UNIVERSITY OF CAPE COAST  DEPARTMENT OF MATHEMATICS AND STATISTICSA STUDY ON FACTORS THAT DETERMINE THE CHOICE OF         ...
UNIVERSITY OF CAPE COAST    DEPARTMENT OF MATHEMATICS AND STATISTICS   A STUDY ON FACTORS THAT DETERMINE THE CHOICE OF    ...
DECLARATIONWe do hereby declare that project entitled “FACTORS THAT DETERMINE THECHOICE OF BRANDS OF MOBILE PHONE” was don...
DEDICATIONTo our beloved parents (Mr. & Mrs. Aidoo, Mr. & Mrs. Nyamedor)                                                  ...
ABSTRACT       The whole world has now become a global village where people can now reachothers in different parts of the ...
ACKNOWLEDGEMENTMr. B.K. Nkansah our supervisor deserves a special word of appreciation. Who despite hisheavy schedule has ...
TABLE OF CONTENTSDECLARATION.................................................................................................
3.6 Test of Hypothesis – 1 ............................................................................................ 21...
LIST OF TABLESTable 2.1: A r × c Contingency Table ..........................................................................
LIST OF FIGURESFigure 3.1: Distribution of Brands of Mobile phone ....................................................... ...
CHARPTER ONE                                   INTRODUCTION1.1 Background        The whole world has now become a global v...
Ghana Telecom. Much of the voice traffic by these telecommunication providers is beingtransmitted over digital networks th...
Internet, e-mailing, e-learning, e-banking and video-conferencing. Consumer research hasdevoted little specific attention ...
3. To determine whether there is a relationship between mobile phone usage and       educational level   4. To determine w...
Kumasi is Ghana’s second city and it is about 300 km from the national capital,Accra. It centrally located in the Ashanti ...
industrial activities include pharmaceutical and medical accessories, mechanical andelectrical engineering works, logging ...
Also, a combination of statistical software (SPSS and Minitab) and others softwarewere used during data processing, and ot...
2004; Sehovic, 2004). The mobile phone industry is currently using many standards amongare the Japanese PDC (Personal Divi...
standards on one or two of the most important attributes, even if it is positive on all otherattributes.It is widely accep...
In wider perspective, the Daily Graphic (December 2004) reported that the numberof mobile phone subscribers around the wor...
conventions. It can therefore be argued that different mobile brands are popular in differentcountries, each with its own ...
CHAPTER TWO                                   REVIEW OF METHODSVarious statistical analysis tools have been used during th...
they form clusters indicating which variables “hang” together. The primary function offactor analysis is to identify these...
Interpreting FactorsIn interpreting factors, the size of the factor loadings will help in the interpretation. As ageneral ...
( Ri × C i )table. The expected frequency for the cell in the ith row and jth column is                            . The  ...
The statistic under the null hypothesis has an approximately chi-square distribution withthe degrees of freedom given by (...
CHAPTER THREE                             PRELIMINARY ANALYSISThis chapter of the report presents how tables and graphs we...
3.2 Brand of Mobile phone DistributionThe figure below displays the distribution of mobile phone users among the various m...
Reason 1 – High cost of purchasing mobile phoneReason 2 – High cost of recharging unitsReason 3 – No needReason 4: OthersF...
It can be seen from Figure 3.3 that, out of the 35 respondents who use more than onemobile phone, 23 of them use more than...
3.6 Test of Hypothesis – 1Statement of Hypothesis       H0: There is no relationship between mobile phone usage and educat...
3.7 Test of Hypothesis – 2Statement of Hypothesis       H0: There is no relationship between mobile phone usage and occupa...
3.8 Test of Hypothesis – 3Statement of Hypothesis         H0: There is no association between gender and brand of mobile p...
Summary of Preliminary AnalysisThe preliminary analysis of the data reveals that out the 300 respondents surveyed, 76% oft...
CHARPTER FOUR                                    FURTHER ANALYSISIn this chapter we perform Factor Analysis to determine t...
In considering a correlation coefficient of 0.2 or greater as being high, then we can seefrom the matrix above that, there...
Using the criterion of retaining only factors with eigenvalues of 1 or greater, the first twofactors will be retained for ...
4.3 The Component Matrix and Interpretation of Extracted FactorsThe Component Matrix below represents the unrotated compon...
Summary of Further AnalysisBased on the criterion of eigenvalues of 1 or greater, the decision of two factors modelfrom th...
CHAPTER FIVE SUMMARY, DISCUSSION, CONCLUSION AND RECCOMMENDATIONThis chapter presents a general discussion on the results ...
Weekly, Yan Xianpu (2004) that when it comes to choice of brand of mobile phones, menand women have different tastes.     ...
From a theoretical viewpoint, this study contributed to the buying decision makingprocess for mobile phones by looking at ...
REFRENCESAssael, H. (1995). Consumer Behavior and Marketing Action. 5th ed. Cincinnati, Ohio:ITP, South-Western College Pu...
Loehlin, J.C. (1992) Latent Variable Models. Erlbaum Associates, Hillsdale NJ.Marcus G. (2002).Global Mobile Phone usage. ...
APPENDIX A                   SPECIMEN OF THE QUESTIONNAIRE USED                           UNIVERSITY OF CAPE COAST        ...
4. Occupational status            Student                 [   ]            Self-employed           [   ]            Employ...
9. What is or are the reason(s) for your chose in question 7 above? Tick as many as      apply.             Affordability ...
SECTION C                         Non users of mobile phone only14. What is or are the reason(s) for not using a mobile ph...
APPENDIX B                     Table 1: The Chi-Square Probability Table                                                αD...
