Addis Ababa University School of Commerce

Graduate studies
Marketing Management program

FACTORS AFFECTING BRAND CHOICE OF

AUTOMOBILE BUYERS IN ADDIS ABABA

BY; DENANESO GEMECHU GILU

May, 2017

Addis Ababa
 Addis Ababa University School of Commerce

FACTORS AFFECTING BRAND CHOICE OF AUTOMOBILE BUYERS IN

ADDIS ABABA

By; DENANESO GEMECHU GILU

Thesis Submitted in Partial Fulfillment of the Requirements for the

Degree of Master of Art in Marketing Management Department of
Marketing Management

Thesis Advisor:
DR.GETIE ANDUALEM
Addis Ababa University

May 2017
Addis Ababa
 Board of Examiner Approval Sheet

Factors affecting brand choice of automobile buyers in Addis Ababa

By
Denaneso Gemechu

Approved by the Examining Board

Advisor …………………………………….

Signature…………………………………..

Internal Examiner ……………………….. Signature…………………………………..

External Examiner ……………………… Signature…………………………………..

 Declaration
I declare that this research paper entitled "factors affecting brand choice of
automobile car buyers in Addis Ababa, Ethiopia" is my original work and has not
been used by others for any other requirements in any other university and all sources of
information in the study has been appropriately acknowledged.

Denaneso Gemechu: _________________

Date: _________________
 Statement of Certification

This is to certify that I the undersigned Denaneso Gemechu Gilu has carried out her
research work on the topic entitled "Factors affecting brand choice of automobile
buyers in Addis Ababa, Ethiopia". The work is original in nature and is suitable for
submission for the award of Master’s Degree in Marketing Management.

Advisor: Getie Andualem (PhD) ____________________

Date: ____________________
 Acknowledgement

First and foremost, I would like to thank the Almighty God, for the gift of life and love
and for knowing me better than I know myself. I wish to express my sincere thanks and
gratitude to my advisor Dr. Getie Andualem for his excellence guidance, unrestricted
and friendly support to make this project real.
Last but not the least, I would also like to thank my staff and my classmates who share me their
idea and provided me moral and valuable information related to the research project.

I
 Table of Contents

ACKNOWLEDGEMENTS........................................................................................... I
Table of content……………………………………………………………………..… II
List of Tables................................................................................................................. IV
List of Figures................................................................................................................ IV
ABSTRACT.....................................................................................................................V
CHAPTER ONE...............................................................................................................1
1. Introduction...................................................................................................................1
1.1 Background of the study.............................................................................................1
1.2 Statement of the problem ...........................................................................................2
1.3 Research Questions.....................................................................................................4
1.4 Objective of the study ................................................................................................4
1.4.1 General objective.....................................................................................................4
1.4.2 Specific objectives: .................................................................................................4
1.5 conceptual definitions of Terms..................................................................................5
1.6 Significance of the study ............................................................................................5
1.7 Delimitation of the Study............................................................................................6
1.8 Organization of the study ...........................................................................................6
CHAPTER TWO ................................................. ............................................................7
2. Related Literature review .............................................................................................7
2.1 Introductions ..............................................................................................................7
2.2 Theoretical review.......................................................................................................7
2.3 model of consumer behavior.....................................................................................10
2.4 consumers brand choice ..........................................................................................11
2.5 factors determine brand choice of customers............................................................12
2.6 Empirical review ……………………………………………….………………….16
2.7 Research hypothesis.............................................................................................., .18
2.8 Conceptual framework..............................................................................................18
CHAPTER THREE....................................................................................................... 20
3. Research Design and Methodology........................................................................... 20
3.1. Introduction............................................................................................................ 20
3.2. Research approach................................................................................................ 20
3.3. Research design...................................................................................................... 20
3.4. Sampling design..................................................................................................... 22
3.4.1 Target population................................................................................................. 22
3.4.2 Sample Size and Sampling Techniques ……………………………………………….22
3.5 Source of data……………………………………………………………………..23
3.6 Method of Data Collection and procedure………………………………………………………24
3.7 Validity & Reliability……………………………………………………….…………………...25
3.7.1 Validity Analysis………………………………………………………………………………25
3.7.2 Reliability Analysis...............................................................................................25

3.8 data analysis……………………………………………………………………….27

3.9 Ethical considerations.......................................................................................…...28

CHAPTER FOUR..........................................................................................................29
4. Data analysis and Interpretation............................................................................... 29
4.1. Reliability Test ...................................................................................................... 29
4.2. General information of respondents .......................................................................30
4.3. Normality test of the data .......................................................................................35
4.4. Inferential statics. ...................................................................................................38
4.4.1 Correlation analysis...............................................................................................38
4.4.2 Multicolinearity test...............................................................................................41
4.4.3 Regression Analysis………………………………………………….…….……..42
4.5.6 Hypothesis Testing and Interpretation of Results……………………..…………44

CHAPTER FIVE..................................................................................... 48

5. Summery, Conclusion and Recommendation........................................................... 48

5.1 Summery...................................................................................................................50
5.2 Conclusion.................................................................................................................50
5.3Recommendations......................................................................................................51
5.4 Recommendations for future research .....................................................................52
5.5 limitation of the study………...……………………………………………………53
Reference.........................................................................................................................54
Questionnaires.................................................................................................................57
Appendix:…………………............................................................................................62

Appendix 1: Questionnaire used in the main survey ………………………………….56

Appendix 2: mean of independent variables …………………………………………..61

Appendix 3: (multicolinearity) collinarity diagnostics ……………………….……….62

Appendix 4: normality test …………………………………………………………....63

Appendix 5: reliability test …………………………………………………………....66
Appendix 6: regression analysis………….…………………………………………...69
Appendix 7 correlation ………………………………………………………………..71
 Index of Tables
Table 1.1: Reliability Test.............................................................................................................25
Table 1.2: Cronbach alpha; for brand choice dimension........................................................................29
Table 1.3: age distribution of the respondent.........................................................................................30
Table 1.4: gender ……………………………….........................................................................30
Table 1.5: education................................................................................................................31
Table 1.6. Occupation..............................................................................................................31
Table: 1.7 income distribution....................................................................................................32
Table 1.8: brand do you have ...................................................................................................33
Table 1.9: information source………………………....................................................................33
Table 1.10: test of normality……………………………………………….....................................35
Table1.11correlationtable.......................................................................................................................38
Table1.12: multicollinearity test......................................................................................................…...41
Table 1.13: One regression analysis…………………………………………………………..............42
Table 1.14hypothesis test………………………………………………………………………………43
 Index of Figures

Figure 1.1: conceptual framework ..................................................................................18

Figure 1.2: normality test …….…………………………………...................................36
 Abstract
Every customer in the market has his/her own brand choice. Customers consider certain attributes before
purchasing products. The objective of this study was to identify factors affecting brand choice of automobile
buyers in Addis Ababa. The variables included in this study are brand image, reliability, price, availability of
spare part, safety, fuel consumption durability and social values of automobile. A sample of 400 automobile
buyers was selected using convenience sampling technique with distributing structured questionnaire based on
likert type scale was used to elicit information from the sampled respondents in the city of Addis Ababa. But 382 of
them return correctly and within time. The data were analyzed using descriptive statistic to calculate general
information of the respondent and inferential statistics to test like multiple regressions, normality, reliability,
correlation and multicolinearity of data. The findings of the study showed that most of respondents were
influenced by their brand image to choice the brands of automobile among available in the market. Particularly
TOYOTA is found to be a top of mind and mostly preferred brands of all brands available in Ethiopia. The study
revealed that brand image, reliability, price, availability of spare part and social values make a significant and
positive contribution to automobile brand choice of consumers in Addis Ababa and the remaining variables like
safety, fuel consumption and durability has no significant for brand choice of automobile in a city. Moreover, the
study finding shows that, there is variation on brand choice based on respondent’s income level.

Key words: brand choice, model of buying behavior, brand image, reliability, safety, availability of spare part,
fuel consumption, durability, social value, durability
 CHAPTER ONE
1. INTRODUCTION

1.1Background of the Study

The production of cars and its trade in global market have impact on employment, the balance
of payments, economic growth and valuable inward foreign direct investment. The car in the
twentieth Century has been described “The machine that changed the world” (Womac, et al.,
1990).
Due to its deep forward and backward linkages with several key segments of the economy, the
automobile industry is having a strong multiplier effect on the growth of a country and hence is
capable of being the driver of economic growth.
The rise of income levels in many African countries and the emergence of a middle class, the
continent as the final frontier for the global automotive industry. Given Africa‟s population size
and its positive economic outlook, automotive companies will be able to gain a competitive
advantage by adopting a medium- to long-term view towards the continent.”(Black, A.&
McLennan, T. (2015). The Last Frontier: Prospects and Policies for the Automotive Industry in
Africa).
Africa‟s automotive market is relatively small. In 2014, there were just over 42.5 million
registered vehicles in use in Africa – a continent of approximately one billion people that time.
As a result, the motorization rate on the continent is only 44 vehicles per 1 000 inhabitants.
This is far below the global average of 180 vehicles per 1 000 inhabitants, and lower than other
developing regions such as Latin America (176) and Developing Asia, Oceania and the Middle
East (79). McLennan, T. (2015). The Last Frontier: Prospects and Policies for the Automotive
Industry in Africa).
In 2015, approximately 1.55 million new vehicles were sold or registered across Africa. South
Africa, Egypt, Algeria and Morocco – all countries with established and rapidly developing
automotive industries – together accounted for more than 80% of total new vehicle sales in
2015. Based on recent sales trends, some sources estimate that Africa‟s passenger vehicle sales
could reach up to 10 million units per annum within the next 15 years. McLennan, T. (2015).
The Last Frontier: Prospects and Policies for the Automotive Industry in Africa).

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Ethiopia was Africa‟s fastest growing economy in 2015 and has the continent‟s second largest
population. Ethiopia‟s automotive potential is underpinned by the state-driven economy and a
government that is geared toward industrialization, which makes it the African economy that is
most similar and arguably likely to replicate the development successes of China of the mid-
1980s onwards. (Ethiopian Investments Commission (2015). Invest in Ethiopia. Addis Ababa:
EIC.)
Since Ethiopia doesn‟t or little manufacture automotive, construction machineries and
agricultural equipments locally at present, it imports those from various countries of the world.
Automotive importing companies in Ethiopia are importing different types of vehicles to the
country‟s vehicle market. In doing so, a predictive study on the marketing trends of imported
automotive is necessary to clearly see the demand supply gap and for the growth in sales of
automotive in Ethiopia.(Ethiopian Investment Commission. (2015). Invest in Ethiopia. Addis
Ababa: EIC)

1.2Statement of the problem

The automotive industry is an important segment of the economy in any country as it links
industries and services. It is the key driver of any growing economy. It plays an important role
in growing the economy in each country and one way to strengthen the industry is to improve
consumer insight into vehicle buying behavior.
Besides, competitive pressure of automotive companies arising in Ethiopia has led the
companies to look for an edge to be competitive in automotive industry. Both the local and
foreign cars are competing to get attention from the consumers like Toyota ,Suzuki ,Mercedes ,
Hyundai ,lifan motors….etc ….etc Therefore, the objective of this study is to identify the
factors influencing consumer buying behavior while buying automobile.

From different ground consumers „choice is limited to few brands from a range of brands
available in the market. As various studies explained, the brand preference of consumers might
be affected by marketing strategy of firms. Moreover, consumers may have their own choice
criteria in selection of a particular brand from a set of brands in a given product category.

Ethiopia‟s automotive potential is underpinned by the state-driven economy and a government

that is geared toward industrialization, which makes an industry need an emphasis to study on.

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Despite the current limited disposable income, Ethiopia‟s automotive market is dominated by
second-hand imported vehicles – particularly commercial vehicles, there are many brands of
automobile cars in the market.

This shows it is very critical for companies to understand the customer‟s requirement and
provide the products that satisfy their needs. Consumers brand preference represents a
fundamental step in understanding consumer choice.

In most product category, consumers have more choices, more information and higher
expectations than ever before. To move consumer from trial to preference, brands need to
deliver on their value preposition, as well as dislodge someone else from the consumer‟s
existing preference set.

There are minimum number international journals and studies in Ethiopia that‟s try to show the
customer preference regarding buying automobile car for their own purpose. Mr.Eskinder
Desta study the automotive industry and trend Analysis and show trends in countries as
general but still the specific case that show the determinant factor that influence the brand
choice of buyers while buying automobiles are not addressed. Observed that is found to be an
initiation to conduct the study is lack of theoretical evidence that can be used as an insight to
understand customers‟ perception towards building a brand through the use of brand equity
dimensions.

