The effects of cellular phone innovation on brand image and purchase intention amongst UKZN students.

Abstract

Abstract Given the rapidly and continually changing economy, innovation has become a necessity for companies that wish to endure and grow. This study approached innovation from a consumer perspective and aimed to discover whether innovation is associated with brand image and purchase intention in the cellular phone industry amongst Generation Y consumers. Brand image is important as it influences purchasing decision; when customers see one brand as more innovative as compared to others, they are more likely to purchase. The importance of purchase intention stems from its ability to determine actual purchase of a product and thereby to determine the success of innovation; therefore these two variables, brand image and purchase intention, were selected. The study also aimed to answer the question of which innovation factors - performance or appearance - are most valued by consumers, with focus on the cellular phone industry from the perspective of South African students. A quantitative approach was employed in the study to survey students and a four part questionnaire was physically distributed to 372 students at the Westville Campus of the University of KwaZulu-Natal (UKZN). A five point Likert scale was used with responses to questions ranging from 1 (strongly disagree) to 5 (strongly agree). An interval scale was used to measure the responses. The data was captured and a software program, Statistical Package for the Social Sciences (SPSS), was used to analyse the data and create graphs to present the findings. Descriptive statistics, factor analysis, t-tests and regression were conducted so as to obtain comprehensive results. The highly competitive nature of the cellular phone industry and high penetration in South African markets has created a demand for brands to become more innovative and to differentiate their products in order to survive and maintain a competitive advantage. The findings of the study were consistent with the literature sources and indicated that features related to performance were slightly more important than those related to appearance. Based on the findings it was also concluded that by improving innovation in cellular phone technology, brand image is consequently improved. Enhancing innovation and strengthening brand image in turn increases purchase intention. This creates a further incentive to implement and practice innovative initiatives which have a positive trickledown effect.