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Chapter I

Introduction

This chapter of the study explain the introduction of the study. It includes the background of

the study, statement of the problem, theoretical background, and conceptual framework, scope of

the study, significance of the study and the definition of terms.

Background of the Study

The development of digital marketing has immensely altered the marketing scene. It has

given all organizations a chance to market and advertise their brand on a global platform,

majorly growing their possible target audience (Stafford, 2022). As a result, businesses are

investing heavily in digital advertising to reach and attract their target customers. Digital

advertising is particularly appealing to younger generations, such as students, who are highly

tech-savvy and spend a considerable amount of time online (Bakker & Schouten, 2019). In the

highly competitive market and technological advancement with the usage of the internet, it has

shifted the traditional market to digital marketing strategies. Digital marketing grabs a wide area,

and in the highly competitive market, it involves exploring business models using digital

technologies, which reduce costs and expand businesses globally (Kaur et al. 2018).

Among the various consumer groups targeted by digital advertising, students have

emerged as a crucial market segment for businesses. Students are not only the future consumers

but also have significant purchasing power and influence on the purchasing decisions of their

family and friends. Therefore, understanding the impact of digital advertising on students'

purchasing behavior is crucial for businesses to devise effective marketing strategies. Previous

studies have investigated the impact of digital advertising on the purchasing behavior of students.
For example, Khechine et al. (2019) found that digital advertising positively influenced the

purchasing behavior of university students in Tunisia. Similarly, Lee and Hong (2016) found that

mobile advertising had a significant impact on the purchase behavior of college students.

Furthermore, Yang et al. (2018) found that social media advertising positively influenced the

purchase intentions of college students.

There is a growing body of research that has investigated the impact of digital advertising

on consumer behavior, with some studies focusing specifically on the student population (Chung

& Pysarchik, 2017; Lee et al., 2019). However, there is still much to be learned about how

different types of digital advertisements influence students' purchasing behavior.

Understanding the relationship between digital advertising and student purchasing

behavior is of great importance to businesses that target this demographic as well as to

policymakers who seek to regulate the digital advertising industry. By identifying the factors that

influence the effectiveness of digital advertising in shaping student purchasing behavior,

businesses can develop more effective advertising strategies that resonate with their target

audience. However, there is still a need for further research to explore the specific factors that

influence the impact of digital advertising on students' purchasing behavior.

The primary purpose of the digital market is to understand the customers’ needs and

allow them to mix the product with digital media. The digital market allows customers to keep an

eye on the information provided by the organization related to the product; it ensures

transparency (Sathya, 2015).

Digital marketing provides an opportunity for the customers to have a look at the

information about the product provided by the company and be able to make comparisons
accordingly so that they can enjoy the right to choose and can place an order at any time, 24/7, at

any place. With the updated technologies and an increase in the usage of internet engagement,

the interconnectivity of consumers is increasing day by day, because of which consumer

behavior changes and organizations should understand the behavior of a consumer (Tandon,

Nidhi, Kaur, Simran, 2018).

Therefore, this study aims to investigate how digital advertisements affect the purchasing

behavior of students. The study will analyze how digital advertisements affect different stages of

the consumer decision-making process, including awareness, consideration, purchase, and post-

purchase evaluation. Additionally, the study will examine how factors such as age, gender, and

income level may influence the impact of digital advertisements on consumer behavior.

By examining the impact of digital advertising on students' purchasing behavior, this

study will contribute to the existing body of knowledge on consumer behavior and digital

advertising. The findings of this study will be beneficial to businesses that target students as their

primary audience. The study will provide insights into how to create effective digital advertising

strategies to attract and retain student customers.

Statement of the Problem

This study aims to explore how Digital Advertisement impacts the purchasing decisions of

Business Administration students at Carlos Hilado Memorial State University-Binalbagan. The

study will analyze the influence of Digital Advertisement on consumer behavior, considering:

The demographics such as:


1. Age

2. Gender

3. Year Level

Specifically, the study seeks to address the following questions:

1. What is the impact of online customer reviews on purchase desicions, considering

various demographics, needs, and desires?

2. How does online customer reviews concerning factors like informativeness,

customization, invasiveness, security, and satisfaction?

3. What factors do consumers consider when making purchasing decisions?

4. Is there a significant correlation between the online customer reviews and demographic

factors, needs, and desires?

In summary, this study aims to understand the role of Online Customer Reviews on Purchase

Decisoins among Business Administration students and identify key factors influencing their

purchasing decisions.

Hypotheses

Null Hypothesis: There is no notable correlation between the impact of online customer reviews

on consumer purchasing behavior and any variations in purchase decision-making when

considered collectively and categorized based on demographics, needs, and desires.


