VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY --------***-------- TRAN LUU LY IMPACTS OF ETHICAL MARKETING PRACTICES ON CUSTOMER SATISFACTION AND LOYALTY ON COSMETICS PRODUCTS: A COMPARATIVE STUDY BETWEEN GENERATION Z AND GENERATION Y MASTER’S THESIS VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY --------***-------- TRAN LUU LY IMPACTS OF ETHICAL MARKETING PRACTICES ON CUSTOMER SATISFACTION AND LOYALTY ON COSMETICS PRODUCTS: A COMPARATIVE STUDY BETWEEN GENERATION Z AND GENERATION Y MAJOR: BUSINESS ADMINISTRATION CODE: 8340101.01 RESEARCH SUPERVISORS: Prof. SADAMI SUZUKI Dr. NGUYEN PHUONG MAI Hanoi, May 2023 COMITTMENT The present study, entitled "Impacts of ethical marketing practices on customer satisfaction and loyalty on cosmetics products: a comparative study between Generation Z and Y" represents an original research endeavor conducted by the undersigned, under the guidance of Professor Sadami Suzuki and Dr. Nguyen Phuong Mai.
The present study employs reliable data and ensures that the quantitative analysis and findings presented in this thesis are original and have not been previously published in any other research. The complete citation source has been duly acknowledged in this MBA thesis. The present study adheres to the Regulation on prevention of plagiarism in academic and scientific research activities at VNU Vietnam Japan University (Issued together with Decision No 700/QD-ĐHVN dated 30/9/2021 by the Rector of Vietnam Japan University). The author pledges with personal honor that the research result presented herein is original and does not infringe upon any intellectual property rights or ethical standards.
The author of this thesis expresses a strong commitment and readiness to assume accountability for this research project. Signature Student: Trần Lưu Ly ACKNOWLEDGEMENT I am honored to present my Master's thesis, and I must express my heartfelt gratitude to the individuals who have helped me throughout this journey. First and foremost, I would like to express my sincere appreciation to my supervisor, Dr. Mai and Prof.
Without their guidance, expertise, and unwavering support, this thesis would not have been possible. Their insightful feedback and constructive criticism helped me to refine my research and write with greater precision and clarity. I would also like to extend my gratitude to the members of my thesis committee, who provided invaluable feedback and insights. Their constructive criticism and diverse perspectives helped to shape my ideas and arguments and made this work more nuanced and sophisticated.
Moreover, I would like to thank the staff at the university library, who assisted me in locating and accessing the resources necessary to conduct my research. Their tireless efforts and willingness to help made the research process much smoother and more efficient. Finally, I would like to express my gratitude to my family and friends, who supported and encouraged me throughout this process. Their love, understanding, and patience sustained me during the long hours of research and writing.
In summary, I would like to express my deep gratitude to all the individuals who have played a vital role in the successful completion of this thesis. Their unwavering support and encouragement have been priceless, and I am truly indebted to them for their contributions, as this accomplishment would not have been possible without their assistance. TABLE OF CONTENTS LIST OF TABLES. i LIST OF ABBREVIATION.
iv CHAPTER 1: INTRODUCTION. Scope and subject of the research. Structure of the research. 4 CHAPTER 2: LITERATURE REVIEW.
Theory of planned behavior. Proposed research model. Data collection process. Analyzing data plan.
Reliability testing of scale. 25 CHAPTER 4: DATA ANALYSIS .2 Exploratory factor analysis (EFA). Findings and discussion. 40 CHAPTER 5: IMPLICATIONS, RECOMMENDATIONS AND CONCLUSION.
Some suggestions for further studies. 62 LIST OF TABLES Table 3.1: Likert 5-point scale…………………………………………………….1: Description of respondents’ profile……………………………………….2: Cronbach's Alpha analysis results table……………………………….3: KMO and Barlett's Test……………………………………………………31 Table 4.8: Hypothesis assessment results…………………………………………….9: Comparison between Generation Y and Z in Price fairness………………38 Table 4.10: Comparison between Generation Y and Z in Product fairness……….11: Comparison between Generation Y and Z in Health consciousness…….12: Comparison between Generation Y and Z in Customer satisfaction…….13: Comparison between Generation Y and Z in Customer loyalty………….40 i LIST OF FIGURES Figure 1.1: Theory of planned behavior model (Ajzen, 1991)………….2: Proposed research model…………………………………….18 ii LIST OF ABBREVIATION CA Customer attitude CS Customer satisfaction CL Customer loyalty EFA Exploratory factor analysis H Hypothesis HC Health conscious PF Price fairness PRF Product fairness iii ABSTRACT This study aims to investigate the impact of ethical marketing practices on customer satisfaction and loyalty for cosmetic products, with a specific focus on the differences between Generation Z and Generation Y consumers. Ethical marketing practices refer to marketing activities that promote social and environmental responsibility, such as using sustainable packaging, cruelty-free testing, and fair-trade sourcing. To achieve this aim, a comparative study will be conducted among a sample of Generation Z and Generation Y consumers who purchase cosmetic products.
The study will use a quantitative research design and collect data through an online survey. The survey will measure the respondents' perception of ethical marketing practices, their level of satisfaction with the cosmetic products they purchase, and their loyalty towards the brand. The data collected will be analyzed using descriptive statistics and inferential statistics, such as regression analysis and t-tests. The results of the study are expected to provide insights into the relationship between ethical marketing practices, customer satisfaction, and loyalty.
