International Journal of Business a

International Journal of Business and Social Science Vol. 3 No. 6; [Special Issue -March 2012]
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THE IMPORTANCE OF COLOR IN PRODUCT CHOICE AMONG YOUNG HISPANIC, CAUCASIAN, AND AFRICAN-AMERICAN GROUPS IN THE USA Dr. Okan Akcay Dr. Paul Sable Dr. M. Halim Dalgin Kutztown University of Pennsylvania United States of America Abstract Our research paper focuses on understanding the importance of color in product decision making amongHispanics, Caucasians and African-Americans who are under 25 years of age in the U.S. We include aliterature review and survey resultsforyoung adult ethnic groups. Our analysis indicates that color is very important when buying certain product categoriesfor the young adult population. Keywords: Marketing, Consumer Behavior, Color andProduct Choice, Young Ethnic Consumer INTRODUCTION
The market for young ethnic consumers has become a very important consumer segment in the U.S. This segment has been a key demographic in terms of both size and expenditures for the past decade. According to theU.S. Census, the number of young consumers, those between the ages of15 to 24,has soared to above 43.6million presently (U.S. Census 2010). They are realistic, optimistic and exhibit a strong need for individuality in their self-expression. They spend their money primarily on clothing, video games, magazines, food, soft drinks and snacks (www.sideshare.net).They have money to spend and they influence household spending of big and small purchases. They also influence 81% of family apparel purchases and 52% of other purchases such as family cars (Carter, 2011). Marketers have been aiming at and targeting this diverse and growing crucial age group not only in the U.S. but also around the world. Marketers appreciatethese young adult consumersbecause they are trendsetters in fashion, music, entertainment, ideas and attitudes.Many companies want to keep them as customers as they age (Kotler and Keller, 2012). The U.S. population is highly ethnically and racially diverse. As of the 2010 Census, the U.S. population was 63.7% White, 12.2% African American and 16.3% Hispanic. The Hispanic population grew 43% between 2000 and 2010. It is now 16.3% (50.4 million)of the population and expected to make up 18.9% of the population by 2020 (Kotler and Keller, 2012). According to the Census Bureau, the U.S. Hispanic population is projected to reach 132.8 million by 2050 which would be 30% of the nation’s total population (Westlund, 2009). The examination of racial and ethnic group distribution nationally shows that the non-Hispanic White population is still numerically and proportionally the largest major race and ethnic group in the U.S. Overall, the U.S. population is becoming more racially and ethnically diverse over time (Census, 2010). LITERATURE REVIEW Marketers know color has a strong power to create brand image, affect the buyer’s decision making process and change the mood of consumers. Color can contribute to differentiating products from competitors and creating positive or negative feelings about products (Grossman and Wisenblit, 1999; Singh, 2006). Demographic differences such as age, gender and ethnic group cause consumers to accept and perceive color differently. Young people are more open than their elders to experiment with color. Perception of color is different between age groups, for example: red represents love and blood for teens but blood and passion for the 55 and older age group. In the same research, young adult prefer different shades of blue than older age groups. According to recent studies, there are specific ethnic differences in color choice (Silver, 1998; Crozier, 1996; Jemason, 2005). Hispanics are usually drawn to brighter, stronger, more intense colors. African Americans prefer deeply saturated colors and Asian Americans have a significantly lower preference for green than any other ethnic segment. African Americans and Hispanics lean proportionately more towardpurple, Asians toward pink and Caucasian toward green.
The Special Issue on Contemporary Research in Business and Economics © Centre for Promoting Ideas, USA
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Blue is the number one overall choice of color by all ethnic groups.Ethnicity also plays a role in the preference of different colors and different shades of blue among Caucasians, African Americans and Hispanics (Paul, 2002). Color is one of the primary purchasing considerations among consumers and is a very important factor for product choice (Clarke and Honeycutt, 2000). There are a number of studies that suggest that consumer color choice depends on demographic factors, such as age, gender, ethnicity and socio-economic level. (Boyatzis and Varghese, 1994; Krishna, 1972; Choungourian, 1968). Color response is learned and can be changed overtime (Adams and Osgood, 1973; Hupka, et al., 1997). In addition, color preferences can be affected by external factors such as geographic location (urban vs. rural) and climate (Wagner, 1988).Marketers know that an average consumer’s decision to purchase a product is based, up to over 60%, on its color (Singh, 2006; pcimag.com). In general, color has the potential to affect a consumer’s overall perception of a product and the persuasiveness of purchase decisions (Sable and Akcay, 2010). Color has different meanings and perceptions in different cultures (Aslam, 2006; Madden, et al.2000). The knowledge of consumers’ color choicesenables marketers to identify and offer the right product color. Color is also used to attract, draw attention, create a purchase intention, and desired atmosphere in retail stores (Bellizi, et al., 1983; Kerfoot, et al., 2003). The importance of color is a function of the average life and price level of a product. Consumers are more likely to be focused on color in their choice of high priced, high involvement and long life products. In contrast, for low involvement products consumers are more flexible in their choice (Grossman and Wisenblit, 1999). In general, understanding color choice and responses of consumers for various products has become very complicated because consumers have developed a wide range of color associations for various products. Marketers should be aware that color is more important for value-expressive products as opposed to utilitarian type products (Ogden, et al., 2010; Akcay, et al., 2011). HYPOTHESES We would like to test the following hypotheses:
1. Color is a very important factor in the purchase of many products by young Hispanic, African American and Caucasian consumers.
