Antecedents and consequences of status consumption

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UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------ Vo Thi Thu Trang ANTECEDENTS AND CONSEQUENCES OF STATUS CONSUMPTION: EVIDENCE FROM VIETNAM MASTER OF BUSINESS (Honours) Ho Chi Minh City - Year 2014 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business ------------------------ Vo Thi Thu Trang ANTECEDENTS AND CONSEQUENCES OF STATUS CONSUMPTION: EVIDENCE FROM VIETNAM ID: 22120078 MASTER OF BUSINESS (Honours) SUPERVISOR: Dr. NGUYEN THI MAI TRANG Ho Chi Minh City - Year 2014 CONTENTS ABBREVIATION ................................................................................................................5 ACKNOWLEDGEMENT ....................................................................................................6 ABSTRACT..........................................................................................................................7 CHAPTER 1 - INTRODUCTION ...........................................................................................8 1.1 Background to the research ............................................................................................8 1.2 Research problem ...........................................................................................................9 1.3 Research objectives...................................................................................................... 12 1.4 Methodology ................................................................................................................ 13 1.5 Research Structure ....................................................................................................... 13 1.6 Research scope ............................................................................................................. 14 CHAPTER 2 - LITERATURE REVIEW AND HYPOTHESES......................................... 15 2.1 Literature review .......................................................................................................... 15 2.1.1 Collectivism and Individualism ............................................................................ 15 2.1.2 Materialism ............................................................................................................ 17 2.1.3 Status Consumption ............................................................................................... 18 2.1.4 Life satisfaction ..................................................................................................... 19 2.2 Research hypotheses .................................................................................................... 19 2.3 Conceptual model ........................................................................................................ 23 2.4 Summary ...................................................................................................................... 24 CHAPTER 3 - METHODOLOGY ....................................................................................... 25 3.1 Research design ........................................................................................................... 25 3.1.1 Research process ................................................................................................... 25 3.1.2 Measurement scales ............................................................................................... 26 Page | 1 3.2. Measurement refinement ............................................................................................ 29 3.3 The quantitative study.................................................................................................. 30 3.3.1 Sampling and data collection ................................................................................ 30 3.3.2 Data analysis.......................................................................................................... 30 3.4 Summary ...................................................................................................................... 30 CHAPTER 4 - DATA ANALYSIS AND RESULTS .......................................................... 32 4.1 Data collection ............................................................................................................. 32 4.2 Respondents’ demographics ........................................................................................ 32 4.3 Descriptive statistic ...................................................................................................... 34 4.4 Confirmatory factor analysis (CFA) ............................................................................ 34 4.4.1 CFA for the first-order constructs ......................................................................... 35 4.4.2 CFA for second-order construct ............................................................................ 39 4.4.3 CFA for the final measurement model .................................................................. 40 4.5 Structural equation modeling (SEM) ........................................................................... 44 4.6 Bootstrap method ......................................................................................................... 47 4.7 Discussion .................................................................................................................... 48 4.8 Summary ...................................................................................................................... 53 CHAPTER 5 CONCLUSION, IMPLICATIONS, AND LIMITATION ............................. 55 5.1 Conclusions about hypotheses and research problem ................................................. 56 5.2 Implications for theory and managerial implications .................................................. 60 5.3 Limitations and further research .................................................................................. 