Thus from the above ground this study is conducted to identify the underlying factors of
consumers brand choice it will lead them to formulate a better marketing programs. The main
research question of the study is ―Determining factors that affect brand choice of automobile
buyers in Addis Ababa? Under this main research question, the following specific research
questions were addressed;

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 1.3 Basic research questions

The research questions that need to be addressed include the following:

1.3.1General research questions

 What are the factors that affect the brand choice of automobile car buyers?

1.3.2 Specific research questions

1. Which determinant factors more significantly affect choice of automobile

brand?
2. What are the most preferred brands of automobile car in Addis Ababa?

1.4 Objectives of the Study

1.4.1 General objective

 The general objective of the study is to identify factors that affect brand
choice of automobile buyers in Addis Ababa.
1.4.2 Specific objectives
The specific objectives of the study are:
 To identify the most preferred brand among the set of brands available
in the city.
 To identify which determinants are more significantly affect choice of
automobile brand.

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 1.5 Definition of terms

1.5.1 Conceptual Definition

 Marketing Concept; "The marketing concept is marketers can sell more if they
produce the consumer needs and wants than to produce what they want to sell. In
marketing concept consumer needs and wants became the firm‟s primary focus. Hence
basically marketing concept is a philosophy of consumer oriented" (Leon G. Schiffman,
2007 pp.).
 Consumers;"Consumers are individuals and households that buy the firms product for
personal consumption" (Sata, 2013 pp.).

 Brand Awareness: is related to the strength of the brand trace in memory as reflected
by consumers‟ ability to recall or recognize the brand under different conditions. (Keller
(2004).

 Brand preference: is the degree of brand loyalty in which a customer definitely prefers
one brand over competitive offerings and will purchase this brand if it is available.
(Dibb S., Simikin L., Pride W.M., and Ferrell O.C. (2006)).

 Brand choice is concerned with the selection and consumption of the brand (Bettman et
al., 1998).
 Purchasing behavior; As Pikini Rani, tries to define purchasing behavior is the
decision processes and acts of people involved in buying and using products (Rani,
2014).

1.4 Significance of the Study

Automobile market in Ethiopia is growing rapidly. Different automobile brands are introducing
to the market and at the same time, demand is increasing. The introduction of various brands
will lead to tight competition, which in turn make consumers to face brand choice decision in
the market. In such a situation, it becomes necessary for manufacturers to understand the major
factors attracting buyers to one„s own brand, so that they can succeed in the market and win the
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competition. A clear understanding of the factors that influence brand choice is critical to
ensure that a company„s branding and marketing efforts are matched with the needs of buyers.
Therefore, this study can help marketers to design a better marketing strategy by identifying the
factors that determine buyers brand choice Thus; the study will have a theoretical contribution
in the area of product purchase decision and buyers brand choice criteria in the context of
Ethiopian market specifically in Addis. Furthermore, the study will give insight for other
researchers to explore and investigate more in the area, in a broader scope and wider context.

1.7 Scope of the Study

This study would try to show the main factors that determine the buyers brand choice in
automobile cars. To achieve this aim, the scope of the study is to identify different factors, i.e.
Brand image, Reliability, Price, Availability of spare parts, Safety, Fuel consumption,
Durability and Social value that influence a brand choice of a particular automobile brand in
the city.

The scope of the study is limited to Addis Ababa, capital city of Ethiopia. This geographical
limitation is not only chosen because of time, access and cost restriction, but also it is believed
that a considerable number of automobile users are available in Addis Ababa.

More specifically data were collected from the owners of automobile, may be they are self
employee, different company‟s employees or trader by distributing structured questioners that
are related with the main variables the researcher wants to touch within convenient time for the
respondents.

1.8 Organization of the Research Report

The content of this research would have five chapters. The first chapter includes the research
background, problem statement and research questions, objective of the study, significance of
the study, scope of the study and organization of the report and followed by the discussion of
concepts and theories related to the area of study (chapter two, literature review). The third
chapter describes the research design, participants of the study, the data source, data collection
and analysis techniques and procedures. The fourth chapter deals with data analysis,

6
interpretation and discussion of the findings. Finally, in the last chapter; summery, conclusion
and recommendations were being included.

CHAPTER TWO
Review of Related Literature

2.1 Introduction

This chapter provides an insight to readers about the theoretical reviews, empirical reviews and
the conceptual framework of the study is presented at the end of this chapter.

2.2Theoretical reviews

Concept of Branding

Brands are not new to marketing. Historically, the concept of brand was first used by the
ancient Egyptian brick-makers who drew symbols on bricks for identification (Farquhar, 1990).
Other examples of the use of brands were found in Greek and Roman times; at this time, due to
illiteracy shopkeepers identified their shops using symbols. Moreover, in the Middle-Ages,
craftsmen marked their goods with stamps as a trademark by which to differentiate their skills.
The next milestone of brand evolved in North America with the growth of cattle farming as a
kind of legal protection, proof of ownership and quality signals (De Chernatony and
McDonald, 2003).

Brand definitions are numerous; different authors provide their own explanation towards the
meaning of a brand. The definitions are useful to understand a brand from different
perspectives. Keller (2004), define brand as a perceptual entity rooted in reality, but it is also
more than that reflecting the perceptions and perhaps even the idiosyncrasies of consumers.
This definition states that brand is what resides in the minds of consumers and the ultimate goal
of all efforts in creating a brand is creating a perceived value of products and services in the
minds of consumers. Kapferer (2008), support Keller„s definition by explaining a brand as a set
of mental associations, held by the customer, which add to the perceived value of a product or
service. These associations should be unique (exclusive), strong (salient), and positive
7
(desirable). The above definitions have something in common which explain what a brand is.
Brand is an added value, which identify and differentiate a product from other brands/products.
Moreover, brand will be meaningful when consumers able to create a mental association in
their mind. DeChernatory and McDonald (2003) offer a definition that incorporates many
scholars view. ―A successful brand is an identifiable product, service, person or place,
augmented in such a way that the buyer or user perceives relevant, unique added values which
match their needs most closely. Furthermore, its success results from being able to sustain those
added values in the face of competition. According to Keller (2004), brands used to identify the
source of a product and allow consumers to assign responsibility to a particular manufacturer or
distributor. Brands play a significant role by signaling quality and other important
characteristics of a product. In effect, they can reduce the risk associated with a product
purchase decisions. Aaker (1991) defined brand equity as “a set of five categories of brand
assets (liabilities) linked to a brand‟s name or symbol that add to (subtract from) the value
provided by a product or service.” He identified five brand equity constructs: brand awareness,
brands perceived quality, brand associations, brand loyalty; and other proprietary brands assets,
such as patents, trademarks, and channel relationships.

According to Kapferer, (2008) there are two perspectives from which brand equity can be
viewed. One is customer-based, it focuses exclusively on the relationship customers have with
the brand (from total indifference to attachment, loyalty, and willingness to buy and re-buy
based on beliefs of superiority and evoked emotions). The other relates to suppliers, brand
equity is viewed as a financial asset. It aims at producing measures in monetary values.

Both approaches have their own champions. Interestingly, regardless of one„s perspective,
literature appears to be consistent in the opinion that brand equity is generated by consumers,
who base their (re)purchase behaviors on the judgment of a brand„s value to themselves
(Keller, 2004).

For example, as per Kotler and Keller (2006), brand equity is the customer's subjective and
intangible assessment of the brand, beyond its objectively perceived value. Similarly, Kotler et
al., (2005), define brand equity as the positive outcome that the customers show to the product
or service. Moreover, as per the Official Marketing Science definition, brand equity is the set of
associations and behavior on the part of a brand„s customers, channel members and parent
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corporation that permits the brand to earn greater volume or greater margins than it could
without the brand name (Kapferer, 2008).

Brand Preference

Because brand preference is indispensable in highly competitive businesses, practitioners and

researchers have long spotlighted the concept. The term brand preference refers to the degree of
brand loyalty in which a customer definitely prefers one brand over competitive offerings and
will purchase this brand if it is available (Dibb et al., 2006). However, if the brand is not
available, the customer will accept a substitute brand rather than expending additional effort
finding and purchasing the preferred brand (Dibb et al., 2006). Customers form brand
preferences to reduce the complexity of the purchase decision process (Gensch, 1987). The
process of forming brand preference involves, first, being exposed to many brands, followed by
a complex purchase decision process. Customers often delete some product brands from their
memory; then, among remaining brands of products, customers memorize the brands of
products they would consider purchasing in the future (Roberts &Lattin, 1991).

Brand Identity
Brand identity is the representation of the company‟s reputation through the conveyance of
attributes, values, purpose, strength and passion. It is the aggregation of what the organization
does. Brand identity is an organization‟s mission, personality, promise to the consumers and
competitive advantages. It is a basic means of consumer recognition and represents the brand‟s
distinction from its competitors (Brand identity and brand building concept. 2010. Drypen.in
internet site. Referred to10.10.2011. http://drypen.in/branding/brand-identity-a-brand-building-
concept.html).

Consumer Buying Behavior

The modern market consists of a big variety and diversity of packages, designs, products,
goods, and services. It develops and innovates daily and makes improvements in strategies
permanently. However, it would not put so much effort into the development if the consumer
and the overall society would not need and require new products, product ideas and functions.
The market is the dependable sector of industry and the consumers are only one indispensable
element of market performance which allows the industries to exist and grow. In order to create
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an appropriate product or service, companies need to understand the consumers, their behavior
and perception, and to meet their needs and requirements.

Consumer behavior is the process involved when individuals or groups of people select,
purchase, use or dispose of products, services, ideas or experiences to satisfy their needs and
desires (Solomon &Bamossy&Askegaard& Hogg 2010). There are different people with
different roles who are involved in this process: the purchaser, whose function is to buy the
product or service; the user who uses the actual product or service; and the influencer who
provides information and recommendations for or against the product or service without buying
or using it. Understanding consumer behavior is not simple. However, studying consumer
behavior is crucial factor for companies „success. Marketers, considering that, dedicate a lot of
efforts in trying to specify the exact needs and wants for their customers and target markets,
they also try to determine the best product characteristics that can satisfy the target market from
the consumers own perspective. (Solomon &Bamossy&Askegaard & Hogg 2010, pp.6 - 7.)

2.3 Model of Consumer Behavior

The consumer market is not only large it is dynamic Etzel et al. (2006). Thus, buyer behavior
within markets has to be understood before marketing strategies can be developed. However,
constructing a standard model of consumer buyer behavior can be somewhat problematic.
While the inputs and the outputs of decision-making can readily be identified and, to a certain
extent, measured, the intangible element, which concerns buyer characteristics and choice
determinants is often more elusive (McDonald and Christopher, 2003).

According to Kotler et al. (2005), often, consumers themselves do not know exactly what
influence their purchase. The idea that the mind is a computer with storage compartments
where brands or logos or recognizable packages are stored in clearly marked folders that can be
accessed by cleverly written ads or commercials simply doesn‟t exist. Instead, the mind is a
whirling, swirling, jumbled mass of neurons bouncing around, colliding and continuously
creating new concepts and thoughts and relationships inside every single person‟s brain all over
the world. Therefore, the central question for marketers is; how do consumers respond to
various marketing efforts the company might use?

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Even though, predicting consumer buyer behavior may be an imprecise science, some simple
models have been created to assist marketers in gaining a deeper understanding of consumers in
order to acquire and retain their customers (McDonald and Christopher, 2003).

2.4 Consumers’ Brand Choice

Understanding and predicting brand choice decisions by consumers has been a topic of interest
to both marketers and researchers. Brand choice investigation involves understanding consumer
behaviors in their selection of brands among various product categories (Bentz andMerunka,
2000). In the past, brands have been perceived as products with different attributes; however,
brands are now viewed as personalities, identities, and have special meanings intrinsic to
consumers (Ballantyne et al. 2006). Much of brand choice research has been through
probability models to test the impact of marketing mix variables as a predictor of brand choice
(Wagner and Taudes, 1986; Chib et al.2004; Bentz and Merunka, 2000).When used in
probability modeling, marketing mix variables are considered non stationary and heterogeneous
among the population (Wagner and Taudes, 1986).

There are other areas that have been researched with brand choice as well. Researchers have
examined the casual effects of brand related variables on brand choice. These variables include
Situational factors, consumer personality, social benefits, emotions, quality, brand credibility,
product attributes, seasonality, and trends. The studies used within brand choice researches
have involved experiments and surveys of key marketing variables to measure impact on brand
choice (Charlton and Ehrenberg, 1973; Simonson et al. 1994; Erdem and Swait, 2004;Wagner
and Taudes, 1986; Orth, 2005).

