the ads to match with the consumers personal preferences. From the information from Hutch which is the one of providers of signal service for mobile phones in Thailand, the rate of price for sending SMS is 200 baht for 100 messages, 500 baht for 400 messages, and 2000 baht for 1000 messages. Absolutely its cost is low but if the amount of receivers is huge, it will not be low comparing the effectiveness of other types of advertisements. Furthermore, someone has a mobile phone but they have never known how to open the sent message. Therefore, it will be quite wasted. Actually it is an interesting marketing tool which can reach the target customers. On the other hand, it may disturb the customers which results in more negative perception about the products and the business. REFERENCES [1] Becker, D. Participation TV: Premium SMS vs. Toll-Free IVR.International Journal of Mobile Marketing, 2007, Vol. 2 Issue 2: [2] Bamba, F., and Barnes, S. J. SMS Advertising, Permission and The Consumer: A Study. Business Process Management Journal 2007, Vol. 13 Issue 6:

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