International Journal of Applied Research & Studies ISSN

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1 Abstract: International Journal of Applied Research & Studies ISSN Research Article Demographic Influence on Brand Preference Towards Budget Airline in UAE Authors DR. MOHAMMED RIZWAN ALAM Address for Correspondence: Sr. Lecturer, Amity University-Dubai, UAE The purpose of the study is to investigate the influence of demographic characteristics on brand preference towards budget airlines like Air Arabia in the UAE market. The geographic extent is majorly in northern UAE. The methodology used is random sampling using survey questionnaire personally administered to the sample size of five hundred ninety three from diverse demographic segments. Findings suggest that band preference does not vary significantly for all the variables in the study. The variation in preference is not uniform. Keywords: brand preference, budget airline, demography. Introduction Airline has emerged as one of the most indispensable travel alternatives in today s time. This holds true especially when the travelers are either price sensitive or have no choice but to choose the same available airline- budget airline operating in a particular route for the destination at hand. A true preference is meaningful when the passengers have multiple options of airlines, then in that case price is usually a key factor to prefer airlines, but besides price, various factors, too, play their role to attract the travels to fly budget airline. At the same time, demographic elements like age, gender, nationality, etc. play their significant role in attracting customers towards a particular airline. In fact, customer preference towards any airlines, especially budget airline is pretty complex which is associated with consumer buying intension or behavior and customer satisfaction, among several other variables. What the hard facts or data may infer customer preference or loyalty, the same or some of them may be because of forced preference under the circumstance like sponsored ticked, emergency situations, group travel, rout restrictions, timing, or even reference and so on. Literature Review Demography, as per Oxforddictionaries.com (2012), is the study of statistics such as births, deaths, income, or the incidence of disease, which illustrate the changing structure of human 1

2 populations. The demographic characteristics statistically constitute variables such as age, gender, nationality, income level, and so on. Demographic elements, as an independent variable varyingly influence the dependent variables. Impact of demography on purchase intension or loyalty is arguably complex as this essentially is engrained in human, or precisely put, consumer buying behavior. The psychology behind human behavior as it pertains to brand selection can be both rudimentary and complicated at the same time ( ). This equally holds true to the undifferentiated offerings from airline industry, including even budget airliner. Though low cost airline typically position itself as low fare travel alternative, it does strategically and tactfully, too educate on appealing features and even expressly persuade the customers to induce into buying the service products repeatedly. Brand preference for budget airline can be on account of both- with or without choice of the airline. Brand is any unique identifiable element which differentiates sellers. The company creates unique image, identity in the customer s mind through commercial or social transaction. At the same time, customers, too find it helpful as it eases up the information search, assures them of the continued quality, functional, emotional or symbolic performance. In due course, the customers start trusting the brand and are subsequently loyal to the same brand, albeit substitutes are available. If defined, The American Marketing Association (1994) defines a brand as a "name, term, sign, symbol or design, or a combination of them intended to encourage prospective customers to differentiate a producer's product (s) from those of competitors". Keller (2002) in his study said that the brand is the sum total of all elements of the marketing mix. Brands can also be explained based on their elements". While, brand preference is the extent to which the customer favors the designated service provided by a certain company, in comparison to the designated service provided by other companies in his or her consideration (Hellier et al., 2003). Customers form brand preferences to reduce the complexity of the purchase decision process (Gensch, 1987). Hawkin et al. is of the view that repeat purchase is the continuous purchase of the same brand by consumers though they may not have an emotional attachment to the brand. It is difficult to maintain customers who repeat purchase due to the lower price, that is the mere repeat purchase (Hawkins, et al, 1987). According to Zhou and Wong (2008), some consumers focus heavily on brands, making those brands become more important than product quality per se in purchasing situations. In addition, customers no longer focus on functional value alone when making a purchasing decision about products/services (Pitta & Katsanis, 1995). Customers from various demographic backgrounds respond differently to the same airline, but the difference may not substantially vary against the given key or basic offering like lower fare in the case of budget airline. Budget airline is characterized by no-frills, point-to-point coverage, uniform aircraft, low air fare, simplified and unified operation, quick turnover, smaller aircraft, and so on. Usually, budget airline flies for a relatively shorter distance. It can be domestic like Southwest Airline in the US and international like Flydubai in the UAE. Arifin, et al. (2010) views that the 2

3 development strategy of low cost carriers can be summed up as low costs, low fares, and no frills. Problem Statement: Air travel has become the reality for an increasingly larger number of customers today, especially in Asian region. However, good number of customers from diverse demographic backgrounds still does find the price as one of the key determinants for choosing a particular airline. In this context, the study is directed to investigate non-price variable (s) such as demographic elements and its influence on brand preference towards budget airline in UAE. Hypothesis: H1: The attitude scores on brand preference do not vary significantly for different age groups. H2: Hypothesis: The attitude scores on brand preference do not vary significantly for different nationalities. H3: The attitude scores on brand preference do not vary significantly for different periods of stay in UAE. Methodology: The study was based on descriptive research. The population was from the passengers and employees of Air Arabia. Geographic span was for entire UAE with major concentration on the northern Emirate mainly on account of the location of Sharjah Airport. The researcher administered 650 questionnaires of which 57 were rejected as they were wrongly and or incompletely filled up. Therefore, final sample size arrived at was 593. The researcher employed simple random sampling technique. The instrument for the investigation was survey questionnaire with multiple options under each variable namely age, nationality or ethnic group, employee level, and stay in UAE. Firstly pilot test on twenty respondents from three categories- Air Arabia Employee, passengers, and academicians was conducted. Their inputs were incorporated and the modified version was put to survey. The researcher administered the questionnaire at Sharjah International Airport where the respondents from various demographic characteristics were covered, though most of them were from South Asian Countries. To incorporate Arab passengers, the researcher distributed the questionnaire at Arabic Coffee Shops at various Arab dominated locations, where the questionnaire was given only to those who had experience of Air Arabia light. Besides, the employees of Air Arabia were also surveyed by getting the questionnaire filled up in person. This approach increased the rate of acceptable questionnaire significantly higher to 88%. ANOVA was used to investigate the variations between the variable and to test the hypothesis. The data collected through the questionnaires were analyzed using the Statistical Package for Social Sciences (SPSS) version 17. 3

