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1. Introduction
Smartphones are a combination of personal device assistants and mobile phones that
use advanced operating systems and permit users to install new applications, be
constantly connected to the internet, and provide multifarious functionalities of both.
Smartphones are increasingly entwined in peoples everyday activities as it makes
their lives easier access the internet 24 hours a day, seven days a week, and 365 days a
year anywhere. The top smartphones that consumers own include the iPhone 5, Galaxy
S III, and HTC One X, because they are able to transfer more mobile data than the iPad
or Galaxy Tab 2 10.1.
Mobile phones have become an inseparable part of everyday life and a majority of
people carry them all the time (Smura et al., 2009). Heavy mobile phone users possess a
higher level of knowledge, have more social participation, maintain extensive
interpersonal networks, and have contact with people not only within the social system
but also outside it (Suki and Suki, 2007). Consumers do not view smartphones just as
devices for calling and texting, instead as multi-use devices for gaming, socializing,
and downloading applications which results in a radical shift in behaviour patterns
(Shin, 2012), lifestyle and status.
Forest Interactive (2013) stated that IE Market Research reported Malaysia will
have 41.9 million mobile subscribers in 2013 with 17.3 million (41.4 per cent)
subscribing to Maxis, 13.8 million (33.0 per cent) to Celcom, and 10.7 million (25.6 per
cent) to DiGi. Malaysia is the third most mobile payment-ready nation in Southeast
Asia after Singapore and Philippines, as reported by Mastercard (2011). The increase
in use of smartphones among consumers including students has made it unlimited
consumer demands. Hence, this study aims to examine structural relationships of
product features, brand name, product price, and social influence with demand for
smartphones among Malaysian students.
The paper is organized as follows: the next section reviews prior studies on the
relationships between product features, brand name, product price, and social
influence with demand for smartphones among users. The next section, methodology,
describes the data, variables, and analysis approach. In the results section, model
results are presented. The last section recapitulates the key ndings and provides a
number of practical implications and future directions.
2. Literature review
Factors affecting users demand for smartphones are complex and cannot be
determined using a single factor or a simple reason (Chow et al., 2012) and it varies
among individuals. This section emphasizes product features, brand name, product
price, and social influences.
2.1 Product features
Product features are related to the attributes of a product that help to meet the
satisfaction level of consumers needs and wants through owning the product, use, and
utilization of the product (Kotler and Armstrong, 2007). smartphones like iPhone and
BlackBerry have larger and higher resolution screens and offer consumers a wide
array of features, including mobile web browsing, thousands of applications, e-mail,
instant messaging, picture messaging, video, and audio playback, global positioning
system (GPS), games, a video camera, picture, and video editing (Persaud and Azhar,
2012). The most popular operating systems for mobile phones are Symbian, RIM
Blackberry, Apple iPhone, Windows mobile, Google Android, and Linux. Googles
Android operating system has propelled Samsung to the top of global smartphone
sales in 2011 in Southeast Asia (GfK Retail and Technology, 2011). Users largely value
the smartphone features such as full-screen viewing for images and video and larger
text and buttons with stylish design according to their preferences. Design was found
to be the most important determinant of consumer response and new product sales
success (Bloch, 1995; Crilly et al., 2004; Mohd Azam et al., 2012). Usability is also
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affecting consumer choice of the mobile phone (Mack and Sharples, 2009). Hence, the
study proposed the following hypothesis:
H1. Product features significantly influence students demand for smartphones.
238
buy a smartphone if it helped them to fit in with their social group. Therefore, the
following hypothesis is proposed:
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3. Methodology
Data were collected from pre-screened university students studying at the pubic higher
learning institution in Federal Territory of Labuan, Malaysia who have experience in
using and owning smartphones via the self-administered questionnaire, a method of
quantitative research employing convenience sampling techniques, from 1 to 30
September 2012. Initially, 400 questionnaires were administered, however a total of
320 unique and usable responses were successfully collected for a response rate of
80 per cent. The structured close-ended questionnaire was designed in line with this
studys research objective of examining structural relationships of product features,
brand name, product price and social influence with demand for smartphones among
Malaysian students. The questionnaire comprised three sections. Section A consisted
of demographic profile of respondents, Section B requested the respondents to provide
responses on their personal experiences using smartphones and Section C examined
the factors affecting users demand for smartphones. In total, 17 items (described in
Appendix A), were used to measure the four independent variables: product features,
brand name, product price, and social influence, and five questions were used to
measure the dependent variable: demand for smartphones on a five-point Likert scale
ranging from 1 strongly disagree to 5 strongly agree.