Among specific marketing mix variables, pricing appears to have the most consistent impact in
studies. Promotions such as sales promotions have shown influence on brand choice which
ultimately effect bottom-line prices for consumers. For example, pricing promotions could
involve coupons or simply a reduction of price within the product category (Singh et al. 2005;
Papatla and Krishnamurthi, 1996; Wagner and Taudes, 1986; Orth, 2005). In probability
modeling studies, it has been shown that displays and features have some impact on brand
choice, but this evidence is not as overwhelming or as consistent as other factors among brand

11
choice research studies (Chib et al. 2004; Papatla and Krishnamurthi, 1996; Alvarez and
Casielles, 2005).

Non-marketing mix variables have been researched in order to discover external factors that
impact brand choice. Seasonality and trends have been researched with brand choice. However,
their outcomes depend upon the product category. For example, a product such as laundry
detergent will most likely have better sales figures in the summertime when the weather is
more favorable and people are outside more (Wagner and Taudes, 1986). Personality factors
have shown an impact based on what brands consumers buy. Brand credibility has shown
significance in determining brand choice as well (Erdem and Swait, 2004; Fry, 1971).

2.5 Factors determine the brand choice of buyers

Although, many studies have been conducted in various product categories, literature on brand
choice in the cars specifically automobiles in Ethiopia is relatively insignificant. Thus,
considering different studies conducted in different product categories for the selection of
relevant variables/factors for this research. Therefore, in this study, eight variables are
considered; Brand image, Reliability, Price, availability of spare parts, Safety, Fuel
consumption, Durability and Social value.

Reliability
In terms of value reliability, consumers consider a vehicle to be reliable if it is likely to have
fewer problems than other vehicles (Consumer Report, 2010). Vehicle reliability has been
found to have a positive impact on the consumers‟ likelihood of choosing a vehicle (Woodset
al, 2010). Reliability and quality are interrelated, perceived quality has direct impact on
customer purchase decision and brand loyalty especially during the time customers have less or
no information of the products that they are going to purchase (Armstrong and Kotler,2003).
Besides, reliability is one of the criteria to be considered for vehicle choice (destoop.com,
2010). Consumers want their vehicles to be both reliable, simple to maintain and to repair. The
benefits that consumers see in buying a vehicle with high reliability include lower costs of
repair and higher resale value (BuyingAdvice.com, 2007). Therefore, consumers are likely to
be concerned about vehicle reliability when researching their upcoming vehicle purchase.

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Safety
In terms of safety, consumers consider safety to be one of the most important considerations in
buying a new or used vehicle. The vehicle safety performances are ratings before purchasing a
vehicle (Harris, 2001). In addition, consumers are increasingly seeking safety features in their
vehicles (Deloitte, 2010) and are willing to pay more for a vehicle to obtain improved safety
levels (Harris, 2001). Furthermore, the Deloitte study also predicted that the current economic
crisis will leave customers to value vehicle safety more than before and seek vehicles with
enhanced safety features. Consumers‟ increasing demand for safety has led manufacturers to
think and develop safety-related innovations and features (such as automatic crash notification,
emergency assistance, and remote vehicle diagnostics) in their recent models (Deloitte, 2009;
Dannenberg & Burgard, 2007).
Fuel Economy
Fuel economy is as important a factor in a consumer‟s choice of vehicle as are safety and
reliability. The impact of volatile gasoline prices can be seen in all markets; Consumers across
all markets expect to see greater emphasis on fuel efficiency and a significant shift to
alternative-fuel vehicles in the coming decade. Electric/battery, water, hydrogen and solar were
among the anticipated fuel sources for cars of the future (Car Online, 2009). Furthermore,
Austin and Dinan (2005) assume that consumers fully value lifetime fuel savings when
considering fuel economy in their vehicle choices. There is no doubt that consumers do care
about fuel costs, do value fuel economy, and that their interest in fuel economy increases when
fuel prices increase (Mahadi and Gallagher, 2009).
Price

Price is one of the most investigated elements of the traditional marketing mix largely because
it generates revenue to organizations (Keller, 2003); represents what is sacrificed by consumers
to obtain a product (Zeithaml, 1988). Dodds and Monroe (1985) found that price is an
important cue to quality when other cues available are limited, when the product cannot be
evaluated before purchase, and when there is some degree of risk inherent in making wrong
choice; a key variable that influences consumers‟ purchase intention (Zeinab&Seyedeh, 2012).

Price is often viewed as a dominant factor in the guiding process when it comes to making a
purchase decision. Price in general has always been a determinant factor on consumers‟ brand

13
choice when selecting a product or service. It is assumed that when a consumer is facing a
buying decision in a product category, consumers observe a price to take into account on their
current inventory position in the category. This helps them to maximize their immediate utility
that they gain from the purchase. However, when consumer faces brand with varying prices and
perceived quality levels, they would have to make a choice consistent with the relative
importance attached to both attributes (Zeinab&Seyedeh, 2012).

According to Peter and Donnelly (2007), the price of products and services often influences,
whether consumers will purchase them at all and if so, which competitive offering is selected.
For some offerings, higher prices may not deter purchase because consumers believe that the
products or services are highly quality or more prestigious. However, many of today„s quality
conscious consumers may buy products based on price than other attributes. Therefore, a better
understanding of how customers use price information in choosing among alternative brands
within frequently bought product categories helps to evaluate it and knowing the intensity as
compared to other factors or reasons.

Social Value

Social value is described as “the perceived utility acquired by an alternative as a result of its
association with one or more specific social groups. Social value relates to acceptability to
other persons or a need to belong to groups and have a good reputation (Sánchez, 2006).

Brand image
A brand image is how the consumers perceive the brand (Aaker 1996, 69). Aaker (1991, 109-
110) explains that brand image is a set of associations which might not even reflect the
objective reality. Arnold (1998, 94) says that brand image refers to the way in which certain
groups decode all of the signals resonating from the product or service. An online writing
(Brand image, www.asiamarketresearch.com/glossary/brandimage. htm) explains the concept
of brand image as follows: Brand image can be reinforced by brand communications such as
packaging, advertising, promotion, customer service, word-of-mouth and other aspects of the
brand experience. Brand images are usually evoked by asking consumers the first
words/images that come to their mind when a certain brand is mentioned (sometimes called
"top of mind"). When responses are highly variable, non-forthcoming, or refer to non-image

14
attributes such as cost, it is an indicator of a weak brand image. It is the key of how consumers
make their choices after gathering information about the particular brand and the alternatives.
(Brand image. Asia market research internet site. Referred to 10.10.2011.
www.asiamarketresearch.com/glossary/brand-image.htm).

Durability

According to Dr. S. T. Foster, a professor at Boise State University it is one dimensions of

quality. And like most of the other quality dimensions, durability is a transcendent, product
based, user based, manufacturing based, and value based concept. Also he describes durability
as "the degree to which a product tolerates stress or trauma without failing." (Foster P6).
Like the other dimensions of quality, it is easier to plan durability into a products design and
manufacturing process than it is to alter the finished product. There are many ways to increase
a product's durability. You can increase it by using durable parts and modules in your product.
Another way to increase durability is to use redundancy. Redundant parts can vastly increase
durability; however, it will increase the products weight and cost as well. And finally another
way to increase durability is to design a product for the most demanding user, that way to the
average user the product appears to be very durable.
When designing a product and its durability, you should design with your product base, user
base, manufacturing base, and value base in mind. Different product bases require different
levels of durability. The difference can be seen in the two types of Ford vehicles, the Crown
Victoria, which is a law enforcement vehicle, and the Focus, which is an economy car. Both
vehicles are designed from the ground up to be different types of cars with different levels of
durability. (Foster P6).
Availability of spare parts
The motor vehicle aftermarket covers all goods and services intended to maintain a vehicle in
good condition after its purchase and throughout its useful life. The motor vehicle aftermarket
generates turnover in terms of retail sales. When this expenditure is broken down, the largest
item consists in maintenance and repair services and the purchase of spare parts followed by
fuel and lubricants vehicle purchases and car insurance of expenditure corresponds to other
individual vehicles-related services. Half of the turnover generated by vehicle repair and
maintenance works corresponds to servicing, as specialist labor is increasingly required to
15
repair and maintain a vehicle, and also more commonly to diagnosing the causes of faults or
breakdowns and to preventing future problems. The other half corresponds to the purchase of
spare parts to replace damaged parts or, in the case of lubricants for example, to ensure that the
vehicle's internal components such as the engine operate correctly.
Although the repair and maintenance sector brings together an offer by repairers and demand
from private individuals, insurers and vehicle fleets, and is therefore situated downstream in the
chain, an analysis of the spare parts distribution sector needs to look at the value chain as a
whole, from the manufacture of the spare parts to their sale to the end consumer, usually as part
of repair or maintenance works. Given that it is the repairers who generally select the spare
parts, such parts tend to serve as an input for repair and maintenance activities rather than as the
end product sold to and selected by consumers. Demand for spare parts therefore originates
essentially from repairers. (GIPA Professional Survey 2009, page 102).
So, the easy availability of the spare parts to maintain the damaged parts of automobile is the
factors to choose a particular brand of car.

2.6 Empirical review

Underlying factors of Customer Based Brand Equity and Brand Preference

Brands must be developed and maintained constantly in order to secure a set of loyal
consumers. Keller et al. (1996) stated the loyalty of consumer‟s lies with brands, rather than
the products. There were several researches done on the Customer Based Brand Equity of
different products.

To name a few, Abad (2012) studied The Customer Based Brand Equity in the Banking sector
of Iran aiming to conceptualize the customer based brand equity in the financial service sector
with respect to its effect on perception of brand. After employing Aaker's (1996) CBBE model,
they found out that Perceived quality, brand loyalty, brand awareness and brand association are
influential criteria of brand equity that enhances perception of brand in financial service sector.

Among the four mentioned dimensions, brand association appears to have the most influence
on brand equity.

16
Also Hossien (2012) studied The Customer Based Brand Equity in the Chocolate industry of
Iran with the intention of identifying which factors are influential in building brand equity and
also to measure the relationship among the dimensions of CBBE in the Iranian chocolate
industry. After employing Aaker's CBBE model, the researcher found out that the brand equity
of chocolate products is directly made up of two dimensions, namely brand loyalty and brand
image. These two dimensions have a medium direct impact on brand equity. Other dimensions
have a very small and indirect impact on brand equity that in chocolate industry of Iran.

To quote a third article, Tong and Hawley (2009), researched about measuring Customer Based
Brand Equity in the Sportswear market in China. Based on Aaker‟s conceptual framework of
brand equity, they employed structural equation modeling to investigate the causal relationships
among the four dimensions of brand equity and overall brand equity in the sportswear industry.

The study used a sample of 304 actual consumers from China‟s two largest cities, Beijing and

Shanghai. The research's findings concluded that, brand association and brand loyalty are
influential dimensions of brand equity and weak support was found for the perceived quality
and brand awareness dimensions. Thus sportswear brand managers and marketing planners
should consider the relative importance of brand equity in their overall brand equity evaluation,
and should concentrate their efforts primarily on building brand loyalty and image.

In summary, although no significance literature was found with regards to the Ethiopian
automobile industries that are related with brand choice;

2.7 Research Hypothesis

Based on the literature review and the hypothesized connections presented in the conceptual
framework the following hypotheses were tested:

 H1: Brand image has no a significant effect on brand choice for automobile buyers.
 H2: Reliability has no a significant effect on brand choice for automobile buyers.
 H3: Price has no a significant effect on brand choice for automobile buyers.
 H4: Availability of spare parts has no a significant effect on brand choice for
automobile buyers.
 H5: Safety has no a significant effect on brand choice for automobile buyers.
17
  H6: Fuel economy has no a significant effect on brand choice for automobile buyers
 H7: Durability has no a significant effect on brand choice for automobile buyers.
 H8: Social value has no a significant effect on brand choice for automobile buyers.

2.8 Conceptual Framework

Based on the related literature review the conceptual frame work was developed which includes
Brand image,Reliability,Price, availability of spare parts, Safety,Fuel consumption, Durability
andSocial value. as the independent variable that influence a brand choice(dependent variable)
particular automobile brand.