2. Color preferences may vary by gender in the young consumer market.
3. The importance of color might vary by various ethnic segments in different product categories.
SAMPLE SIZE AND QUESTIONNARE
In this paper, we analyzed the importance of color in product purchasing decisions among theyoung adult ethnic population. We distributed 600 questionnaires and used convenience sampling among young adults with 477 usable questionnaires. The response rate was about 80%. The questionnaire was divided into four sections. The first section dealt with the importance of color for theyoung adult population when they make a decision about purchasing products. The second section asked respondents about the rate of importance for color in various product categories. The third section focused on favorite colors for different products that are frequently purchased by young adults. The last sectioncovered demographic variables such as ethnicity, gender, and age. We can summarize the demographics as follows,15% of the respondents were Caucasian, and 67% were Hispanic, 18% were African-American, with the remaining belonging to a few other ethnic groups such as Asians and Native Americans. Forty four percent of respondents were male and 56% were female. About 69% of them grew up in an urban setting, 14% grew up in the suburbs, and the remaining 17% grew up in rural areas. An overwhelming majority of the respondents, 73%, are from low-income families. Ninety two percent of them had a high school education and the majority were under 25 years old.
METHODOLOGY
We used ordinal logit and multinomial logit models. We wanted to use these models because in determining the color preference it is important to control various other variables that might affect the color preference such as age, gender, where the respondents grew up, and family income. Also, it is much easier to analyze categorical variables using these models while controlling for other variables that might influence the color choice. We chose a model like this because of the categorical variables that we have in our survey. Logit models are derived from linear probability models, which are about dichotomous response variables. Because the expectation of a Bernoulli random variable is simply its probability, this can be used to advantage. Suppose Y is a Bernoulli variable and we would like to estimate it by a simple linear regression equationYi=β0+β1Xi+ui. Then the conditional expectation can be interpreted as its success probability:
International Journal of Business and Social Science Vol. 3 No. 6; [Special Issue -March 2012]
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E(Yi=1|Xi)=β0+β1Xi=Pi Yet there are some issues with this kind of interpretation because estimated values can be negative or greater than one. Hence, consider the representation of the probability in a different way Pi=E(Yi=1|Xi)=β0+β1Xi= 11+e−(β0+β1Xi) But after all this can be simply stated as Pi1−Pi=eβ0+β1Xi When we take the log of the above expression, call it Li we have the logit model – simply log it – Li=log  Pi1−Pi=β0+β1Xi Now the way we interpret the estimated regressand in terms of odds is that positive values of L indicate increasing odds for one and negative values indicate decreasing odds for one. The discussion above is for dichotomous outcome but we are interested ordinal multi values as well simply multinomial outcomes. In any case if the relevant coefficient is positive and significant then going from

Hasil (Bahasa Indonesia) 1:

Jurnal internasional bisnis dan ilmu sosial Vol. 3 No 6; [Khusus masalah - Maret 2012]1Dalam kelompok-kelompok kepentingan dari warna di produk pilihan antara muda HISPANIK, KAUKASIA dan Afrika-Amerika Amerika Serikat Dr. Okan Akcay Dr. Paul Sable Dr. M. Halim Dalgin Kutztown University of Pennsylvania Amerika Serikat abstrak kami kertas penelitian berfokus pada memahami pentingnya warna dalam produk pengambilan keputusan amongHispanics, Kaukasia dan Afrika-Amerika yang berusia di bawah 25 tahun di Amerika Serikat Kami termasuk aliterature review dan survei resultsforyoung dewasa kelompok-kelompok etnis. Analisis kami menunjukkan bahwa warna sangat penting ketika membeli produk tertentu categoriesfor populasi orang dewasa muda. Kata kunci: Pemasaran, perilaku konsumen, andProduct warna pilihan, muda etnis konsumen pengenalanThe market for young ethnic consumers has become a very important consumer segment in the U.S. This segment has been a key demographic in terms of both size and expenditures for the past decade. According to theU.S. Census, the number of young consumers, those between the ages of15 to 24,has soared to above 43.6million presently (U.S. Census 2010). They are realistic, optimistic and exhibit a strong need for individuality in their