Survey instruments were adapted from the following sources: product features
(Market Analysis and Consumer Research Organization, 2004), brand name (Rio et al.,
2001), product price (Cheong and Park, 2005), social influences (Tian et al., 2009), and
demand for smartphones (Park and Chen, 2007; Venkatesh et al., 2003). Completed
questionnaires were keyed in the computer program Statistical Package for Social
Sciencesversion 20.0 to process and analyse the data in the form of descriptives such as
frequencies, mean, standard deviation, skew, and kurtosis. Next, a graphical model
development known as path diagram was drawn using the structural equation
modeling (SEM) technique via AMOS 20.0 computer program which has the ability to
ensure the consistency of the model with the data and to estimate effects among
constructs.
Product
Features
H1
Brand Name
H2
H3
Price
Demand for
Smartphones
H4
Social
Influence
Figure 1.
Theoretical framework
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4. Data analysis
Table I displays the demographic profile of the respondents. A total of 320 participants
were included in the final sample, out of which more than half of the respondents were
female (58.8 per cent), the remainder (41.2 per cent) were male. They were mostly 18-20
years old (90.3 per cent), and nearly half held STPM certification (49.7 per cent).
240
Table I.
Demographic profile
of respondents
Gender
Male
Female
Age (years old)
18-20
21-23
424
Education level
STPM
Matriculation
Diploma
Frequency
132
188
41.2
58.8
289
29
2
90.3
9.1
0.6
159
122
39
49.7
38.1
12.2
Frequency
98
45
170
7
30.6
14.1
53.1
2.2
197
82
26
8
7
61.6
25.6
8.1
2.5
2.2
158
79
4
49
14
16
49.4
24.7
1.3
15.3
4.4
4.9
111
167
20
12
10
34.7
52.2
6.3
3.8
3.0
75
93
57
95
23.4
29.1
17.8
29.7
even if the price is higher, on their expected factor, indicating a relatively high level of
construct reliability (Hair et al., 2010).
4.5 Convergent validity
The standardized loading items shown in Table III were considered significant as they
surpassed the cut-off value of 0.50 (Hair et al., 2010). The average variances extracted
(AVE) of latent constructs, range from 0.765 to 0.809, and exceed the recommended
threshold value of 0.50 (Hair et al., 2010), which meant that more than one-half of the
variances observed in the items were accounted for by their hypothesized constructs.
Hence, the current data have good convergent validity.
4.6 Discriminant validity
Discriminant validity was checked by comparing the shared variances between factors
with the square root of AVE for each construct. Table IV shows that all shared
variances of one construct with other constructs were lower than the square root of
AVE of the individual factors, confirming adequate discriminant validity. Hence, each
construct was statistically different from the others.
The results described in Table IV reveal that there is a signicant positive correlation
between all variables at the 0.01 level. Product features has the strongest correlation
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Table II.
Experience using
smartphone
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Constructs
Items
Standardized
loadings
Cronbachs
a
Composite
reliability
Average variance
extracted
Product features
PF1
PF2
PF3
PF4
PF5
BD1
BD2
BD3
BD4
PR2
PR3
PR4
SI1
SI2
SI3
SI4
DD1
DD2
DD3
DD4
DD5
0.834
0.891
0.877
0.874
0.835
0.753
0.843
0.824
0.784
0.748
0.573
0.784
0.696
0.720
0.780
0.662
0.593
0.771
0.717
0.817
0.740
0.939
0.826
0. 821
0.891
0.834
0.747
0.748
0.853
0.810
0.783
0.874
0.807
0.855
0.847
0.811
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Brand name
Product price
Social influence
Demand for
Smartphone
Table III.
Reliability and
validity analysis
with demand for smartphones (r 0.639, po0.01), followed by brand name (r 0.633,
po0.01). Hence, there is no multicolinearity problem in this research. All the item
ranges are negatively skewed from 0.094 to 0.590, however, still beneath 72.0.
The kurtosis values range from 0.583 to 0.202, well below the cut-off value of 710.
Both the skewness and kurtosis are less than the threshold value, thus ensuring
that the data used in the study is normally distributed. Means for all constructs
range from 3.235 to 3.459 on a scale of 1 strongly disagree to 5 strongly agree.
These means demonstrated that most of the respondents had a positive demand
for smartphones.
Table IV.