Alternative Hypothesis: There exists a significant relationship between the online customer

reviews and the decision-making process when analyzed collectively and categorized according

to demographics, needs, and desires.

Theoretical Framework

The Stimulus-Response Theory, also known as the S-R Theory, offers valuable insights

into how digital advertisements influence consumer buying behavior. According to this theory,

human behavior is shaped by the association between a stimulus and the corresponding response.

In the context of digital advertising, the stimulus is the advertisement itself, which serves as a

stimulus that elicits a desired response from students, such as making a purchase. The model

suggests that marketers can use various stimuli, such as advertisements, promotions, and sales, to

influence consumer behavior. The stimulus-response model is the starting point for

understanding buyer behavior.

Marketing and environmental stimuli enter the buyer’s consciousness. The buyer’s

characteristics and decision process lead to certain purchase decisions. The marketer’s task is to

understand what happens in the buyer’s consciousness between the arrival of outside stimuli and

the buyer’s purchase decision.

For consumers, perception and attention play crucial roles in determining their response

to digital advertisements. With countless ads vying for their attention, consumers' perception and

attention are influenced by factors like the ad's design, placement, relevance, and their own level

of involvement with the product category. Once a consumer perceives an ad, cognitive

processing begins. They interpret the message, evaluate the value proposition, and assess the ad's
relevance to their needs and desires. This cognitive processing involves considering product

features, comparing prices, and drawing upon previous experiences.

Emotional responses are another important aspect of consumer behavior. Digital

advertisements often aim to elicit specific emotions, such as happiness, excitement, trust, or fear.

Emotional reactions triggered by the ad can shape the consumer's attitude towards the brand or

product, influencing their buying behavior.

Ultimately, the behavioral response is the culmination of the stimulus-response chain.

The digital advertisement has an impact on the consumer's decision and action regarding the

purchase of the advertised good or service. This can encompass brand choice, purchase intention,

timing of the purchase, or even the decision not to make a purchase at all.

While the Stimulus-Response Theory provides a general framework for understanding

consumer behavior, it's important to acknowledge that additional factors contribute to the

complexity of consumer decision-making. Personal characteristics, social influences, cultural

norms, and previous experiences all play significant roles alongside the stimulus itself.

By applying the insights from the Stimulus-Response Theory, marketers can gain a better

understanding of how digital advertisements influence consumer behavior. They can optimize

their campaigns by designing ads that effectively capture attention, engage cognitive processes,

and evoke desired emotional responses. This understanding can lead to more effective strategies

that resonate with consumers and drive desired outcomes in terms of buying behavior.

Conceptual Framework

Independent Variable: Exposure to Digital Advertisements


This pertains to the extent to which students are exposed to various forms of online customer

reviews in shops such as facebook,shopee, lazada,tiktok, amazon and shein. Factors such as the

frequency, duration, and types of online customer reviews encountered by students are

considered in this variable.

Dependent Variable: Student Buying Behavior

This encompasses the actual purchasing actions of students, including the frequency of their

purchases, the monetary value spent on purchases, and the specific products or services acquired.

Measurement of this variable can be obtained through self-reported surveys, purchase records, or

other reliable means.

Independent Variable Dependent Variable

Demographics (age, Attitude towards

sex, year level) Online Shopping

Website Quality Purchasing Online Purchase

(facebook,shopee, Decisions
Decision Making
lazada,tiktok,
Intention to Shop
amazon and shein)
Online

Significance of the Study


This research aims to assess the Effectiveness of Online Customer Reviews on Purchase

Decision among Business Administration Students at Carlos Hilado Memorial State University,

Binalbagan. It intends to achieve several objectives:

1. Students: The study seeks to raise awareness among students about how digital

advertising influences their purchasing decisions.

2. School: It aims to provide insights for the institution to understand the digital

advertising's role in students' purchasing behavior.

3. Marketers: This research is valuable for marketers as it endeavors to assess the

effectiveness of product advertising and its influence on consumer buying behavior.

4. Researchers: The study aims to contribute to existing literature by providing insights for

future researchers interested in delving into the influence of digital advertising on

consumer behavior.

5. Future Researchers: It intends to offer comprehensive information for future researchers

to build upon and apply to similar research topics.

Scope and Limitation of the Study

This study focuses solely on the responses of BSBA students regarding their buying behavior

influenced by online reviews. It specifically analyzes the effectiveness of online customer

reviews on purchase decision. Geographically, the study is limited to consumers surveyed at

Carlos Hilado Memorial State University-Binalbagan Campus.