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  1. 1. UNIVERSITY OF CAPE COAST DEPARTMENT OF MATHEMATICS AND STATISTICSA STUDY ON FACTORS THAT DETERMINE THE CHOICE OF BRANDS OF MOBILE PHONE (A CASE STUDY IN KUMASI METROPOLIS) BY AIDOO ERIC NYAMEDOR BRIGHT APRIL, 2008
  2. 2. UNIVERSITY OF CAPE COAST DEPARTMENT OF MATHEMATICS AND STATISTICS A STUDY ON FACTORS THAT DETERMINE THE CHOICE OF BRANDS OF MOBILE PHONE (A CASE STUDY IN KUMASI METROPOLIS) BY AIDOO, ERIC NYAMEDOR, BRIGHT STA499 (PROJECT WORK)A dissertation submitted to the Department of Mathematics and Statistics,University of Cape Coast in partial fulfillment of the requirement for theaward of Bachelor of Science Degree in Statistics. APRIL, 2008 i
  3. 3. DECLARATIONWe do hereby declare that project entitled “FACTORS THAT DETERMINE THECHOICE OF BRANDS OF MOBILE PHONE” was done entirely by us under thesupervision of Mr. B. K. Nkansah. ii
  4. 4. DEDICATIONTo our beloved parents (Mr. & Mrs. Aidoo, Mr. & Mrs. Nyamedor) iii
  5. 5. ABSTRACT The whole world has now become a global village where people can now reachothers in different parts of the world within a short period with the advent of mobilephones. As a result of its importance numerous factors need to be considered whenchoosing mobile phone. It is against these challenges that the topic “factors that determinethe choice of brands of mobile phone” was chosen for study. The main objective of this paper is to determine the factors that determine choice ofbrand of mobile phone among residents of Kumasi metropolis. To identify these factors, aquestionnaire survey was carried out among the people of Kumasi. Three hundredrespondents were sampled for the study. The chi-square and factor analysis, were the main statistical tools used for theanalysis. Also, a combination of statistical software (SPSS and Minitab) was used for theanalysis. From the primary analysis, it was found that 76% of the respondents owned mobilephone and also most people do not use mobile phone because of its high cost. The analysisalso reveals that the most used mobile phone is Nokia and the affordable mobile phoneprice ranges from GH¢50 – GH¢100. From the test of hypothesis, it was also revealed thatbrand of mobile phone used by the consumer is associated with educational levelattainment and occupational status of the consumer. In further analysis, two factors were obtained as being the number of factorsunderlying choice of brand of mobile phone. The first most important factor is reliablequality of the mobile phone brand and the other factor is user-friendliness of the brand ofthe mobile phone. iv
  6. 6. ACKNOWLEDGEMENTMr. B.K. Nkansah our supervisor deserves a special word of appreciation. Who despite hisheavy schedule has rendered us immeasurable supports by reviewed the manuscript. Hiscomments and suggestions immensely enriched the content of this work.We are also grateful to the lectures and entire staffs of Department of Mathematics andStatistics, University of Cape Coast.Finally we want to thanks the 2008 year group of Statistics Students of DepartmentMathematics and Statistics. v
  7. 7. TABLE OF CONTENTSDECLARATION............................................................................................................... iiDEDICATION..................................................................................................................iiiABSTRACT ...................................................................................................................... ivACKNOLEDGEMENT.................................................................................................... vTABLE OF CONTENTS........................................................................................... vi-viiLIST OF TABLES .........................................................................................................viiiLIST OF FIGURES ......................................................................................................... ix1 INTRODUCTION.......................................................................................................... 1 1.1 Background ............................................................................................................... 1 1.2 Statement of the Problem .......................................................................................... 3 1.3 Objectives of the study.............................................................................................. 3 1.4 Hypothesis................................................................................................................. 4 1.5 Significance of the Study .......................................................................................... 4 1.6 Data Collection.......................................................................................................4-6 1.7 Literature Review...................................................................................................... 6 1.7.1 Definition of Mobile Phone/Cellular Phone ....................................................6-7 1.7.2 Generations of Mobile Phones.........................................................................7-8 1.7.3 Consumer Choice Behavior...........................................................................8-10 1.7.4 Mobile Phone Choice ..................................................................................10-11 1.7.5 Brand Preference and Product Attribute........................................................... 112 REVIEW OF METHODS ........................................................................................... 12 2.1 Factor Analysis ..................................................................................................12-14 2.2 Chi-Square Analysis ..........................................................................................14-163 PRELIMINARY ANALYSIS ..................................................................................... 17 3.1 Mobile Phone Distribution by Gender .................................................................... 17 3.2 Brand of Mobile phone Distribution....................................................................... 18 3.3 Reasons by Respondents who do not use Mobile Phone ...................................18-19 3.4 Reasons by Respondents who use More Than One Mobile Phone....................19-20 3.5 Mobile Phone Cost.................................................................................................. 20 vi
  8. 8. 3.6 Test of Hypothesis – 1 ............................................................................................ 21 3.7 Test of Hypothesis – 2 ............................................................................................ 22 3.8 Test of Hypothesis – 3 .......................................................................................23-244 FURTHER ANALYSIS ............................................................................................... 25 4.1 Correlation Analysis...........................................................................................25-26 4.2 Total Variance Explained...................................................................................26-27 4.3 The Component Matrix and Interpretation of Extracted Factors .......................27-295 SUMMARY, DISCUSSION AND CONCLUSION .................................................. 30 5.1 Summary ................................................................................................................. 30 5.2 Discussion ..........................................................................................................30-31 5.3 Conclusion .........................................................................................................31-32 5.4 Recommendation..................................................................................................... 32REFERENCE .............................................................................................................33-34APPENDIX A: Specimen of the Questionnaire.......................................................35-38APPENDIX B: The Chi-square Probability Tables..................................................... 39 vii
  9. 9. LIST OF TABLESTable 2.1: A r × c Contingency Table ............................................................................. 15Table 3.1: Distribution of Mobile phone Ownership by Gender ..................................... 17Table 3.2: Distribution of Mobile phone Cost ................................................................. 20Table 3.3: Cross-tabulation of level of education against the owned of mobile phone ... 21Table 3.4: Cross-tabulation of occupational status against mobile phone usage ............. 22Table 3.5: Cross-tabulation of Mobile phone brands against Gender .............................. 23Table 4.1: Correlation Matrix........................................................................................... 25Table 4.2: Results of KMO and Bartlett’s Test of Significance....................................... 26Table 4.3: Total Variance Explain ................................................................................... 26Table 4.4: Component Matrix .......................................................................................... 26 viii
