latvia factors

7/30/2019 Latvia Factors

1/5

ISSN 1822-6515 ISSN 1822-6515EK ONOMI KA IR VADY BA: 2011. 16 ECONOMICS AND MANAGEMENT: 2011. 16

1274

FACTORS AFFECTING CONSUMER BEHAVIOUR ASSUMING ANDFULFILLING CREDIT L IABILITIES IN LATVIA

I lona Lejniece

University of Latvia, Latvia, [email protected]

Abstract

The aim of the research paper is to determine the factors which affect the behaviour and decisionmaking of consumers when assuming credit liabilities.

To achieve this objective the questionnaire as a method of qualitative analysis was worked out and

employed. The questionnaire was used to reveal the motivation of consumers behaviour regarding creditliabilities.

The data obtained during the research process about the parameters of this phenomenon characterizethe each part of the unit analysed.

Consumer behaviour and decision making process is affected both by internal and external factors.The group of internal factors comprises psychological and personal factors of consumer behaviour. The

group of external factors affecting consumer behaviour comprises social factors, which influence the decisionof the consumer to assume credit liabilities.

Keywords: consumer behaviour, external factors, internal factors, credit liabilities, Latvia.J EL Classification: M39, M30, M30, G2, P2.

Introduction

The main goal of research is to analyze factors what influences consumer behaviour assuming and

fulfilling credit liabilities. Very special role in presented research is devoted to analysis of consumer

behaviour in small market with specific particularities (for example Latvia).

Research object is particularities of consumer behaviour under impact of internal and external factors.

The research data collection realized through a direct interview method and indirect method of

interview. The data collection instrument in this research is a structured questionnaire with limit options, part

of the questions can have more answers. The research method - a typological multi-stage sample or

occasional sample. In processing the research data are used statistical analysis and multidimensionalanalysis.

Using the evaluation scale of 1 to 10, the participant of the research (respondents) value each given

factor, where "1" means that a given factor did not affect the decision / insignificant factor, "10 "means that

the given factor has a major impact on the decision / the most important factor (see Table 1).

Table 1. Factors affecting consumer behaviour to the questionnaire(authors summary)

Factors group Factors Rating/valueAttitude 1 2 3 4 5 6 7 8 9 10

Knowledge 1 2 3 4 5 6 7 8 9 10

Level interested-in 1 2 3 4 5 6 7 8 9 10

Motivation 1 2 3 4 5 6 7 8 9 10

Psychological factors(internal factors)

Perception 1 2 3 4 5 6 7 8 9 10

New experience 1 2 3 4 5 6 7 8 9 10Personal factors(internal factors) Values 1 2 3 4 5 6 7 8 9 10

Information about credit relation 1 2 3 4 5 6 7 8 9 10

Living standard 1 2 3 4 5 6 7 8 9 10Social factors(external factors) Social status 1 2 3 4 5 6 7 8 9 10

The table summarizes the ten most important factors affecting consumer behaviour. These factors are

grouped into three main categories-psychological factors, personal factors and social factors. For each factorgroup the author made analyze using the survey results. Statistical data analysis was made using the program

SPSS tools.
mailto:[email protected]:[email protected]


2/5


1275

Table 2. Analyze sample (n=1008, authors summary)

Valid Frequency Valid PercentWomen 799 79,3Gender

Men 209 20,7

18-25 324 32,1

26-30 204 20,2

31-35 120 11,936-40 60 6

41-45 132 13,1

46-50 48 4,8

51-55 72 7,1

56-60 36 3,6

61-65 0 0

Age

Over 65 12 1,2

Elementaryschool

48 4,8

Secondary school 319 31,6

Education

Higher 641 63,6

Capital 542 53,8City 144 14,3

Town 212 21Location

Rural area 110 10,9

Unemployed 72 7,1

Farmer 12 1,2

Housekeeper 48 4,8

Self-empoyed 53 5,3

Pensioner 13 1,3

Private sectoremployed

148 14,7

Public sectoremployed

242 24

Student 204 20,2

Employer 144 14,3

Occupation

Other 72 7,1

The unit of analysis- respondents aged over 18 years, who have credit liabilities and who is the end-

user of the credit products. The survey involved 1008 respondents of Latvia (n = 1008).

Psychological factors what influence consumer behaviour

Psychological factors are the elements of consumers mental processes, comprising perception,

motivation, knowledge and capacities, attitude and personality of the consumer. Perception shapes the world

outlook of a human being. In fact, this process of selection and analysis means, that human beings view on

credit relations are insufficient. Because of this human mind fills the gaps in perception, synthesizing itsknowledge, previous experience, rumours, phantasies, etc.

It is the process of analysis and selection of human mind. Motivation is the inner force that stimulates

the consumer to act. Motivation as a catalyst to assume credit liabilities is a vector- it has intensity and

direction. At the same time the consumer assesses the level of his knowledge and capacities that affect the

process of decision making, when selecting the most adequate credit agreement.

