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166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Introduction

Apple Computer with its innovative products and the legendary Steve Jobs, created consumers that have the urge to adopt Apple products. Consumers’ recognition towards Apple as a brand is different from other competitors such as Blackberry, Samsung, HTC, etc. Users of Apple products have their own sense of identity, being unique, and expressing themselves through the possession of Apple products. Certain features such as iMovie and iTune attract music creators, movie makers, and entertainers.

However, with the previous success under Jobs’ leadership, stakeholders question the future of Apple regarding the revolutionary concept and products that Apple has provided to its new and long-term customers. Loyal customers perceive the value in Apple products far beyond others. They tend to use Apple products even though the price is actually higher than other products offered in the market. Currently, Samsung offers highly developed technology with much more affordable prices and coordinated features. Samsung is not the only competitor and will not be the last. This study explores Apple and Samsung product user’s positions and therefore asks the following research questions: RQ1: Do consumer needs relate to consumer choice behavior fulfilled by Apple products? RQ2: Is the relationship between needs and consumer choice different with products of other brands, such as Samsung’s?

In the present age, the need for speedy information availability, convenience, and networking, and communication in different formats help individuals to acquire social acceptance to fit in the society. The usage of technology is a medium for individuals to achieve their purposes. In Riley and Boome’s (2011) documentary film, they asked people from the slums of Delhi to the streets of London and Chicago who they call most on their mobile phones, and the most common answers are always the same: friends and family. The basic needs for human being are fundamentally the same regardless of country, religion, race, or culture. Electronic product/service providers fulfill consumers’ needs for networking. Consumer’ needs are satisfied through perceived value in product possession such as Apple’s detailed product design and characteristics that lead the electronic industries.

The rationale of this study is to understand the components of consumer needs when using electronic devices and their relationship to consumer behavior choice. Consumers seek products with certain qualities and features to fulfill their networking and communication needs. Apple appears to have successfully recognized these latent needs and, thus, generated desirable perceived value by offering distinctive products in the market.

This study is limited to comparing product lines, not specific products. For example, Sheth, Newman and Gross (1991b) compared users and non-users, i.e. smoker and non-smoker, for specific products or brands. Future studies can examine

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and compare the difference in consumer choice for specific products and not only products lines belonging to known brands like we do in this research.

We first present the two theories, motivations theory and the theory of consumption values, that help illuminate the issues discussed in the paper and summarize the literature on the fitting of consumer needs and perceived product value. We then offer and provide rationale for the research hypotheses. Next, we propose the methodology used, discuss the results obtained, and finally offer some conclusions and future research. Literature Review

There may not be suitable literature to the purpose of this research, but some published work is in tune with our purpose. Pincus (2004) proposed the need fulfillment scale derived from low- and high-order theories of motivation. In order to serve the purpose for product-specific attitudes, previous pure psychological segmentations fail to target a specific population; Pincus (2004) elaborated the concept of segmentation by unmet needs. Unmet needs are generally defined as the difference between the ratings of importance, i.e. expected performance, and the actual performance delivered by brand/product.

In the research on electronic devices, Coursaris and Hassanein (2002) specified five types of needs when consumers use mobile phones. These needs include connectivity, communication, information, entertainment, and commerce. Further definitions for each need are provided in Table 1. Coursaris and Hassanein (2002) indicate that mobile devices serve as a medium for consumers to perform communication needs at the highest level among all five needs.

Fitzsimons, Chartrand and Fitzsimons (2008) conducted three experiments to examine brand exposure influencing behavioral effects in line with the exposure to social primes. Their results showed that participants activated with Apple logos behave more creatively than those activated with IBM. Bødker, Gimpel and Hedman (2009) investigated smart phone users (iPhone) by using qualitative method in evaluating consumers’ use experience. These experiences are associated with pre- adoption beliefs, initial use, and post-adoption attitude changes in a longitudinal study. In the values participants perceive in using iPhone, five types of values change over time: functional, social, emotional, epistemic, and conditional.