  10. 10. LIST OF FIGURESFigure 3.1: Distribution of Brands of Mobile phone ....................................................... 18Figure 3.2: Reasons by Respondents for not using Mobile phone................................... 18Figure 3.3: Reasons why respondents use more than one Mobile phone ........................ 19Figure 4.2: Scree Plot of Eigenvalue against Number of components ............................ 27 ix
  11. 11. CHARPTER ONE INTRODUCTION1.1 Background The whole world has now become a global village where people can now reachothers in different parts of the world within a short period. This global village was broughtby the introduction of information and communication technology (ICT) tools. These toolsinclude mobile phones. Mobile phones have become a fundamental part of personalcommunication across the globe during the past ten years. This great technology hasbrought in its wake a lot of challenges. Two decades ago, the telecommunications market in Ghana was dominated andmonopolize by Ghana Telecom (GT). GT formally known as Ghana Post &telecommunication (GP&T) was incorporated in 1994. The enactment of the statutorycorporation in June 1995, transformed what had been a telecommunication device intoGhana Telecom Company, with the Ghana government being the majority shareholder.Until 1992, cross-border and internal corporation between Ghana post andtelecommunication, and telecommunication providers elsewhere was all but noneexistence. Typically, regulations prohibited foreign firms from entering the country’stelecommunication market to compete with the domestic provider. Most of the trafficcarried by GP&T was voice traffic, almost all of it was carried over wires, and customerswere charged a hefty premium to make long distance and international calls. Besides, thefew telephone lines available were all centered in the regional capital and metropolitanareas. Only the government ministries, universities, hospitals and few other importantgovernment and private institutions had that opportunity of enjoying this facility. Thefacility was also accessible to the privileged in the society who could afford to pay forservices. A little more than a decade ago (since 1992) the landscape of telephone system inGhana has changed. New competitors have emerged to take on the dominant provider,Ghana -Telecom. The state-owned monopoly has been privatized. New wireless andcellular technologies have facilitated the emergence of competitors such as TiGo, MTN,Westel and Kasapa, which now compete head to head with the former state monopoly, 1
  12. 12. Ghana Telecom. Much of the voice traffic by these telecommunication providers is beingtransmitted over digital networks that utilize fiber optics, digital switches and protons tosend the voice around at the speed of light. The first cellular phone service was initiated in 1992 by Millicom Ghana limited-mobitel (now TiGo). Scancom Ghana Limited –Spacefon (now MTN) joined Mobitel in1994 in the provision of mobile telephone services. One-Touch (Ghana Telecom) mobiletelephone operator was the next competitor in the cellular phone market in the year 2000.A local cellular phone operator, Kasapa, followed. It is worthy of note that in 1992 about19,000 Ghanaians owned mobile phones. In 1998 the number of mobile phone users in thecountry increased to 43,000 and by the middle of 1999 the number increased to 68,000.The usage rose from 22,000 to 130,000 subscribers between 1999 and 2000. From the year2000 up to date, the subscribers’ base has increased to about 3,500,000. Between 1992 andthe year 2001, mobile phone usage seemed limited to some categories of people in thecountry. These include businessmen, managers in reputed companies, governmentofficials, diplomatic corps, wealthy individuals and some very important personalities.These may be attributed to the fact that cellular phone usage was new and their coveragewas limited to the country’s main cities. Now, due to the nation-wide coverage of themobile phone service providers, every category of people owned mobile phone. It hashelped bring about a source of employment to a section of the populace. It has also becomefashionable to own a mobile phone. The need for the acquisition of mobile phone by allhas brought about some challenges. This is because people go to all extent to acquire them.In recent times, the acquisition of the phone alone is not the issue. The issue now is thetype of phone one possesses. It is the latest fashion to see persons of all age groups andprofessions boasting about the features their mobile phones possess. The need forfashionable phones has also caught up with the mobile phone manufactures as they alsomanufacture new and fashionable mobile phones within short interval of time. In a way,there seems to be a competition among the mobile phone manufacture as they mustprovide latest and fashionable mobile phones to satisfy their customers. In Ghana, there is substantial population of mobile phone users. Mobile services inGhana have advanced to the stage where, in addition to traditional service such as voicecall and SMS, most users can freely enjoy the latest mobile technologies such as mobile 2
  13. 13. Internet, e-mailing, e-learning, e-banking and video-conferencing. Consumer research hasdevoted little specific attention to factors underlying the mobile phone buying decisionprocess. There are numerous factors that need to be taken into account when exploringmobile phone buying decision process. These factors may include conditions that affect theevolution of mobile phone market in general and individual consumer’s motives inparticular. The study seeks to know the factors that underlying a person’s decision in choosingbrand of mobile phone(s) to use. At the end of this study, we will be able to know the mostcommon brand of mobile phone in use among the study population. Also, we will be ableto determine among other things if there are certain consumer-based indicators(educational status, occupational status and gender) have influence in the purchasing ofmobile phone.1.2 Statement of the Problem The use of mobile phones has become a fundamental part of personalcommunication across the globe during the past ten years. In Ghana mobile phone usagehas become common, but there are numerous factors that need to be taken into accountwhen choosing a brand of mobile phone. Consumer research has devoted little specificattention to factors that determine choice of brand of mobile phones. Conversely, only afew published academic researches were focused on comparative studies. It is against thisbackground that the topic “factors that determine the choice of brands of mobile phone”was chosen for study.1.3 Objectives of the StudyThe objectives of the study has been categorize into two: main objective and specificobjectives.The main objective of this study is to examine the important factors that determine choiceof brand of mobile phone.The specific objectives of the study are as follows. 1. To determine the most used mobile phone brand. 2. To determine the reasons why some people don’t use mobile phone. 3
  14. 14. 3. To determine whether there is a relationship between mobile phone usage and educational level 4. To determine whether there is a relationship between mobile phone usage and occupational status. 5. To determine whether there is a relationship between mobile phone usage and gender. 6. To determine the reasons why some consumers choose to use more than one mobile phone.1.4 HypothesesThe null hypotheses formulated for the study were as follows: 1. There is no relationship between mobile phone usage and educational level 2. There is no relationship between mobile phone usage and occupational status. 3. There is no association between gender and the brand of mobile phone used.1.5 Significance of the Study The significance of this study is to extend previous studies conducted in differentparts of the world. It is hope that the findings will not only inform factors that determinechoice of brand of mobile phone, it will also bring to light the brand of mobile phone thatis mostly used by consumers in Ghana. An awareness of factors that determine choice ofbrand of mobile phone might ultimately guide or influence manufacturers in the kind ofmobile phones to produce. Conversely, it will also guide mobile phone importers in Ghanato know the kind of mobile phones to import into the country.1.6 Data Collection The target population for the project comprised the total population of Kumasi, acapital city of Ashanti Region. A sample of size 300 was drawn from the study area forthis research. 4