62 REFERENCES .................................................................................................................. 64 APPENDICES ................................................................................................................... 69 Page | 2 LIST OF FIGURES Figure 1.1 Population Pyramid of Vietnam .......................................................................... 11 Figure 2.1 Conceptual model ................................................................................................ 23 Figure 3.1 Research process .................................................................................................. 26 Figure 4.1 CFA model of collectivism .................................................................................. 36 Figure 4.2 CFA model of individualism ............................................................................... 36 Figure 4.3 CFA model of life satisfaction............................................................................. 37 Figure 4.4 CFA model of status consumption ...................................................................... 37 Figure 4.5 CFA model of materialism .................................................................................. 39 Figure 4.6 Final measurement model .................................................................................... 43 Figure 4.7 Structural results (standardized estimates) .......................................................... 45 LIST OF TABLES Table 4.1 Source of data collection ....................................................................................... 32 Table 4.2 Respondents’ characteristics ................................................................................. 33 Table 4.3 Descriptive statistic: Eliminated items.................................................................. 34 Table 4.4 Summarized of pvc and pc (first order constructs) ................................................. 38 Table 4.5 Summarized of pvc and pc (second order construct) .............................................. 40 Table 4.6 Correlations (of Materialism)................................................................................ 40 Table 4.7 Summary of pvc and pc (final measurement model)............................................... 41 Table 4.8 Correlations (final measurement model) .............................................................. 42 Table 4.9 CFA Summary of eliminated item ........................................................................ 42 Table 4.10 Unstandardized structural paths .......................................................................... 44 Table 4.11 Measurement validation ...................................................................................... 46 Table 4.12 Regression Weights (bootstrap standard errors) ................................................. 47 Table 4.13 Removed items .................................................................................................... 53 Page | 3 LIST OF APPENDICES Appendix A List of in-depth interviews’ participants .......................................................... 69 Appendix B In-depth Interview’ refinement measurement scale ......................................... 69 Appendix C Questionnaire (English Version) ...................................................................... 73 Appendix D Questionnaire (Vietnamese Version) ............................................................... 78 Appendix E Descriptive statistics ......................................................................................... 83 Appendix F Summarized results of Confirmatory factor analysis........................................ 84 Appendix G Standardized Regression Weights (Final measurement model) ....................... 89 Appendix H Final measurement scales ................................................................................. 90 Page | 4 ABBREVIATION CIEM Central Institute for Economic Management CFA Confirmatory Factor Analysis GDP Gross Domestic Product GSO General statistics Office of Vietnam LS Life satisfaction MAT Materialism MOIT Ministry of industry and trade of the socialist republic of Vietnam MVS Material values scale RS Gross retail sales of goods and services SC Status consumption SEM Structural equation modeling SPSS Statistical Package for the Social Sciences TE Transitional economy VAMA Vietnam Automobile Manufacturers' Association Page | 5 ACKNOWLEDGEMENT At first, I would like to express my deep gratitude to my supervisor Dr. Nguyen Thi Mai Trang for her professional guidance, dedicated support, valuable suggestions, instructions, and encouragements during the time of doing my research. Secondly, I would like to express my appreciation to Prof. Nguyen Dong Phong, Prof. Nguyen Dinh Tho, Dr. Tran Ha Minh Quan, Dr. Nguyen Phong Nguyen, and Dr. Tran Phuong Thao for their valuable time as the members of the ISB research committee. Their comments and meaningful suggestions are significantly contributed to this research completion. Finally yet importantly, my sincere thanks are given to all of my teachers at International Business School – University of Economics Ho Chi Minh City for their teaching and guidance during my Master course. Page | 6 ABSTRACT In the Vietnam context after Doimoi, Vietnam was one of the TEs nations strongly affected by culture transitions, young population, economic and population growth. The author uses research methods in marketing with an expectation of at first, investigating the influence of following factors: collectivism, individualism, and materialism on the consumption behavior – status consumption and the life satisfaction; secondly, strengthening evidence in Vietnam; thirdly, pointing out useful practical and managerial implications, which support the nation and enterprises to understand consumers’ needs. Using the data collection of 427 respondents, the author found that life