Fig 1.1 conceptual framework

18
 CHAPTER THREE
Research design & methodology

3.1 Introduction

This chapter presented detailed discussion of the research methodology employed in the study.
Hence, topics related to research design, data type and source, target population, sampling
technique and sample size, data collection procedure and method of data analysis were covered.
Explanation about the reliability and validity of the study is also included in this chapter.

3.2 Research Approach

There are three types of research approaches Quantitative, qualitative and mixed research
approach
Quantitative research involves studies that make use of statistical analyses to obtain
their findings. Key features include formal and systematic measurement and the use of
statistics. it is means of testing objective theories by examining the relationship among
variables. This variables in turn can be measured typically on instruments so that
numbered data can be analyzed using static procedures the final written report has a set
structure consists of introduction literature and theory methods results and
discussion.(creswell,2008)
Qualitative research involves studies that do not attempt to quantify their results
through statistical summary or analysis. Qualitative studies typically involve interviews
and observations without formal measurement. A case study, which is an in-depth
examination of one person, is a form of qualitative research. Qualitative research is
often used as a source of hypotheses for later testing in quantitative research. It is a
19
 means of exploring and understanding the meaning individuals or the group ascribe to a
social or human problem. The process of research involves emerging questions and
procedures. The final report has a flexible structure. (creswell,2008)
Mixed research it has an approach to enquiry that combine or associate both qualitative
and quantitative approaches. It involves philosophical assumption the use of qualitative
and quantitative approach and the mixing of both studies. Thus it is more than simply
collecting and analyzing both kinds of data it also involves the use of both approach in
tandem so that the overall strength of the study is greater than qualitative or quantitative
research (creswell & plano clark,2007)

3.3 Research design

Descriptive research is aimed simply at describing phenomena and is not particularly

concerned with understanding why behavior is the way it is regarding the average
member of a group. (creswell & plano clark,2007)
Exploratory research It is often the starting point of a research project into phenomena
(known as an exploratory study) of which we know very little(creswell & plano
clark,2007)
Explanatory research is deeper in the sense that it describes phenomena and attempts
to explain why behavior is the way it is(creswell & plano clark,2007)

Among the above research approach and research design represents the major methodology
driving the study, being distinctive and specific research approaches which are best suited to
answer the research question (Comack,1996).It explains and justifies the type and method of
data collection,, source of information, sampling strategy and time-cost constraints. The
research methodology can be classified using the variety of ways, such as methods of data
collection, time dimensions, researcher participation and the purpose of the study (Blumberg,
2008).

Thus this study is trying to identify and explain factors that determine brand choice of buyers.
Therefore for this purpose quantitative research approach would use by researcher because the
researcher use different statistical tools to measure and quantify the report. Explanatory
research design method is also used to understand about factors affecting consumer branch

20
choice among the alternative automobile cars and provide theoretical explanation so; this
research uses explanatory research design. Each of these strategies plays a distinct but
complementary role in order to get an answer on the research problem. Explanatory research is
deeper in the sense that it describes phenomena and attempts to explain why behavior is the
way it is. Thus this research would try to identify what are the determinant factors that are
influence brand choice of automobile car buyers while buying. Therefore for this study the
appropriate design is explanatory research design.

3.4 Sampling design

3.4.1 Target population

The target populations for this study are the residents of Addis Ababa who are owners of
automobile car in a city. Since it is impossible to list all the people, the sample frame is the
same as the population of concern. The sample frame is a set of items from which the sample is
drawn.

More specifically data were collected from the owners of automobile, may be they are self
employee, different company‟s employees or trader by distributing structured questioners that
are related with the main variables the researcher wants to touch within convenient time for the
respondents.

3.4.2. Sample Size and Sampling Techniques

Judgmental sampling would used to select some parts of the city in which the researcher
believe to address the respondents. There is no specific place to access them.

The current study was depend on non-probability sampling; namely, convenience sampling
because the sampling frame is unavailable (Saunders et al., 2012).According to Kothari (2004)
when the population element were selected for inclusion in the sample based on the easiest of
access, in can be called convenience sampling .This is a technique in which a sample is drawn
from that part of the population that is close to hand, readily available, or convenient
(Bhattacherjee, 2012). It is an easy, quick, and cost-effective technique, thus, the two non-

21
probability techniques i.e. judgmental and convenience will be used to select the sample from
the targeted population.

There is always the danger of bias entering into this type of sampling technique. But if the
investigators are impartial, work without bias and have the necessary experience so as to take
sound judgment, the results obtained from an analysis of deliberately selected sample may be
tolerably reliable. However, in such a sampling, there is no assurance that every element has
some specific chance of being included. Sampling error in this type of sampling cannot be
estimated and the element of bias, great or small, is always there. As such this sampling design
is rarely adopted in large inquires of importance .However, in small inquiries and researches by
individuals, this design may be adopted because of the relative advantage of time and money
inherent in this method of sampling (Kothari, 2004)

The sample size for this study was 400. The appropriateness of the 400 respondents is justified
by Neuman (2007) who asserts that when it comes to sampling size selection the researcher
should used his discretion. In addition, this decision is consistent with Tabacknick and Fidell
(1996) who suggested that, for a regression analysis, the minimum sample size (N) should be N
> 50 + 6M, where M is the number of predictors (independent variables).In this study, there are
8 main predictors of automobile brand choice as contained in the conceptual framework
adapted for this study (i.e. Brand image, Reliability, Price, availability of spare parts, Safety,
Fuel consumption, Durability and Social value), thus the sample size based on their
recommendation should be greater than 98.

Thus, the researcher consider available fund and time, sample size used by similar past studies
and own judgment to determine the sample size. Hence, samples of 400 participants were
participating from targeted population.

3.5 Sources of Data

The sources of data used in this research comprised both primary and secondary data.
According to Malhotra (2005), primary data are originated by the researcher for the specific
purpose of addressing the problem at hand. Even if obtaining them can be expensive and time
consuming, primary data, being the most significant were gathered through structured
questionnaires.
22
Secondary data are data that are collected for some purpose other than the problem at hand
(Malhotra, 2005). Secondary data are usually collected from journals, existing reports, and
statistics by government agencies and authorities. The secondary data helped the student
researcher as specific reference and explore different construct important to this study.

3.6 Method of Data Collection and procedure

Questionnaire design and administration

Firstly, all questions and formats were standardized so that all respondents face the same
questionnaire.

Second, the questionnaire was designed comprehensively, in order to motivate respondents to

cooperate and accurately complete it.

Specifying the data required

The first step in questionnaire design was to accurately determine the required information to
achieve the research objectives. Based on the research questions, hypotheses and the
explanatory research, the required question was designed for the independent variables that
influence dependent variables.

Appropriate methods of data collection for quantitative study are experimental and survey.
Experiments are used in different researches studying consumer preference (i.e., Nordgren and
Djiksterhvis (2009)). However it is used to examine cause and effect between two variables in
controlling setting. It is often conducted in laboratory settings with a limited number of
variables which impedes the generalization of the result (Saunders, 2012).

A survey is used for descriptive study. Several studies in marketing research studying consumer
brand choice use the survey method (i.e. Jamal and Al-Mari (2007)). Survey studies ask large
numbers of people questions about their behaviors, attitudes, and opinions. Because the number
of population is very large, cross sectional survey design with questionnaire technique is used
23
to collect data at a single point in order to collect quantitative data and examine the pattern of
association of variables. There are many techniques used to conduct survey. However,
questionnaire is common technique for survey (Saunders, 2012).

3.7 Validity & Reliability

3.7.1 Validity Analysis

Validity is the extent to which differences found with a measuring instrument reflect true
differences among those being tested,(Kothari,2004).In other words, Validity is the most
critical criterion and indicates the degree to which an instrument measures what it is supposed
to measure. In order to ensure the quality the research design the researcher will check content
and construct validity of the research.

According to Kothari (2004), content validity is the extent to which a measuring instrument
provides adequate coverage of the topic under study. If the instrument contains a representative
sample of the universe, the content validity is good. Its determination is primarily judgmental
and intuitive. It can also be determined by using panel of persons who judge how well the
measuring instrument meets the standards, but there is no numerical way to express it.

A measure is said to possess construct validity to the degree that it confirms to predicted
correlations with other theoretical propositions. Construct validity is the degree to which scores
on a test can be accounted for by the explanatory construct of a sound theory. For determining
construct validity, we associate a set of other propositions with the results received from using
our measurement instrument. If measurement on our devised scale correlate in predicted way
with those other propositions, we can conclude that there is some construct Validity (Kothari,
2004).Therefore, in order to test the construct validity, correlation coefficient for the
independent and dependent variables will be calculated. Based on the result of the correlation
analysis, since the independent variables are positively related with the dependent variables, the
independent variable therefore can be considered as a good measure of brand choice.

3.7.2Reliability Analysis
24
In statistics, Cronbach's (alpha) is a coefficient of internal consistency. It is commonly used as
an estimate of the reliability of a psychometric test for a sample of examinees. It was first name
dalpha by Lee Cronbach in 1951.

Cronbach's alpha will generally increase as the inter correlations among test items increase,
and is thus known as an internal consistency estimate of reliability of test scores. Because inter
correlations among test items are maximized when all items measure the same construct,
Cronbach‟s alpha is widely believed to indirectly indicate the degree to which a set of items
measures a single one-dimensional latent construct. However, the averages inter correlation
among test items is affected by skew just like any other average. (Revelle W Zinbarg R
(2009)).

From the empirical review of different studies related with this industry they used this
instrument in order to calculate the reliability of the variables.

Thus, In order to test the internal consistency of variables in the research instrument
Cronbach„salpha coefficient will be calculated.

Reliability Analysis of the Variables

Item-Total Statistics
Corrected Item- Squared Cronbach's
Scale Mean if Scale Variance Total Multiple Alpha if Item
Item Deleted if Item Deleted Correlation Correlation Deleted
Branding 29.5818 5.460 .626 .662 .689
Reliaility 29.6913 5.214 .309 .372 .756
Price 29.9642 5.483 .352 .388 .733
Sparepart 29.3445 5.218 .582 .763 .687
Safety 29.5264 5.213 .561 .776 .690
Feul 29.1939 5.742 .480 .529 .711
Durability 29.4688 5.415 .610 .627 .689
Socialvalue 30.0395 5.874 .218 .186 .759

Table1.1; reliability analysis of the variables

Source: survey 2017
25
3.8. Data Analysis

The data analysis would be made by using both descriptive and inferential statistics.
Descriptive statistics such as frequencies, percentages, means and standard deviations would be
used to summarize and present the data. In addition to this, Pearson correlation coefficient
would also be used to show the interdependence between the independent and dependent
variables. With regard to inferential statistics, multiple linear regression analysis would be used
to test the significance contribution of each independent variable to the dependent variable
(brand choice) and also the researcher would use milticollinearity test that is used to test if there
is milticollinearity problem within the independent variables. Also the normality of the data is
tested through (SPSS 16.0) statistical tool.

Regression equation for the problem is the following:

Yi =a+β1X1+β2X2+β3X3+β4X4+ β4x4+ β5x5+ β6x6+ β7x7+ β8x8+ Σ

Where, Y=Overall brand equity
α= Y intercept/constant
β1= the beta weight or regression coefficient of brand image
β2= the beta weight or regression coefficient of reliability
β3= the beta weight or regression coefficient of price
β4= the beta weight or regression coefficient of spare part availability
β5= the beta weight or regression coefficient of safety
β6 = the beta weight or regression coefficient of fuel consumption
β7= the beta weight or regression coefficient of durability
β8= the beta weight or regression coefficient of social value
X1= brand image
X2= reliability
X3 = price
X4 = spare part availability
26
X5= safety
X6= fuel consumption
X7= durability
X8= social value
Σ = sum of residuals or error terms

3.9. Ethical Considerations

Ethics in business research refers to the set of behavioral principles and norms beginning with
the research from the first phase of the study (Sekaran, 2003). The ethical code of conduct
should reflect the behavior of everyone participating in the research project; researcher,
participants or moderator (Sekaran, 2003). In this research, in order to keep the confidentiality
of the data given by respondents, the respondents were not required to write their name and
assured that their responses will be treated in strict confidentiality. The purpose of the study
was disclosed in the introductory part of the questionnaire.