  15. 15. Kumasi is Ghana’s second city and it is about 300 km from the national capital,Accra. It centrally located in the Ashanti Region of Ghana. It has an approximate area of254 square kilometers and it is the second largest metropolis after Accra in Ghana. Beingstrategically located on the cross roads of the northern parts of the country, Kumasi is alsothe capital of ancient Asante Kingdom and presently Ashanti Region. Politically Kumasi isdivided into four (4) sub-metropolitan areas namely; Manhyia, Asokwa, Bantama andSubin. In terms of population, it has been estimated in 2000 population census to be1,170,270 out of which 587,012 are males representing 50.16% and 583,258 were femalesrepresenting 49.84% of the entire population of the metropolis. As a cosmopolitan city, itcontains members of most ethnic groups from West Africa although the indigenousAshanti people dominate life in general. Although these migrants’ communities maintaintheir language and cultural identity, Ashanti Twi is universally spoken and understood. The people in the metropolitan are mostly businessmen and women. A sizeablepercentage of the populations engage in vocational trade such as fitting, carpentry etc. withAdum, Central market, Suame Magazine and Anloga as the major areas where theseactivities takes place. Others are in the Government establishment such as education,health, financial institutions and so on. The road network in the metropolitan is first class(tarred with bitumen) and almost all of them have streetlights.The economic of the Kumasi metropolis comprises the agriculture, industrial and servicessectors. Like any urban economy the agricultural sector is very small, accounting for onlyabout ten (10) percent of its Gross Domestic Product (GDP). The services sector is thelargest and the most important sector which contributes about 60 percent of the metropolisGDP follow by industrial sector accounting for about 30 percent of the GDP.The contribution of Agriculture to the metropolitan economy is moderate and it is mostlypracticed in the peripheral areas like Appiadu, Deduako, Kokoben, Ohwin and Sokobanetc. Most of the crops grown are stables and include maize, cassava, plantains, cocoyamand vegetables. The Kumasi metropolis is endowed with many varied industrial activities. This ismainly due to its linkage to all parts of the country. The industrial activities in themetropolis may be classified into the three scale industries. The medium and large-scale 5
  16. 16. industrial activities include pharmaceutical and medical accessories, mechanical andelectrical engineering works, logging and saw milling. The small-scale industrial activitiesinclude footwear, cosmetics, soap making, carpentry and joinery, foam and plastics,printing and stationery and metal works. The central of industrial activities are Kaase,Ahinsa, Asokwa, Anloga and Suame Magazine areas. An important innovation in themetropolis economy in recent times is a wide variety of predominantly informal economyenterprises and home-base industries which are springing up with most of their operationsin the residential areas. This may be partly due to the shrinking public and formal sectorand the recent encouragement of the private sector as an engine of growth of the country’seconomy. In this research, seven variables were considered to measure the factors thatdetermine the choice of brand of mobile phone(s). These variables are as follows:X1 – AffordabilityX2 – FashionableX3 – More features in the mobile phoneX4 – Reliability of the receptionX5 – High qualityX6 – PopularityX7 – Portability The main instrument of data collection was questionnaire. The questionnaire was inthree sections consisting of sixteen items in all. The first section of the questionnairecontains items which enabled us to group the respondents. The second and third section ofthe questionnaire also enabled us to measure the variables of interest. To ensure accuracy of responses, the research instrument was self-administered bythe researchers to the subjects of the study. During the administration of the researchinstrument, convenient sampling was introduced in the selection of the research objects. The analysis of the data gathered from this research was in two parts. The first part,which is the preliminary analysis made use of descriptive statistics tools such as bar chart,pie chart and frequency tables. The second part, which is the further analysis made use ofinferential statistics tools such as chi-square analysis and factor analysis. 6
  17. 17. Also, a combination of statistical software (SPSS and Minitab) and others softwarewere used during data processing, and others.1.7 Literature Review1.7.1 Definition of Mobile/Cellular Phone The Cellular telephone (commonly “mobile phone” or “cell phone” or “handphone”) is a long-range, portable electronic device used for mobile communication(www.wikipewdia.com definition of mobile phone). In addition to the standard voice callof a telephone, current mobile phones can support many additional services such as SMS(Short Message Service) for text messaging, email, packet switching for access to theInternet, and MMS (Multimedia Messaging Service) for sending and receiving photos andvideo in a single messaging. Cellular telephone is also defined as a type of short-waveanalog or digital telecommunication in which a subscriber has a wireless connection from amobile telephone to a relatively nearby transmitter. The transmitter’s span of coverage iscalled a cell. Generally, cellular telephone service is available in urban areas and alongmajor highways. As the cellular telephone user moves from one cell or area of coverage toanother, the telephone is effectively passed on to the local cell transmitter.1.7.2 Generations of Mobile Phones The evolution in mobile phone and advancement technology started from the firstgeneration phones (1G). We are currently experiencing a shift from the second generation(2G) to the third generation (3G) mobile phones, which is expected to change the waypeople use their mobile phones. The rise of the 3G network and its consumer acceptance issaid to be one of the toughest marketing challenges in recent history (Benady, 2002). Ingeneral terms, the success of 3G depends primarily on how the real benefits of thetechnology are marketed to consumers on one hand and on pricing policy of the serviceson the other hand (Benady, 2002). If we look beyond the hype around 3G it is obvious thatwe are not experiencing a revolution in mobile phone markets, rather an evolution whereconsumers are able to do the same things they could with 2G and 2.5G examples are theGPRS (General Pocket for Radio Services) and EDGE (Enhance Data rate for GlobalEvolution) technology, but only better and faster in terms of download times (Drucker, 7
  18. 18. 2004; Sehovic, 2004). The mobile phone industry is currently using many standards amongare the Japanese PDC (Personal Division Code), European GSM (Global System for MobilTelecommunication) and American CDMA (Code Division Multiple Access), which hasmade it difficult for users traveling to utilize their phones extensively. The evolution of 3Gis expected to simplify this as only two standards are competing, the WCDMA (Wide-Code Division Multiple Access) that will become the European UMTS (Universal MobileTelecommunications System), CDMA2000 (Code Division Multiple Access), and theChinese TD-SCDMA (Time Division-Synchronous Code Division Multiple Access). TheWCDMA standard is said to dominate the global market for the next five years (Sehovic,2003). Consumer shift from 2G to 3G means that in order to be able to use the servicesoffered by the faster network consumers need to acquire new mobile handsets equippedwith Internet access like GPRS (General Pocket for Radio Services), WAP (WirelessApplication Protocol) and new features such as possibility to receive and send multimediamessages. Although recent news indicates a strong demand for new mobile phonesequipped with color displays and built-in camera, there still is plenty of skepticism in themedia, as well as in the market itself, towards the technological development. Thedevelopment of mobile phones is leading the market into a situation where the basic need,communication, is actually broadened to new means.1.7.3 Consumer Choice Behaviour Consumers engage in information search before making choice. Consumer decisionmaking process is usually guided by already formed preferences for a particularalternative. In close relation to information search, evaluation of alternatives has alsogained a momentum in recent research (Laroche et al 2003). Their study on consumer’suse of five heuristics (conjunctive, disjunctive, lexicographic, linear additive, andgeometric compensatory) in the consideration set formation found that conjunctiveheuristics is the most often used decision model in the consideration set formation for twoproduct classes in the study (beer brands and fast food outlets). Conjunctive heuristicsmeans that a consumer selects a brand only if it meets acceptable standards, the so-calledcutoff point on each key attribute consumer regards as important. In this non-compensatorymethod of evaluation, a consumer would eliminate a brand that does not fulfill the 8