Attitudeaffects consumer in three dimensions:

by exploration, which characterizes conscious mind activity, by impressions that characterize the consumer's emotional attitude to credit liabilities, by commitment that characterizes the realization of consumer's planned action or behaviour

model.

Knowledgeaffects the decision making process itself, based on the previous knowledge. It is difficultto determine the prior knowledge of each consumer, but with additional and key questions it is possible to

detect at least a certain part of what the consumers knowledge is about.


3/5


1276

The level of interested-in characterizes what importance the consumer gives to the choice in favourof one or another credit product and decision making process. This level reflects consumers emotional

attitude towards credit liabilities.

Motivation is the inner force that stimulates the consumer to act. Motivation as a catalyst to assumecredit liabilities is a vector- it has intensity and direction. At the same time the consumer assesses the level of

his knowledge and capacities that affect the process of decision making, when selecting the most adequate

credit agreement.Perception indicates how consumer has created his own world outlook where the reflection of

complexity of objects, visions, situations and events in conscience does not take place by direct effect on

sensor organs.

Table 3. Psychological factors affecting consumer behaviour to the questionnaire(n=1008, authors summary)

Attitude Knowledge The levelinterested-in

Motivation Perception

Valid

Frequency

V

alid

Pe

rcent

Frequency

V

alid

Pe

rcent

Frequency

V

alid

Pe

rcent

Frequency

V

alid

Pe

rcent

Frequency

V

alid

Pe

rcent

1 180 17,9 144 14,3 168 16,7 408 40,5 336 33,3

2 96 9,5 48 4,8 84 8,3 72 7,1 96 9,5

3 12 1,2 84 8,3 24 2,4 48 4,8 72 7,1

4 24 2,4 24 2,4 48 4,8 72 7,1 48 4,8

5 204 20,2 168 16,7 156 15,5 96 9,5 120 11,9

6 84 8,3 48 4,8 24 2,4 36 3,6 60 6

7 72 7,1 120 11,9 72 7,1 0 0 96 9,5

8 96 9,5 120 11,9 144 14,3 108 10,7 108 10,7

9 96 9,5 84 8,3 144 14,3 36 3,6 36 3,6

10 144 14,3 168 16,7 144 14,3 132 13,1 36 3,6

Total 1008 100 1008 100 1008 100 1008 100 1008 100

Analyzing results of the survey about attitude as psychological factor impact on consumer behaviour,

that affect the consumer's decision assuming and fulfilling credit liabilities, author concludes that attitude did

not affect decision of 180 respondents assuming and fulfilling credit liabilities (17,9% of cases), however for

144 respondents (14,3% of cases), attitude was an important factor that affected the decision of consumer

behaviour assuming and fulfilling credit liabilities in Latvia.

Analyzing results of the survey about knowledge as psychological factor impact on consumer

behaviour, that affect the consumer's decision assuming and fulfilling credit liabilities, author concludes that

knowledge did not affect decision of 144 respondents assuming and fulfilling credit liabilities (14,3% of

cases), however for 168 respondents (16,7% of cases), knowledge was an important factor that affected the

decision of consumer behaviour assuming and fulfilling credit liabilities in Latvia.

Analyzing results of the survey about the level of interested-in as psychological factor impact onconsumer behaviour, that affect the consumer's decision assuming and fulfilling credit liabilities, author

concludes that the level of interested-in did not affect decision of 168 respondents assuming and fulfilling

credit liabilities (16,7% of cases), however for 144 respondents (14,3% of cases), the level of interested-in

was an important factor that affected the decision of consumer behaviour assuming and fulfilling credit

liabilities in Latvia.

Analyzing results of the survey about motivation as psychological factor impact on consumer


motivation did not affect decision of 408 respondents assuming and fulfilling credit liabilities (40,5% of

cases), however for 132 respondents (13,1% of cases), motivation was an important factor that affected the


Analyzing results of the survey about perception as psychological factor impact on consumer

behaviour, that affect the consumer's decision assuming and fulfilling credit liabilities, author concludes thatperception did not affect decision of 336 respondents assuming and fulfilling credit liabilities (33,3% of


4/5


1277

cases), however for 36 respondents (3,6% of cases), perception was an important factor that affected the


Personal factors what influence consumer behaviour

Personal factors include individual features of the consumer which affect the decision making process.

They comprise: 1) demographic factors which are individual features- age, gender, nationality, income level,family status, occupation; 2) situative factors which are the level of the change of material conditions of the

consumer and his interests (preferences). The considerable attention is focused on selection of

product/service and the decision making process which reflect the emotional attitude of the consumer

towards product/service.