27
 CHAPTER FOUR
ANALYSIS AND INTERPRITATION
The main focus of this chapter is on presentation of data analysis, empirical findings and results
of the survey of the factors that affect brand choice of automobile buyers in Addis Ababa. The
data analysis was made with the help of Statistical Package for Social Science (SPSSv.16).
4.1. Reliability Test
Cronbach‟s alpha is used in this study to assess the internal consistency of the research
instrument, which is developed questionnaire. Cronbach's α (alpha) is a coefficient of reliability
used to measure the internal consistency of a test or scale; it resulted as a number between 0
and 1. As the result approaches to 1 the more is the internal consistency of the items, which
means all the items measure the same variable.
The result of the coefficient alpha for this study‟s instrument was found to be 0.789, as
indication of acceptability of the scale for further analysis since all the eight items of brand
choice dimensions (brand image, price, reliability, safety, availability of spare part, durability,
fuel consumption and social value) measure the same variable, which is brand choice. Besides
the overall reliability test, the items under each of the eight brand choice dimensions are also
tested to check if they measure the same dimension or not. Most of the dimension consistency
test result was acceptable meaning greater than 0.7 except for brand image, durability, safety
and availability of spare part 0.689, 0.689, 0.690 and 0.687 respectively. The reliability
measures of the dimensions are moderate. However, Cronbach (1951) describes that sometimes
measurements with low reliability result might still influence the scale measure and the overall
reliability tastes results indicate excellent internal consistency. Thus considering the results are
acceptable further analysis is conducted (reliability test result result available on Appendix
part).

28
Reliability Statistics

Reliability Statistics

Cronbach's Alpha Based

Cronbach's Alpha on Standardized Items N of Items

.741 .780 8

Table1.2, Cronbach alpha; for brand choice dimension

Survey result, 2017

4.2 General information of the respondent

Out of the 400 questionnaires sent out, only 382 were returned during a period of two weeks‟
time. They were not fully completed, and the rest 382 representing a response rate of 95.5 %.

The first part of the questionnaire consists of the general profile of respondents. This part of the
questionnaire requested a limited amount of information related to general and company status
of the respondents.

Descriptive statistics (frequency distribution) is used to discuss the general demographic

characteristics of respondents (Age, gender occupation ) and general information of respondent
which are suitable for study that are discussed in the table belo

29
Frequency Table
Age

Cumulative
Frequency Percent Valid Percent Percent

Valid 18-25 45 11.8 11.8 11.8

26-35 169 44.2 44.2 56.0

36-44 111 29.1 29.1 85.1

45 and above 57 14.9 14.9 100.0

Total 382 100.0 100.0

Table1.3, age distribution of the respondent

Survey result, 2017

As the table shown above 11.8%of the respondent is aged between age 18-25 and 44.2% of the
respondent is aged between 26-35 and 29% of the respondents are aged between 36-44 and the
remaining respondents are 14.9% aged above 45.generally the above table shows that the
largest no from the respondents are younger age (26-35).

Gender

Frequency Percent Valid Percent Cumulative Percent

Valid Female 109 28.5 28.5 28.5

Male 273 71.5 71.5 100.0

Total 382 100.0 100.0

30
Table1.4; gender distribution of the respondents
Survey result, 2017

From the total 382 respondent 109 (28.5%) are females and 273(71.5%) of them are male this
tell us largest respondents are male.

Education
Cumulative
Frequency Percent Valid Percent Percent

Valid primary education 5 1.3 1.3 1.3

secondary education 10 2.6 2.6 3.9

Diploma 48 12.6 12.6 16.5

first degree 272 71.2 71.2 87.7

masters and above 47 12.3 12.3 100.0

Total 382 100.0 100.0

31
Table1.5; educational back ground of the respondents
Survey result, 2017
The above table shows that from the total respondents of 382 1.3% are under primary education and
2.6 % from the total respondents secondary education completes‟ and also 12.6% respondents are
diploma graduates and totally the remaining respondents are first degree, masters and above 71.2%
and 12.3% respectively. From this table we can conclude that most of the respondents are first degree
graduates.

Occupation

Cumulative
Frequency Percent Valid Percent Percent

Valid private service business 232 60.7 60.7 60.7

government service
21 5.5 5.5 66.2
university teacher

Doctor 1 .3 .3 66.5

Lawyer 11 2.9 2.9 69.4

Other 117 30.6 30.6 100.0

Total 382 100.0 100.0

Table1.6; occupation of the respondents

Survey result, 2017

32
The above table discusses the status of the respondents; from the total respondents 382 60% `s
are categorized under private service business and 5.5% from government service university
teachers also 3% from the total categorized under doctors and 2.9% are lawyers and the
remaining respondents are categorized in different position which under other 30.6% .from the
above table we conclude that most of the respondents are categorized under private service
business.

Income
Cumulative
Frequency Percent Valid Percent Percent

Valid less than 100,000 111 29.1 29.1 29.1

101,000-200,000 122 31.9 31.9 61.0

201,000-500,000 107 28.0 28.0 89.0

500,000 and above 42 11.0 11.0 100.0

Total 382 100.0 100.0

Table1.7; income distribution of the respondents

Survey result, 2017

The above table shows us the income distribution of the respondents that is categorized us the
income of the respondents per annum. From the total respondents 29.1% are under the
categories of income less than ETB100, 000 and 31.9% of the respondents are categorized
under of income ETB 101,000-200,000 also 28% of the respondents are categorized under
annual income ETB 201,000-500,000 and the remaining respondents are under income of ETB
500,000 and above. This shows that from the total respondents the largest participants (31.9%)
are categorized under annual income of ETB 101,000-200,000.

brand do you have

Frequency Percent Valid Percent Cumulative Percent

Valid Toyota 224 58.6 58.6 58.6

33
 Hyundai 18 4.7 4.7 63.4

Suzuki 41 10.7 10.7 74.1

Lifan 35 9.2 9.2 83.2

Mercedis 16 4.2 4.2 87.4

Other 48 12.6 12.6 100.0

Total 382 100.0 100.0

Table1.8; brand distribution of the respondents

Survey result, 2017

This tables show us from the total respondents382; 58.6% respondents are the owner of Toyota
brand and 4.7 % from the total respondents have Hyundai brand automobile and the other brand
is Suzuki from the total respondents cover10.7% the remaining brand that the respondents have
are lifan, Mercedes and other brands its has coverage from the total respondents in percentile
9.2%, 4.2% and 12.6% respectively. Generally from the above table we can conclude that
Toyota is more preferred brand in a city.

Information from
Cumulative
Frequency Percent Valid Percent Percent

Valid i did extensive information

search among all available 194 50.8 50.8 50.8
brand

i compared only among the

94 24.6 24.6 75.4
brands in my consideration

it was jointly family decision 62 16.2 16.2 91.6

it was friends decision 27 7.1 7.1 98.7

34
 Other 5 1.3 1.3 100.0

Total 382 100.0 100.0

Table.1.9; information of respondents while buying

Survey result, 2017

The above table describe about the respondents get information about how they decide to buy
their automobile either from the above choices from the total respondents of 382 50.8% of the
respondents search information among all available brands in a city and 24.6% of the
respondents are compared only among the brands in their own consideration the other is that
16.2% are bought through the decision of family and 7.1%`s of the respondents are influenced
by their friends and the remaining respondents are search from other sources of information.
From the above table we conclude that most respondents are search information among all
available brands.
4.3 Test of normality of the Data
Among the others, one of the assumptions was normality of the data should be tested before
running the analysis of the data using skwness and Kurtosis.
According to Fieled (2005), normally distributed data assumed that the data are from one or
more normally distributed populations. The rationale behind hypotheses testing relies on having
normally distributed populations and so if these assumptions are not met then the logic behind
hypothesis testing is flawed.
Therefore, value of S (Skewness) and K (Kurtosis) and their respective standard errors were
computed. An absolute value greater than 1.96 Z-score for Skewness and less than 3.29 for
Kurtosis is expected to be significant at p< 0.05. Large sample will give rise to small standard
errors and so when sample sizes are big, significant values arise from even small deviations
from normality for both skewness and Kurtosis (Fieled, 2005).

Descriptive Statistics

N Mean Std. Deviation Skewness Kurtosis

35
 Statistic Statistic Statistic Statistic Std. Error Statistic Std. Error

Brandimage 382 4.1746 .35766 -.466 .125 -.182 .249

Reliability 382 4.1387 .76100 -1.496 .125 3.414 .249
Price 382 3.8658 .61250 -.363 .125 1.074 .249
Durability 382 4.3613 .44247 -.737 .125 .316 .249
Socialvalue 382 3.7906 .59984 -.659 .125 .302 .249
Saftone 382 4.3037 .53432 -.842 .125 .814 .249
Fueloff 382 4.6361 .41438 -.683 .125 -.808 .249
avsp23 382 4.4856 .51911 -1.428 .125 3.510 .249
Valid N (listwise)
382

Table 1.10 descriptive statics

Survey result, 2017

As we can see from table 1.10 above the absolute value of the Z-scores of all variables in this
study were greater than1.96 in skwness and the absolute value of kurtosis was same- haw
deviated from the standard of the Z –scores which means brand choice and overall brand choice
of the variables scored less than 3.29 Z –sore value. Hence data was normally distributed I

36
Skwness Z-score however in Kurtosis have some deviations.

Fig 1.2 normality chart

Survey result, 2017

Normality of a data should be test before running the regression analysis because multiple
regressions require that the independent variables in the analysis be normally distributed.
According to Brooks (2008), as cited by Abate (2012) if the residuals are normally distributed,
the histogram should be bell- shaped and thus this study implemented graphical methods to test
the normality of data. From the Histogram figure, it can be noted that the distribution is normal
curve, demonstrating that data witnesses to the normality assumption.
As the assumption holds as the histogram was a bell- shaped and the residuals were normally
distributed around its mean of zero. Besides, the normal probability plots were also used to test
the normality assumption as shown by the Normal P P-Plot Figure as you can see from the
above.
As shown in the Figures from the above residuals were normally distributed around its mean of
zero which indicates that the data were normally distributed and it was consistent with a normal
distribution assumption. As the figures confirmed the normality assumption of the data, this
implies that the inferences made about the population parameters from the sample statistics
tend to be valid.

37
4.4 Inferential Statistics
4.4.1 Correlation Analysis
A correlation coefficient expresses quantitatively the magnitude and direction of the liner
relationship between two variables, Pearson correlation coefficient reveal magnitude and
direction of relationships (either positive or negative) and the intensity of the relationship (-1 to
1). In this section a correlations analysis were done to establish whether relationships do exist
between variables conceptualized in the framework. The results would enable the researcher to
determine the regression on the dependent variable. The researcher used one of the most
commonly used types of correlation coefficient which is Pearson correlation coefficient
methods because of the statistical accuracy that usually results from this method.
If there is a perfect linear relationship with negative slope between the two variables, we have a
correlation coefficient of -1; if there is negative correlation, whenever one variable has a high
(low) value; the other has a low (high) value. A correlation coefficient of 0 means there is no
linear relationship between the variables (Valerie and McColl, 2005).
As per table above, the coefficients show that the five factors of automobile brand choice are
all positively and significantly correlated with the buying decision within the range of 0.034 to
0.478; all were significant at P= 0.000 level. But the remaining variables like safety, fuel
consumption and spare part availability have positive and insignificant relationship with the
independent variable which is buying decision.
The results of the correlation analysis indicate that all of the marketing mix variables are
positively related to the financial performance. According to Cohen (1998), strength of
correlations can be interpreted as follows: Strength of correlation

• r = - + .10 to - + .29 small effect (weak)

• r = - + .30 to - + .49 medium effect (moderate)

• r = - + .50 to - + 1.0 large effect (strong)

Correlations

38
 Branding Reliabili Price Sparepr Safet Feul Durabili Socialvalu buying
decisio
n
Pearson
1.00
Branding Correlation
Pearson
0.16 1.00
Reliaility Correlation
Pearson
0.12 0.59
Price Correlation 1.00
Pearson
0.63 0.04 1.00
Sparepart Correlation 0.03
Pearson
0.74 0.05 0.79
Safety Correlation 0.04 1.00
Pearson
0.53 0.05 0.67
Feul Correlation 0.10 0.46 1.00
Durabilit Pearson
0.71 0.08 0.66 1.00
y Correlation 0.09 0.73 0.46
Socialval Pearson
0.02 0.29 0.03 0.14 1.00
ue Correlation 0.35 (0.03) 0.05
buying Pearson
0.30 0.47 0.07 0.21 0.41
decision Correlation 0.48 0.03 0.06 1.00

**. Correlation is significant at the 0.01 level

(2-tailed).
*. Correlation is significant at the 0.05 level
(2-tailed).
Table 1.11 correlation table
Survey result, 2017

Brand image versus buying decision

39
As indicated in the table above brand image was positively and significantly correlated with
buying decision(r=0.305**, p=0.000). In other words the value of (r=0.305) indicates that
brand image and buying decision have moderate and positive relationship in the context of
automobile brand choice in the market of Addis Ababa.
Reliability versus buying decision
As indicated in the table above reliability was positively and significantly correlated with
buying decision(r=0.466**, p=0.000). In other words the value of (r=0.466) indicates that
reliability and buying decision have moderate and positive relationship in the context of
automobile brand choice in the market of Addis Ababa.