satisfaction is motivated by status consumption, which is motivated by collectivism, individualism, and materialism. Furthermore, the results indicated that collectivism and individualism have a positive influence on materialism and coexist in Vietnamese consumers. These findings suggest that the companies should carefully consider the culture elements of their products or services, in order to segment the customers and to plan an adequate strategy. Besides, the policy markers should state out the policies, which based on the real demand of status consumption in Vietnam market, in order to increase the life satisfaction of their citizens. Key words: status consumption, collectivism, individualism, materialism, life satisfaction Page | 7 CHAPTER 1 - INTRODUCTION 1.1 Background to the research From Doimoi (Economic Renovation) policy of government in 1986, the new components of economy have formed. Hence, the role of organizations and individuals in providing goods and service is continuously developing. The open-door policy attracts huge amount of investment from another developed country (Central Institute for Economic Management, 2012). The new economic reformation in Vietnam has dramatically changed the retailing industry. A retail sale of goods and services is an important indicator of GDP and is the motivation of Vietnam economy. This indicator also reflects the consumption capability of domestic customers. Along with economic reformation, in 2008, Vietnam became a lower-middle-income economy and retail sales index rapidly grew up from 0.7 bill VND in 1985 to 2325 bill VND in 2012 (General Statistic Office of Vietnam, 2012). Total retailed sales of consumer goods and services in the first nine months of 2014 rose by 11.1% from the same period in 2013. If the factor of inflation was excluded, it would be 6.2%. Totally, retailed sales of goods went up by 10.7%, accommodation and catering services by 11.9%, traveling service by 17.4% (General Statistic Office of Vietnam, 2014) and other services by 12.5%. This was resulted from many factors, such as the increase in population (up to 1% per year), the young population of "golden age", the growing proportion of middle class, government open-door policies, the increasing of foreign investments, and social exchange resulting in social-psychology shift on consumer values, attitudes and behaviors (Phương Dung, 2013). In depth, some of these change values are materialism, self-perception (individualistic self and collectivistic self), sense of life satisfaction, and status consumption. Many studies, which are related to materialism, have been investigated all over the world, essentially the relationship between materialism and consumption behavior; the differences of materialism either between collectivistic culture and individualistic culture; or between various demographic variables (age, gender, generation, etc.) (Flynn et al., 2013; Otero-Lopez et al., 2011; Olivia et al., 2012; Sharma, 2011…). Among consumption behaviors, previous studies explore the impact of materialism on compulsive consumption Page | 8 (Rasool et al., 2012; Xu, 2008); consumer involvement (Browne & Kaldenberg, 1997); consumer ethic (Olivia et al., 2012); addictive buying (Otero-Lopez et al., 2011); value consciousness (Sharma, 2011); brand engagement (Flynn et al., 2013). As defined by Richins and Dawson (as cited in Richins, 2004), materialism is an over design for material goods and includes three components: success, centrality, and happiness. The cultural differences of materialism have been researched by various economists. Watchravesringkan (2012) points out the dissimilarity of materialism in many countries. The exploration of United State-individualistic culture displays higher degree of overall materialism than Thailand-collectivist culture does, he concludes that American participants tend to regard materialism as a sign of success and central to their lives more often than their Thai counterparts do while participants from both cultures tend to view materialism as the pursuit of happiness. In like manner, Ogden and Cheng (2011) points out that a high individualism (low collectivism) score is associated with a high materialism level and the Chinese are likely more interested in acquiring possessions to display wealth (MAT-success dimension) and to find happiness (MAT-pursuit of happiness dimension) than the Canadians. In addition to this, many researches about the effects of MAT on children and adolescents are progressed due to an apparent shift in social value orientation in Asian countries such as Hong Kong, China, Singapore, and Thailand (Chan, 2003; Chang & Wang, 2006; Durvasula & Lysonski, 2010; Ferle & Chang, 2008). The same as MAT, many studies are interested in status consumption and life satisfaction especially in transitional economies (TEs), due to their potential markets. 1.2 Research problem In the past, Vietnamese could have happy life without paying attention on material values. However, in 21st century, Vietnam is a country which undergoing rapid change. The rate of population in urban and rural has significant changed from 19/81 in 1986 to 32/68 in 2013, which causes tangible and intangible shifts in economy. Likewise, average monthly earning of wageworkers has rapidly increased from 206 (000s VND) in 1995 to 4335 (000s VND) in 2014. Especially in urban area, the shifts of average monthly earning is from 452 (000s VND) in 1995 up to 5119 (000s VND) in 2014. In 2012, about 47.5 percent of the Page | 9 population in Vietnam is younger than 30 years old and 29.3 percent in the group age from 30 to 50 years old (General Statistic Office of Vietnam, 2014). In 2014, according to the population pyramid in Figure 1.1, which illustrates the age and sex structure of a Vietnam's population in 2014, the rate of population younger than 30 years old is 50.7 percent and the rate of group age from 30 to 50 years old is 29.3 percent (The world factbook, 2014). These statistic numbers