Chapter 1

INTRODUCTION

“There are about 60 million television sets in the country and about four million PCs. The

reach of newspapers and other magazines is even lower. One medium, which has the highest

reach in the country, is the mobile”

1.1 Mobile Phone Users and Mobile Industry in India

The total mobile subscribers in India were 391.76 million at the end of March 2009. The

outstanding growth of 50.04% in 2008 - 2009 was slightly low than 58.13% growth in 2007 –

2008 (Figure 1). India adds around 10 million new subscribers each month and now has achieved

world’s second largest mobile subscriptions, which is after China. 85 % of the mobile phone

users are from Urban India, where high level of penetration and significant mobile subscribers

are offered by metro/urban areas (Figure2), however penetration in rural areas in on increasing

trend and will contribute much in future, as many infrastructural developments have been

undertaken in rural areas and also as urban market is saturating.. High disposable income and

low price of handsets have bought this revolution in mobile industry and have made mobile

phone in reach of all social groups, income levels, professionals, businessmen’s and all age

groups. Youth between 15– 30 are 45% of the total mobile phone users in India.

Figure 1: India Mobile Subscribers Growth

Source: TRAI 2009

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Figure2: Penetration in Metro/Urban India. Source: AIMAI 2008

India’s largest Wireless Service Providers are Bharti Airtel (23.74%), Reliance (17.54%),

Vodafone (16.9%) and BSNL (15.62%). However, these ‘Big 4’ service providers are to get

increasing competition from Tata Teleservices and Idea Cellular. Also further competition will

come from new international entrants such as Bahrain's Batelco, Norway's Telenor and Russia's

Sistema.

Figure3: Market Share of Wireless Service Providers (As on 31st March 2008).

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Source: TRAI 2008

Mobile operators in India along with voice services, provide mobile value added services like

SMS, mobile Internet, e-mail services, chatting services, GPRS etc to customers. Based on the

need of customers, innovative services like Closed User Group, Video Conferencing etc. are

available to mobile customers. However, SMS currently dominates and contributes around 49%

to the overall MVAS revenues.

1.2 Mobile Advertising in India

Mobile advertising is at a nascent stage in India and dominated by SMS advertising, where push

based advertising is most popular. A survey by Limbo GFK on 1000+ people in India found

that 85% of people are receiving advertising messages on their mobile phone, of which 75% said

they receive advertisements through SMS. This means many consumers have experienced SMS

advertising. Close to 400 million mobile phone subscribers and their exceptional growth every

month makes mobile phone the single largest durable in India, the strength on which marketers

are capitalizing and cannot afford to ignore. Adding to it is increasing mobile web usage, the

arrival of new technological advancements like 3G and Location based services in India. At

present, SMS advertising in India is conducted without permission. Therefore, Telecom

Regulatory Authority of India (TRAI) in late 2007 introduced National Do Not Call Registry

(NDNC Registry) to curb unsolicited calls and SMS done for commercial communications

(NDNC Registry 2007). But, it is not proving effective, to stop telemarketing calls and SMS

advertisements from marketers. However, permission based advertising and location based

advertising is expected to be a ‘big thing’ in near future and marketers and businesses in India

are seeing mobile advertising as a great opportunity. The mobile advertising industry in India is

about $ 25 million at present and is expected grow to over $62 million by 2011.

Though marketers in India are looking it as powerful gateway for future the growth in mobile

advertising has been slow and below expectation in past years. The clear reason is that SMS

advertising efforts by marketers are not generating the required impact on consumers in India;

this is because marketers have not fully understood the attitude of consumers towards SMS

advertising and the drivers influencing their attitude. Marketers are still exploring and have still

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not understood the full potential mobile advertising. They wish to explore what it means to

consumer and as consumer is not responding well to SMS advertising, they say “The consumer

sees mobile as communication device, so it’s the consumer who’ll tell what to do”. Therefore,

this study with its objective to find out Indian consumers view of dominantly prevailing SMS

advertising will give intensive insight to marketers and will give directions towards the future of

SMS advertising in India. This will be done by identifying the drivers of consumer’s attitude

towards SMS advertising, if SMS ads generate purchase intentions and if brand advertise through

SMS have any effect on purchase intentions. Further, it will be determined if consumers are

willing to except Location Based Advertising and if privacy concerns regarding location tracking

will be significant for Location Based Advertising.

1.3 Benefits of SMS Advertising

The high global penetration of mobile phones and popularity of SMS is only one indicator of

potential of SMS advertising. Every phone today has the capability to send and receive SMS.

SMS advertising also allows the integration of multiple interactivity features such as Click-to-

call, click to mobile web and click-to-download to handsets with required capabilities by

displaying colored links and underling of URL’s and phone numbers.

Further, SMS advertisements are relatively cheap and easy to send compared with other

mediums and provides wide reach, short lead times and rapid response. Mobile marketing is one

of the few mobile opportunities in which the potential of the opportunity actually exceeds its

current hype. A viral effect takes place and is immense if the receiver of SMS advertisement find

it appealing and forwards it to their friends, family and so on, who are not the initial target of the

campaign. This turns out as a positive ‘word of mouth’ or can say positive ‘word of text’ as

people believe, trust and respond well to messages from their known. This viral makes it

possible to enlarge the reach of the SMS marketing campaign and also increase its effectiveness

linked mobile marketing as having "your best salesman in the pocket of your best customer."

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1.4 Issues with SMS Advertising

The technical issue with SMS advertising is that marketers only have 160 characters to express

their message and cannot use colors and logos to represent the brands. However, these issues are

‘no issues’ compared to the benefits and functionality provided by SMS advertising and when

marketers uses the space effectively to deliver relevant message to the consumer and at right

time. But, there are consumer related issues that might completely hide the benefits and

functionality of SMS advertising. These issues are related to consumer’s privacy and security,

because using the capabilities of mobile phone to collect, store and monitor information the user

can be easily identified through the access to their demographic data, location information,

calling pattern etc.

Email was once considered as killer application for both the consumers and marketers. However,

spam and frauds quickly made it a plague for consumers, which makes consumer resist this

medium when used by marketers. Compared to e-mail, mobile phone is very personal to a

person, and there is less tolerance for interruption or abuse, and above all it cannot distinguish

between a spam and genuine messages itself. Consumers are really sensitive about receiving

SMS from an unknown person or organization and find it really intrusive. Therefore, while

addressing consumers through SMS advertising the privacy issues are really important. For such

issues related to privacy and security of consumer, legislation in many developed countries, e.g.

in European countries, Canada, Australia and New Zealand have made strict rules for advertisers

to use ‘permission based advertising’ for contacting consumers using mobile advertising.

1.5 SMS VAS in India – Perspective

The following market report (Source:- http://www.pluggd.in/india-mobile-market-report-sms-as-

a-vas-service-297/) looks at SMS usage in Urban India to shed some light on its future and

answer a critical question, “Is SMS here to stay or will it be replaced?”

Indians use SMS for all sorts of reasons from receiving jokes to checking on flight status to

enquiring about exam results. It’s a very powerful medium for getting in touch with people

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without soliciting a backlash as seen on phone calls. It’s effective for getting the message out to

potential customers or retaining existing ones. Some key points of this report are:

1 in 5 urban Indians have used a SMS based VAS service either as a one-off or on

subscription basis

SMS is an effective marketing tool, showing conversion rates a lot higher than other

conventional mediums i.e. TV/Radio etc. 1 in 3 Urban Indian has acted in some manner

over the SMS i.e. forwarding to others or enquiring about it.

SMS, an advertising medium, has an interaction rate of around 5%

A quarter of urban Indians have participated in some sort of SMS contest, a valuable tool

for getting consumers involved with products/services

1.5.1 SMS VAS Users – City wise Distribution

SMS is a popular medium for delivering Value Added Services (VAS); it’s a valuable revenue

source for service providers, almost 5% of service provider revenue comes from SMS VAS

services the highest revenue earning VAS.

Almost 20% of Urban Indians or 1 in 5 have used a SMS VAS service over the quarter ending

May 2009. On looking at the big 7 Indian cities, Delhities are the most avid users of SMS VAS

services, accounting for 6% of all SMS VAS users in Urban India followed by Mumbai and

Chennai at 5% each.

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SMS Usage - City wise

1.5.2 Most Popular SMS VAS Usage

Receiving jokes via SMS on phones is the most popular SMS VAS service subscribed by 1 in

2 SMS VAS subscribers followed by Astrology (47%), News alerts (44%) and Jobs (43%).

SMS Usage in India - Most Popular Items

1.5.3 Gender wise Distribution of VAS Usage

Males are generally more active users of SMS VAS services compared to their counterparts.