Price versus buying decision

As indicated in the table above price was positively and significantly correlated with buying
decision(r=0.478**, p=0.000). In other words the value of (r=0.478) indicates that price and
buying decision have moderate and positive relationship in the context of automobile brand
choice in the market of Addis Ababa.
Availability of spare part versus buying decision
As indicated in the table above spare part availability was positively and insignificantly
correlated with buying decision(r=0.072*, p, greater than 0.05 which is 0.159). In other words
the value of (r=0.072) indicates that spare part availability and buying decision have weak and
positive relationship in the context of automobile brand choice in the market of Addis Ababa.
Safety versus buying decision
As indicated in the table above automobile safety was positively and insignificantly correlated
with buying decision(r=0.034*, p, greater than 0.05 which is 0.503). In other words the value of
(r=0.034) indicates that safety and buying decision have weak and positive relationship with
insignificant relationship us the respondents data in the context of automobile brand choice in
the market of Addis Ababa.
Fuel consumption versus buying decision
As indicated in the table above fuel consumption was positively and insignificantly correlated
with buying decision(r=0.061**, p, greater than 0.05 which is 0.231). In other words the value
of (r=0.061) indicates that fuel consumption and buying decision have weak and positive
relationship with insignificant relationship in the context of automobile brand choice in the
market of Addis Ababa.
40
Durability versus buying decision
As indicated in the table above durability was positively and significantly correlated with
buying decision(r=0.207**, p=0.000). In other words the value of (r=0.207) indicates that
durability and buying decision have weak and positive relationship with significant enough
relationship in the context of automobile brand choice in the market of Addis Ababa.
Social value versus buying decision
As indicated in the table above social value was positively and significantly correlated with
buying decision(r=0.411**, p=0.000). In other words the value of (r=0.411) indicates that
social value and buying decision have moderate and positive relationship with significant
enough relationship in the context of automobile brand choice in the market of Addis Ababa.
The remaining data related to correlation and significance of buying decision dimensions are
available in part of appendix.
4.4.2 Multicollnearity Test
In regression, multicollinearity occurs when independent variables in the regression model are
more highly correlated with each other than with the dependent variable When the independent
variables the regression model is highly correlated with one another; they are basically
measuring the same thing. In other words, when two variables are highly correlated, they both
communicate essentially similar information. One way to assess multicollinearity is to examine
correlations among the independent variables. If a correlation matrix demonstrates correlations
of 0.90 or higher among the independent variables, they may be a problem with
multicollinearity. Hair et al. (2006) argued that correlation coefficient below 0.90 may not
cause serious multicollinearity problem, cited by Muhammed (2012). Multicollinearity can also
be detected using tolerance value and variance inflator factor (VIF) value. An insignificant
tolerance value point to the variable under discussion is almost a perfect liner combination of
the independent variables already in the equation and that it should be dropped out from to the
equation. Multicollinearity does not exist among all the independent variables provided that
the tolerance value of all the independent variables was greater than 0.1 and the VIF values of
all the independent variables are also less than 10. As you can see from table below all
independent variables are greater than 0.1 and the VIF value of all the independent variables
are also less than 10.

Coefficients

41
 Collinearity Statistics

Model Tolerance VIF

1 Branding .338 2.960

Reliaility .628 1.592

Price .612 1.634

Sparepart .237 4.217

Safety .224 4.457

Feul .471 2.122

Durability .373 2.683

Socialvalue .814 1.228

a. Dependent Variable: buying decision

Table 1.12 multi co linearity table
Survey result, 2017

4.4.3 Regression Analysis

The above table shows that the tolerance values of all the independent variables were greater
than 0.1 and the VIF values of all the independent variables were less than 10. This indicates
that model I was free from multicollinearity. Hence, there was no problem of multicollinearity
between the independent variables in the model. Therefore regression analysis was done.
As you can see the Model Summary from the appendix part the adjusted R Square statistic tells
us the proportion of variance in the dependent variable that is accounted for by the independent
variables. In this case the co- efficient of determination adjusted (R2) was 0.456. This implies
that about 45.6% of the dependent variable (i.e. brand choice) can be explained by the
independent variables (i.e. brand image, reliability, price, availability of spare part, durability,
fuel consumption, safety and social value), leaving about 54.4% to be explained by other
exogenous factors. Adjusted R2 values also indicate the overall effect size of all the independent
variables on the dependent variable.

Regression analysis of overall buying decision dimensions

42
 Unstandardized Standardized T Sig
coefficient coefficients
1. Model
B Std error Beta -1.09 .278

(Constant) -.484
1.063 .446 .537 8.26 .000
Branding
.199 .129 .183 3.83 .000
Reliability
.338 .052 .249 5.15 .000
Price
Spare part .295 .066 .184 2.37 .018
- .000
Safety -.765 .124 -.492 6.16
- .000
Fuel -.411 .124 -.205 3.72
.163 .110 .087 1.40 .163
Durability
.330 .116 .238 5.69 .000
Social value
Dependent Variable: buying decision
Table 1.13 regression analysis
(Source: Researcher's survey, 2017)
From the above table we can have the following general formula for the model under the study.
The regression equation was
BUD =α+β1x1+β2x2+β3x3+β4x4+ β5x+ Σ............................................ (1)
BUD =α+β1BI+ β2REL +β3PR+ β4AVSP+ β8SOV+ Σ …….……….. (2)
BUD=--484+0.537BI+0.183REL+0.249PR+0.184AVSP+238SOV+ Σ... (3)
The regression model from the above table result shows that keeping other variables constant
0.537 unit increases in brand image will bring a unit increase in the buying decision.0.183 unit
increase in reliability will have a unit increase impact on buying decision of automobile market
in Addis Ababa. 0.249 unit increase of price will have a unit increase impact on buying
decision of automobile market in Addis Ababa. 0.184 unit increase of availability of spare parts
of will have a unit increase of buying decision of automobile market in Addis Ababa. 0.238
unit increases in social value will bring a unit increase in the buying decision. 0.087 unit
increases in durability will bring a unit increase in the buying decision but durability of
automobile is insignificant for brand choice in the market since its p, is greater than 0.05 which
is 0.163. the remaining two variable safety and fuel consumption have significant for brand
choice when the value of p<0.05, while it have negative beta value which is -0.765 and -0.411
43
 respectively this means that this two variables have inversely relation while buying decision in
market of automobile in a city.
4.4 Hypothesis Testing and Interpretation of Results (Table 1.14) source survey2017
Hypotheses Result Analysis
Technique
Ho: Rejected β =0.537,
H1: Brand image has no a significant effect on brand choice for p<0.05
automobile buyers

Ho: Rejected β =0.183

H2: Reliability has no a significant effect on brand choice for p<0.05
automobile buyers.

H3: Price has no a significant effect on brand choice for automobile Ho: Rejected β =0.249
buyers. p<0.05

Ho: Rejected β =0.184

H4: Availability of spare parts has no a significant effect on brand p<0.05
choice for automobile buyers.

H5:Accepted β =-0.492,
H5: Safety has no a significant effect on brand choice for p<0.05
automobile buyers.
H6: Accepted β =-0.205
H6: Fuel consumption has no a significant effect on brand choice p<0.05
for automobile buyers.
H7: Accepted β =0.087
H7: Durability has no a significant effect on brand choice for p>0.05
automobile buyers.
H8: Rejected β =0.238,
H8: Social value has no a significant effect on brand choice for p<0.05
automobile buyers

44
As the significance value of F statistics shows a value of (.000), which was less than p<0.05.
Thus, the model was significant and fit. The strength of each predictor (independent variable)
influencing the criterion (dependent variable) can be investigated via standardized Beta
coefficient. The regression coefficient explains the average amount of change in the dependent
variable that is caused by a unit change in the independent variable. The larger value of Beta
coefficient an independent variable has, brings the more support to the independent variable as
the more important determinant in predicting the dependent variable.
The adjusted R-square value only indicates the variance in the buying decision of automobile
brands in Addis Ababa market as it was explained by the independent variables which means
the result of regression for the five independent variables on buying decision of automobile
brands as presented in Appendix part and the model explains the relationship between the
independent variables and the dependent variables. Model I that obtained from the result of the
regression analysis represents a multiple regression model which relates the dependent variable
buying decision to the five independent variables brand image, price, reliability, availability of
spare part and social value.
Generally the above table multiple linear regression (Beta Coefficient) analysis revealed that
Brand image was the first most significant variable for buying decision followed by price,
social value, reliability and spare part availability.
Brand image and buying decision
A brand image is how the consumers perceive the brand (Aaker 1996, 69). Aaker (1991, 109-
110) explains that brand image is a set of associations which might not even reflect the
objective reality. Arnold (1998, 94) says that brand image refers to the way in which certain
groups decode all of the signals resonating from the product or service. So, the mind set up of
buyers is the main issue in automobile market to make a choice among available brands.

Reliability and buying decision

In terms of value reliability, consumers consider a vehicle to be reliable if it is likely to have
fewer problems than other vehicles (Consumer Report, 2010). Vehicle reliability has been
found to have a positive impact on the consumers‟ likelihood of choosing a vehicle (Woodset
al, 2010). Reliability and quality are interrelated, perceived quality has direct impact on
customer purchase decision and brand loyalty especially during the time customers have less or
no information of the products that they are going to purchase (Armstrong and Kotler, 2003).
45
Thus reliability is the second more significant variable in the market to choose brand among
available brands in a city.
.
Price and buying decision

Price is often viewed as a dominant factor in the guiding process when it comes to making a
purchase decision. Price in general has always been a determinant factor on consumers‟ brand
choice when selecting a product or service. It is assumed that when a consumer is facing a
buying decision in a product category, consumers observe a price to take into account on their
current inventory position in the category. This helps them to maximize their immediate utility
that they gain from the purchase. However, when consumer faces brand with varying prices and
perceived quality levels, they would have to make a choice consistent with the relative
importance attached to both attributes (Zeinab&Seyedeh, 2012). Thus this study shows us price
is the next significant and influential variable for brand choice of automobile car in the market
to brand image and reliability respectively.

Social value and buying decision

Social value is described as “the perceived utility acquired by an alternative as a result of its
association with one or more specific social groups. Social value relates to acceptability to
other persons or a need to belong to groups and have a good reputation (Sánchez, 2006). The
acceptability of others for automobile bought by the buyer is other influential variable for
buying decision.

Availability of spare part and buying decision

The motor vehicle aftermarket covers all goods and services intended to maintain a vehicle in
good condition after its purchase and throughout its useful life. The motor vehicle aftermarket
generates turnover in terms of retail sales. Demand for spare parts therefore originates
essentially from repairers. (GIPA Professional Survey 2009, page 102). So, the easy availability
of the spare parts to maintain the damaged parts of automobile is the factors to choose a
particular brand of car.

46
Safety and buying decision
The vehicle safety performances are ratings before purchasing a vehicle (Harris, 2001). Even if
the theoretical back ground of the variable safety like this but this data show us its beta value is
negative value -0.492 and significance relationship with buying decision with the value of
0.000 and the value of p<0.05 this show us safety is inversely significant for brand choice of
buyers of automobile so we can accept the null hypothesis.
This indicates there is relationship between safety and automobile brand choice in a city but it‟s
have a negative beta value while p<0.05. Bhattacherjee (2012) pointed out that, if p>0.05, then
we do not have adequate statistical evidence to reject the null hypothesis or accept the
alternative hypothesis.
Fuel consumption of automobile and buying decision
Furthermore, Austin and Dinan (2005) assume that consumers fully value lifetime fuel savings
when considering fuel economy in their vehicle choices. There is no doubt that consumers do
care about fuel costs, do value fuel economy, and that their interest in fuel economy increases
when fuel prices increase (Mahadi and Gallagher, 2009). Although theoretical concept discuss
this our result show us fuel consumption is significant and inverse relationship with buying
decision with beta value of -0.205 and significance vale p<0.05(0.000). so, we can accept the
null hypothesis.
Durability of automobile and buying decision
Like the other dimensions of quality, it is easier to plan durability into a products design and
manufacturing process than it is to alter the finished product. There are many ways to increase
a product's durability.
According to Dr. S. T. Foster, a professor at Boise State University it is one dimensions of
quality. And like most of the other quality dimensions, durability is a transcendent, product
based, user based, manufacturing based, and value based concept. Also he describes durability
as "the degree to which a product tolerates stress or trauma without failing." (Foster P6). The
result show us it‟s have a positive beta value of 0.87 but its have insignificant relationship with
dependent variable buying decision with value of 0.163(p>0.05) so we can accept the null
hypothesis.
Bhattacherjee (2012) pointed out that, if p>0.05, then we do not have adequate statistical
evidence to reject the null hypothesis or accept the alternative hypothesis.