  19. 19. standards on one or two of the most important attributes, even if it is positive on all otherattributes.It is widely accepted that the traditional problem solving approach involving rationaldecision making to the study of consumer choice may not be suitable for all situations, oris at least incomplete to understand choice behavior. Quite similarly, consumer choice can also be approached from the perspective ofconscious and nonconscious choice (Fitzsimons et al., 2002). Quite many choice situationsoccur outside of conscious awareness and with limited information search (Kivetz andSimonson, 2000) and it can be stated that many choices have both conscious andnonconscious motives. Fitzsimons et al. (2002) found that in many cases, nonconsciousinfluences affect choice much more than is traditionally believed by researchers. The acquisition of a new mobile phone follows this traditional view of buyingprocess, but is in many situations also affected by symbolic values related to brands. Withthe advent of globalization and high tech production methods, a large variety of mobilephones has almost overwhelmed the mobile market. This has changed the visual standardsof many consumers over the world. For instance, according to a China Business WeeklyYan Xianpu (2004), mobile phone production and sales in China in 2003 reached 158million and 151million with growth rates of 48% and 49% respectively. With references tothe Yan Xianpu report for example, Chinese consumers are always chasing after newmobile phones with more functions, and more reliable quality. According to the report,different age groups have different preferences for mobile phone brands. The report furtherstated that generally, with the increase of age, Motorola is more widely accepted thanSamsung, Nokia is more popular in the youth range from 16 to 24 years. Nokia andMotorola are popular among middle-aged consumers (45 to 60 years). The report furtherestablished that men and women also have different tastes when purchasing mobilephones. Men prefer Motorola and Bird whilst women prefer flip phones. Nokia andSamsung are roughly the same for both sexes. Yan Xianpu also revealed that Nokia,Motorola and Samsung are in the top three. Samsung has emerged later and becomepopular among the youth, surpassing Nokia and Motorola in several areas, includingranking first in future purchase potential. 9
  20. 20. In wider perspective, the Daily Graphic (December 2004) reported that the numberof mobile phone subscribers around the world totaled nearly 1.5 billion by the middle of2004. The report also pointed out that in Ghana, industry experts put the figure around 1.5million subscribers, representing about 7% of the population, compared to 1% in the year2002. According to British Broadcasting Corporation (BBC) report (June 2005), in theirdifferent ways, user demand and market forces, in different countries and regions, areleading to the spread of mobile phones, at a rate which is almost certainly greater than anyother invention in history. In the report the mobile is said to be one of the most democraticinventions in history, because it is accessible to all parts of the population ultimately in allcountries. For example, there are major problems in making cars, personal computers or evenfixed line phones available to everyone in the world. But there are no insurmountablebarriers; technical or commercial, in the way of everyone on the planet having a mobilephone of his preference.1.7.4 Mobile Phone Choice Previous literature on mobile phone choice is meager. Couple of academic articleshave dealt with mobile phone usage and grasped the consumer decision making process.To begin with, a survey conducted by E-Belarus.org (2001-2006) revealed that out of 400respondents, 33% said they used Nokia, 25% used Samsung, 8% Siemens, 13% Motorolawhiles 5% used Sony-Ericsson. According to a survey conducted by British Broadcasting Corporation in 2004,Nokia is the most popular handset in Europe. In another survey, Brandstock (2004),Samsung is the most popular in Korea. The results of a survey carried out by TV3, atelevision station in Ghana, in 2005, also indicate that Nokia is the most popular brand inGhana. One of the reasons being the different brand power: in terms of durability, coverageand reception, and battery capacity in these countries. Further research by the Nokia Company also reveals that user interface styles areregarded as a competitive asset in the race for market dominance (Lindholin et al 2003).However, all the different mobile handset manufactured have its own user interface and 10
  21. 21. conventions. It can therefore be argued that different mobile brands are popular in differentcountries, each with its own user interface. In the same sense, it is anticipated that differentmobile brands will be popular among different groups and individuals. In addition, it seems that size and brand play to some extent an important role indecision making. Liu (2002) for instance, surveyed Asian mobile phone users and foundthat the size of the phone had no impact on mobile phone choice, but this finding might bedue to the fact that all competing brands have quite similar sized phones that are smallenough. Liu continues that the trend will actually be not towards smaller phones buttowards phones with better capability and larger screens. While companies are advertisingnew models and services that do not yet exist, it according to the paper signals to themarket that the company is at the cutting edge of technology and shows what will beavailable in the very near future. The sales of new phones will then be driven byreplacement rather than adoption. Price of the phone has been identified as a critical factorin the choice of the mobile phone brand, especially among younger people (Karjaluoto etal., 2003a; Karjaluoto et al., 2003b). By the use of a survey involving a sample size of 397,they found that besides new technological advances, price was the most influential factoraffecting the choice of a new mobile phone model.1.7.5 Brand Preference and Product AttributeAttributes are the characteristic or features that an object may or may not have andincludes both intrinsic and extrinsic. Benefits are the positive outcomes that come from theattributes. People seek products that have attributes that will solve their problems andfulfills their needs. Understanding a consumer choose a product based upon its attributeshelps marketers to understand why some consumers have preferences for certain brands.The Lancaster model of consumer demand (1966, 1979), also referred to as the productattributes model, was used to evaluate brand positioning. This model assumes thatconsumer choice is based on the characteristics (or attributes) of a brand. Each product is abundle of attributes and that choice is based on maximizing utility/satisfaction from theattributes subject to budget constraints. Both tangible and intangible attributes of a productare equally important in choosing a product or brand. 11
  22. 22. CHAPTER TWO REVIEW OF METHODSVarious statistical analysis tools have been used during the analysis of the data. Some ofthe statistical tools were used in preliminary analysis as well as in further analysis. Themain statistical tools used are the chi-square analysis and factor analysis.2.1 Factor AnalysisFactor Analysis is a statistical tool used to reduce the number of factors needed to explainthe variability in data. The major aim of factor analysis is the orderly simplification of alarge number of intercorrelated measures to a few representative constructs or factorswhich can then be used for subsequent analysis. In other words, the latent factorsdetermine the values of the observed variables. Each observed variable (y) can beexpressed as a weighted composite of a set of latent variables (fs) such that Yi = a i1 f 1 + a i 2 f 2 + ... + aik f k + ei (2.1)Where y i - the i th observed variable on the factors a ij - the loadings of the variables f j - the factors ei the residual of y i on the factors.Given the assumption that the residuals are uncorrelated across the observed variables, thecorrelations among the observed variables are accounted for by the factors. Factor analysisis based on the assumption that all variables are correlated to some degree. Those variablesthat share similar underlying dimensions should be highly correlated, and those variablesthat measure dissimilar dimensions should yield low correlations. Analysis of variablesthat share the same underlying dimensions should yield high correlation coefficient,whereas test of different dimension should yield low correlation coefficient. These highand low correlation coefficients will become apparent in the correlation matrix because 12
  23. 23. they form clusters indicating which variables “hang” together. The primary function offactor analysis is to identify these clusters of high intercorrelations as independent factors. As factor analysis is based on correlations between measured variables, acorrelation matrix containing the intercorrelation coefficients for the variables must becomputed.Determining the Number of Factors to be ExtractedThere are two conventional criteria for determining the number of initial unrotated factorsto be extracted. These are the Eigenvalues greater than one criterion and the Scree testcriterion. Eigenvalues: Only factors with eigenvalues of 1 or greater are considered to besignificant; all factors with eigenvalues less than 1 are disregarded. An eigenvalue is aratio between the common (shared) variance and the specific (unique) variance explainedby a specific factor extracted. The rationale for using the eigenvalue criterion is that theamount of common variance explained by an extracted factor should be at least equal tothe variance explained by a single variable (unique variance) if that factor is to be retainedfor interpretation. An eigenvalue greater than 1 indicates that more common variance thanunique variance is explained by that factor. Scree Test: This test is used to identify the optimum number of factors that can beextracted before the amount of unique variance begins to dominate the common variancestructure. The Scree test is derived by plotting the eigenvalues (on the Y axis) against thenumber of factors in their order of extraction (on the X axis). The initial factors extractedare large factors (with high eigenvalues), followed by smaller factors. Graphically, the plotwill show a steep slope between the large factors and the gradual trailing off of the rest ofthe factors. The point at which the curve first begins to straighten out is considered toindicate the maximum number of factors to extract. That is, those factors above this pointof inflection are deemed meaningful, and those below are not. As a general rule, the screetest results in at least one and sometimes two or three more factors being consideredsignificant than does the eigenvalue criterion. 13