While males are more interested in getting sports updates females are interested in spiritual

and astrology quotes.

SMS Usage in India - Gender Difference

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1.5.4 SMS VAS Usage Distribution by Age

On looking at usage of SMS VAS services by age, SMS related to “Stocks/Finance/Business”

are most popular among 55 years or older people while Jokes are the most popular SMS VAS

service for 18 to 44 years old.

SMS VAS Usage in India - Age Matters

1.5.5 SMS as a Marketing Tool

SMS is increasingly being viewed by India Inc. as a source of getting in touch with their

customers. This is evident from the fact that every second urban Indian acknowledged receiving

marketing/promotional SMS on their phone in quarter ending May 2009.

India: SMS as a Marketing Tool

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The intensity of using SMS for marketing/promotions is quite high with almost 75% receiving a

minimum of 4 such SMS.

1.5.6 SMS – What’s in for companies to use the medium?

Companies offering downloads for ringtones/wallpapers/games use SMS as a marketing tool a

lot more frequently, 37% of Urban Indians have received a SMS offering such products,

followed by entertainment/media companies i.e. movies, music etc, garnering a 36% recall rate.

SMS Marketing in India Usage

1.5.7 Efficiency of SMS as a Marketing Tool

1 in 3 of Urban Indians who receive a marketing/promotional SMS takes some action while 2 out

3 deleted or ignore the message completely.

Calling up to inquire (if number available) followed by forwarding message to others are the

two most commonly cited actions taken on receipt of marketing/promotional SMS. While 11%

also indicated they made a purchase on the basis of information received via SMS.

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India: Efficiency of SMS as a Marketing Tool

1.5.8 SMS Marketing Effectiveness – The Battle of Sexes

Females are less likely to ignore and/or delete the message compared to males and are more

likely to enquire further i.e. by calling up customer service or walking into the store. However

males are more involved when it comes to using the coupons/discounts offered in SMS.

SMS Marketing Effectiveness – The Battle of Sexes

1.5.9 SMS Marketing Effectiveness – What’s Age Got to with it?

35 to 44 year olds are most likely to purchase a product(s) and/or service(s) based on information

received via SMS.

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SMS Marketing Effectiveness – What's Age Gotta Do

1.5.10 SMS as an Advertising medium

SMS is so widely used in India that it’s now becoming a medium for advertising as well. Many

companies are using this powerful medium to advertise their offerings. 8% of the urban Indians,

approx 22 million have seen an ad in a SMS they have received, while 65% of those who have

seen have also read the advertisement message. Such high level of awareness indicates the

importance of this medium for advertising.

India: SMS as an Advertising medium

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CHAPTER-2

CONCEPTUAL FRAMENWORK

2.1 Defining Mobile Marketing and Advertising

“Advertising says to people, 'Here's what we've got. Here's what it will do for you. Here's how

to get it”. To its simple from, Mobile Marketing Association defines mobile advertising as “a

form of advertising that is communicated to the consumer/target via handset”. Mobile

advertising and marketing have various definitions in literature and many use the terms mobile

advertising, mobile marketing and wireless marketing interchangeably.

Haghirian & Madlberger defines mobile advertising as:

“The usage of interactive wireless media (such as mobile phone) to transmit advertising

messages to consumers in form of time and location sensitive, personalized information with

the overall goal to promote goods and services.”

Where Scharl, Dickinger and Murphy define mobile marketing as:

“Using a wireless medium to provide consumers with time- and location-sensitive,

personalized information that promotes products, services and ideas, thereby benefiting all

stakeholders.”

Both these definitions highlight that mobile advertising creates opportunity and value for both,

the marketer and the consumer. Definitions also bring out the important features of mobile

advertising i.e. personalized, time and location sensitive advertising. Amongst these, time- and

location is exclusive feature of mobile advertising, which is not present in any other medium.

Location-based advertising takes advantage of this feature to send advertisements based on users

location.

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2.2 Location Based Advertising (LBA)

LBA is simply defined as “targeted advertising initiatives delivered to a mobile device from an

identified sponsor that is specific to the location of the consumer”. It is one of the most

interesting opportunities provided by mobile advertising, as using the Global Positioning System

(GPS) technology in handset, real time marketing is possible by meeting customers’ needs at the

time and place they want and, when they are most ready to buy

For example, customer near a mall or in the mall, receiving a message from ‘Versace’ that ‘50%

discount has started right now, come and grab the latest collection’, thereby inducing impulse

purchase. LBA is relatively new and have started in various developed countries, like many parts

of Europe and recently Singapore's launched location-based SMS advertising. LBA enables the

marketer to target the right person with the right message at the right time in the right place.

2.3 Mobile Advertising Avenues

Mobile advertising uses messaging applications unique to mobile phone, i.e. SMS and MMS

argues are the main mobile advertising systems. Using wireless application protocol (WAP)

which allows mobile web, advertising on mobile phone also occurs through email, browsing,

Instant Messaging, banner ads, sponsorships, video ads and games. Multimedia Messaging

Services (MMS) is a rich messaging service that allows mobile users to send and receive

messages that can include graphics, photos, audio video and text. Marketing opportunities

through MMS are significant but it is not yet universally supported by all operators’ networks

and all mobile phones. Short Messaging Service (SMS) are the most popular and common form

of mobile advertising. In the literature, mostly all the researchers have used advertising

conducted through SMS form to represent mobile advertising in general, and their findings are

based on it. The focus of this project is also on the SMS advertising, widely known as mobile

advertising.

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2.3.1 SMS

SMS also referred to as ‘text messages’ or ‘texting’ is a form of Instant Messaging system that

allows users to send alphanumeric messages of up to 160 characters to any GSM (Global System

for Mobile communication) phone. SMS was introduced in 1992 and is one of the fastest

growing communications technologies in human history. SMS is most widely used mobile phone

service after voice and popular among users of all ages for social and business contacts around

the world.

Wei, Xiaoming & Pan (2009) refer SMS as the most successful killer mobile service application.

According to ABI Research, SMS accounts for 83% of all mobile messaging revenues until

2013, providing global service revenues of $177 billion. According to Telecoms market research

(2009), till mid - 2008 world’s population was 6.7 billion, there were 3.5 billion mobile

subscribers and there were 2.3 trillion SMS sent. Such a high usage and popularity show that

marketers and businesses would not like to miss this tool to send across their message and bring

business.

2.3.2 SMS Advertising:

The rising popularity of SMS has created the channel for mobile advertising. The first mobile

advertising in the form of SMS happened in Finland in 1997. Big brands such as Procter &

Gamble, Coca-Cola, Microsoft, Cadbury and McDonald’s are the pioneers in integrating SMS

advertising into their marketing campaigns. Today due to very high volume of SMS usage,

marketers have realized its potential and the use of SMS for marketing purpose has drastically

increased in many parts of the world. Wireless Business and Technology in 2005 found that lots

of companies from different industrial sectors are inclined to use SMS as a part of their

marketing mix.

SMS advertising increases customer’s inclination to purchase by 36% and delivers a 15 %

response rate, which according to their estimates is twice as much as direct mail or e-mail

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campaigns. They further noted that SMS ads are 50 % more successful at building brand

awareness than TV and 130 % more than radio. SMS advertisements and promotions in the U.S.

have proven effective with response rates of up to 12%.

Six ways of using SMS for advertising, i.e. brand building, special offers, timely media ‘teasers’

competitions, polls/voting, products, services and information requests. LBA is done by SMS at

present and different ways of SMS advertising would translate to LBA when sent based on the

location-specific information of a consumer.

2.4 Categories of SMS Advertising

SMS advertising has typically been categorized into:

Push Model

Pull models

Which Wei, Xiaoming & Pan argue is another major difference between SMS/Mobile

advertising and traditional forms of advertising. Adding to it, Location Based SMS Advertising

is also categorized into push and pull model.

2.4.1 Pull Advertising

The marketer sends the information requested by the consumer. Basically the consumer pulls the

information towards himself or herself by actively seeking information. Example, consumer

request the product/service or information by sending an SMS to number that has been

advertised on other mediums like T.V, internet, point of sale etc. ‘Text – to- Win’ competitions

are common example of pull strategy . This strategy is more close to interactive communication

and can be good for building relations with consumers. However, a better integration is required

with other mediums as sometimes it becomes challenging through other advertisements to have a

desired pull effect. In a pull LBA, the consumer requests for the advertising or promotion for his

preferred product categories close to his or her location. Example, a consumer in a mall could

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use mobile phone to check for promotions in preferred categories from retailers in an around that

area.