47
 CHAPTER FIVE
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

This chapter winds up the study undertaken so far by giving insights about
summary, conclusions, recommendations and highlighting future research
areas

5.1 Summary of the Major Findings

The primary objective of this study was to determine the factors that affect brand choice of
automobile buyers in Addis Ababa. Nowadays the Ethiopian automobile market is getting in to
stiff computation through providing different brand of automobile within almost similar
purpose. This computation lead the firms to act as a flexible marketer and tiring to satisfy
buyers need through answer the question like what, where, when, how, there buyers satisfy to
take largest market share from similar automobile suppliers in a market Hence, this study tries
to identify which determinant has the highest influence on the overall brand choice. In addition,
this study also tries to answer the five research questions it started with in the introduction.

 All respondents of the questioner are automobile owners and live in a city.
 In order to determine the factors that influence the buyers of automobile in a city the
researcher test eight independent variable like brand image, reliability, price,
availability of spare parts, fuel consumption, durability, safety and social value. By
distributing 400 questioners to selected respondent through judgmental and convenience
sampled respondents. But from the total distributed questioner 382(95.5%) of them
completed correctly and return within a time. Based on the conceptual frame work and
objectives of the study 29 questions were provided in a 5 point Likert scale to the
respondents. The gathered data has analyzed by means of descriptive and inferential
statistics using SPSS version 16 soft ware.
 We can understand that among the total brands available in Addis Ababa automobile
market the buyers choice is brand TOYOTA. From the total respondents of the
questioner 58.6% of the respondents have the owners of TOYOTA automobiles.

48
 As we read from the result of questioner the largest portion of annual income
distribution of the respondents are categorized under annual income of ETB 101,000-
200,000. This show us most of them have medium income level annually.
 The other thing we read from responded questioner the occupation of the respondents
have dominated by private service business among listed on the question with the result
of 60.7% from the total respondents.
In the inferential statistics part the following results were achieved.
 The findings indicate that brand image was the first most significant variable than other
by resulting beta value of 0.537 and significantly related with dependent with value of
p<0.05.
 The results indicates that although all five variables(brand image, reliability, price,
availability of spare parts, social value) had a positive and significant influence on the
brand choice of automobile brands, the remaining variables like safety and fuel
consumption resulted negative beta value -0.492 and -0.205 with significant relationship
with dependent variable brand choice but its significance is inverse relation. The other
is durability has resulted with positive beta value and insignificant relationship with
dependent variable brand choice of automobile.
 The first hypothesis which states that brand image has no a significant effect on brand
choice of automobile buyers, as a result we can reject the null hypothesis and accept
alternative one.
 The next hypothesis which states that reliability has no a significant effects on brand
choice of automobile buyers, as a result we can reject the null hypothesis and accept
alternative one.
 The next hypothesis which states that price has no a significant effect on brand choice
of automobile buyers, as a result we can reject the null hypothesis and accept alternative
one.
 The next hypothesis which states that availability of spare parts has no a significant
effects on brand choice of automobile buyers, as a result we can reject the null
hypothesis and accept alternative one.
 The next hypothesis which states that safety has no a significant effects on brand choice
of automobile buyers, as a result we can accept the null hypothesis and reject alternative
one.
49
 The next hypothesis which states that fuel consumption has no a significant effects on
brand choice of automobile buyers, as a result we can accept the null hypothesis and
reject alternative one.
 The next hypothesis which states that durability has no a significant effects on brand
choice of automobile buyers, as a result we can accept the null hypothesis and reject
alternative one.
 The final hypothesis which states that social value has no a significant effects on brand
choice of automobile buyers, as a result we can reject the null hypothesis and accept
alternative one.
 Finally brand choice found to be positively explained by the sum of the
five independent variables by 45.6% in this study and the reaming 54.4%
of the dependent variable (i.e. brand choice) has explained by other
exogenous variables.

5.2 Conclusion
The primary purpose of this study was to investigate the factors affecting brand choice
of automobile buyers in Addis Ababa. More specifically, in this study the brand image
level of consumers, most popular brand in a city and the most significant determinant
would also identified in the study.
One of the objectives of this study was to find out which brand was more prefer in a
city. The data we collected show us the most preferred automobile brand in Addis
Ababa is TOYOTA brand among all brands that are available in the market which is
58.6%.
The results of regression analysis indicated that there is a positive effect of brand image,
reliability, price, availability of spare parts and social values from this finding; we can
conclude that all are influential factors for dependent variable that is brand choice.
The other main issue we read from the results of inferential statistics is that three
variables like safety, durability and fuel consumption has no influential effects on
dependent variable that is brand choice in automobile market so, we can conclude that
this factors are no influences on automobile buyers in a city.
One of the objectives of this study was to find out which dimension has the most
significant impacts on dependent variable. As indicated in the result among identified

50
 and tested independent variables brand image has the largest value in its significance
with dependent variable and beta value so, we can conclude that brand image has
mostly influential factors that is the customer level of minding about the brand because
of different reason.
From the result we can also see that the income of most respondent is not to high which
is categorized under annual income of ETB 101,000-200,000 and they are not more
attached their life style with their safety other than the purpose (reliability) and other
factor of automobile they bought so, we can conclude that their annual income is more
attached with the brand choice of automobile.
 At the beginning of the study it was hypothesized that all the eight determinants of
brand choice had no significant impact on brand choice. After the analysis was done,
the findings revealed that the major dimension which affects the brand choice of
automobile buyers are discussed like brand image, reliability, price, availability of spare
parts and social values. so we can conclude that null hypothesis is rejected and accepted
alternative hypothesis. the other three variables did not strongly influence the brand
choice, the hypotheses drawn were accepted because they had no a significant but
positive effect on the automobile buying decision.

5.3 Recommendations

Based on the findings of the study and conclusions made, the following possible
recommendations are drawn:

 From different prior researches we know that consumers are unable to identify their
preferred automobile in blind. Perception of buyers therefore comes from the extrinsic
marketing communication and suppliers should use different positioning strategies that
put their brand unique in the eyes of the consumer or creates the point of difference.
 Keller (2009) posits that since consumers spend little time or effort on the buying
decision of low involvement products, brand image alone is sufficient to decide
consumer brand choice and determine purchase as consumers are willing to base their
choices merely on familiar brands. Hence, it is recommended that automobile
companies or sellers should embark on intensive campaign to create stronger brand
image.

51
  The effort of companies on the creativity is much impressive. Regarding actively
engaging in their customer pleasure.
 As the finding of the research there are five influential factors having influences on
brand choice of automobile buyers. So the companies and suppliers of automobile must
identify need of their customer related with the influential factors like brand image,
reliability, price of automobile, availability of spare part and build the social
acceptability of the brand through different method.

5.4 Recommendations for Future Research

 The present study was conducted to investigate the underlying factors of automobile
brand choice in Addis Ababa, Ethiopia. Therefore, there is scope for other researchers
to study consumers brand choice decision in other product categories and in the context
of other cities in the country where consumers may have different characteristics.
Similarly, future researcher may use more time, resource and sample size in order to
make all-round assessment in this area. Besides that, this study used the eight variables
that are brand image, reliabilities, price, availability of spare parts, durability, fuel
consumption of automobile, social value and safety of a particular automobile brand,
which explain or influence only 45.6% percent of the variance in buyers brand choice.
Therefore, future researcher may investigate other variables which have a potential to
influence the variance in automobile brand choice.

5.5 limitation of the study

There are insignificant empirical reviews in the country that support the problem of the
thesis. So, to show detail gap and detail analysis is problem of researcher also there is some
constraint for a researcher that‟s related to finance and time because the problem area is
almost new for the scope of a city.

52
Reference

Aaker, D.A. (1991). Managing Brand Equity: Capitalizing on the Value of a Brand

Name, New York: The Free Press.

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56
 Appendix 1
Consumer buying decision survey

Dear Respondents,

My name is Denaneso Gemechu studying Master Program at Addis Ababa University School of
commerce in marketing program. I have designed the following questionnaire for the purpose of
my thesis work, the objective of my study is to” examine factors affect the brand choice
automobile car in Addis Ababa. This questionnaire consists of three sections: section i deals
with the general information, section ii, determinants of automobile buying and section iii,
buying decision.

The information you provide in this survey will be used for the stated purpose and it will be
held confidential. I appreciate your voluntary and valuable participation in this survey. I really
thank you in advance for sharing your valuable experience and time in completing the
questionnaire. Would you please take some fifteen minutes to fill the questionnaire? Please do
not write your name on the questionnaire.
Tel: +251909534815
E-mail Dgdenaso@gmail.com

Sincerely yours,
Denanso Gemechu

57
Part 1 General information

Instruction: please encircle the appropriate number that describes you best.

1. Age: 1, 18- 25 2, 26- 35 3, 36-44 4, 45 and above

2. Gender: 1, Female 2, Male

3. Highest educational level obtained:

1, Primary education 2, Secondary education

3, Diploma 4, First Degree 5, Masters and

above

4. What is your occupation?

1, Private Service Business 2, Government Service University teacher
3, Doctor 4 , lawyer 5, others ----------------
5. What is your income per annum?
1, less than 100 000 2, 101 000 - 200 000
3, 201 000-500 000 4, 500 000 & More than ---------------
6. Which brand car do you have?
1, Toyota 2, Hyundai 5, Mercedes
3, Suzuki 4, lifan
6, Others…………….
7. Did you do a lot of information search for buying a car or you just compared the
car brands you are aware of?
1, I did extensive information search among all available brands
2, I compared only among the brands in my considerations set
3, it was a joint family decision
4, it was my friend decision
5, Others ----------------

58
 Part 2: determinants of automobile buying
Direction: Please indicate your degree of agreement/disagreement with the following
statements by circling the appropriate number. (1-Strongly disagree; 2-Disagree; 3-
Neutral; 4-Agree and 5-Strongly agree) Key: SDA= strongly disagree; DA= Disagree;
N=Neutral; A= Agree, SA= strongly agree.

S.no. Items Strongly Dis Neutral Agree Strongly

Dis agree Agree agree
Brand image
1 I search so many information about the 1 2 3 4 5
car brands that I was not previously
aware of.

2 I consider any lesser-known brand car. 1 2 3 4 5

3 A well-known branded car is always 1 2 3 4 5

better in quality than a lesser known
brand

4 It is important that the brand name 1 2 3 4 5

alongside your desired attributes.

5 I always go for the well known 1 2 3 4 5

branded products.

6 “A lesser-known brand does not 1 2 3 4 5

necessarily mean inferior quality”

7 I feel more secure when I buy 1 2 3 4 5

automobile with a well-known brand

Reliability

8 The quality of automobile car 1 2 3 4 5

influences the brand choice.

59
9 `` Real service `` (purpose) of 1 2 3 4 5
automobile car influence the brand you
choice.

Price

10 Price of automobile car influences the 1 2 3 4 5

brand choice.

11 My monthly income affects my brand 1 2 3 4 5

choice while buying.

12 Low price is one of my priorities 1 2 3 4 5

when making a buying decision.

13 I prefer an automobile brand that is 1 2 3 4 5

reasonably priced.

Availability of spare part

14 Availability of my car spare part 1 2 3 4 5

influences me while buying.

15 Availability of local auto spare parts 1 2 3 4 5

influence my auto decision

Safety

16 “It‟s safe to buy a branded product as 1 2 3 4 5

they always come with better quality”

17 The design of automobile is determine 1 2 3 4 5

the brand choice in the market

18 Medium safety is enough for me to

buy automobile

Fuel consumption

19 Fuel consumption of my car is 1 2 3 4 5

influence me while buying
60
20 Types of fuel consumed by my car 1 2 3 4 5
influence my buying decision
Durability

21 Durability of my car is influence me 1 2 3 4 5

while buying.

22 I buy automobile that is produced as 1 2 3 4 5

per acceptable quality standard

23 I buy automobile that I consider it has a 1 2 3 4 5

consistence quality.