may provide deep insights about political, social stability, and economic development, as well as an evidence of high potential market. The younger tend to be more sensitive to status products or brand names, and they like to talk about their consumption experiences: what kind of status products they used, how these products look like, what its utilization is. Additionally, Vietnam has undergone the rapid economic development over recent years, which results in the different lifestyle of the young Vietnamese from those of their parents and grandparents. In consequence, it may lead to the more important role of material possessions to many people. A study of Nguyen (2012) shows that Vietnamese consumers’ judgment of overall life satisfaction is significantly explained by “defining success”, “acquisition centrality” and gender. Perhaps, the same as what happened with China, under the effects of globalization of business and telecommunication and the shift of Vietnam to a more free-market economy, Vietnam’s values are beginning to change (Ogden & Cheng, 2011). Furthermore, according to market survey of Taylor Nelson (TNS) the typical group people, who afford to purchase luxury and expensive products, are in the group age of 35-54 years old (40%) and have income per month higher than 8.5 million VND (Sức hút thị trường “hàng hiệu” tại Việt Nam, 2013). Thus, the researcher consider the group age below 30 years old and high-income group of people from 30 to 50 years old as potential customers of status consumption field. As mentioned above, retail sales index grow up rapidly in 2012 and keep rising up to 2014 with the increasing rate of 11.1%. In July 2014, quantity of less than 9-seats used car are imported into Vietnam’s market with an increment of about 45 percent compared with those from previous year (Ministry of Industry and Trade, 2014). All of well-known luxury car brand such as Lexus, Rolls-Royce, Bentley, and Lamborghini… or high-class sport cars like Mercedes-Benz, Porsche, and Audi… report a stable development in yearly financial Page | 10 statement with rate of increasing about 10-15 percent per month. Vietnam Automobile Manufacturers' Association predicts that the volume of car would be sold in 2014 is about 120,000; there is an increase of 9% compared with 2013 (2014 auto sales likely to rise 9% year on year, 2014). According to the reports of Ministry of Industry and Trade of the Socialist republic of Vietnam, under the controlled imported goods, which include luxury goods, gems, jewelry, mobile, cars… in eight beginning months of 2014 are 3.77 (billion USD) (increase 12% compared with previous year) (Ministry of Industry and Trade, 2014). Especially, the first-seven-month import turnover of gems and rare metal was 348.61 million USD, which rises up to 30.21 percent. Hence, Vietnam market is a potential market for status products, despite the difficult period of economy. Figure 1.1 Population Pyramid of Vietnam Source: The world factbook, 2014 In general, customer behavior is a driver of many consuming decisions. For marketers, a better understanding of how and why people value their possessions would enable them to serve customers in a better way and a good marketing mix management helps them maximize value of the customer while provide profit to the firm. Up to present Page | 11 time, although many researches have been investigated in both Western and Asian countries, very few studies explore the perceptions of consumers in Vietnam in terms of the self-perception (collectivism, individualism), materialism, status consumption, life satisfaction, and their mutual relationship; and they mostly show these concepts separately (Nguyen, 2012; Nguyen & Tambyah, 2011; Truong, 2014). Accordingly, this study attempts to expand the understanding in customer behavior field through examining the mutual impacts of self-perceptions, materialism, and status consumption on life satisfaction in Vietnam market. The paper also investigate the relationship between two domains of selfperceptions (adopted from Singelis 1994 & Singelis et al., as cited in Nguyen & Tambyah, 2011), and three domains of materialism as developed by Richins & Dawson (as cited by Richins, 2004) separately in combination with status consumption, life satisfaction in general, and with several domains of life. In addition, it contributes a richer understanding of internal and external effects on consumer behavior in TEs market, especially those related to consumption for the sake of status. 1.3 Research objectives The overall objective of this study is to examine some antecedences and consequences of status consumption in the Vietnamese context. Specifically, it investigates: - The relationship between self-perceptions (collectivism and individualism) and status consumption; - The relationship between materialism (success, centrality, and happiness) and status consumption; - The relationship between status consumption and life satisfaction; In addition, it examines: - The relationship between self-perceptions (collectivism and individualism) and materialism; - The relationship between materialism (success, centrality, and happiness) and life satisfaction; Page | 12 1.4 Methodology In this research, two phases of study are undertaken: a qualitative study and a quantitative study. The questionnaire is translated from English into Vietnamese. Through qualitative study, in-depth interviews with six people are conducted in order to modify and revise all observations and to make the improvement for the official questionnaire. In the quantitative study, the author collects data and tests the measurement models and structural models. Due to limited time, the researcher uses a convenient sampling approach. The method of self-administered survey is employed in this study. In order to obtain a sample size of about 300, both indirectly method via electronic mail and Google surveys and directly one via hard copies are used to deliver 550 questionnaires to participants. SPSS 20 and Amos 20 are used to test the model. The researcher uses CFA in order to test the reliability and validity. Then, SEM is used to test the hypothesized model. 