Table 4. Personal factor affecting consumer behaviour to the questionnaire(n=1008, authors summary)

New experience ValuesValid Frequency Valid Percent Frequency Valid Percent

1 516 51,2 276 27,4

2 48 4,8 84 8,3

3 72 7,1 96 9,54 72 7,1 60 6

5 84 8,3 132 13,1

6 36 3,6 60 6

7 24 2,4 84 8,3

8 60 6 72 7,1

9 36 3,6 48 4,8

10 60 6 96 9,5

Total 1008 100 1008 100

Analyzing results of the survey about new experience as personal factor impact on consumer


new experience did not affect decision of 516 respondents assuming and fulfilling credit liabilities (51,2% ofcases), however for 60 respondents (6% of cases), new experience was an important factor that affected the


Analyzing results of the survey about values as personal factor impact on consumer behaviour, that

affect the consumer's decision assuming and fulfilling credit liabilities, author concludes that values did not

affect decision of 276 respondents assuming and fulfilling credit liabilities (27,4% of cases), however for 96

respondents (9,5% of cases), values was an important factor that affected the decision of consumer behaviour

assuming and fulfilling credit liabilities in Latvia.

Social factors what influence consumer behaviour

The group of external factors affecting consumer behaviour comprises social factors, which influence

the decision of the consumer to assume credit liabilities.Social factors characterize the impact of friends and family members on the consumer decision

making process.

There exist different situative conditions that have a profound impact on consumer attitude and

behaviour. The situative condition affected by communications can be personal and indirect. Personal

communication is defined as direct impact on consumer. Indirectly affecting communication is integrated in

the form of marketing communications- advertising, booklets, publications, etc. The evaluation of service

provider or a specific brand shapes the attitude which manifests itself in active consumer behaviour when

assuming and fulfilling credit liabilities.


5/5


1278

Table 5. Social factors affecting consumer behaviour to the questionnaire(n=1008, authors summary)

Information about creditrelation

Living standard Social status

Valid Frequency Valid Percent Frequency Valid Percent Frequency Valid Percent

1 72 7,1 72 7,1 348 34,52 48 4,8 48 4,8 84 8,3

3 24 2,4 12 1,2 84 8,3

4 60 6 24 2,4 36 3,6

5 144 14,3 120 11,9 108 10,7

6 72 7,1 72 7,1 36 3,6

7 132 13,1 108 10,7 36 3,6

8 168 16,7 108 10,7 96 9,5

9 96 9,5 180 17,9 96 9,5

10 192 19 264 26,2 84 8,3

Total 1008 100 1008 100 1008 100

Analyzing results of the survey about information about credit relation as social factor impact onconsumer behaviour, that affect the consumer's decision assuming and fulfilling credit liabilities, author

concludes that information about credit relation did not affect decision of 72 respondents assuming and

fulfilling credit liabilities (7,1% of cases), however for 192 respondents (19% of cases), information about

credit relation was an important factor that affected the decision of consumer behaviour assuming and

fulfilling credit liabilities in Latvia.

Analyzing results of the survey about living standard as social factor impact on consumer behaviour,

that affect the consumer's decision assuming and fulfilling credit liabilities, author concludes that living

standard did not affect decision of 72 respondents assuming and fulfilling credit liabilities (7,1% of cases),

however for 264 respondents (26,2% of cases), living standard was an important factor that affected the


Analyzing results of the survey about social status as social factor impact on consumer behaviour, that

affect the consumer's decision assuming and fulfilling credit liabilities, author concludes that social status didnot affect decision of 348 respondents assuming and fulfilling credit liabilities (34,5% of cases), however for

84 respondents (8,3% of cases), social status was an important factor that affected the decision of consumer

behaviour assuming and fulfilling credit liabilities in Latvia.

Summary

Consumer behaviour is affected by situation and the consumer himself, that is, internal and external

factors. Internal factors refer to such characteristics of individuals as age, income level, interests, and state of

mood, knowledge, involvements and attitudes. External factors refer to situation and environment where the

consumers interrelate, which can affect attitude, decisions and behaviour.

Internal and external factors have important influence on consumer behaviour.

However, external factors are more special. External factors are unpredictable and are influenced not

only by economical situation in state out also in region and whole world. Because living standard and social

status of person change by externals, that is influenced by flow of information.

References

1. Arhipova I., Balina S. (2006). Statistics for economics and business. Riga, Datorzinbu centrs, pp 362.2. Andersone I. (2008). On influence of factors on consumer behaviour. 5. International Conference Business and

management 2008, Selected Papers. Vilnius "Technika", ISBN 978-9955-28-311-9, pp 246-252.

3. Blythe J. (2004). Essentials of Marketing. Pearson Education Limited, pp 284.4. Joseph F.Hair, Jr., William C. Black, Barry J. Babin, Rolph E. Anderson, Ronald L. (2004). Tatham. Multivariate

Data Analysis. Sixth Edition. Pearson- Prentice-Hall, pp 14-15.

5. Kothler P. (2004). Marketing management. 11th International edition Prentice-Hall, pp 706.This paper has been supported by the European Social Fund within the project Support for Doctoral

Studies at University of Latvia.

latvia factors

Documents