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Consumer buying behavior and its impact on the local market – A case study on the smartphone market in Bangladesh.

Published on Aug 30, 2020

Bangladesh is the world's 8th largest number of population country and smartphone number users increasing year to year. According to the latest research from the counterpoint’s market monitor service the market of smartphones grew 45% year on year during 2019. The lack of locally manufactured devices unable to meet the market demands so that the majority of smartphones importing from outside of Bangladesh and meeting the local demands. Based on the demand locally manufactured and assemble devices increased by 29% in 2019 but still not reaching the major pick position to dominate the local market.

source: Google image

Walton is one of the leading local electronic brands in Bangladesh they mainly focusing on consumer electronics like refrigerators, Air conditioners, smartphones, TVs. They assemble all its devices in the country and some of the points they manufactured some products. On the other hand, incapable to meet the local demands smartphones have to import from other countries. Foreign brands still holding the top position of holding the major distribution channel and its growing day by day. Some well-known foreign brands are- Samsung, Huawei, Apple, Xiaomi, OPPO, one plus, realme, and Vivo.

source: google

Consumers' behavior is one of the important approaches to find out what trend flows into the market. Consumers get their intention towards a product based on a certain brand,  special feature,  price, country of origin image, ethnocentrism, cosmopolitanism. Besides, the perception of a consumer towards a high-quality product will make them a clear identification between price and quality of a certain brand and towards them to find the best choice from the brands that are offered by competitors. After evaluating the offering brands if there are more than two brands consumers will choose the brand with higher qualities. The consumer will not only identify the quality for the intention of buying a product but also emotional value gets priority to buying intention because of a feeling happy with them using the particular brand products.
To understand the consumer behavior approach these factors define very well-  1. Cosmopolitan consumer and 2. Ethnocentric consumer. -cosmopolitanism which is a willingness to participate with others and openness for different cultural experiences with intellectual stance. Some peoples saw themselves as a nation rather than locality, think globally rather than the nation, the broader, more broadly rather than the narrower, more culturally diversified, and geographic group. Ethnocentrism consumer intention to buy domestically produced products more preferences instead of foreign products for ethnocentric consumers and they have better predictors for domestic product judgment issues instead of foreign product judgment.

source: statcounter globalstats

If we saw the chart it is reflecting that consumers are highly interested to buy foreign smartphone brands rather than local. Why is this situation happening? Because of the consumer either becoming cosmopolitanism and experiencing foreign brands rather than local brands or local brands are not meeting the consumer expectation in terms of product quality, price, feathers.  If this number growing day by day consumer might forget the local brands and depends on the foreign brands. In this situation, local brands will lose their market position and be beaten by foreign brands. Consumers are planning to buy a smartphone after researching the market and market offering products in a range of their budgets. It's not a matter of some days to create a consumer mindset as ethnocentric. This mindset is only able to create after having trust and loyalty on the local brands rather than foreign brands. So at this time- The government and their policy have might a great role to protect the local brands and encourage them to produce the best product experience for the consumers.
Ethnocentric consumers are less interested or ignore to buy foreign products because they consider that they are getting harmful to the national economy and increase unemployment. So consumers are less interested to buy foreign products because it might hurt their emotional dimension also. But If an ethnocentric consumer thinks of the value of the money with the buying goods and this emotional dimension not able to hold for longtime if the consumer is not getting products as their expectations. So local firms should offer a variety of product with concentrating the quality and price so that consumer remains the same as an ethnocentric consumer rather than a shock for the Walton (local brands).
Questions:
1.      Why consumer has the intention to buy foreign smartphone rather than Walton?
2.      Is consumer cosmopolitanism has an impact on the local market? What's your understanding of ethnocentrism and cosmopolitanism to influence the purchasing intention of local or foreign products.
3.      Which area Walton should focus to improve for the market leadership position in Bangladesh. ( smartphone innovative features, design, price, quality, availability, etc.).
References:
1.      Acharya, C., and G. Elliott. 2003. Consumer ethnocentrism, perceived product quality and choice. An empirical investigation. Journal of International Consumer Marketing 15 (4): 87– 114 .
2.      Shimp. T. and Sharma. S. (1987). “Consumer ethnocentrism construction and validation of the CETSCALE”. Journal of Marketing Research. Vol. 24. Pp. 280-9..pdf. (n.d.).
3.      Merton, R. K. 1957. ‘Patterns of Influence: Local and Cosmopolitan Influential.’ In Social Theory and Social Structure, edited by R. K. Merton, 387–420. New York: The Free Press
7.      Waltonbd
Author,
Ashiqur Rahman
International Trade, 
Pusan National University, Busan, South Korea.

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