Inter-construct
correlations
1 Product features
2 Brand name
3 Product price
4 Social influence
5 Demand for smartphone
Mean
Standard deviation
Skewness
Kurtosis
0.906
0.811**
0.639**
0.440**
0.639**
3.53
1.10
0.590
0.583
0.864
0.642**
0.395**
0.633**
3.30
1.02
0.466
0.458
0.900
0.351**
0.500**
3.29
0.848
0.323
0.202
0.898
0.542**
3.12
0.796
0.094
0.059
0.900
3.27
0.764
0.141
0.141
Notes: **Correlation is significant at the 0.01 level (two-tailed). Diagonal elements show the average
variance extracted; off-diagonal elements show the shared variance
Demand for
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5. Discussion
Empirical analysis across a sample of 320 respondents via SEM technique was
executed in examining structural relationships of product features, brand name,
product price and social influence with demand for smartphones among Malaysian
students. Results divulged that brand name and social influence affected the positive
demand for smartphones among Malaysian students, thus supporting H2 and H4.
The first is confirmed as the most influential factor, followed by the latter. This is
according to standardized path coefficients and their statistical signicance as shown in
Table VI and Figure 2.
As expected, brand name was found to have a significant effect on the demand for
smartphones among Malaysian students. This portends that users who are particular
about brand names are more likely to have positive demand towards buying and using
smartphones. The ndings are consistent with preceding discovery by Khasawneh and
Hasouneh (2010). Most of the users are likely to select smartphones that are
internationally recognized, branded, and trustworthy. Besides that, they will only buy
their favourite brands of smartphone. For example, Samsung and iPhone are the most
preferred brands of smartphones.
Further investigation of the study uncovered that the increasing demand for
smartphones among Malaysian students is also affected by social influence. This in
Recommended values
Model values
w2
df
w2/df
CFI
GFI
NFI
RMSEA
PNFI
PCFI
n/a
396.151
n/a
170
o3.0
2.330
40.9
0.950
40.9
0.901
40.9
0.916
o0.08
0.065
40.5
0.741
40.5
0.769
Table V.
Goodness-of-fit indices
for structural model
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1
e1
1
e2
1
e3
1
e4
244
1
e5
PF1
PF2
PF3
Product
Features
PF4
PF5
1=0.054
1
e6
1
e7
1
e8
1
e9
BD1
1
BD2
BD3
R 2=0.65
DD3
1
1
e11
1
e12
1
e13
3=0.006
PR2
PR4
1
e15
Figure 2.
The results of
structural model
1
e16
1
e17
1
e19
1
e20
1
e21
1
e22
Price
PR3
e14
DD4
DD5
e18
DD2
Demand of
Smartphone
BD4
DD1
z1
2=0.573
Brand
Name
4=0.317
SI1
1
SI2
SI3
Social
Influence
SI4
turn implies that students who have strong social influence from friends and family
members tend to have positive demand for smartphones, signifying their decision
making and use rates are mostly influenced by people around them. This is in
accordance with findings by Goldman (2010), Park and Chen (2007) and Rashotte
(2007). For example, when users want to purchase a smartphone, they will seek
recommendations from their friends and family members who have a lot of experience
using and owning smartphones in order to make a more informed choice of
smartphone and benefit from reduced perceived risk. They also execute viral
H1
H2
H3
H4
Path
Estimate
SE
CR
0.054
0.573*
0.006
0.317*
0.111
0.147
0.095
0.061
0.367
3.476
0.063
5.165
0.714
0.000
0.950
0.000
Table VI.
Relationship with demand
for smartphone
Note: *po0.05
Demand for
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empirical and actionable insights about the determinants of demand for smartphones
and how to improve smartphone user experience and plan directions in the smartphone
market.
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Appendix
Product features
PF1 I like smartphones design
PF2 Smartphone has more applications than basic mobile phone
PF3 Smartphone provides high quality of games
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PF4 Smartphones internet accessibility is speedier than basic mobile phone
PF5 I use smartphone due to its operation system (Apple iPhone, RIM Blackberry, Google Android
or others)
Brand name
BD1 I prefer to buy an internationally recognized smartphone
BD2 I prefer to buy a trustworthy brand of smartphone
BD3 I will only buy my favourite brand of smartphone
BD4 Brand name is a major factor that influences my decision towards buying a smartphone
Product price
PR1 I am willing to buy a smartphone even though the price is higher
PR2 I will only buy a smartphone during a price reduction period
PR3 I think that using smartphone is expensive overall
PR4 Price is my main consideration when deciding whether to buy a smartphone
Social influence
SI1
Almost all of my friends and family members use smartphones
SI2
My friends and family members think that we should all use smartphones
SI3
My friends and family members influenced me to buy smartphone
SI4
People around me have encouraged me to use smartphone
Demand for smartphone
DD1 I intend to continue using smartphone although there is new mobile phone in the market
DD2 I intend to increase my use of the smartphone in the future
DD3 I intend to use smartphone for e-commerce
DD4 I will find more details about smartphones
Table AI.
Measurement instruments DD5 I intend to recommend others to use smartphone