4 Discussion &Analysis: The One-way ANOVA for attitude score between brand preference and age groups. Price and brand preference score Mean S.D No. < 20 yrs yrs Age yrs yrs > 50 yrs TOTAL ANOVA for price and brand preference score Sum of Squares df Mean Square F Sig. Power of test Between Groups Ns.286 Within Groups Total Table value: Hypothesis: The attitude scores on brand preference do not vary significantly for different age groups. Result: One-way ANOVA was applied to find whether the attitude scores on brand preference vary significantly among different age groups. The calculated F-ratio value is which is found to be less than the table value of at 5% level of significance. Since the calculated F-ratio value is less than the table value, it is inferred that the mean scores do not vary significantly among different age groups. Hence the hypothesis is accepted. The One-way ANOVA for attitude score between brand preference and nationalities. 4

5 Price and brand preference score Mean S.D No. Asian Arab Nationality African Others Employees TOTAL ANOVA for price and brand preference score Sum of Squares df Mean Square F Sig. Power of test Between Groups Ns.671 Within Groups Total Table value: Hypothesis: The attitude scores on brand preference do not vary significantly for different nationalities. Result: One-way ANOVA was applied to find whether the attitude scores on brand preference vary significantly among different nationalities. The calculated F-ratio value is which is found to be less than the table value of at 5% level of significance. Since the calculated F-ratio value is less than the table value, it is inferred that the mean scores do not vary significantly among different nationalities. Hence the hypothesis is accepted. The One-way ANOVA for attitude score between brand preference and employee levels. Price and brand preference score 5

6 Mean S.D No. Lower Middle Employee level Upper Own business Others Total ANOVA for price and brand preference score Sum of Squares df Mean Square F Sig. Power of test Between Groups Ns.225 Within Groups Total Table value: Hypothesis: The attitude scores on brand preference do not vary significantly for different employee levels. Result: One-way ANOVA was applied to find whether the attitude scores on brand preference vary significantly among different employee levels. The calculated F-ratio value is which is found to be less than the table value of at 5% level of significance. Since the calculated F-ratio value is less than the table value, it is inferred that the mean scores do not vary significantly among different employee levels. Hence the hypothesis is accepted. The One-way ANOVA for attitude score between brand preference and the periods of stay in UAE. 6

7 Price and brand preference score Mean S.D No. < 10 yrs Stay in UAE yrs > 30 yrs TOTAL ANOVA for price and brand preference score Sum of Squares df Mean Square F Sig. Power of test Between Groups Ns.069 Within Groups Total Table value: Hypothesis: The attitude scores on brand preference do not vary significantly for different periods of stay in UAE. Result: One-way ANOVA was applied to find whether the attitude scores on brand preference vary significantly among different periods of stay in UAE. The calculated F-ratio value is which is found to be less than the table value of at 5% level of significance. Since the calculated F-ratio value is less than the table value, it is inferred that the mean scores do not vary significantly among different periods of stay in UAE. Hence the hypothesis is accepted. Conclusion: The study concludes that demographic characteristics do influence the customer s preference towards low cost carrier. Though the lower price is an obvious reason for the repeat purchase of the air tickets, others demographic factors such age, age, gender, stay in the UAE, level of employee also varyingly determine the brand preference towards the budget airline. Further Research Scope: 7

8 Further research can be carried out in the same or related area of demography and brand preference. The researcher can include other demographic characteristics and then investigate the impact on customer s buying behavior. The researcher can take step backward on the buying behavior continuum, like purchase intention or one step forward like brand defection or switching behavior. Besides, even smaller sample size like 250 instead of 593 can suffice the research requirement. Methodology cab ne partly reworked like consistency test of the questionnaire with Likert scale can be taken into consideration. Reference: 1. Arifin, et al.(2010), Service Quality and satisfaction for low cost carriers, Vol 6, P Gensch, D. H. (1987). A two-stage disaggregate attribute choice model. Marketing Science, 6(3), Hawkinns D.I R.J Best and K.A. Koney, (1998): Consumer behavior: Building marketing Strategy, 7th ed., McGraw Hill 4. Hellier, P. K., Geursen, G. M., Carr, R. A., & Rickard, J. A. (2003). Customer repurchases intention: A general structural equation model. European Journal of Marketing, 37(11/12) 5. definition of demography, access date, August 27, American Marketing Association, access date, Aug 25, Keller, K.(2002): Strategic Brand Management, 2 nd ed., Pearson, UK. 8. Nissim, B. (2012): Brand Loyalty: The Psychology of Preference, access date, August 27, Pitta, D. A., & Katsanis, L. P. (1995). Understanding brand equity for successful brand extension. Journal of Consumer Marketing, 12(4), Zhou, L., & Wong, A. (2008). Exploring the influence of product conspicuousness and social compliance on purchasing motives of young Chinese consumers for foreign brands. Journal of Consumer Behavior 8