2.4.2 Push Advetising

SMS advertising is typically considered push based advertising. Here the marketer takes the

initiatives to send messages to the consumer i.e. the messages are pushed out to the consumer.

Example for push advertising can be m-coupons, alerts and promotional messages sent to

consumers. Example can be a dinner offer sent to a consumer when he is passing by a favourite

restaurant in the evening. Push LBA provides effective ways to trigger impulse purchases.

Generally, push strategies have been associated with efforts to boost sales in the short term and

considered effective for brand building. As the marketers push the advertisements to consumers,

the message can be sent regardless of whether consumers have agreed to receive it. This raises

the issue of consumer’s permission and can cause irritation to the consumer. The focus of this

report is on the push SMS based advertising as these are the one which consumers may have not

requested to receive and can lead to negative attitude and perceptions towards SMS advertising.

Mobile phone being a powerful tool can really add value for both the consumer and the

marketers, but being a very personal device can lead to intrusion and reduce the effectiveness.

2.4.3 Permission Based Advertising

Permission based advertising “offers the consumer an opportunity to volunteer to be

marketed to” and it is therefore “anticipated, personal, and relevant”. It is simply where a

consumer has actively given his permission to receive commercial messages, through SMS in

this case. E.g. consumer can opt-in and give his permission by filling in their mobile number on a

regular customer registration form to receive commercial messages of his interest. Further as

location based advertising can be highly intrusive and consumer might get nervous to know that

marketers know his location, Mobile Marketing Association in ‘Code of conduct’ for mobile

marketing states that LBA is prohibited unless the consumer actively gives his permission.

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Permission based approach is the easiest way to tackle the privacy issue and can effectively build

trust. After giving permission consumers would not be surprised on receiving the SMS form

marketer, as they would know where and why it is coming, and will respond well to it.

Therefore, with permission, marketers can precisely target the consumers and send relevant

advertisements, thereby increasing the effectiveness of the campaign. Getting permission to send

marketing message is a prerequisite of effective mobile advertising. However, showing creativity

by using right combination of questions framing and default answers marketers can encourage

customers to give permission. Cyber Dialogue in their study found that 69% of US internet users

did not knew how they had given consent to be included on email distribution list. This raises the

question for permission to be effective. If consumer’s issues regarding the privacy and security

are not considered, the growth of mobile marketing may be jeopardized, similar to what

happened with the growth of e-mail marketing.

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CHAPTER 3

RESEARCH METHODOLOGY

According to Saunders, Lewis & Thornhill (2007) methodology is “the theory of how research

should be undertaken, including the theoretical and philosophical assumptions upon which

research is based and the implications of these for the method or methods adopted”.

3.1 Research Approach

The two types of approaches while doing business research are qualitative and quantitative

research. Many scholars have stated that both types of researches are complimentary and not

mutually exclusive, therefore cannot be used in isolation. This study is also both qualitative and

quantitative. Qualitative research in general aims and emphasizes to understand why something

happens and is commonly used to understand human behavior, attitude and functions. This study

is qualitative as it aims to examine the driver’s influencing attitude of consumers towards SMS

advertising, there purchase intentions and willingness to accept location based advertising.

However, it is quantitative, as quantitative researches are concerned with numbers and statistical

analysis which are employed in this study.

Qualitative researches are generally inductive whereas quantitative researches are deductive. In

an inductive approach general conclusion are drawn from empirical observation and the process

goes from assumptions to conclusion. An inductive approach is taken in this study to determine

the attitude drivers, intention and willingness of consumers in India, which is a new and different

environment and different culture leading to new opportunities and challenges. In deductive

approach conclusions are drawn from a known premise and theory influences the research

process. This study is also deductive as it has well established role of existing theories, which

gives the choice of variables or antecedent of attitude and willingness, and selection of research

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questions. Both inductive and deductive researches are not totally exclusive of each other and

include elements of one another.

3.2 Research Strategy

“Research methods refer to systematic, focused and orderly collection of data for the purpose

of obtaining information from them, to solve a particular research problem or question.

Amongst the popular business strategies i.e. case studies, experiment, action research, survey,

ethnography and grounded theory, the survey method has been used. A survey strategy is most

commonly and widely used in business studies and generally uses questionnaire or interview

techniques for recording behavior of respondent. Survey has been used in the study as it is an

effective tool to get opinions, attitude and cause and effect relationships. It makes large samples

feasible and can give high quantity of quality data, which is easy to understand and directly

comparable. However, if sample is non representative or biased, the results may not be

generalized. Email- survey has been used being economical and due to time constraints. This

strategy has also been used based research questions and data collection source. However in

these surveys there is an issue of high rate of ‘non response’. Survey method has been used in

mostly all the researches on SMS and mobile advertising.

3.3. Data Source

3.3.1 Primary Data Collection

Primary data are the original data collected for the research problem at hand. The reason for

using primary data is that this study is about the attitude, intention and willingness of consumers

which is always better to collect first hand and only primary data can help answer these. The

main advantage of using primary data is that it is more consistent with the research questions and

objectives. However, collecting primary data can take long time and gives less degree of control

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in data collection. The research uses e-mail questionnaire survey for collecting the primary data

to answer all the research questions, which is usually quicker.

3.3.1.1. Consumer Questionnaire

Questionnaire is most commonly used and is an important part of survey process which can

collect data from large number of respondents. The Questionnaire has been carefully designed

and structured taking care of the cultural aspect of the respondents; using simple and concise

language and being specific to the information required ensuring that every respondent

understands the question in the same manner. As Location Based Advertising is new to many, it

was explained before the specific questions regarding it, so that responses are with proper

knowledge of the subject. The email sent with the link for electronic questionnaire included a

polite request from the respondents for their help. The objective of the study is to identify the

attitude drivers, intention and willingness, therefore 5 point Likert scale ranging from “strongly

agree” (1) to “strongly disagree” (5) has been used in the questionnaire.

3.3.2. Secondary Data

Secondary data are the information collected by others which may be for a different purpose

from the one who is using them. For this research secondary data has been used from a wide

range of reliable sources which helped in conducting an extensive literature review and therefore

helping in better understanding and explaining the research problem, framing focused research

questions and providing benchmark to compare results of the study. The secondary data has been

collected from various academic and professional journals, relevant newsletters, marketing and

business researches and reports, government statistics, books, newspaper articles, magazines and

industry reports.

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3.4. Sampling

Sampling is an important part of research activity. A sample is a subset of large population

which represents the characteristics of the entire population and helps gathering the important

data in less time and economically. The population for this research is basically all mobile users

in Urban India.

3.4.1. Sampling procedure

Sampling procedures are categorized into probability and non-probability samples. In a

probability sampling each unit of population has an equal chance of being included in the

sample. This research uses convenience and judgment sampling which are under non-probability

sampling category. Convenience sampling involves a random selection of easy accessible units

and is effective in short time duration of the research. The sample includes students from

various ICFAI Business schools because college students are appropriate for such studies as they

are an important market for mobile phones. The survey questionnaire was developed online at

http://www.surveygizmo.com/ the link to which was sent across to the sample through e-mail.

The sampling is also judgmental. Wentz (1972) says “Occasionally it is possible to select, using

judgment alone, a sample that is truly representative of the market population.”

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Chapter 4

Literature Review

4.1 Attitude

“Numerous failed business ventures attest to the fact that managers emphasize technologies

over consumers at their own peril” .

Understanding consumer attitudes toward advertising have been an area of attention since long

and it is an important concept in research on marketing and information systems. “An attitude is

a person’s enduring favorable or unfavorable evaluations, emotional feelings, and action

tendencies toward some object or idea”. Attitude is as an indicator of the effectiveness of

advertising. Success of a new marketing tool depends on its acceptance by consumers and the

acceptance can be determined by the consumer attitude towards it. Directions to this have been

given by the Theory of Reasoned Action (TRA) developed by Fishbein and Ajzen in the early

1970s, the model that explains human behavior across situations. The most basic premise of the

TRA is that system use is determined by behavioral intention and the behavioral intention is

influenced by individual’s attitude. Many researchers found that the attitude towards mobile

advertising strongly determines the behavioral intention to receive mobile advertisements.

The Theory of Reasoned Action (Ajzen & Fishbein, 1980; Fishbein & Ajzen 1975) proposes

that Attitude influences behavior through intention. Intention is defined as “the strength of a

person’s Informativeness, Credibility, Irritation, Attitude, Intention, Gender, Prior Permission,

Entertainment, Subjective Norm conscious plan to perform the target behavior”. A study of

coupon usage shows that attitude and subjective norm will lead to intention to use coupon

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FIGURE : THE TRA-BASED MBOILE ADVERTISING MODEL

Consumers’ attitudes towards mobile advertising are positively related to their behavioral intention

to receive and read mobile advertisements.