1.5 Research Structure This thesis includes five chapters: Chapter 1: Introduction Chapter 1 presents background to the research, as well as, research problems, research objectives, research methodology, and structure of thesis. Chapter 2: Literature Review and Hypotheses In this chapter, the author reviews the conceptual/theoretical dimensions of the literature and presents the fundamental ideas about: self-perceptions (collectivism and individualism), materialism, status consumption, and life satisfaction. Based on the literature review and research problems, this chapter also describes research model and proposed hypotheses. Chapter 3: Methodology This chapter introduces research design, research methodology, and the process of doing the research to test the hypotheses. Chapter 4: Research Results Chapter 4 is designed to present patterns of results and to analyse them for their relevance to the research questions or hypotheses. Page | 13 Chapter 5: Conclusions, Implications and Limitations The last chapter remarks conclusions about research hypotheses, conclusions about the research problems, implications for theory, implications for policies and practices. Accordingly, the limitations are presented to lead to further research. 1.6 Research scope The findings suggest that current theoretical models tested in developed markets need considerable modifications when applied in emerging markets context. Therefore, further researches are required to develop a congruent framework in developing market contexts. In order to collect data from participants in Ho Chi Minh City, the method of self-administered survey with the convenience sampling approach was employed for this study. However, the rate of Vietnam’s population in urban and rural is 32/68 in 2013, which means that not only urban area, such as Ho Chi Minh City, Hanoi Capital, Da Nang City… but also rural area can be the potential markets for consumption, especially for consumption based on the expectation of improving social standing. Thus, status consumption’s prevalence should be noticed in all areas of Vietnam with wider scope of research and larger sample size. The convenience sampling which was applied in this research was non-probability sampling. To increase the generality of sample, the author should consider the probability sampling in future researches. Page | 14 CHAPTER 2 - LITERATURE REVIEW AND HYPOTHESES This chapter mainly introduces the theories, which are proposed by many scholars in academic field and are related to all the concepts and research model. Firstly, the author introduces the definition of collectivism, individualism, materialism, status consumption, and life satisfaction in sequence. Next, the previous research of these concepts and their related discussion are mentioned. Finally, based on these theories and the relation of previous research, the hypotheses of relationship among these constructs and a conceptual model are proposed. 2.1 Literature review 2.1.1 Collectivism and Individualism O’Cass and Frost (as cited in Nguyen & Tambyah, 2011) note that different selfperceptions influent to purchase behaviors and help explain how and why consumers use products to communicate their image to others. Nguyen and Tambyah (2011) display Singelis’s argument that two aspects of the self: the independent self and the interdependent self, which have also been called the individualistic and collectivistic self-concepts, can and do coexist in individuals. Geert Hofstede, who had a notable work in culture dimension theory, indicates that individualism is the concept in which a person conceives him or herself as being separate, autonomous, and distinct from others, whereby individuals consider his or her interests more important than those of the group. The individualistic culture orientation is toward oneself and internal attributes. In an individualist culture, an individual expresses the independence through acquisition possessions, such as style choices and indicators of success such as the quantity and quality of one’s possessions. The collectivist individual, on the other hand, has a lower need for individual recognition. Success for the collectivist is measured by group success; individuals show a lower tendency to stand out from the group. Thus, high individualism scores are associated with high materialism both overall and in all its components (Ogden & Cheng, 2011). Western cultures such as the United States tend to be more individualistic, whereas Asian cultures tend to be more collectivistic (Singelis et al., as cited in Le & Stockdale, Page | 15 2005). In general, the most apparent difference between Western and Eastern cultures is the influence of the social expectation on individual development. Matsumoto and Kupperbusch (as cited in Lee et al., 2010) state that, Western (individualistic) cultures tend to emphasize independent relationships, personal goals, autonomy, and individual competence and Eastern (collectivistic) cultures, on the other hand, tend to emphasize interdependent relationships, group goals, group cohesion, and community cooperation. These two cultural orientations could influence the developmental process of individuation (Le & Stockdale, 2005). Although individualism embraces the attitude of autonomy while collectivism highlights the idea of conformity, most cultures and societies still value some balances of both autonomy and conformity, though they may prioritize them differently (Lee et. al, 2010). Moreover, in this era of globalization it is hard to conceive that individuals in highly populated urban areas can be exclusively classified as either collectivistic or individualistic. Therefore, Lee et al. (2010) suggest that it is more accurate to assess each individual’s cultural value orientation directly rather than to assume that