Moreover, the study will investigate if there are any significant differences in the impact of ethical marketing practices on Generation Z and Generation Y consumers. The findings of this study will contribute to the existing literature on ethical marketing practices, customer satisfaction, and loyalty in the cosmetic industry. Furthermore, the results may help cosmetic companies to understand the preferences and expectations of Generation Z and Generation Y consumers, and to develop marketing strategies that promote ethical practices and enhance customer satisfaction and loyalty. iv CHAPTER 1: INTRODUCTION 1.
Research background The cosmetic industry has been facing growing pressure to adopt ethical marketing practices in recent years. Ethical marketing practices refer to marketing activities that promote social and environmental responsibility, such as using sustainable packaging, cruelty-free testing, and fair trade sourcing. These practices are increasingly important to consumers, particularly younger generations like Generation Z and Generation Y, who prioritize social and environmental responsibility in their purchasing decisions (Bartikowski & Walsh, 2011; Johnson & Young, 2017). Ethical marketing strategies have been proved in several research to increase consumer happiness and loyalty.
Ethical marketing techniques, such as adopting ecologically friendly packaging, were shown to have a beneficial effect on consumer satisfaction and loyalty in the cosmetics business in a research conducted by Chandon et al. Yeo and Lee (2018) also discovered that cosmetics companies that used fair trade ingredients and other ethical marketing tactics had more loyal customers. However, despite the increasing importance of ethical marketing practices in the cosmetics industry, little research has investigated if there are any differences in the impact of these practices on customer satisfaction and loyalty among different age groups. This is particularly important given that GenerationZ and GenerationY consumers have been found to have different values and expectations when it comes to ethical consumption (Dangelico & Vocalelli, 2017; Joergens, 2006).
Therefore, this study aims to address this research gap by investigating the impact of ethical marketing practices on customer satisfaction and loyalty in the cosmetic industry, with a specific focus on the differences between Generation Z and GenerationY consumers. Research objectives The main objectives of this study are: To investigate the level of awareness and importance of ethical marketing practices among Generation Z and Generation Y consumers in the cosmetic industry. To examine the impact of ethical marketing practices on customer satisfaction and loyalty in the cosmetic industry, with a specific focus on the differences between Generation Z and Generation Y consumers. To identify which ethical marketing practices are most influential in shaping customer satisfaction and loyalty among Generation Z and Generation Y consumers in the cosmetic industry.
To provide recommendations for cosmetic companies on how to adopt and implement effective ethical marketing practices to improve customer satisfaction and loyalty among Generation Z and Generation Y consumers. By addressing these research objectives, this study aims to contribute to a better understanding of the impact of ethical marketing practices on customer satisfaction and loyalty among different age groups, and to provide insights into how cosmetic companies can better target and engage younger consumers who prioritize social and environmental responsibility. What are the impacts of ethical marketing on customer satisfaction and loyalty in Generation Z and Generation Y? 2. What are the recommendations for cosmetics companies to improve customer satisfacton and loyalty among Generation Z and Generation Y consumers? 1.
Scope and subject of the research The subject of this study is the impact of ethical marketing practices on customer satisfaction and loyalty in the cosmetic industry, with a comparative analysis between Generation Z and Generation Y consumers in Hanoi, Vietnam. The primary objective of this study is to examine the level of awareness and significance attributed to ethical marketing practices among two consumer segments in Hanoi. Additionally, the study 2 aims to explore the preferences and attitudes of these consumer groups towards ethical and sustainable cosmetic products. The scope of the research is limited to the city of Hanoi and focuses on the impact of ethical marketing practices on customer satisfaction and loyalty in the local cosmetic market.
The study will explore various ethical marketing practices, such as the use of natural and organic ingredients, cruelty-free testing, and eco-friendly packaging, as they are implemented by cosmetic companies in Hanoi. The research will also investigate the differences in perception and behavior between GenerationZ and GenerationY consumers in Hanoi towards these ethical marketing practices. By conducting this study in Hanoi, we aim to provide valuable insights into the impact of ethical marketing practices on customer satisfaction and loyalty among GenerationZ and GenerationY consumers in the local cosmetic market. The results of this study may also serve as a reference for cosmetic companies operating in Hanoi to better understand and cater to the needs and preferences of younger consumers who prioritize social and environmental responsibility.
The motivation behind conducting a comparative study on the impacts of ethical marketing practices on customer satisfaction and loyalty in the cosmetics industry between Generation Z and Generation Y stems from several factors. Firstly, the cosmetics industry has witnessed a growing emphasis on ethical marketing practices, such as sustainable sourcing, cruelty-free production, and transparent labeling. Understanding how these practices influence customer satisfaction and loyalty is essential for both practitioners and researchers. Secondly, Generation Z and Generation Y represent significant consumer segments in the cosmetics market.
Generation Z, as the younger cohort, has distinct characteristics and preferences compared to Generation Y. Exploring their attitudes and behaviors towards ethical marketing practices can provide valuable insights into the evolving consumer landscape and help businesses tailor their strategies to meet the needs and expectations of these generations. 3 Furthermore, there is a need to examine potential differences between Generation Z and Generation Y in their responses to ethical marketing practices. These differences could be influenced by factors such as their level of health consciousness, social awareness, digital fluency, and cultural influences.
By comparing the two generations, researchers can uncover unique insights into how ethical marketing practices impact customer satisfaction and loyalty differently across these segments. Overall, the research aims to contribute to the existing body of knowledge in the cosmetics industry by shedding light on the specific effects of ethical marketing practices on customer satisfaction and loyalty among Generation Z and Generation Y consumers. The findings can inform marketing strategies and guide businesses in developing more effective and targeted approaches to engage these consumer groups.