Social value

24 A well-known branded car is a status 1 2 3 4 5

symbol.

25 Using a branded product signifies 1 2 3 4 5

social class

26 Social acceptability of the brand 1 2 3 4 5

influence you while buying this car

27 Logo of a well-known brand is 1 2 3 4 5

important as it tells who you are.

28 I seek any opinion as to which brand 1 2 3 4 5

car to buy from others.

Part 3 buying decision

29 The overall determinants are 1 2 3 4 5

strongly influence the brand choice
of automobile buyers.

61
APPENDIX 2
MEAN OF VARIABLES

b
Variables Entered/Removed

Variables
Model Variables Entered Removed Method

1 Socialvalue,
Branding,
Reliaility, Feul, . Enter
Price, Durability,
a
Sparepart, Safety

a. All requested variables entered.

b. Dependent Variable: buying decision

a
Coefficients

Collinearity Statistics

Model Tolerance VIF

1 Branding .338 2.960

Reliaility .628 1.592

Price .612 1.634

Sparepart .237 4.217

Safety .224 4.457

Feul .471 2.122

Durability .373 2.683

Socialvalue .814 1.228

a. Dependent Variable: buying decision

62
APPENDIX 3
Co linearity Diagnostics( multicolinearity)

Variance Proportions
Dim
ensi Eigenvalu Condition (Consta Sparep Socialvalu
Model on e Index nt) Branding Reliaility Price art Safety Feul Durability e

1 1 8.905 1.000 .00 .00 .00 .00 .00 .00 .00 .00 .00

2 .044 14.290 .00 .00 .16 .07 .01 .01 .00 .00 .04

3 .020 20.887 .00 .00 .24 .01 .00 .00 .00 .00 .67

4 .011 28.119 .00 .00 .56 .83 .00 .00 .00 .00 .09

5 .007 34.824 .21 .00 .00 .07 .00 .11 .17 .02 .08

6 .005 41.358 .17 .10 .01 .01 .23 .00 .09 .10 .03

7 .003 52.329 .57 .19 .00 .00 .03 .17 .18 .10 .01

8 .003 56.496 .00 .38 .01 .00 .03 .09 .01 .76 .08

9 .002 77.008 .05 .32 .01 .01 .70 .62 .55 .01 .00

a. Dependent Variable: buying decision

a
Residuals Statistics

Minimum Maximum Mean Std. Deviation N

Predicted Value 1.99 5.30 4.25 .568 382

Residual -1.572 1.323 .000 .607 382

Std. Predicted Value -3.977 1.853 .000 1.000 382

Std. Residual -2.564 2.157 .000 .989 382

a. Dependent Variable: buying decision

63
APPENDIX 4
Charts (normality test)

64
65
66
 Descriptives

Descriptive Statistics

N Minimum Maximum Mean Std. Deviation Skewness Kurtosis

Statis Std.
Statistic Statistic Statistic Statistic Statistic tic Error Statistic Std. Error

Branding 382 2.67 5.00 4.2483 .42034 -.554 .125 -.061 .249

Reliaility -
382 1.00 5.00 4.1387 .76100 .125 3.414 .249
1.496

Price 382 1.75 5.00 3.8658 .61250 -.363 .125 1.074 .249

Sparepart -
382 2.00 5.00 4.4856 .51911 .125 3.510 .249
1.428

Safety 382 2.67 5.00 4.3037 .53432 -.842 .125 .814 .249

Feul 382 3.50 5.00 4.6361 .41438 -.683 .125 -.808 .249

Durability 382 3.00 5.00 4.3613 .44247 -.737 .125 .316 .249

Socialvalue 382 2.00 4.80 3.7906 .59984 -.659 .125 .302 .249

Valid N (listwise) 382

APPENDIX 5
Reliability

Scale: ALL VARIABLES

Case Processing Summary

N %

Cases Valid 382 100.0

a
Excluded 0 .0

Total 382 100.0

a. Listwise deletion based on all variables in the

procedure.

67
Reliability Statistics
Cronbach's Alpha
Based on
Standardized
Cronbach's Alpha Items N of Items

.741 .780 8

Item Statistics

Mean Std. Deviation N

Branding 4.2483 .42034 382

Reliaility 4.1387 .76100 382

Price 3.8658 .61250 382

Sparepart 4.4856 .51911 382

Safety 4.3037 .53432 382

Feul 4.6361 .41438 382

Durability 4.3613 .44247 382

Socialvalue 3.7906 .59984 382

Item-Total Statistics

Scale Mean if Item Scale Variance if Corrected Item- Squared Multiple Cronbach's Alpha
Deleted Item Deleted Total Correlation Correlation if Item Deleted

Branding 29.5818 5.460 .626 .662 .689

Reliaility 29.6913 5.214 .309 .372 .756

Price 29.9642 5.483 .352 .388 .733

Sparepart 29.3445 5.218 .582 .763 .687

Safety 29.5264 5.213 .561 .776 .690

Feul 29.1939 5.742 .480 .529 .711

Durability 29.4688 5.415 .610 .627 .689

Socialvalue 30.0395 5.874 .218 .186 .759

68
Scale Statistics
Mean Variance Std. Deviation N of Items

33.8301 6.867 2.62057 8

Hotelling's T-Squared Test

Hotelling's T-
Squared F df1 df2 Sig

916.176 128.821 7 375 .000

Intraclass Correlation Coefficient

95% Confidence Interval F Test with True Value 0

Intraclass
a
Correlation Lower Bound Upper Bound Value df1 df2 Sig
b
Single Measures .264 .226 .305 3.865 381 2667 .000
c
Average Measures .741 .700 .779 3.865 381 2667 .000

Two-way mixed effects model where people effects are random and measures effects are fixed.

a. Type C intraclass correlation coefficients using a consistency definition-the between-measure variance is excluded from the
denominator variance.

b. The estimator is the same, whether the interaction effect is present or not.

c. This estimate is computed assuming the interaction effect is absent, because it is not estimable otherwise.

69
APPENDIX 6
Regression

b
Variables Entered/Removed

Variables
Model Variables Entered Removed Method

1 Socialvalue,
Branding,
Reliaility, Feul, . Enter
Price, Durability,
a
Sparepart, Safety

a. All requested variables entered.

b. Dependent Variable: buying decision

b
Model Summary

Std. Error of the

Model R R Square Adjusted R Square Estimate
a
1 .684 .467 .456 .613

a. Predictors: (Constant), Socialvalue, Branding, Reliaility, Feul, Price,

Durability, Sparepart, Safety

b. Dependent Variable: buying decision

b
ANOVA

Model Sum of Squares df Mean Square F Sig.

a
1 Regression 123.096 8 15.387 40.914 .000

Residual 140.278 373 .376

Total 263.374 381

a. Predictors: (Constant), Socialvalue, Branding, Reliaility, Feul, Price, Durability, Sparepart, Safety

b. Dependent Variable: buying decision

70
Coefficientsa
Unstandardized Standardized
Coefficients Coefficients 95% Confidence Interval for B

Model B Std. Error Beta t Sig. Lower Bound Upper Bound

1 (Constant) -.484 .446 -1.086 .278 -1.361 .393

Branding 1.063 .129 .537 8.264 .000 .810 1.315

Reliaility .199 .052 .183 3.830 .000 .097 .302

Price .338 .066 .249 5.148 .000 .209 .467

Sparepart .295 .124 .184 2.374 .018 .051 .539

Safety -.765 .124 -.492 -6.163 .000 -1.009 -.521

Feul -.411 .110 -.205 -3.719 .000 -.628 -.194

Durability .163 .116 .087 1.398 .163 -.066 .391

Socialvalue .330 .058 .238 5.693 .000 .216 .445

a. Dependent Variable: buying decision

a
Residuals Statistics

Minimum Maximum Mean Std. Deviation N

Predicted Value 1.99 5.30 4.25 .568 382

Residual -1.572 1.323 .000 .607 382

Std. Predicted Value -3.977 1.853 .000 1.000 382

Std. Residual -2.564 2.157 .000 .989 382

a. Dependent Variable: buying decision

71
APPENDIX 7
Correlations
Sparepar Socialv buying
Branding Reliaility Price t Safety Feul Durability alue decision

Branding Pearson ** * ** ** ** ** **
1 .162 .120 .627 .743 .528 .711 .018 .305
Correlation

Sig. (2-tailed) .001 .019 .000 .000 .000 .000 .721 .000

N 382 382 382 382 382 382 382 382 382

Reliaility Pearson ** ** ** **
.162 1 .587 .040 .047 .052 .081 .292 .466
Correlation

Sig. (2-tailed) .001 .000 .436 .362 .308 .115 .000 .000

N 382 382 382 382 382 382 382 382 382

Price Pearson * ** ** **
.120 .587 1 .030 .041 .095 .087 .352 .478
Correlation

Sig. (2-tailed) .019 .000 .559 .429 .062 .088 .000 .000

N 382 382 382 382 382 382 382 382 382

Sparepart Pearson ** ** ** **
.627 .040 .030 1 .795 .674 .663 .033 .072
Correlation

Sig. (2-tailed) .000 .436 .559 .000 .000 .000 .517 .159

N 382 382 382 382 382 382 382 382 382

Safety Pearson ** ** ** **
.743 .047 .041 .795 1 .461 .728 -.029 .034
Correlation

Sig. (2-tailed) .000 .362 .429 .000 .000 .000 .576 .503

N 382 382 382 382 382 382 382 382 382

Feul Pearson ** ** ** **
.528 .052 .095 .674 .461 1 .464 .050 .061
Correlation

Sig. (2-tailed) .000 .308 .062 .000 .000 .000 .334 .231

N 382 382 382 382 382 382 382 382 382

Durability Pearson ** ** ** ** ** **
.711 .081 .087 .663 .728 .464 1 .136 .207
Correlation

Sig. (2-tailed) .000 .115 .088 .000 .000 .000 .008 .000

N 382 382 382 382 382 382 382 382 382

Socialvalue Pearson ** ** ** **
.018 .292 .352 .033 -.029 .050 .136 1 .411
Correlation

72
 Sig. (2-tailed) .721 .000 .000 .517 .576 .334 .008 .000

N 382 382 382 382 382 382 382 382 382

buying Pearson ** ** ** ** **
.305 .466 .478 .072 .034 .061 .207 .411 1
decision Correlation

Sig. (2-tailed) .000 .000 .000 .159 .503 .231 .000 .000

N 382 382 382 382 382 382 382 382 382

**. Correlation is significant at the 0.01 level (2-

tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

Correlations

Correlations

Brandin
g Reliaility Price Sparepart Safety Feul Durability Socialvalue
** * ** ** ** **
Branding Pearson Correlation 1 .162 .120 .627 .743 .528 .711 .018

Sig. (2-tailed) .001 .019 .000 .000 .000 .000 .721

N 382 382 382 382 382 382 382 382

** ** **
Reliaility Pearson Correlation .162 1 .587 .040 .047 .052 .081 .292

Sig. (2-tailed) .001 .000 .436 .362 .308 .115 .000

N 382 382 382 382 382 382 382 382

* ** **
Price Pearson Correlation .120 .587 1 .030 .041 .095 .087 .352

Sig. (2-tailed) .019 .000 .559 .429 .062 .088 .000

N 382 382 382 382 382 382 382 382

** ** ** **
Sparepart Pearson Correlation .627 .040 .030 1 .795 .674 .663 .033

Sig. (2-tailed) .000 .436 .559 .000 .000 .000 .517

N 382 382 382 382 382 382 382 382

** ** ** **
Safety Pearson Correlation .743 .047 .041 .795 1 .461 .728 -.029

Sig. (2-tailed) .000 .362 .429 .000 .000 .000 .576

N 382 382 382 382 382 382 382 382

** ** ** **
Feul Pearson Correlation .528 .052 .095 .674 .461 1 .464 .050

73
 Sig. (2-tailed) .000 .308 .062 .000 .000 .000 .334

N 382 382 382 382 382 382 382 382

** ** ** ** **
Durability Pearson Correlation .711 .081 .087 .663 .728 .464 1 .136

Sig. (2-tailed) .000 .115 .088 .000 .000 .000 .008

N 382 382 382 382 382 382 382 382

** ** **
Socialvalu Pearson Correlation .018 .292 .352 .033 -.029 .050 .136 1
e Sig. (2-tailed) .721 .000 .000 .517 .576 .334 .008

N 382 382 382 382 382 382 382 382

**. Correlation is significant at the 0.01 level (2-

tailed).

*. Correlation is significant at the 0.05 level (2-

tailed).

74