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Table 1. Operational Definitions of the Constructs

Operational Definitions Sources Meanings Dependent variables Connectivity Needs

Coursaris and Hassanein (2002)

Having access to wireless networks including voice and Internet communications anytime and anywhere through various mobile/electronic devices.

Communication Needs Coursaris and Hassanein (2002)

Communication with others may be for business purposes or for personal purposes and may be carried out within an information, entertainment, or commerce context.

Information Needs

Coursaris and Hassanein (2002)

This information may be similar to the general information found on the Web and can be categorized as being static or dynamic.

Entertainment Needs

Coursaris and Hassanein (2002)

Users want to turn to their mobile/electronic devices when they have a few minutes to kill and get useful and practical entertainment solutions, such as access to games or leisure information.

Commerce Needs

Coursaris and Hassanein (2002)

Indicates the presentation of product/service information and a wireless payment mechanism.

Independent variables Functional Values (measured by Price and Quality)

Sheth, Newman and Gross (1991b); Sweeney and Soutar (2001)

The perceived utility acquired from an alternative’s capacity for functional, utilitarian, or physical performance. An alternative acquires functional value through the possession of salient functional, utilitarian, or physical attributes. Functional value is measured on a profile of choice attributes.

Social Value Sheth, Newman and Gross (1991b)

The perceived utility acquired from an alternative’s association with one or more specific social groups. Social value is measured on a profile of choice imagery.

Emotional Value Sheth, Newman and Gross (1991b)

The perceived utility acquired from an alternative’s capacity to arouse feelings or affective states. Emotional value is measured on a profile of feelings associated with the alternative.

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For example, functional value increases for some participants but decreases for others. The magnitude and direction of changes are due to the pre-adoption expectations. Epistemic value drops dramatically, and social value also declines over time. Emotional and contextual values vary depending on the participants’ situation. The former is associated with the software available in iPhone and services provided; the latter is related to whether an internet-connected personal computer is available or not at a specific time. Interestingly, participants did not take into consideration the particular service provider, artifact, software, and delivery technology. Instead, participants evaluated the iPhone as an entire package together. Sheth, Newman and Gross (1991b) emphasized that the five values influencing consumer choice are distinct from each other but they are inter-related.

This study focuses on the impact of perceived product values on certain consumer needs. We use Apple products and Samsung products to accomplish this. The perceived product values are examined using the Theory of Consumption Values (TCV) which is linked to the five dimensions of m-commerce phenomenon, as exemplified in research of mobile phones by Coursaris and Hassanein (2002). The TCV is founded on three axioms. First, consumer choice is a function of multiple consumption values. Second, the consumption values make differential contributions in any given choice situation. Third, the consumption values are independent. On the basis of these three assumptions, TCV explains consumers’ choice behavior as a function of values perceived by consumers to fulfill their unmet needs through the attributes of Apple products. Figure 1 shows the framework of the study.

The consumer needs are studied using the five dimensions used in Coursaris and Hassanein (2002), assuming that the same needs for mobile users hold in the Apple and Samsung product users.

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Figure 1. The Conceptual Framework

Motivation Theory

The fundamental concept of motivation theory is that motivation is the result of unmet needs (Pincus 2004). By the same token, motivation theory explains that “satisfied needs are not motivating” (Pincus 2004). Motivation theory has evolved from pure biological to complex social-cognitive motivation Based on Fiske and Taylor (1984), “motivations provide the motor for behavior.” The higher-order theories of motivation expand to the theories of gestalt, cognition and personality.