Apart from one’s attitude towards an object, another important variable determining intention is

subjective norm in the TRA model. Subjective norm refers to an individual’s perception of what

Important people think he/she should or should not do, and the individual’s inclination to comply

with their specific desires. One of the assumptions of the TRA model is that human beings are

rational. Basic economic theory states that an individual often maximizes his/her utility. Under

this circumstance, consumers only accept mobile advertising when they perceive benefit in

receiving and reading mobile advertisements. The “use-and-gratification” approach can explain

the utility perception of mobile advertising. This approach implies that people will consciously

choose and employ certain media to satisfy specific needs since the mass media have social and

psychological functions.

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Informativeness

Entertainment

Irritation

Credibility

Prior Permission

Gender

ATTITUDE

SUBJECTIVE

NORM

INTENTION

INTENTIO

The more positive the subjective norm, the higher the behavioral intention to receive and read

mobile advertising.

Katz, Hass, & Gurevitech (1973) also suggested other two needs:

1. “Needs related to strengthening information, knowledge, and understanding”;

2. “Needs related to strengthening aesthetic, pleasurable and emotional experience”;

Informativeness is described as “the ability to inform customers of product alternatives for their

greatest possible satisfaction. Informativeness can be interpreted as the ability of advertising to

deliver information to consumers in order to satisfy their needs. The Optimum Stimulation Level

theory states that people aspire to accomplish a certain degree of stimulation and collect

information with intrinsic motivation. It has been considered as the main factor in acceptance of

advertising. Informative content is also essential for Internet advertising. A research finds that

the majority of the respondents regard the Internet as an information source rather than as an

entertainment source.

Informativeness is positively related to consumers’ attitude towards mobile advertising.

With Referring to Figure 1, the fourth hypothesis concerns the effect of the entertainment

dimension on consumers’ attitude. Entertainment element in advertising can fulfill consumers’

needs for aesthetic enjoyment and emotional release. Based on the studies of Bauer and Greyer

(1968), Pollay and Mittal (1993) found that hedonic pleasure (perceived entertainment value)

had a positive effect on attitudes towards advertising. The perceived entertainment value of

mobile advertisements will be one of the important factor affecting consumers’ attitudes towards

advertising.

Entertainment has a positive influence on attitudes towards mobile advertising.

The credibility of advertising is defined as “consumers’ perception of the truthfulness and

believability of advertising in general... Credibility has been shown to be one of the antecedents

affecting attitudes towards advertising.

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Credibility is positively related to attitudes towards mobile advertising.

Zanot (1981) reviewed survey results in 1930s to 1970s and concluded that the public’s attitudes

towards advertising became unfavorable gradually. One of the important reasons why people

criticize advertising is irritation. The theory of psychological reactance suggests that people react

adversely when they perceived their freedom of choice is being threatened. When people feel

that advertising is annoying or irritating, they will probably express their irritation by developing

unfavorable attitudes towards receiving advertising. People would also tend to maximize their

benefits or utilities by reducing the cost, i.e. the irritation caused by the advertising.

Irritation has a negative effect on the attitude towards mobile advertising.

Other than the belief dimensions, prior permission (opt-in permission) is also an important factor

affecting consumers’ attitude towards advertising. Permission-based marketing means that

Consumers permit marketers to educate them concerning its products. One experimental study

indicates that prior permission for an email marketing campaign would favor attitudes towards

the advertisers and increase consumers’ purchase intentions. Since the mobile phone is a highly

personal communication tool of the user, prior permission is important for mobile advertising. In

addition, perceived risk will determine an individual’s behavior. The risk associated with mobile

marketing is the loss of privacy of mobile phone users. Rather than maximizing benefits, people

will try to minimize their risk. Prior permission can minimize users’ risk by reducing the chance

of abusing their personal data.

Prior permission has a positive effect on attitudes towards mobile advertising.

Finally, the next construct, gender, will exercise an effect on consumers’ attitudes. Gender is

regarded as a crucial variable in affecting one’s cognition and attitude. Since males and females

represent different biological and sociological processes, they will have different affects and

cognition during their information processes. Previous studies have revealed that the beliefs,

attitude and behavior vary according to gender.

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Gender will have influence on the attitude towards mobile advertising

Various studies found that "Perceived Usefulness" is the central driver of the consumer’s

attitude and acceptance of mobile advertising. Perceived usefulness is "the degree to which a

person believes that using a particular system would enhance his or her job performance”.

Researcher determined that utility or usefulness of mobile advertising to consumers is influenced

by message characteristics such as entertainment, credibility, informativeness, and irritation and

they have used these message related dimensions and various important consumers related

factors to determine the attitude of consumer towards SMS advertising.

4.2 Antecedents of Attitude towards SMS Advertising

4.2.1 Message related factors

4.2.1.1. Entertainment:

SMS advertising can also be viewed as fun, interesting and entertaining, as users need mobile

phones for aesthetic, pleasurable, and emotional experiences. Feeling of fun and enjoyment

associated with advertisements play a great role towards consumers overall attitudes toward the

advertisements. Entertaining advertisements have a good chance to attracting consumers’.

Therefore, it is important that the message is concise and funny, that can immediately captures

consumers’ attention. Entertainment is the major factor that affects the overall attitude in mobile

advertising.

4.2.1.2. Informativeness:

As mobile phones are very personal device, the information delivered to customers must be the

one which is in his interest and is relevant to him. The advertisement need to show accuracy,

timeliness, and usefulness for the consumer. Advertisements tend to be ineffective and irrelevant

because they reach consumers when they are not actually shopping. The contextual information

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(location and time Information) can improve the effect. Information significantly influences the

attitude towards SMS advertising.

4.2.1.3. Irritation:

Receiving frequent and high number of messages on mobile phone can cause irritation to

customers, especially at inappropriate time, where customer is busy with his work, which can

extremely damage brand image. The relevance and entertainment of advertising may decline

with the repetition of messages and would lead to boredom. The number of advertising messages

received on mobile influences the advertising value and attitude of the consumer. Adding to it,

the cause of irritation are unwanted messages (spam) which may lead to a feeling that ads are too

intrusive and affects customers privacy. Due to privacy concerns consumers fear registration on

SMS-based information services. Privacy, data security and unsuitable content have been viewed

as consumer risk, and have been negatively related with positive attitude towards SMS

advertising.

4.2.1.4. Ad Source (Credibility)

Credibility is the amount of trust consumer has and the extent to which he believes in the

advertisement. Credibility of an advertisement can be influenced by company’s credibility and

advertising medium (Mobile Phone here) and have been found affect the attitude towards the

advertisements. Trust is crucial and advertisements received from a credible source give the

sense of reliability and positive response. Consumer’s familiarity with the company and its

products or brand contributes towards a source of trust.

4.2.2. Consumer Related Factors:

4.2.2.1 Attitude towards control and permission:

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User’s permission to receive SMS advertising and control over it have been highlighted across

many studies. The importance of privacy issues call for prior consent (permission) from

consumers. Consumers wish to have to ‘opt in’ before they receive mobile advertising messages,

and have the option to ‘opt out’ at any stage and control the volume of SMS ads they receive.

Permission is considered to be a major factor that may affect attitudes towards SMS advertising.

Marketing communications over mobile phone can only be effective if consumers permit the

continuous reception of advertising.

4.2.2.2. Incentives

Individuals by nature like receiving some sorts of benefits and incentives. They especially like

receiving incentives from direct marketing programs. Incentives for SMS advertising can include

free minutes, free texts, free connection time etc, and they have impact on consumer’s attitude

and intentions towards SMS advertising.

4.2.2.3. Age

Generally, young people are heavy users of mobile services. SMS is infused with the ‘fun’ factor

which makes it especially attractive to young consumers. Younger consumers also show a more

favorable attitude toward traditional advertising in a number of dimensions and feel more

comfortable with ads. The age influences the attitude towards SMS advertising.

4.3. Previous researches on Attitude towards SMS advertising

Mobile advertising is relatively n ew and past literature on it is limited. However various

conceptual and empirical researches have been undertaken majorly in different developed

countries to determine the attitude of consumer towards SMS advertising. Throughout the

literature on mobile advertising and marketing, all the factors discussed in the previous section

have been the common and major factors used by researchers to identify the attitude of

consumers towards SMS advertising. These past researches showed both similarities and

differences.