Definitions and Terms


To ensure clarity in comprehending the study, the subsequent terms are defined both

conceptually and operationally:

Business Administration Students

Conceptually, they learn business principles while strengthening their leadership skills,

and they have a flexible curriculum that allows them to pursue a variety of careers (Gurbuz,

2020).

Operationally, Business Administration Students are individuals actively enrolled in a

business administration program at Carlos Hilado Memorial State University-Binalbagan. These

students will serve as the respondents for the study, providing data and insights relevant to the

research objectives.

Consumer Buying Behavior

Conceptually, it refers to the buying behavior of individuals and households that buy

goods for personal use and consumption (Philip Kotler, Gary Armstrong, 2012).

Operationally, it refers to a measurable and observable description of behaviors, actions,

or indicators that can be utilized to identify and understand how consumers make purchasing

decisions.

Customization

Conceptually, it refers to the action of altering a product or service to suit a person’s or

company’s preferences or requirements. (Joe, 2020)

Operationally,it pertains to the capacity of a company to customize its operations and

procedures to fulfill the distinct needs and demands of individual customers.


Demographic

Conceptually, the description of a population according to selected characteristics such as

age, gender, ethnicity, income, and occupation (American Marketing Association, 2021)

Operationally, it pertains to a collection of quantifiable and observable attributes or

factors utilized for categorizing and comprehending populations or cohorts of individuals.

Online Customer Review

Conceptually, Online Customer Review refers to a user-generated evaluation or critique

of products, services, or experiences, typically posted on digital platforms accessible via the

internet. These reviews encompass written feedback, ratings, and occasionally multimedia

elements like images or videos. Online reviews serve as a form of electronic word-of-mouth

communication, enabling individuals to share their subjective opinions and experiences with

others in an online setting (Cheung & Thadani, 2012; Filieri, 2015; Xie et al., 2011).

Operationally, Online reviews are identified from various digital platforms such as e-

commerce websites

Informativeness

Conceptually, communicative success depends on the quantity and quality of information

conveyed by a speaker and the efficiency of transmission. (Nicholas & Brookshire, 1993)

Operationally, In practical terms, the quantity and quality of information found within a

website.

Invasiveness
Conceptually, in the context of digital advertising, invasiveness refers to the degree to

which an advertisement disrupts the user's online experience and privacy. Invasive digital

advertisements are those that interfere with the user's ability to browse the internet or use an app

comfortably, often by blocking content or causing unexpected interruptions (Böck et al., 2016).

Operationally, the impact and disruption caused by aonliine customer review on a

consumer's online experience are typically measured by factors such as how often they appear,

where they're placed, how intrusive they are, and how relevant they are to the user.

Satisfaction

Conceptually, it is "a person’s feeling of pleasure or disappointment resulting from

comparing a product’s perceived performance (or outcome) in relation to his or her expectations

(Kotler and Keller, 2016).

Operationally, anything that provides satisfaction, enjoyment, or a sense of fulfillment.

Security

Conceptually, it refers to "a state of being free from danger or threat" (Crawford and

Hutchinson 2016).

Operationally, this entails putting into action methods to secure consumer information,

prevent fraudulent behavior, and guarantee a secure and reliable online advertising environment.
Chapter II

Review of Related Literature

This chapter presents a Review of Related Literature that will serve as a guide to

distinguish the Consumer Buying Behavior of BSBA students of CHMSU-Binalbagan. This

chapter also represents both local and foreign sources that are related to the study. The purpose

of this chapter is to review related literature on how Digital Advertisement Influence Consumer

Buying Behavior among BSBA students at CHMSU-Binalbagan.

Foreign Literature

Adnan (2014) established that perceived advantages and product awareness had a

positive impact on consumer attitudes and buying behavior in Pakistan. In Kenya, a previous

study conducted in Nairobi County revealed that some of the reasons for the adoption of online

shopping include time savings, easy comparison of alternative products, fairer prices of online

goods, expert or user reviews of products, and access to a market without borders (Ngugi,

2014).

According to a study by Ming Shen, Effects of Online Shopping Attitudes, Subjective

Norms, and Control Beliefs on Online Intentions: A Test of the Theory of Planned Behavior,
the author found that the attitude toward online shopping, more specifically their behavioral

beliefs, had a significant effect on their shopping behavior.

Control behavior was found to have a stronger influence than that of consumer

shopping attitude on their shopping intentions, and subjective norms were found to have no

influence on their online shopping intentions. Online shopping experience is negatively related

to perceptions of products and financial risks associated with online shopping, regardless of

product category (Dai, Forsythe, & Kwon, 2014). Perceived risks associated with online

shopping negatively influence online purchase intention and behavior (Dai et al., 2014). The

greater the perceived risk, the more a consumer may choose a traditional retailer for the

purchase of the product.