Theory of Consumption Values

The Theory of Consumption Values (TCV) is used in this study to explain how the needs of Apple product users related to their consumption choices of values. Sheth, Newman and Gross (1991a; 1991b) proposed TCV to integrate five different types of values- functional, social, emotional, epistemic, and conditional-that influence

Alternative 1: Apple Stimuli

Alternative 2: Samsung Stimuli

Consumer Needs Fulfilled:

- Information - Commerce - Entertainment - Communication - Connectivity

Perceived Product Value:

-Quality - Price - Social Value - Emotional Value - Brand Equity

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consumer when they decide to buy an Smartphone. The five values are addressed below with specific definition (Bødker, Gimpel and Hedman, 2009):

1. Functional value: the consumer’s decision to buy a product or service is based on utilitarian needs.

2. Social value: visible products or services are to be shared with others. Social value is the perceived social image conveyed through products or services with the symbolic meaning of an artifact.

3. Emotional value: indicates the aesthetic aspects of products, including beauty and artistry that increase emotional arousal.

4. Epistemic value: demonstrates consumers’ decisions in buying a new computer or mobile phone due to their curiosity about something new and different and desire to experiment.

5. Conditional value: applying a product or services in a specific context. A short- term situation may create such a need.

Previous studies have not found a direct relationship between consumer needs and consumers’ perceived values with respect to Apple products. Bødker, Gimpel and Hedman (2009) conducted a qualitative study to explore values that iPhone users seek when assessing the products. Coursaris and Hassanein (2002) identified consumer needs when they use mobile commerce (m-commerce). Pincus (2004) proposed a scale to measure unmet needs based on the low-order and high-order theories of motivation. The motivation of seeking and exploring the meaning of unmet needs is evaluated from product-specific benefits to product-specific unmet needs. The borderline of need understatement and overstatement is not clearly defined between brand and product ratings (Pincus 2004). This study bridges the gap between the unmet needs when consumers are using electronic devices and the consumers’ perceived value achieved by Apple products and Samsung products. Instead of focusing on the brand, this study focuses on the product attributes perceived by consumers.

Based on motivation theory, the needs-based segmentation is the motivation for product-specific benefits. Further, segmentation in unmet needs is the basis for product-specific unmet needs. Consumers tend to seek the product traits that can fulfill their needs to help achieve their task and goal. In addition, individuals are goal-oriented and they intend to find products or services attributes to make purchase decisions. An example would be the means-end approach proposed by Zeithaml (cited in Sánchez-Fernández and Iniesta-Bonillo, 2007).

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Regarding the impact of perceived product values on consumer needs when applied to Apple users versus Samsung users, we hypothesize the following:

Hypothesis 1: The overall impact of perceived product values on consumer needs is stronger and more clearly defined in the case of Apple users than in the case of Samsung users.

Hypotheses 2: The impact of perceived product values that are more personal, such as emotional values, is stronger and more clearly defined in the case of Apple users than in the case of Samsung users.

Purpose

Thus, the purpose of this study is to examine consumer needs when using an electronic device in relation to consumer perceived value pertaining to the features built into the products or services. This study chooses Apple and Samsung products to examine whether consumer choice behavior is determined by consumers’ specific needs they are aware of. The context this study intends to study is Apple product users in general, not limited to specific products. Method

Testing Instruments

This study adopted the definition of m-commerce proposed by Coursaris and Hassanein (2002). There are five dimensions: information, commerce, entertainment, communication, connectivity. The definition of each dimension is presented in Table 1. This study used the established scale for unmet needs suggested by Pincus (2004). A second-order factor with five dimensions was derived from the study of Coursaris and Hassanein (2002). The perceived value scale was generated from the study of Sweeney and Soutar (2001).Sweeney and Soutar (2001) tested consumer perceived value by the same dimensions of consumer buyer choice proposed by Sheth, Newman and Gross (1991b). However, they recommended and tested a multiple item scale, PERVAL, with a 19-item measure. This study used the definition provided by Sheth, Newman and Gross (1991b), without the inclusion of epistemic and conditional value. There were forty-eight questions; the answer for each question is on a scale of 1 to 7 (7=Strongly Agree; 1=Strongly Disagree).

Sample and Sampling Procedures

Samples of this study are undergraduate and graduate students in Business school located in the South region. The samples of online Samsung survey were undergraduate student samples in four different classes. There are 125 Apple respondents; 13 respondents were excluded due to incorrect responses and/or more than half missing answers. On the other hand, there were 121 Samsung respondents and three were excluded due to inconsistent responses.