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In one of the earliest studies done by Rettie & Brum (2001), found that respondents disliked

unsolicited SMS advertising and wanted control over them. Negative attitude was determined,

but respondents were positive and preferred receiving ads with incentives (like discount phone

calls and promotional offers) and preferred receiving messages only after giving permission.

Another early research by Barwise & Strong (2002) in U.K found that consumers

enthusiastically showed acceptance for permission based adverting and found it a good way to

communicate with them, given that incentives are provided, the message is relevant and the

volume of messages is not much. Their study was on 16 to 30 year-olds, and evidence suggests

that 51 % of respondents were ‘very satisfied’ and 42 per cent were ‘fairly satisfied’ by

permission based advertising. Some 72 per cent agreed that advertising with permission was

relevant to them and 84 per cent were willing to recommend it.

The importance of permission was echoed in the studies by Bamba and Barnes (2007) in U.K

and Tsang, Ho & Liang (2004) in Taiwan, where consumers had negative attitude without

permission, but positive if permission was obtained. Bamba and Barnes (2007) noted overall

negative attitude of consumer, and identified that brand familiarity did not have an impact on

consumers. However, Tsang, Ho & Liang (2004) determined that entertainment was the most

significant factor affecting respondents’ attitudes, followed by credibility and irritation. They

also found that consumers were positive when offered incentives and it can increase their

intention to receive SMS advertisements. Drossos et al (2007) in an experimental study in

Greece also found that incentives were important, however, credibility did not affected

consumer’s attitude.

Bauer et al (2005) in their research identified that the higher the perceived utility (information

and entertainment) of SMS advertising the more positive consumers are towards SMS

advertising, and higher the risk perceived (data security and privacy), the more negative they are.

Entertainment and information value were identified as the central acceptance drivers of SMS

advertising. Choi, Hwang & McMillan (2008) found that entertainment and credibility were key

factors predicting positive attitude among both Koreans and Americans. But in the U.S., where

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informativeness positively influenced and irritation was negatively related to the attitude, these

did not have any significant effects on Korean consumers.

Further, Haghirian & Madlberger (2005) in their study on Austrian mobile users found all the

message related factors to influence the attitude towards SMS advertising, where information

was identified to be the strongest factor. They found that attitude toward SMS advertising

strongly depends on message characteristics and it need to be developed carefully. They also

determined that customer’s attributes like age do not play dominant role in attitude towards SMS

advertising. However, Barutcu (2008) in Turkey found that youngsters between 21- 30 years

have more positive attitude towards SMS advertisements and found that consumers have positive

attitudes towards SMS advertising. Carroll et al (2007) in their study in New Zealand found that

permission to send the message, limit to the number of mobile advertising messages they wished

to receive, receiving relevant messages and at suitable time were important factors predicting

positive attitude and acceptance of SMS advertising. However, the overall attitude and consumer

acceptance of SMS advertising messages was much low.

4.3.1. Conclusion:

Overall an extensive literature review of consumer’s attitude towards SMS advertising and the

main drivers behind these has been done. The main drivers highlighted are entertainment,

informativeness, irritation, credibility, incentives, age, and permission and control. It has been

analyzed that permission for SMS advertising is really important, which has been identified in

the very earliest research by Rettie & Brum (2001), and has been seen across all researches,

which makes unpermitted SMS advertising a aggregator of negative attitude. However, the

attitude of mobile phone users towards SMS ads has been different in different countries e.g.

consumers in Turkey have positive attitude, whereas in New Zealand and U.K more towards

negative. Also the other important factors influencing the attitude show differences, like

credibility is an important factor for consumers in Taiwan, Korea and America, but not in

Greece and U.K, and information has positive effect on Americans and Austrians but no effect

on Koreans. This entirely seems to be due to the cultural and technological differences. The

past studies have been conducted in various developed countries like U.K, U.S, Australia, New

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Zealand etc, and a clear lack of such investigation has been noted in developing countries like

India, which is culturally and technologically different to an great extent from the countries past

researches have been done. Therefore, based on Research Question 1 ‘What are the main drivers

influencing Indian consumer’s attitude towards SMS advertising amongst ‘Entertainment,

Informativeness, Irritation, Credibility, Age, Incentives, and Attitude towards control and

permission’, it will be interesting to see what are the key factors influencing their attitude and

how similar or different are they with the attitude researched in developed countries. This will

help in understanding Indian consumers better, for planning SMS marketing strategies

effectively.

4.4. Previous research on purchase intentions through SMS advertising and role of brand advertise in purchase intentions.

There is very limited research done regarding purchase intentions through SMS advertising. Wei,

Xiaoming & Pan (2009) in their study in Singapore found that SMS advertisement creates

purchase intentions and can be highly effective in triggering a purchase when consumers respond

positively towards SMS advertising. Rettie, Grandcolas & Deakins (2005), in their study in U.K

also found that SMS advertising had positive effect on purchase intentions of consumers. The

positive effect on purchase was approximately twice that of positive effect on brand attitude.

Positive purchase intentions were related to brand image, where 87.7 % of those who felt more

positively towards the brand claimed they were more likely to make purchase. Message

relevance was also related to purchase intention and intentions were significant in youngsters

between 16 – 24 yrs. Similarly Choi, Hwang & McMillan (2008) in their study found that brand

was a key factors contributing to the purchase intention among both Koreans and Americans.

However, Drossos et al (2007) in Greece found that incentives influenced purchase intentions

but brand advertised in SMS did not impact the intentions of consumers to purchase.

4.4.1. Conclusion:

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As per the literature review it has been analyzed that SMS ads have a positive effect on purchase

intention. Further, it has been noticed that a brand advertised in SMS can influence the purchase

intentions, as seen in case of U.K. and U.S. However, these studies have been done in advance

countries where culture and consumer behavior or buying behavior is different from India. From

the marketer’s perspective it is crucial to know how far SMS advertising has an impact on

purchase intentions of consumers. Therefore, based on Research Question 2 ‘Does SMS

advertising have a positive effect on purchase intentions of Indian consumer’ and Research

Question 3 ‘Does brand advertised in SMS has any positive effect on purchase intentions’ it

will interesting to see the effect of SMS ads on generating purchase intentions and how far

the brand advertised influences purchase intentions.

4.5. Previous research on customers willingness to accept Location Based Advertising

Even though Location Based Advertising is regarded as one of the best and increasingly valued

marketing tool it has received less scholarly attention and studies in this are extremely rare. As

discussed earlier, Location Based Advertising is not allowed without permission, because it can

bring major privacy concerns. Attitude towards Location Based Advertising is defined as “a

person's general predisposition toward commercial messages that are received on a personal

mobile communication device and customized for one's geographic position”. If consumers

have a positive attitude toward Location Based Advertising, then this marketing tool can allow

mobile marketing to kick into high gear.

Wei, Xiaoming & Pan in Singapore found that people were willing to accept location based SMS

ads and were more inclined to receive ads offering discounts. Merisavo et al in Finland also

found that consumers were willing to receive location based ads. Similarly, Bamba and

Barnes in U.K also determined people’s willingness to accept Location Based Advertising

provided ads should be relevant and personalized, even though sometimes intrusive . However,

Unni & Harmon in U.S. found that even though with permission, consumer’s were not

willing to receive Location Based Advertising and the most important factor leading to

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negative attitude and intention was privacy concerns with respect to tracking of location

information, as consumers fear marketer tracing them and it will be more intrusive and tend to

interrupt the consumer. Even the benefits and value of Location Based Advertising such as

relevant message with context (time and location) was valued low by the consumers. Similarly,

Drossos et al in Greece found that SMS advertising did not led to positive attitude when

received closer to the selling point, reflecting their unwillingness to adopt LBA and location

privacy concerns.

4.5.1. Conclusion:

It is analyzed that mobile users from different countries have different responses towards

Location Based Advertising. For instance, consumers in Singapore and Finland are ready to use

highly personalized location and timely services, and on the other hand consumer in Greece and

U.S., are unwilling and do not show value to contextual benefits of Location Based Advertising

due to the fear that they can be traced and will be in reach of marketers anytime. Looking at the

marketing opportunities and benefits provided by Location Based Advertising, it is expected as a

next big thing in India. But no research on consumer’s views about it has been done there. Any

technology cannot precede the human factor, and consumers for whom and on whom this tool

will we used it is important to know their views and willingness about it. Therefore, based on the

Research Question 4 ‘Are Indian consumers willing to accept Location Based advertising’ and

Research Question 5 ‘Will consumer’s privacy concerns about location tracking be significant

for Location Based Advertising’, it will be identified if Indian consumers are positive and willing

to accept Location Based Advertising, or will they show significant resistance to it due to

location tracking privacy concerns.