  24. 24. Interpreting FactorsIn interpreting factors, the size of the factor loadings will help in the interpretation. As ageneral rule, variables with large loadings indicate that they are set of indicators of thefactor, while small loadings suggest that they are not. In deciding what is large or small, acutoff point must be set such that a factor loadings greater than the cutoff point areconsidered to meet the minimal level of practical significance. The grouping of variableswith high factor loadings should suggest what the underlying dimension is for that factor.2.2 Chi–Square AnalysisThe chi-squared test which is denoted by the Greek symbol χ 2 , is probably the mostcommonly used test of statistical significance. It is a non-parametric test, since for the chi-squared test there are no underlying assumptions that must be made about a normallydistributed population before the test can be considered to be appropriate.Assumptions of Chi-square Analysis One underlying assumption the chi-square has is that, observations are randomlyselected from some large population. If the observations are not randomly selected, then aresearcher must be very cautious about generalizing from the data set’s results back to thelarger population. A second assumption is that the number of expected observations withina given category should be reasonably large, and more importantly, for a betterChi – square approximation, no more than 20% of the expected frequencies should be lessthan 5. The distribution depends on a number of degrees of freedom denoted by ν. It has amean v and variance 2v.Tests for Independence/Association/RelationshipThis application of the chi-squared test in testing of independence between two variables inwhich one of the variable is classified into r classes and the other into c classes, gives ar × c contingency table. A r × c contingency table format is a test of association betweenmutually exclusive categories of one variable (given in the rows of the table) and mutuallyexclusive categories of another variable (given in the columns of the table). It is a table offrequencies showing how the total frequency is distributed among the r × c cells in the 14
  25. 25. ( Ri × C i )table. The expected frequency for the cell in the ith row and jth column is . The Nχ statistic is the sum of all 2 (O − E )2 values for all the r × c cells. EThe table below is an example of r × c contingency table with the number of degrees offreedom DF = (r − 1)(c − 1) TABLE 2.1: A r × c Contingency TableThe hypothesis which is tested is H0: No relationship or association exists between the two variable classifications. against H1: Relationship or association exists between the two variable classifications.The test statistic is given by r c (O − Eij ) 2 χ =ΣΣ 2 ij (2.2) i =1 j =1 EijWhere Oij is the observed cell frequency for the (ij) th cell. E ij is the expected cell frequency for the (ij) th cell. 15
  26. 26. The statistic under the null hypothesis has an approximately chi-square distribution withthe degrees of freedom given by (r − 1)(c − 1) . The critical region for the test at α 0 0significance level is therefore, χ 2 ≥ χ α [(r − 1)(c − 1)] . 2Table 1 in Appendix B gives the critical region for a particular α level and the variouscorresponding degrees of freedom.To chose between H0 and H1 we determine the critical region of the test. The critical regionis the set of values of the test statistic that will enable us to reject H0. The region isdetermined using a pre-set level of significance. The level of significance, denoted by α , isthe probability of committing Type I error (that is, the probability of rejecting H0 when infact, it is true. Also, from computer output, the decision to reject or fail to reject H0 isbased on the p − value of the test. The p − value is the probability of observing a value ofthe test statistic at least as extreme as that observed under the null hypothesis. Generally,we reject H0 at level of significance α , if p − value less than α and fail to reject H0 ifp − value greater than α . 16
  27. 27. CHAPTER THREE PRELIMINARY ANALYSISThis chapter of the report presents how tables and graphs were used to analyze the data ofthis research. The chapter also describes how the stated hypotheses in this research weretested.3.1 Mobile Phone Distribution by GenderThe table below displays the distribution of mobile phone used in terms of gender. Table 3.1 Distribution of Mobile phone Ownership by Gender GENDER Mobile Phone Ownership Male Female Total Percentage Yes 130 98 228 76 No 38 35 73 24 TOTAL 168 132 300 100It is shown in table 4.1 that, there is wide variation in the distribution of owned of mobilephone. Out of the 300 respondents surveyed, 228 of them representing 76% owned mobilephone, while 72 of the respondents representing 24% don’t own mobile phone. The table also indicates that out of the 300 interviewed, 168 and 132 are males andfemales respectively. Out of the 228 respondent who owned mobile phone, 130 of themwere males and 98 were females. 17
  28. 28. 3.2 Brand of Mobile phone DistributionThe figure below displays the distribution of mobile phone users among the various mobilephone brands. Figure 3.1: Distribution of Brands of Mobile phoneFrom Figure 3.1 above, the most used mobile phone among the respondents is Nokiawhich represent 39.2% of all brands of mobile phone used by respondents. Motorola is thenext most used mobile phone which represents 16.7%. Also from the figure, the leastmobile phone used is LG with a percentage of 2.3.The common mobile phone brands which were specified by the respondents who use noneof the listed brands of mobile phones are NEC and Alcatel.3.3 Reasons by Respondents who do not use Mobile PhoneThe figure below displays the most common reasons given by respondents who do not usemobile phone. 45 N ME O R S O S S(%) 40 U B R F EP NE 35 30 25 20 15 10 5 0 Reason 1 Reason 2 Reason 3 Reason 4 REAS O NS FO R NO T US ING MO B ILE PHO NE Figure 3.2: Reasons by Respondents for not using Mobile phone 18
  29. 29. Reason 1 – High cost of purchasing mobile phoneReason 2 – High cost of recharging unitsReason 3 – No needReason 4: OthersFrom Figure 3.2, it is shown that the most of the reasons why some of the respondentsdon’t use mobile phone were “high cost of purchasing mobile phone” and “No need”.These two reasons form a percentage of 38.6 and 35.6 respectively. Thus, many people donot use mobile phone because of its high cost. Some also find it not necessary/importantfor them to use mobile phone. The common reasons specified by the respondents includeunemployed and low income.3.4 Reasons by Respondents who use More Than One Mobile PhoneThe figure below displays the most common reasons given by respondents who use morethan one mobile phone. 40 35 NSES 30 12 BER O RESPO 17 25 20 F 35 15 NUM 23 10 18 5 0 0 Reas on 1 Reas on 2 Reas on 3 REASONS FOR USING MORE THAN ONE MOBILE PHONE Ticked Not Ticked Figure 3.3 Reasons why respondents use more than one Mobile phoneReason 1 – To be in touch alwaysReason 2 – To have access to different mobile phone networkReason 3 – Others 19
  30. 30. It can be seen from Figure 3.3 that, out of the 35 respondents who use more than onemobile phone, 23 of them use more than one mobile phone just because they want to be intouch always. Also out of the 35 respondents who use more than one mobile phone 18 ofthem use more than one mobile phone just because they want to have access to differentmobile phone networks. None of the respondents specified any other reasons why theyuse more than one mobile phone.3.5 Mobile Phone CostThe table below displays the distribution of cost of mobile phone Table 3.2: Distribution of Mobile phone Cost Mobile phone cost (GH¢) Frequency Below 50 36 50 – 100 111 110 – 150 49 160 – 200 16 210 – 250 11 260 and above 5 Total 228From Table 3.2, it can be seen that, the modal class of mobile phone cost is “GH¢50 to100” with a frequency of 111. Thus, the affordable mobile phone price ranges from GH¢50to GH¢100. Also, only few people purchased mobile phones that are expensive. This clearlyshows that, most people purchase mobile phone that is affordable. 20
  31. 31. 3.6 Test of Hypothesis – 1Statement of Hypothesis H0: There is no relationship between mobile phone usage and educational level H1: There is a relationship between mobile phone usage and educational level.The contingency table below indicates the observed and expected frequencies for thecategories. Within each cell, the expected frequency is placed under the observedfrequency. Table 3.3: Cross-tabulation of level of education against the owned of mobile phone. Do you own Mobile phone Level of Education Yes No Total No School 9 18 67 20.52 6.48 First Cycle 48 20 68 51.68 16.32 Second Cycle 50 26 76 57.76 18.24 Third Cycle 121 8 129 98.04 30.96 Total 228 72 300 Chi-Square = 54.787 DF = 3 p − value = 0.000Decision and Conclusion At 5% level of significance we reject the null hypothesis, since the p − value of0.000 is less than α − value of 0.05. We therefore conclude that, there is a relationshipbetween mobile phone usage and educational level. Thus, either a person use or does notuse mobile phone depends on his/her level of education. 21