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Survey Administration

This study used paper and pencil questionnaire and the online survey. Students were distributed the survey in class and returned it in the next class. Surveys were filled out by either Apple or Samsung users. Some students own both Apple and Samsung products and they were free to choose either survey based on their own preference. The second part of the survey was conducted online to generate equivalent numbers of Samsung survey since the classroom distribution of Apple users surpasses Samsung users. The distribution period was September 2012 to December 2012. The questionnaires were sent only to these who own Apple and Samsung products, regardless of the product type.

Testing Procedures

This study first conducted independent sample t-test by using SPSS 18.0 to compare means of needs being fulfilled between two groups. Secondly, exploratory factor analysis (EFA) was conducted to four dimensions of TCV Theory of Consumer Values: price, quality, social and emotional value. Brand equity was added in the questionnaire due to the consideration of not specifying particular product type. The measurement of intercorrelation was examined to precede the following analysis. The results show the coefficient of intercorrelations among variables fit the criteria of the measurement. This study used the principal component method to examine the underlying structure of the scales. Items with low factor loading and high cross- loading were eliminated through multiple times of rotation. Varimax rotation was used to derive a simpler structure and factors with eigen values higher than 1 (Hair, et al. 2009). One item was eliminated from Brand Equity construct in Apple sample. In Samsung sample, one item was eliminated from price construct due to cross- loading; two items were excluded from emotional value item due to none-loading issue.

Regression model was conducted with independent variables (price, quality, social value, emotional value, and brand equity) with the dependent variable (satisfaction in needs). Each regression has one dependent variable; one of the five dimensions in m-commerce needs. This study use item 4 to represent consumers’ satisfaction level. Each regression model was run separately five times in both Apple and Samsung samples.

Findings

Table 2 shows the output of independent sample t-test by comparing Apple and Samsung products. In the five dimensions, Apple users are more satisfied with Apple products compared to the counterparts of Samsung users, as shown by the higher means for Apple users. Apple users feel their needs are fulfilled completely, even beyond what they expect in information, entertainment, and communication needs.

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Table 2. Independent sample t-test

Needs Itema Mean Mean

Difference t b

Apple Samsung

Information

------- product(s) meet my information needs completely

5.56 5.3 .260 1.223

------- product(s) provide more information than I need

5.07 4.52 .548 2.424**

Commerce

------- product(s) meet my commerce needs completely

5.39 4.88 .516 2.425**

------- product(s) provide more commerce options than I need

4.55 4.39 .160 .658

Entertainment

------- product(s) meet my entertainment needs completely

5.92 5.38 .539 2.491**

------- product(s) entertain me more than I need

5.11 4.64 .467 1.758

Communication

------- product(s) fulfill my communication needs completely

5.89 5.52 .371 1.734

------- product(s) provide more communication options than I need

5.05 4.54 .506 1.899

Connectivity

------- product(s) satisfy my needs for connectivity completely

5.69 5.12 .568 2.657***

------- product(s) provide more connectivity options than I need

4.77 4.37 .396 1.535

a Apple and Samsung samples responded to the same items. Apple (n=125); Samsung (n=121). b ** p < .05 *** p < .01

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In EFA output, factor loadings were straightforward in Apple sample whereas there are several items not loading to an established construct in Samsung sample. In particular, two values, emotional values and price, are more robust in the case of Apple users; as more items are contained in those two constructs for Apple users (See and compare Tables 3 and 4). Those results mean that construct validity of perceived product values is better when applied to Apple users than it is when applied to Samsung users.

Cronbach’s Alpha was estimated for the five constructs: quality, price, social and emotional value and brand equity with new generated items and all the constructs show internal consistency as reflected by alphas higher than 0.7 (Hair et al., 2009).