Overall, the five Research Question’s once analyzed will give an extensive insight and

knowledge to marketers in India and abroad about how Indian consumer value and how effective

the ‘at present’ used push SMS advertisements sent to them are. Further, it will bring out the

views of consumers towards LBA. All the Research Question’s are steps by step process to

analyze the present and determine the future of push SMS advertising in India.

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Chapter 5

RESULT AND DISCUSSION

The first section of this chapter presents and analyses the results from the consumer survey. Data

has been analyzed using the mean values generated by descriptive statistics using Excel 2007 and

one sample t-test is conducted on quantitative data to make relevant statistical inferences. Where

ever possible a comparison of findings from previous studies has been done. The second section

discusses the findings with relevance to research aim and questions, and lists the opportunities

and threats for marketers.

5.1 Respondents Demographics

This section provides general information about the mobile phone users who responded to the

survey. Out of 108 useable respondents 62 were males and 46 were females.

GENDER

The respondents were also well qualified, with majority having Bachelor (44) or Masters Degree

(36). Around 30% were students and 23% were professionals at managerial levels, and

remaining were at good executive and analyst levels. It shows quite a good balance of males and

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females which are the major part of mobile phone users in Urban India. Also the respondents

were well educated and at good profiles. Being heavy mobile users they form a good target

group for SMS advertising and provide varied data as they have different needs so are their

perceptions towards SMS advertisements.

Descriptive StatisticsThe descriptive statistics computed from the data is presented below. Data with complete

percentages is in Appendix D. *S.D = Standard Deviation.

Consumers Attitude and Drivers Mean S.DOverall Attitude 3.05 0.98Entertainment 3.43 0.94Informativeness 2.70 0.97Irritation 2.20 0.92Credibility of Mobile 3.16 0.87Credibility of Brand 2.35 0.91Incentives 2.28 1.01Permission 1.93 0.88Control 1.74 0.81

Purchase Intentions 3.12 0.73Brand effect on Purchase Intentions 2.47 0.84

Willingness for LBA 2.43 0.85Location Tracking Privacy 3.03 1.11

Figure 1 Descriptive Statistic

Descriptive Statistics

In the results, Mean 1 – 2.70 is positive (except of irritation) Mean - 2.80 – 3.20 is neutral and

Mean 3.20 above is negative, which is also based on the percentage of responses when analysed

for particular question.

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5.2 Analysis of Attitude and Factors influencing attitude towards SMS advertising

Factors Influencing Attitude towards SMS Advertising

Question 1

I feel that receiving SMS advertising is enjoyable and entertaining.

Entertainment Mean S.DQ1. I feel that receiving SMS advertising is enjoyable and entertaining.

3.43 0.94

According to the mean rating of 3.43 it appears that Indian consumers don’t find receiving SMS

ads entertaining and enjoyable. 28.7 % disagreed, 14.81% strongly disagreed and

43.52% respondents were neutral for Q1. Conducting a t-test showed that population mean was

(μ) ≥ 3.57 (Appendix E 2).

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Question 2

I feel that SMS advertising is a good source for timely information.

Informativeness Mean S.DQ2. I feel that SMS advertising is a good source for timely information.

2.70 0.97

Many authors indicated that consumers will only be positive and accept SMS advertising if they

perceive benefits in receiving them on their mobile phone (Bauer et al 2005). The mean rating of

2.70 reflects that Indian consumers find SMS advertising a relatively good source for timely and

useful information. As push SMS advertising is mostly for boosting sales, it seems that timely

promotional offers and sales information’s through SMS channel are found useful and liked by

consumers in India, which positively influences their attitude. 6.48% strongly agreed, 38.89%

agreed to this and 40.74% were neutral. Conducting a t-test it was inferred that population mean

is (μ) ≤ 2.55 (Appendix E 3).

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Question 3

I feel that SMS advertisements are irritating.

Irritation Mean S.DQ3. I feel that SMS advertisements are irritating. 2.20 0.92

Though Indian consumers find SMS advertisements timely and useful, they consider it as a

hindrance in their privacy, which is reflected by the mean of 2.20 for Q3. As the ads are sent

without consumer’s permission in India - too much SMS ads, unwanted messages and any

time/anywhere i.e. may be consumer is at work or busy elsewhere causes this irritation. 21.30%

respondents strongly agreed and 48.15% agreed that SMS advertising are irritating. Conducting a

t-test it was inferred that population mean is (μ) ≤ 2.10 (Appendix E 4), which indicates that

most people agree and find SMS ads irritating.

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Question 4 and 5

I trust the SMS advertisements received on my mobile phone

Credibility of Mobile as Advertisement Medium Mean S.DQ4. I trust the SMS advertisements received on my mobile phone 3.16 0.87

I only trust SMS advertisements by the brand I am familiar with.

Credibility of Brand advertised on Mobile Mean S.DQ5. I only trust SMS advertisements by the brand I am familiar with.

2.35 0.91

Analyzing the responses of credibility of mobile ads, it was seen that Indian consumers are

almost neutral towards believing and trusting the ads received on their mobile phone. In the

mean rating of 3.16, 51.89% said that they are neutral and 18.87% agreed for Q4.

However, Indian consumers show much trust in SMS ads received through the brand they are

familiar with, which is indicated by the mean of 2.35 for Q 5. 12.15% strongly agreed, 54.21%

agreed and 23.36% were neutral for it. Conducting a t-test showed that population mean was (μ)

≤ 2.25 for Q5 (Appendix E 5). This shows that brand and company’s image plays an important

role for Indian consumers to trust the message sent on mobile phone.

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Question 6

I am willing to receive SMS ads when some incentives are provided, e.g. free calls, free SMS package, discounts etc.

Incentives Mean S.DQ6. I am willing to receive SMS ads when some incentives are provided, e.g. free calls, free SMS package, discounts etc.

2.28 1.01

Indian consumers show a positive inclination and intention towards SMS advertising when

incentives are provided, as indicated by a mean of 2.28 for Q 6, where 19.44% strongly agree

and 50.93% agree for it. Conducting a t-test for Q 6 showed that population mean is (μ) ≤ 2.15

(Appendix E6). The power of incentives to influence can also be noted that consumers

would be ready to trade off their privacy concern when incentives in form of monetary

rewards are given to some extent.

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Question 7 and 8

I am willing to receive SMS advertisements when I have provided my permission (Consent).

After giving permission, it is important that I can refuse (opt-out) to receive SMS advertisements anytime I want.

Permission and Control Mean S.D

Q7. I am willing to receive SMS advertisements when I have provided my permission (Consent).

1.93 0.88

Q8. After giving permission, it is important that I can refuse (opt-out) to receive SMS advertisements anytime I want.

1.74 0.81

Like consumers in all countries studied in the past, Indian consumers also consider permission

very important for receiving SMS ads, which positively influences their attitude, as indicated by

the mean of 1.93 for Q 7, where 31.48% respondents strongly agreed and 51.85% agreed for it.

Conducting a t-test for Q7 showed that population mean is (μ) ≤ 1.80 (Appendix E7).

After giving permission, control over it is even more important for Indian consumers, which is

indicated by the mean of 1.74 for Q 8, where 42.06% strongly agreed and 47.66% agreed for it.

Conducting a t-test for Q8 showed population mean is (μ) ≤ 1.62 (Appendix E 8).

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Question 9

I feel positively about SMS advertising.

Overall Attitude Mean S.D

Q9. I feel positively about SMS advertising. 3.05 0.98

Based on a five-point Likert scale, where 1 is strongly agree and 5 is strongly disagree, average

respondents score was 3.05. This implies that consumers in India are neutral towards SMS

advertising. In terms of highest percentage, 39.81% respondents were neutral, 27.78% agreed

and 20.37% disagreed for Q9. Conducting a t-test it was inferred that population mean (μ) = 3.04

(Appendix E 1).

Question 10 and 11

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I am likely to purchase the product(s) presented in the SMS advertisements.

I am likely to purchase if SMS advertisement is from the brand I am familiar with

and trust.

Purchase Intentions Mean S.D

Q10. I am likely to purchase the product(s) presented in the SMS

advertisements.

3.12 0.73

Q11. I am likely to purchase if SMS advertisement is from the

brand I am familiar with and trust.

2.47 0.84

The mean of 3.12 for Q10 shows that SMS advertising has a neutral effect on Indian consumer’s

overall purchase intentions. 61 % respondents were neutral, 14% agreed and 19.44% disagreed

for Q 10.