everyone has the same cultural value orientation based on his or her regional residency. Given the typical sample sizes and convenience samples conducted by most researchers, Menon (2004) points out common inconsistent results that even if one country scores high on a particular dimension, there could be a wide variation at the individual level. He also alerts to the possibility of within country differences. Vietnam is considered a fairly collectivist culture. Because of Confucian roots, Vietnamese culture as some other Asian culture is strongly orientated around family and community. Family comes before oneself. Therefore, the Vietnamese tend to value the group rather than the individual. To bring pride to one’s family or community is the ultimate goal. However, due to the economic transition, it has been suggested that varying levels of individualism and collectivism could coexist in Vietnamese consumers (Nguyen & Tambyah, 2011). As managers from Western countries come to countries with Asian cultures, such as Vietnam, in order to avoid communication problems and misunderstandings deriving from these differences, they have to understand the insight Page | 16 domestic culture and research Vietnam’s culture at both national level and individual level thoroughly before embarking on business ventures (Kohl, 2007; Kobayashi et al., 2010). Besides, the Vietnamese government has to understand inside out the culture orientation of their citizens to be clear about the domestic market and to state out the adequate policies. Accordingly, the necessity of expanding researches related to the effect of culture is noticed. To measure collectivism and individualism, Hofstede’s model (as cited in Ogden & Cheng, 2011) with its four cultural dimensions, has been widely used to explain many characteristics across cultures and may apply in this study. However, in accordance with the research of Nguyen and Tambyah (2011), which is conducted in Vietnam’s market, the author uses a scale of 14 items (seven items to measure collectivism and seven items to measure individualism) adopted and modified from the self-construal scale developed by Singelis (1994) and Singelis et al. (1995). Hence, it is possible to make the comparison among these studies and increase the strength of evidence. 2.1.2 Materialism Goldsmith (2012) states that studying consumer motivation is important, due to it provide the basis for understanding many subsequent consumer behaviors. One of the most important consumer motives, which attracts a great deal of attention, is an over desire for material goods. Under perspective of personality trait, Belk (1985) defines materialism as “the importance a consumer attaches to worldly possessions. At the highest levels of materialism, such possessions assume a central place in a person’s life and are believed to provide the greatest sources of satisfaction and dissatisfaction” (p.265). Belk’s scale of materialism consists of three dimensions: possessiveness, envy, and non-generosity (Belk, 1985). Under perspective of consumer value, Richins and Dawson (as cited in Richins, 2004) develop material values scale (MVS) to examine materialism as a “facet of consumer behaviors.” Although these two perspectives of materialism have some common items, Richins and Dawson (as cited in Belk, 1996) defines materialism as “an enduring belief in the desirability of acquiring and possessing things” and consisting of three components: acquisition centrality, the role of acquisition in happiness, and the role of possessions in defining success. Page | 17 Unifying these three components, Richins and Dawson (as cited in Richins, 2004) produce a description of materialism that rests on the two processes of acquisition and possessions, which organize and guide the materialist’s plans and behaviors under the expectation of particular consequent end states. In this sense, acquisition and possessions can be considered as a value structure that is framed in accomplishment, esteem, and life satisfaction (Hunt et al., 1996). Although materialisms between countries are different due to the varied cultures (Caldas, 2010; Ger & Belk, 1996; Minkov & Hofstede, 2011), MVS is already examined the reliability and validation through countries, which are different from cultures (individualist and collectivist cultures, materialist and non-materialist countries) (Eastman et al., 1999; Ogden, 2003; Ogden & Cheng, 2011; Ogden & Venkat, 2001; Watchravesringkan, 2012). In Nguyen’s study (Nguyen, 2012; Nguyen & Tambyah, 2011), the MVS, which is developed by Richins and Dawson, is used to investigate materialism in Vietnam market. 2.1.3 Status Consumption Status consumption is the motivational process by which individuals strive to improve their social standings through the conspicuous consumption of consumer products that confer and symbolize status for both the individual and surrounding significant others. This consumption related need for status is the “tendency to purchase goods and services for the status or social prestige value that they confer on their owners” regardless of income or social class level. By another expressing, individuals communicate meaning about themselves to their reference group by using status goods as symbols (Husic & Cicic, as cited by Eastman & Eastman, 2011). Investigating by many researchers, status consumption is positively related to concepts of materialism (Eastman & Eastman, 2011).The period of transition from centrally planned economy to a market system has provided Vietnamese consumers with motivations and opportunities for involving in status consumption (as cited in Nguyen, 2012). Similarly to urban consumers in other TEs, such as Chinese, Thailand, and Indian, urban Vietnamese consumers, now tend to more desire in luxury goods and services consumption, and in well-known imported brands owning for an image of status (Ogden & Cheng, 2011; Shukla, 2010; Truong, 2014). Page | 18
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