Table 3. Apple EFA: Factor Loading (Varimax Rotation)

Factor 1 2 3 4 5 Cronbach’s Alpha Quality1 Quality2 Quality3 Quality4 Quality5 Quality6

.833

.868

.786

.592

.565

.700

.84

Price1 Price2 Price3 Price4

.742 .698 .662 .694

.76

Social1 Social 2 Social 3 Social 4

.731 .839 .831 .854

.88

Emotional1 Emotional 2 Emotional 3 Emotional 4 Emotional 5

.722 .738 .741 .788 .788

.89

Brandequity1 Brandequity 2 Brandequity3

.604 .830 .912

.80

Note: Brandequity 4 was eliminated due to low loading.

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Table 4. Samsung EFA: Factor Loading (Varimax Rotation)

Factor 1 2 3 4 5 Cronbach’s Alpha Quality 1 Quality 2 Quality 3 Quality 4 Quality 5 Quality 6

.893

.900

.795

.756

.563

.794

.91

Price1 Price2 Price3

.853 .773 .688

.85

Social 1 Social 2 Social 3 Social 4

.819 .932 .846 .860

.93

Emotional 3 Emotional 4 Emotional 5

.779 .809 .784

.86

Brandequity 1 Brandequity 2 Brandequity 3 Brandequity 4

.760 .868 .868 .810

.86

Note: Emotional 1, 2 and Price 4 were eliminated due to non-loading in the factor and cross-loading.

Table 5 and 6 show multiple regression results by which Apple users demonstrate emotional attachment to Apple products. The attachment is pronounced when satisfying entertainment, communication and connectivity needs. On the other hand, Samsung users demonstrate negative brand equity in commerce and connectivity. In addition, social values have a positive relationship with communication for Samsung users. In general, the values perceived explain equivalently well (R2) the needs of consumers when using electronic devices in both Apple and Samsung samples.

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Table 5. Multiple Regression Model

Dependent variable: Y (Apple) N=125 Variablesa Information Commerce Entertainment Communication Connectivity Constant 1.211b 1.987 .817 1.638 1.647 (1.436) (2.351**) (1.024) (1.806) (1.993**) Price .226 .318 (1.749) (2.452**) Quality .343 .446 .429 .407 (2.321** c) (3.208***) (2.692***) (2.804***) Social Valued Emotional Value

.301 .458 .273

(2.244**) (2.996***) (1.95**) Brand Equity .183 (1.693) R2 .212 .164 .3 .23 .224

a Independent variables: price, quality, social value, emotional value, and brand equity. b Bold numbers are unstandardized coefficients; t-statistic is given in parentheses. c ** significant at 0.05 level; *** significant at 0.01 level.

d βx of social value in all regression models is not significant. Table 6. Multiple Regression Model

Dependent variable: Y (Samsung) N=121

Variablesa Information Commerce Entertainment Communication Connectivity

Constant 0.451b 0.369 0.706 1.532 0.461

(0.479) (0.388) (0.762) (1.652) (0.588)

Price 0.409 0.441

(2.113**c) (2.272***)

Quality 0.386 0.834 0.555 0.706

(2.104**) (4.611***) (3.131***) (4.27***)

Social Value 0.229 0.351 0.431

(1.745) (2.769***) (3.682***)

Emotional Valued

Brand Equity -0.215 -0.226 -0.247

(-1.748) (-1.923) (-0.195**)

R2 0.2 0.167 0.312 0.232 0.221 a Independent variables: price, quality, social value, emotional value, and brand equity. b Bold numbers are unstandardized coefficients; t-statistic is given in parentheses.

c ** significant at 0.05 level; *** significant at 0.01 level. d βx of emotional value in all regression models is not significant.