  32. 32. 3.7 Test of Hypothesis – 2Statement of Hypothesis H0: There is no relationship between mobile phone usage and occupational status. H1: There is relationship between mobile phone usage and occupational status.The contingency table below indicates the observed and expected frequencies for thecategories. Within each cell, the expected frequency is placed under the observedfrequency. Table 3.4: Cross-tabulation of occupational status against mobile phone usage Do you own Mobile phone Occupation Status Yes No Total Student 90 19 109 82.84 26.16 Self-employed 48 14 62 47.12 14.88 Employee 85 23 108 82.08 25.92 Unemployed 5 16 21 15.96 5.04 Total 228 72 300 Chi-Square = 34.440, DF = 3, p − value = 0.000Decision and ConclusionAt 5% level of significance we reject the null hypothesis, since the p − value of 0.000 isless than α − value of 0.05. We therefore conclude that, there is a relationship betweenmobile phone usage and occupational status. Thus, either a person use or does not usemobile phone depends on his/her occupational status. 22
  33. 33. 3.8 Test of Hypothesis – 3Statement of Hypothesis H0: There is no association between gender and brand of mobile phone used. H1: There is association between gender and brand of mobile phone used.The contingency table below indicates the observed and expected frequencies for thecategories. Within each cell, the expected frequency is placed under the observedfrequency. Table 3.5: Cross-tabulation of Mobile phone brands against Gender BRANDS OF MOBILE PHONEGENDER Nokia Motorola Sony Samsung Siemens LG Others Total EricksonMale 67 23 12 15 15 2 19 153 59.92 25.60 12.22 18.62 13.38 3.49 19.78Female 36 21 9 17 8 4 15 110 43.08 18.40 8.78 13.38 9.62 2.51 14.22Total 103 44 21 32 23 6 34 263Chi-Sq = 6.382, DF = 6, p − value = 0.382Decision and ConclusionAt 5% level of significance we fail to reject the null hypothesis, since the p − value of0.382 is greater than α − value of 0.05. We therefore conclude that, there exist noassociation between gender and the brand of mobile phone used by consumers. Thus,either a person is male or female has nothing to do with the brand of mobile phone used. 23
  34. 34. Summary of Preliminary AnalysisThe preliminary analysis of the data reveals that out the 300 respondents surveyed, 76% ofthem owned mobile phone and also most people do not use mobile phone because of itshigh cost. Others also finds the use of mobile phone not need/important.The analysis also reveals that the most used mobile phone is Nokia and the affordablemobile phone price ranges from GH¢50 to GH¢100. Most of the consumers use more thanone mobile phone just because they want to have access to different mobile phonenetworks.The hypothesis testing under this chapter revealed the following: 1. Gender of the consumer may not be an indicator of a factor that influences choice of mobile phone brand. 2. Employment status may be an indicator of the factor that influences the use of mobile phone. 3. Educational level attainment may be an indicator of a factor that influences the use of mobile phone. 24
  35. 35. CHARPTER FOUR FURTHER ANALYSISIn this chapter we perform Factor Analysis to determine the major factors that influencethe choice of brand of mobile phone. The analysis under this chapter has been grouped invarious sub headings such as correlation analysis, total variance explained etc.4.1 Correlation AnalysisThe table below displays the correlation between the seven variables written to measurethe reasons for the choice of mobile phone brand. Table 4.1: Correlation Matrix X1 X2 X3 X4 X5 X6 X7 X1 1.000 .350 0.121 0.127 0.079 0.137 0.154 X2 0.350 1.000 0.041 0.082 -0.047 0.149 0.041 X3 0.121 0.041 1.000 0.189 0.139 0.052 0.233 X4 0.127 0.082 0.189 1.000 0.260 0.120 0.394 X5 0.079 -0.047 0.139 0.260 1.000 0.040 0.377 X6 0.137 0.149 0.052 0.120 0.040 1.000 0.039 X7 0.154 0.041 0.233 0.394 0.377 0.039 1.000From the introduction, the variables were defined as follows: X1 – Affordability X2 – Fashionable X3 –More features in the mobile phone X4 – Reliability of the reception X5 – High quality X6 – Popularity X7 – Portability 25
  36. 36. In considering a correlation coefficient of 0.2 or greater as being high, then we can seefrom the matrix above that, there is a high correlation between the variables X1 and X2,thus, as mobile phone becomes affordable, it also tend to be fashionable. Similarly,variables X4, X5 and X7 has a high intercorrelation coefficient. Table 4.2: Results of KMO and Bartlett’s Test of Significance Kaiser-Meyer-Olkin Measure Bartletts Test of Sphericity of Sampling Adequacy. Approx. Chi-Square df Sig. 0.650 140.720 21 0.000From table 4.2, the Bartlett’s test of Sphericity yield a value 140.720 and an associatedlevel of significance ( p − value ) of 0.000 which is smaller than alpha (α) value of 0.05.Thus, the hypothesis that the correlation matrix is an identity matrix is rejected, that is, thecorrelation matrix has significant correlation among at least some of the variables and thussupports the use of factor analysis.4.2 Total Variance ExplainedAlthough seven factors have been computed as shown in Table 4.3, it is obvious that notall the seven factors will be useful in representing the list of all seven variables. Table 4.3: Total Variance Explained Initial Eigenvalues Rotation Sums of Squared LoadingsComponent Total % of Cumulative Total % of Cumulative Cumulative Variance % Variance % % 1 1.953 27.902 27.902 1.834 26.205 26.205 1.834 2 1.346 19.223 47.126 1.464 20.921 47.126 1.464 3 0.920 13.143 60.269 4 0.871 12.440 72.709 5 0.734 10.480 83.188 6 0.620 8.850 92.038 7 0.557 7.962 100.000 26
  37. 37. Using the criterion of retaining only factors with eigenvalues of 1 or greater, the first twofactors will be retained for interpretation. These two factors accounted for 27.90% and19.22% of the total variance, respectively. That is, 47.13% of the total variance isattributable to these two factors. The remaining five factors together accounted for 52.87%of the total variance.The figure below show the scree plot of the eigenvalues of the seven variables against thenumber of factors Figure 4.1: Scree Plot of Eigenvalue against Number of components.From the scree plot shown by Figure 4.1 above, the plot however, suggests a model withthree factors since the elbow of scree is on the third factor. But in considering the rule ofparsimony, we decided to use two factors instead of three factors. 27
  38. 38. 4.3 The Component Matrix and Interpretation of Extracted FactorsThe Component Matrix below represents the unrotated component analysis factor matrix,and presents the correlations that relate the seven variables under study to the extractedfactors. In the table below, the coefficients, called factor loadings, indicate how closely thevariables are related to each factor. The correlation coefficients of 0.4 or greater areconsidered to be high and otherwise low. Table 4.4 Component Matrix COMPONENT VARIABLE 1 2 3 X7 0.729 -0.297 -0.739 X4 0.679 -0.163 0.145 X5 0.581 -0.405 0.0813 X3 0.485 -0.097 -0.263 X2 0.298 0.741 -0.206 X1 0.468 0.590 -0.291 X6 0.281 0.401 0.831In Table 4.4 above, factor 1 contains four items (portability, more features in the mobilephone, high quality and reliability of the reception) that has coefficient more than 0.4. Thisclearly reflects a motive of reliable quality. Factor 2 also contains three items(affordability, popularity and fashionable) that has coefficient more than 0.4. This clearlyreflects a motive of user-friendliness.Thus, we can say that two factors determine customer choice of brand of mobile phone.Although variable X6 has a higher factor loading of 0.831 under the third factor, but sincevariable X6 has already been captured under factor two, consideration of the third factor isnot necessary. 28
  39. 39. Summary of Further AnalysisBased on the criterion of eigenvalues of 1 or greater, the decision of two factors modelfrom the list of seven variables was made.Based on the component matrix in Table 4.4, conclusion on the factors that determine thechoice of brand of mobile phone(s) was made. This conclusion is that, consumer’s choiceon mobile phone brand is determine by 1. Reliable quality of the mobile phone brand 2. User-friendliness of the mobile phone brand 29
  40. 40. CHAPTER FIVE SUMMARY, DISCUSSION, CONCLUSION AND RECCOMMENDATIONThis chapter presents a general discussion on the results on the analysis of the precedingtwo chapters. The chapter also assesses how far the objectives of the research have beenachieved. Comparison and contrasting of the findings in relation to the previous findingsare also presented.5.1 Summary The preliminary analysis of the data reveals that out the 300 respondents surveyed,76% of them owned mobile phone and also most people do not use mobile phone becauseof its high cost. Others also find the use of mobile phone is not a need. The analysis alsoreveals that the most used mobile phone is Nokia and the affordable mobile phone priceranges from GH¢50 to GH¢100. Most of the consumers use more than one mobile phonejust because they want to have access to different mobile phone networks. It was alsoobserved that gender of the consumer may not be an indicator of a factor that influenceschoice of mobile phone brand. But employment status and educational level attainmentmay be indicators of a factor that influence the use of mobile phone. Finally, based on the results obtained from further analysis, consumers purchasemobile phone based on two factors. That is reliable quality and user-friendliness of thebrand of mobile phone.5.2 Discussion The most predominant mobile phone brand used by the populace in Kumasi isNokia. The result is in agreement with the survey carried out by a television station inGhana (TV3 Network) in the year 2005, which indicated that Nokia is the most popularbrand in Ghana, also with Yan Xianpu (2004) report. Contrary to the perception that different sex groups have interest in some mobilephone brand, it was found out that, that perception is not entirely true since the test forassociation could not confirm this. In fact, it was found out that males and females do notdiffer in mobile phone preference. This is in sharp contrast to the report by the Chinese 30