The Concept of Online Advertising

Online advertisement is a promotional tool that uses the internet and the World Wide

Web to deliver marketing messages to attract customers (Tutaj, 2012). Ha (2017) defines online

advertising as deliberate messages placed on third-party web sites, including search engines

and directories available through internet access. The author adds that online advertising can be

categorized into a variety of functions, including creating awareness, attractiveness, a visual

image, and slogans. Online advertising is a form of promotion that uses the internet and the

World Wide Web to deliver marketing messages to attract customers. Examples of online

advertising include contextual ads on search engine results pages, banner ads, blogs, rich media

ads, particular networking advertising, interstitial ads, online classified advertising, advertising

networks, and e-mail marketing, including e-mail spam, etc.


Athma and Joseph (2018) studied the effectiveness of internet advertising on consumer

buying behavior towards mobile phone users using the internet, using Vengeri, a town in

Kozhikode Municipal Corporation of Kerala, as a case study. Fifty copies of the questionnaire

were administered to collect relevant information for the study. It was found out from the study

that males and females are influenced by internet advertising, but females are not more

influenced than males. Similarly, the age group and income group are not factors that

determine how much internet advertising can influence consumer buying behavior.

Online Impulse Buying

Lin et al. (2018) emphasized that decision-making by consumers has traditionally been

seen as a methodical process in which buyers learn about a product's features and benefits and

then weigh those features against those of competing products to find the best possible fit.

However, changes in consumer behavior, such as impulsive purchasing, have emerged as a

result of the rise of the Internet and other forms of digital technology. Furthermore, Abdelsalam

et al. (2020) highlighted that buying on impulse occurs when a person is exposed to a stimulus

and then makes a snap decision to purchase an item without having any kind of prior plan to do

so. The lack of constraints that shoppers face when they shop online makes it more likely that

they will make impulsive purchases.

According to Arne Floh and Madlberger (2013), a true case of impulse buying occurs

when a customer deviates from their usual purchasing habits to buy an unexpected novelty

item. Cognitive effort is required to recall impulsive purchases since they demand recalling

past experiences or information about things. Nghia et al. (2021) claimed that when a customer
sees a product they do not already own but immediately thinks they need, that's an example of

suggestive purchasing. Rather than being a purely emotional response, suggesting impulsive

purchasing may include a series of interactions between people. Partially planned impulsive

purchasing means that customers are receptive to making purchases outside of their original

shopping list and are actively looking for discounts.

Trait Affect and Web Browsing

A fundamental distinction that can be made between emotional qualities is whether they

are constructive or destructive. Customers who have a favorable attribute effect are more likely

to like their experience of online shopping, spend more time examining things, and surf the site

extensively than customers who do not have a favorable attribute effect (Turkyilmaz et al.,

2015). Customers that are negatively influenced, on the other hand, are the ones who are

stressed out, irritated, and do not feel anything pleasant when doing online research or making

online purchases. Customers who have positive behavior as a genetic characteristic are more

likely to participate in web surfing (both for hedonic and utilitarian reasons) in comparison to

customers who have negative behavior as a trait (Habib & Qayyum, 2017). In addition, several

studies have shown that a person's characteristics have a major impact on impulsive purchases.

For example, a person's propensity to engage in avoidance behavior is lower, but their

propensity to engage in approach activity is higher if that person has a higher positive affect

score (Zhang et al., 2018). When individuals are in a more upbeat emotional state, they have a

greater tendency to make rash financial decisions, including spending more money and buying

stuff without proper consideration.

Web Browsing and The Urge to Buy


Chen and Wang (2016) emphasized that users of the Internet will often navigate the

World Wide Web in order to do research before making a purchase. Some people who purchase

online spend a significant amount of time just browsing different websites and reading

customer feedback. Internet usage may be broken down into two separate categories: browsing

for simply enjoyable reasons and browsing for more useful ones. Wells et al. (2011) found that

consumers may engage in hedonic Browsing for the purpose of pleasure and satisfaction while

also participating in utilitarian Browsing in order to limit risk and learn more about alternatives

when they shop online. Hedonic Browsing and utilitarian Browsing are both types of online

shopping. When they are shopping online, consumers who use the Internet mainly for

functional reasons often place a higher value on speed and cost-effectiveness. Despite this,

buyers find it enjoyable to browse through a broad assortment of products, regardless of

whether or not they end up purchasing anything. According to Lim and Kim (2021), exploring

the Internet, whether for functional or recreational objectives, significantly contributes to the

development of habits of making impulsive purchases. Hedonic and utilitarian considerations

have a significant influence on the kind of purchases that are made on the spur of the moment

in an online setting.