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Limitations

The limitation of this study lies on the approach to products because we sued product lines and brands as opposed to specific products. Future studies can compare specific product categories to detect whether the results are different. Future research should also inspect the comparison using other products, similar to the consumer choice behavior developed by Sheth, Newman and Gross (1991b). Discussion

This study responded to the questions of whether consumer needs are related to consumer choice behavior when examined in concrete product lines, such as Apple products and whether the relationship between needs and consumer choice is different with products of other brands, such as Samsung’s. We found that there is a significant relationship between consumer needs and perceived product values. Moreover, we found that perceived product values explain consumer needs as shown by significant R2 results. The relationship is stronger in the case of Apple users, emphasizing the role of personal values, such as the emotional ones.

Acknowledgements and/or Notes: A previous version was presented/published in the Proceedings of the 2015 AtMa Conference.

References

Bødker, M., Gimpel, G. and Hedman, J., 2009. The user experience of smart phones: a consumption values approach. In: International Executive Education Institute (IEEI) of the American University in Cairo (AUC), 8th Global mobility roundtable (GMR): transformation through mobility, Cairo, Egypt, 2-3 November 2009. Coursaris, C. and Hassanein, K., 2002. Understanding m-commerce: a consumer- centric model. Quarterly Journal of Electronic Commerce, [e-journal] 3(3), 247-271. Available through: Tarleton State University Library website [Accessed 12 November 2015]. Fiske, S.T. and Taylor, S.E., 1984. Social cognition. New York: Random House. Fitzsimons, G.M., Chartrand, T.L. and Fitzsimons, G.J., 2008. Automatic effects of brand exposure on motivated behavior: how apple makes you “think different”. Journal of Consumer Research, [e-journal] 35(1), 21-35. Available through: Tarleton State University Library website [Accessed 13 November 2015].

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Hair, J.F., Black, W.C., Babin, B.J. and Anderson, R.E., 2009. Multivariate data analysis. Upper Saddle River: Prentice Hall. Pincus, J., 2004. The consequences of unmet needs: the evolving role of motivation in consumer research. Journal of Consumer Behaviour, [e-journal] 3(4), 375–387. Available through: Tarleton State University Library website [Accessed 12 November 2015]. Riley, A. and Boome, A., 2011. Superbrands' success fuelled by sex, religion and gossip. BBC News, [online] 17 May 2011. Available at: <http://www.bbc.co.uk/news/business-13416598> [Accessed November 25, 2015]. Sánchez-Fernández, R. and Iniesta-Bonillo, M.Á., 2007. The concept of perceived value: a systematic review of the research. Marketing Theory, [e-journal] 7(4), 427- 451. Available through: Tarleton State University Library website [Accessed 12 November 2015]. Sheth, J.N., Newman, B.I. and Gross, B.L., 1991a. Consumption values and market choices: theory and applications. Cincinnati: South-Western Publishing Co. ---- 1991b. Why we buy what we buy: a theory of consumption values. Journal of Business Research, [e-journal] 22(2), 159-170. Available through: Tarleton State University Library website [Accessed 12 November 2015]. Sweeney, J.C. and Soutar, G.N., 2001. Consumer perceived value: the development of a multiple item scale. Journal of Retailing, [e-journal] 77(2), 203-220. Available through: Tarleton State University Library website [Accessed 12 November 2015].

166| Atlantic Marketing Journal Fitting Consumer Needs to Perceived Product Value

Author Information

Dr. Yi-Chia Wu earned her Ph.D. in Marketing from The University of Texas–Pan American and is an Assistant Professor of Marketing at Tarleton State University. She has published in journals and proceedings including IVEY Business Journal, International Journal of Security, the American Marketing Association, the Academy of Marketing Science, and the Association for Consumer Research, and Interdisciplinary Symposium on Decision Neuroscience conferences. Dr. Arturo Z. Vasquez-Parraga earned his Ph.D. degree in Marketing and International Business from Texas Tech University and is a Professor of Marketing and International Business at the University of Texas Rio Grande Valley (UTRGV). He has published in numerous journals and proceedings including Journal of Marketing Research, Journal of Business and Industrial Marketing, Journal of Consumer Marketing, Journal of Retailing and Consumer Services, Journal of Business Research, and Journal of Travel Research.

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