  41. 41. Weekly, Yan Xianpu (2004) that when it comes to choice of brand of mobile phones, menand women have different tastes. From the results in the further analysis, the first factor (reliable quality) was also inagreement with the study carried out by Laroche et al 2003. Thus, consumer selects abrand which meets acceptable standards. The results from both preliminary analysis and further analysis were also in line onthe basis of consumer based indicator. The preliminary analysis revealed that educationattainment and occupational status influence the choice of brand of mobile phone, whilethe further analysis also reveals that user-friendliness (affordability, popularity andfashionable) is a factor that determines the choice of brand of mobile phone. In relation to the second factor, we can also say that mobile phone brands which areaffordable are more popular. The preliminary analysis which reveals that affordable mobilephone price is between GH¢50 and GH¢100 suggest that for a mobile phone to be popularwithin the public, price must also be affordable. Although variable X6 has a higher factor loading of 0.831 under the third factor, butsince variable X6 has already been captured under factor two, then consideration of thethird factor is not necessary. So the suggestion made by the scree plot on the addition ofthe third factor was rejected.5.3 Conclusion The objective of this research was to investigate the underlying factors thatdetermine the choice of brand of mobile phone. The study found that two factors influenceconsumer’s choice of mobile phone brand. The first most important factor is reliablequality of the mobile phone brand and the other factor is user-friendliness of the brand ofthe mobile phone. The theoretical part of the study outlined two hypotheses that were supported bythe empirical studies. Hypothesis 2 argued that occupational status has an influence on thechoice of brand of mobile phone. This was verified in the preliminary analysis in which weshowed that specifically occupation are significant variables affecting choice.Hypothesis 3 claimed that educational level attainment influences consumer choice of themobile phone model. This hypothesis got strong support in the studies. 31
  42. 42. From a theoretical viewpoint, this study contributed to the buying decision makingprocess for mobile phones by looking at consumer motives and examining the importanceof different attributes affecting the actual choice.5.4 RecommendationWe therefore recommend that, as manufacturers of different mobile brands are improvingon the quality of the brand, they should also consider the price of selling it so as to make itaffordable to all persons.Also, the most remarkable implication for mobile phone manufactures, sellers and othervalue chain members is that advertising of the new mobile phone brands should go beyondhighlighting its properties to assured the quality and the user-friendliness of the mobilephone. 32
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  44. 44. Loehlin, J.C. (1992) Latent Variable Models. Erlbaum Associates, Hillsdale NJ.Marcus G. (2002).Global Mobile Phone usage. www.norkia.com.Matilda, A. (2004). Mobile Phone Subscription in Ghana. Daily Graphic.136754, pp13.Nagel, A. (2003). Beyond Knut Holt’s Fusion model, balancing market pull andtechnology push. International Journal of Technology Management, 25 (6-7), 614-622.Nokia (2004). Nokia closes 2003 with excellent fourth quarter. Press Release 2004,(January), available at: http://press.nokia.com/PR/200401/931562_5.htmlPhilip, J. (2006). Mobile Phone Preferences in Belarus. E – Belarus.orgSehovic, A. (2003). The whole world in 3G: The right choice ... GSMBOX, Ltd., MobileNews, Third Generation, available at http://uk.gsmbox.com/news/mobile_news/all/95639.gsmbox.Sehovic, A. (2004). The end of the beginning? GSMBOX, Ltd., Mobile News, ThirdGeneration, available at: http://uk.gsmbox.com/news/mobile_news/all// 97957.gsmboxSolomon, M.R. (2001). Consumer Behavior. Buying, Having, and Being. 5th ed. NJ:Prentice-Hall.Slovic, P. (1995). The construction of preference. American Psychologist, 50 (August),364-371.Vaananen–Vinu–Mattila and Ruuska. (1999). Mobile Phone user Interface Development.www.samsung.com.Wireless Week, (February), available at: http://www.wirelessweek.com/article/CA381643.Yan Xianpu (2004). Mobile Phone Production and Sales in China. China Business Weekly 34
  45. 45. APPENDIX A SPECIMEN OF THE QUESTIONNAIRE USED UNIVERSITY OF CAPE COAST DEPARTMENT OF MATHEMATICS AND STATISTICS QUESTIONNAIRE ON: FACTORS THAT DETERMINE CHOICE OF BRANDS OF MOBILE PHONE(S)The questionnaire is being used to find out factors that determine choice of brand ofmobile phone(s).Your responses will be used purely for academic purpose; henceconfidentiality and anonymity are assured.INSTRUCTIONS:Please read the following questions carefully – Tick [√] appropriate answer(s) in theboxes provided and specified where necessary. Thank you SECTION A 1. Gender Male [ ] Female [ ] 2. Age Under 18 years [ ] 18 – 30 years [ ] 31 – 40 years [ ] 41 – 50 years [ ] Over 50 years [ ] 3. Level of education No school [ ] First cycle [ ] Second cycle [ ] Third cycle [ ] 35
  46. 46. 4. Occupational status Student [ ] Self-employed [ ] Employee [ ] Unemployed [ ] 5. What is your income level on the average? Below GH¢100 [ ] GH¢100 – GH¢199 [ ] GH¢200 – GH¢299 [ ] GH¢300 – GH¢399 [ ] GH¢400 – GH¢499 [ ] GH¢500and above [ ] 6. Do you own a mobile phone? Yes [ ] No [ ]If No, please go to section C SECTION B Mobile phone users only 7. Which brand of mobile phone do you use? Tick as many as apply. Nokia [ ] Motorola [ ] Sony Erickson [ ] Samsung [ ] Siemens [ ] LG [ ] Other (specify)…………………………………………..……………….If you use only one mobile phone, please don’t answer question 8. 8. What is or are the reason(s) for using two or more mobile phone? Tick as many as apply. To be in touch always [ ] To have access to different mobile network [ ] Others (specify)……………………………………………….………. 36
  47. 47. 9. What is or are the reason(s) for your chose in question 7 above? Tick as many as apply. Affordability [ ] Fashionable [ ] More features in the mobile phone [ ] Reliability of the reception [ ] High quality [ ] Popularity [ ] Portability [ ] Others (specify)…………………………………………………………… 10. How much does your mobile phone cost? Below GH¢50 [ ] GH¢50 – GH¢100 [ ] GH¢110 – GH¢150 [ ] GH¢160 – GH¢200 [ ] GH¢210 – GH¢250 [ ] GH¢260 and above [ ] 11. Do you have any intention of changing your brand of mobile phone? Yes [ ] No [ ]If No, please don’t answer question 12 and question 13. 12. What is or are the weakness(s) of your present mobile phone used that necessitates a change to another mobile phone brand? Tick as many as apply. Few features [ ] Low quality [ ] Outmoded [ ] Unreliability of reception [ ] Not portable [ ] Not popular [ ] Others (specify)……………………….………………………………… 13. Which mobile phone brand do you wish to change to? Nokia [ ] Motorola [ ] Sony Erickson [ ] Samsung [ ] Siemens [ ] LG [ ] Other (specify)…………………………..……………………………….. 37
  48. 48. SECTION C Non users of mobile phone only14. What is or are the reason(s) for not using a mobile phone? Tick as many as apply. High cost of purchasing mobile phone [ ] High cost of recharging units [ ] No need [ ] Others (specify)……………………………………………….……….15. If you decide to own a mobile phone today, which brand of mobile phone will you purchase? Nokia [ ] Motorola [ ] Sony Erickson [ ] Samsung [ ] Siemens [ ] LG [ ] Other (specify)…………………………………….…………………..16. What is or are the reason(s) for your chose in question 15 above? Tick as many as apply. Affordability [ ] More features in the mobile phone [ ] Fashionable [ ] Reliability of the reception [ ] High quality [ ] Portability [ ] Popularity [ ] Others (specify)……………………………………………………………. 38
  49. 49. APPENDIX B Table 1: The Chi-Square Probability Table αDegrees of 0.95 0.90 0.70 0.50 0.30 0.20 0.10 0.05 0.01 0.001Freedom 1 0.004 0.016 0.15 0.46 1.07 1.64 2.71 3.84 6.64 10.83 2 0.10 0.211 0.71 1.39 2.41 3.22 4.61 5.99 9.21 13.82 3 0.35 0.584 1.42 2.37 3.67 4.64 6.25 7.82 11.35 16.27 4 0.71 1.064 2.20 3.36 4.88 5.99 7.78 9.49 13.28 18.47 5 1.15 1.610 3.00 4.35 6.06 7.29 9.24 11.07 15.09 20.52 6 1.64 2.204 3.83 5.35 7.23 8.56 10.65 12.59 16.81 22.46 7 2.17 2.833 4.67 6.35 8.38 9.80 12.02 14.07 18.48 24.32 8 2.73 3.490 5.53 7.34 9.52 11.03 13.36 15.51 20.09 26.13 9 3.33 4.168 6.39 8.34 10.66 12.24 14.68 16.92 21.67 27.88 10 3.94 4.865 7.27 9.34 11.78 13.44 15.99 18.31 23.21 29.59 39

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