However, if the ad is from a well known and familiar brand, it leads to a positive effect on

purchase intentions, as indicated by the mean of 2.47 for Q11. 7.41% strongly agreed, 50%

agreed and 33 % were neutral for it. Conducting a t-test for Q11 showed that population mean

(μ) ≤ 2.34 (Appendix E 9).

Question 12 and 13

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I would like being able to receive location based SMS advertisements.

I would like my location to be traced by the mobile service provider and would be comfortable over my location data being shared with the retailers.

Location Based Advertising Mean S.D

Q12. I would like being able to receive location based SMS

advertisements.

2.43 0.85

Q13. I would like my location to be traced by the mobile service

provider and would be comfortable over my location data being

shared with the retailers.

3.03 1.11

The mean of 2.43 for Q12 represents that Indian consumers are willing to accept LBA. A good

amount of 55.56% respondents agreed, 7.41% strongly agreed and 25.93% showed no strong

feeling for accepting LBA. Conducting a t-test for Q 12 showed that population mean is (μ) ≤

2.30 (Appendix E 10). However as per the mean of 3.03 for Q 13 it occurs that consumers are

neutral towards their location tracking privacy. 4.63% strongly agreed, 31.48% agreed, and 34.26

% showed no strong feeling for Q13.

CHAPTER 6

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FINDINGS AND RECOMMENDATIONS

6.1 Findings:

The following can be the finding for the SMS advertising in Urban India:

1. Feeling of fun and enjoyment associated with advertisements play a great role towards consumers overall attitudes toward the advertisements. According to the survey done it was found that Indian consumers didn’t find receiving SMS advertising on their mobile phones entertaining and enjoyable. 28.7 % disagreed, 14.81% strongly disagreed and 43.52% respondents were neutral

2. As mobile phones are very personal device, the information delivered to customers must be the one which is in his interest and is relevant to him. Indian consumers find SMS advertising a relatively good source for timely and useful information.

3. Though Indian consumers find SMS advertisements timely and useful, they consider it as a hindrance in their privacy as the ads are sent without consumer’s permission in India - too much SMS ads, unwanted messages and any time/anywhere i.e. may be consumer is at work or busy elsewhere causes this irritation. The relevance and entertainment of advertising may decline with the repetition of messages and would lead to boredom. The number of advertising messages received on mobile influences the advertising value and attitude of the consumer. Adding to it, the cause of irritation are unwanted messages (spam) which may lead to a feeling that ads are too intrusive and affects customers privacy.

4. Indian consumers are almost neutral towards believing and trusting the ads received on their mobile phone.

5. Indian consumers show much trust in SMS ads received through the brand they are familiar with. Trust is crucial and advertisements received from a credible source give the sense of reliability and positive response. Consumer’s familiarity with the company and its products or brand contributes towards a source of trust.

6. Indian consumers show a positive inclination and intention towards SMS advertising when incentives are provided. Incentives for SMS advertising can include free minutes, free texts, free connection time etc, and they have impact on consumer’s attitude and intentions towards SMS advertising.

45 | P a g e

7. Indian consumers also consider permission very important for receiving SMS ads, which positively influences their attitude. Consumers wish to have to ‘opt in’ before they receive mobile advertising messages, and have the option to ‘opt out’ at any stage and control the volume of SMS ads they receive. Permission is considered to be a major factor that may affect attitudes towards SMS advertising.

8. After giving permission, control over it is even more important for Indian consumers.

9. SMS advertising has a neutral effect on Indian consumer’s overall purchase intentions. 61 % respondents were neutral, 14% agreed and 19.44% disagreed

10. Indian consumers are willing to accept LBA. A good amount of 55.56% respondents agreed, 7.41% strongly agreed and 25.93% showed no strong feeling for accepting LBA. However it occurs that consumers are neutral towards their location tracking privacy.

6.2 Recommendations:

While conducting this research we came to know about the likings and disliking about the customers, we also came to know which factors are more demanding to people for making mobile advertising successful. The following can be the recommendations to the companies opting for SMS advertising:

1. Permission based approach is the easiest way to tackle the privacy issue and can effectively build trust. After giving permission consumers would not be surprised on receiving the SMS form marketer, as they would know where and why it is coming, and will respond well to it. Therefore, with permission, marketers can precisely target the consumers and send relevant advertisements, thereby increasing the effectiveness of the campaign. Companies must have control over receiving and stopping mobile advertisements.

2. Due to privacy concerns consumers fear registration on SMS-based information services. Privacy, data security and unsuitable content have been viewed as consumer risk, and have been negatively related with positive attitude towards SMS advertising. Companies must be concerned about customer data, they should protect their privacy.

46 | P a g e

3. Entertaining advertisements have a good chance to attracting consumers’. Therefore, it is important that the message is concise and funny, that can immediately captures consumers’ attention. Entertainment is the major factor that affects the overall attitude in mobile advertising.

4. There should be some selectable time for receiving advertisements.

5. There should be some way of getting location based advertising, for those who want it.

6. Mobile Advertising can be applied for couponing, for creating brand awareness, as entertainment provider in location based services, while can also be used for launching new products and also for building customer relationships.

7. Before sending advertisements companies should try confirm whether the advertisements supports customers interests and moreover companies should try to make the SMS advertisements personalized.

CHAPTER 7

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References

7.1 Websites Referred:

http://www.mgovernment.org/resurces/euromgov2005/PDF/46_R130MD.pdf

http://findarticles.com/p/articles/mi_m0EIN/is_2008_July_24/ai_n27944624/

http://www.bileta.ac.uk/Document%20Library/1/Privacy%20issues%20in%20Mobile%20Advertising.pdf .

. http://is2.lse.ac.uk/asp/aspecis/20050038.pdf

http://smib.vuw.ac.nz:8081/WWW/ANZMAC2004/CDsite/papers/James1.PDF

http://www.e-lba.com/Milestones/ELBA_Milestone_4.pdf

http://smib.vuw.ac.nz:8081/www/anzmac2005/cd-site/pdfs/12-Electronic-Marketing/12-Lai.pdf [Accessed 4/7/2009].

http://herkules.oulu.fi/isbn9789514288159/isbn9789514288159.pdf

http://www.mmaglobal.com/studies/groundbreaking-lba-trials-prove-effectiveness-useful-networks

http://www.the-cma.org/PublicUploads/224862FutureMobileDec08.pdf

http://www.marketingcollege.com/upload/52438%20MobileMktngMaster.pdf http://www.kingston.ac.uk/~ku03468/includes/docs/M%20Commerce%20The

%20Role%20of%20SMS%20Text%20Messages.pdf [Accessed 14/May/2009]

http://www.sph.com.sg/article.display.php?id=399

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http://www.strategyanalytics.com/default.aspx?mod=ReportAbstractViewer&a0=4016

http://www.slideshare.net/rocky.meets/mobile-marketing-using-a-location-based-service-presentation

http://www.sciencedirect.com/science?_ob=MImg&_imagekey=B6V1H-4W0WJ5V-1-1&_cdi=5675&_user=7477707&_orig=search&_coverDate=04%2F05%2F2009&_sk=999999999&view=c&wchp=dGLbVlz-zSkWz&md5=da1268da5e6c145c8a91663dd7dbaf47&ie=/sdarticle.pdf

http://www.sciencedirect.com/science?_ob=MImg&_imagekey=B6V1H-4F60JX8-3-1&_cdi=5675&_user=7477707&_orig=search&_coverDate=08%2F01%2F2005&_sk=999779996&view=c&wchp=dGLbVtb-zSkzk&md5=c22dbfcc43eaa44330f8bdcfb55669e4&ie=/sdarticle.pdf

http://www.emeraldinsight.com/Insight/ViewContentServlet?Filename=Published/EmeraldFullTextArticle/Articles/2160020205.html

http://writing.colostate.edu/guides/research/survey/contrib.cfm

http://www.trai.gov.in/WriteReadData/trai/upload/PressReleases/671/pr21apr09no38.pdf

http://www.trai.gov.in/annualreport/TRAIAR2007-08E.pdf

http://proquest.umi.com/pqdweb?did=1672102731&sid=1&Fmt=3&clientId=12449&RQT=309&VName=PQD&cfc=1

Economic Times 2008 http://economictimes.indiatimes.com/articleshow/msid-3625914,flstry-1.cms

http://www.iamai.in/Upload/Research/mobilevasinindia_25.pdf

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http://www.emeraldinsight.com/Insight/viewPDF.jsp?contentType=Article&Filename=html/Output/Published/EmeraldFullTextArticle/Pdf/0770230401.pdf

http://news.bbc.co.uk/1/hi/business/6619767.stm

http://books.google.co.uk/books?id=uAWZUE7EYzwC&pg=PA183&dq=pull+sms+advertising+example&lr=#v=onepage&q=pull%20sms%20advertising%20example&f=false

http://books.google.co.uk/books?id=HDh1bK5uMvUC&pg=PA91&dq=pull+mobile+advertising#v=onepage&q=pull%20mobile%20advertising&f=false

http://findarticles.com/p/articles/mi_m0BDW/is_13_42/ai_72631325/

http://www.netcaucus.org/books/privacy2001/pdf/cacmfinaldoc.pdf

http://ndncregistry.gov.in/ndncregistry/index.jsp

http://www.trai.gov.in/trai/upload/PressReleases/452/pr23apr07no40.pdf

http://timesofindia.indiatimes.com/Opinion/Editorial/Operators_face_Rs_20K_fine_for_pesky_calls/articleshow/2706517.cms

http://timesofindia.indiatimes.com/India/Stressful_and_abusive_lives_of_telemarketers/articleshow/3524321.cms

7.2 Journals referred:

Permission-based Mobile Marketing: Best Practices and Success Stories. An

Air2Web White Paper.