Broad categories of impulse buying (Rezaei et al., 2016) found that there are several

categories of impulsive buys, including "planned," "reminder," and "recommendation" buys, as

well as "pure" or "unintentional" buys. A customer is said to have participated in pure impulse

buying if they stray from their typical purchase patterns in order to get an item that is not

readily available elsewhere. Because consumers require remembering previous experiences or

understanding goods, impulsive purchases necessitate some mental effort. Apart from that,

Zheng et al. (2019) assessed that consumers are said to engage in impulsive shopping when
they learn about a new product and almost instantly experience the need to buy it, according to

one school of thought. The difference between pure impulse buying and suggestion-impulsive

purchases is that the latter may be more of an interpersonal activity than an emotional one.

Moreover, Park et al. (2012) determined that customers who are open to making purchases

outside of their shopping aims and actively seek bargains are engaging in what is known as

"planned impulsive buying," which is also known as "planned impulsive shopping." There are

three categories of spur-of-the-moment purchases that may be influenced by reading reviews

on the Internet: "reminder" purchases, "planned" purchases, and "recommended" purchases.

Influence of Online Reviews

Since Browsing is, by definition, less concentrated and undirected than searching, it is

unnecessary to discriminate between the types of online material that people explore.

Additionally, online reviews are frequently located next to sellers' product descriptions on

shopping websites (Lazim et al., 2020). It is impossible to differentiate the behavior of reading

online reviews from the behavior of seeing information provided by marketers. However, it is

possible for a person to go into a shop without having a predetermined goal in mind;

nonetheless, they wind up making a purchase as a result of a suggestion made while reading

online assessments of the product that is being considered for purchase. As a natural

progression of this idea, the terms "electronic WOM" or "online reviews" are used to refer to

any comments made by consumers about a product or vendor on the Internet, regardless of

whether such comments are positive or critical (Ampadu et al., 2022). Online reviews, in

contrast to other, more traditional kinds of word-of-mouth communication, have a much larger

potential to reach a large audience by making use of the Internet's technological capabilities, as

shown in the figure below.


Consumer Buying Behavior

All of us are consumers who consume products and services in our daily lives. When

buying goods, there are several stages that a consumer goes through to make a purchase

decision. This depends on several factors. According to Khan (2006), consumer behavior is a

decision-making process that involves physical activity in acquiring, evaluating, using, and

disposing of goods. Buyer behavior has been defined as "a process that, through inputs and

their use through process and actions, leads to satisfaction of needs and wants" (Enis, 1974, p.

228). Consumer buying behavior has numerous factors as a part of it that are believed to have

some level of effect on the purchasing decisions of the customers. Consumer buying behavior

refers to the buying behavior of individuals and households that buy goods for personal use and

consumption (Philip Kotler, Gary Armstrong, 2012). Consumers make decisions every day, and

the buying decision is the focal point for the marketer. The consumer's reaction to the

organization's strategy has a significant impact on the firm's success. The marketer must follow

what stimulates consumer response.

Impact of Online Reviews on Consumer Behavior

This seminal study investigates the effect of word-of-mouth on sales using online book reviews.

Through a detailed analysis, the researchers demonstrate how online reviews influence consumer

behavior and purchasing decisions. They explore the dynamics of online reviews, such as the

volume, valence, and variance of reviews, and their impact on sales. By examining a dataset of

Amazon.com book reviews and sales data, the study provides empirical evidence of the

significant influence online reviews have on consumer decision-making processes. Chevalier, J.

A., & Mayzlin, D. (2006):


In this research, the authors delve into the importance of online reviews in shaping consumer

preferences and purchase intentions. Using panel data analysis, they explore whether online

reviews directly impact sales and to what extent. The study examines the relationship between

online reviews and consumer behavior, considering factors such as review valence, review

volume, and product characteristics. Through empirical investigation, the researchers provide

insights into the mechanisms through which online reviews influence consumer decision-making

processes. Duan, W., Gu, B., & Whinston, A. B. (2008)

Focusing on the role of online consumer reviews in driving sales, this study investigates the

moderating effects of product and consumer characteristics. By analyzing a large dataset from an

online marketplace, the researchers examine how different types of products and consumer

demographics interact with online reviews. They explore how factors such as product popularity,

price, and brand reputation influence the impact of online reviews on consumer behavior.

Through advanced statistical modeling, the study uncovers nuanced insights into the complex

relationship between online reviews and sales. Zhu, F., & Zhang, X. (2010)
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