Journal of the Academy of Marketing Science,

Online- International Journal of Information Management

Permission-Based Mobile Advertising [Online] Journal of interactive marketing

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Bruner & Kumar 2007 Bruner, C. G. and Kumar, A. (2007). Attitude toward

Location-Based Advertising.[Online] Journal of Interactive Advertising

International Journal of Advertising

E-Business and E-Commerce Management

Journal of Interactive Advertising

Journal of Current Issues and Research in Advertising

APPENDIX

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APPENDIX 1:

T- Test

1. Performing a two tail t-test on Q9 “I feel positively about SMS advertising.”

Null Hypothesis (H0): Population mean (μ) = 3.04 Alternative Hypothesis (H1): μ = 3.04Level of significance α = 0.05Sample mean x = 3.05Sample Standard deviation = 0.98Sample size n=108

= 0.106

For t0.025, 107 = + and - 1.960

We accept the null hypothesis

Hence, for Q 9 the population mean is (μ) = 3.04

2. Performing t-test on Q1. ‘I feel that receiving SMS advertising is enjoyable and entertaining’.

Null Hypothesis (H0): Population mean (μ) ≥ 3.57Alternative Hypothesis (H1): μ < 3.57Level of significance α = 0.05Sample mean x = 3.43Sample Standard deviation = 0.94Sample size n=108

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= - 1.55

For t0.05, 107 = - 1.645

Since t > t0.05, 107, we can accept null hypothesis.

Hence, for Q 1 the population mean is (μ) = ≥ 3.573. Performing t-test on Q2. ‘I feel that SMS advertising is a good source for timely

information’.

Null Hypothesis (H0): Population mean (μ) ≤ 2.55Alternative Hypothesis (H1): μ < 2.55Level of significance α = 0.05Sample mean x = 2.70Sample Standard deviation = 0.97Sample size n=108

= 1.612

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 2 the population mean is (μ) ≤ 2.55

4. Performing t-test on Q3 ‘I feel that SMS advertisements are irritating’.

Null Hypothesis (H0): Population mean (μ) ≤ 2.10Alternative Hypothesis (H1): μ < 2.10Level of significance α = 0.05Sample mean x = 2.20Sample Standard deviation = 0.92

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Sample size n=108

= 1.136

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 3 the population mean is (μ) ≤ 2.10

5. Performing t-test on Q5 ‘I only trust SMS advertisements by the brand I am familiar with’.

Null Hypothesis (H0): Population mean (μ) ≤ 2.25Alternative Hypothesis (H1): μ < 2.25Level of significance α = 0.05Sample mean x = 2.35Sample Standard deviation = 0.91Sample size n=108

= 1.149

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 5 the population mean is (μ) ≤ 2.25

6. Performing t-test on Q6 ‘I am willing to receive SMS ads when some incentives are provided, e.g. free calls, free SMS package, discounts etc.’

Null Hypothesis (H0): Population mean (μ) ≤ 2.15Alternative Hypothesis (H1): μ < 2.15Level of significance α = 0.05Sample mean x = 2.28

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Sample Standard deviation = 1.01Sample size n=108

= 1.340

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 6 the population mean is (μ) ≤ 2.15

7. Performing t-test on Q7 ‘I am willing to receive SMS advertisements when I have provided my permission (Consent)’.

Null Hypothesis (H0): Population mean (μ) ≤ 1.80Alternative Hypothesis (H1): μ < 1.80Level of significance α = 0.05Sample mean x = 1.93Sample Standard deviation = 0.88Sample size n=108

= 1.547

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 7 the population mean is (μ) ≤ 1.80

8. Performing t-test on Q8 ‘After giving permission, it is important that I can refuse (opt-out) to receive SMS advertisements anytime I want’.

Null Hypothesis (H0): Population mean (μ) ≤ 1.62Alternative Hypothesis (H1): μ < 1.62

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Level of significance α = 0.05Sample mean x = 1.74Sample Standard deviation = 0.81Sample size n=108

= 1.558

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 8 the population mean is (μ) ≤ 1.62

9. Performing t-test on Q11 ‘I am likely to purchase if SMS advertisement is from the brand I am familiar with and trust’.

Null Hypothesis (H0): Population mean (μ) ≤ 2.34Alternative Hypothesis (H1): μ < 2.34Level of significance α = 0.05Sample mean x = 2.47Sample Standard deviation = 0.84Sample size n=108

= 1.625

For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 11 the population mean is (μ) ≤ 2.34

10. Performing t-test on Q12’ I would like being able to receive location based SMS advertisements’.Null Hypothesis (H0): Population mean (μ) ≤ 2.30

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Alternative Hypothesis (H1): μ < 2.30Level of significance α = 0.05Sample mean x = 2.43Sample Standard deviation = 0.85Sample size n=108

= 1.604For t0.05, 107 = 1.645

Since, t < t0.05, 156, we can accept the null hypothesis H0.

Hence, for Q 12 the population mean is (μ) ≤ 2.30

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APPENDIX 2:

SMS Advertising Questionnaire:

Please answer all the questions. Your contribution will be highly appreciated.

The following questions are related to SMS advertisements sent to you by businesses, for example, SMS for sales promotion, new product/store launch or any kind of commercial message.  Please mark the appropriate for the following questions as follows

Strongly agree – 1

Agree -2

Neutral-3

Disagree-4

Strongly Disagree-5

1. I feel that receiving SMS advertising is enjoyable and entertaining.

Strongly Agree Agree Disagree

Neutral Strongly disagree

2. I feel that SMS advertising is a good source for timely information

Strongly Agree Agree Disagree

Neutral Strongly disagree

3. I feel that SMS advertisements are irritating

Strongly Agree Agree Disagree

Neutral Strongly disagree

4. I trust the SMS advertisements received on my mobile phone.

Strongly Agree Agree Disagree

Neutral Strongly disagree

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5. I only trust SMS advertisements by the brand I am familiar with

Strongly Agree Agree Disagree

Neutral Strongly disagree

6. I am willing to receive SMS ads when some incentives are provided, e.g. free calls, free SMS package, discounts etc.

Strongly Agree Agree Disagree

Neutral Strongly disagree

7.  I am willing to receive SMS advertisements when I have provided my permission (Consent).

Strongly Agree Agree Disagree

Neutral Strongly disagree

8. After giving permission, it is important that I can refuse (opt-out) to receive SMS advertisements anytime I want

Strongly Agree Agree Disagree

Neutral Strongly disagree

9. I feel positively about SMS advertising

Strongly Agree Agree Disagree

Neutral Strongly disagree

10. I am likely to purchase the product(s) presented in the SMS advertisements

Strongly Agree Agree Disagree

Neutral Strongly disagree

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11. I am likely to purchase if SMS advertisement is from the brand I am familiar with and trust.

Strongly Agree Agree Disagree

Neutral Strongly disagree

Location Based SMS Advertising is SMS advertisement which you can receive based on your location. Example, when you are near a mall or in the mall, you can receive a SMS from ‘Levis’ that '50% discount has started right now, come and grab the latest collection'. Another example, a discounted dinner offer when passing by a favorite restaurant in the evening. 

Location Based Advertising will be permission based, meaning, where you have given your active permission (consent) to receive the SMS from retailers or businesses you want. Please mark the appropriate for the following questions

12. I would like being able to receive location based SMS advertisements

Strongly Agree Agree Disagree

Neutral Strongly disagree

13. I would like my location to be traced by the mobile service provider and would be comfortable over my location data being shared with the retailers.

Strongly Agree Agree Disagree

Neutral Strongly disagree

14. Gender

Male Female

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