self-expression. They spend their money primarily on clothing, video games, magazines, food, soft drinks and snacks (www.sideshare.net).They have money to spend and they influence household spending of big and small purchases. They also influence 81% of family apparel purchases and 52% of other purchases such as family cars (Carter, 2011). Marketers have been aiming at and targeting this diverse and growing crucial age group not only in the U.S. but also around the world. Marketers appreciatethese young adult consumersbecause they are trendsetters in fashion, music, entertainment, ideas and attitudes.Many companies want to keep them as customers as they age (Kotler and Keller, 2012). The U.S. population is highly ethnically and racially diverse. As of the 2010 Census, the U.S. population was 63.7% White, 12.2% African American and 16.3% Hispanic. The Hispanic population grew 43% between 2000 and 2010. It is now 16.3% (50.4 million)of the population and expected to make up 18.9% of the population by 2020 (Kotler and Keller, 2012). According to the Census Bureau, the U.S. Hispanic population is projected to reach 132.8 million by 2050 which would be 30% of the nation’s total population (Westlund, 2009). The examination of racial and ethnic group distribution nationally shows that the non-Hispanic White population is still numerically and proportionally the largest major race and ethnic group in the U.S. Overall, the U.S. population is becoming more racially and ethnically diverse over time (Census, 2010). LITERATURE REVIEW Marketers know color has a strong power to create brand image, affect the buyer’s decision making process and change the mood of consumers. Color can contribute to differentiating products from competitors and creating positive or negative feelings about products (Grossman and Wisenblit, 1999; Singh, 2006). Demographic differences such as age, gender and ethnic group cause consumers to accept and perceive color differently. Young people are more open than their elders to experiment with color. Perception of color is different between age groups, for example: red represents love and blood for teens but blood and passion for the 55 and older age group. In the same research, young adult prefer different shades of blue than older age groups. According to recent studies, there are specific ethnic differences in color choice (Silver, 1998; Crozier, 1996; Jemason, 2005). Hispanics are usually drawn to brighter, stronger, more intense colors. African Americans prefer deeply saturated colors and Asian Americans have a significantly lower preference for green than any other ethnic segment. African Americans and Hispanics lean proportionately more towardpurple, Asians toward pink and Caucasian toward green.The Special Issue on Contemporary Research in Business and Economics © Centre for Promoting Ideas, USA2Blue is the number one overall choice of color by all ethnic groups.Ethnicity also plays a role in the preference of different colors and different shades of blue among Caucasians, African Americans and Hispanics (Paul, 2002). Color is one of the primary purchasing considerations among consumers and is a very important factor for product choice (Clarke and Honeycutt, 2000). There are a number of studies that suggest that consumer color choice depends on demographic factors, such as age, gender, ethnicity and socio-economic level. (Boyatzis and Varghese, 1994; Krishna, 1972; Choungourian, 1968). Color response is learned and can be changed overtime (Adams and Osgood, 1973; Hupka, et al., 1997). In addition, color preferences can be affected by external factors such as geographic location (urban vs. rural) and climate (Wagner, 1988).Marketers know that an average consumer’s decision to purchase a product is based, up to over 60%, on its color (Singh, 2006; pcimag.com). In general, color has the potential to affect a consumer’s overall perception of a product and the persuasiveness of purchase decisions (Sable and Akcay, 2010). Color has different meanings and perceptions in different cultures (Aslam, 2006; Madden, et al.2000). The knowledge of consumers’ color choicesenables marketers to identify and offer the right product color. Color is also used to attract, draw attention, create a purchase intention, and desired atmosphere in retail stores (Bellizi, et al., 1983; Kerfoot, et al., 2003). The importance of color is a function of the average life and price level of a product. Consumers are more likely to be focused on color in their choice of high priced, high involvement and long life products. In contrast, for low involvement products consumers are more flexible in their choice (Grossman and Wisenblit, 1999). In general, understanding color choice and responses of consumers for various products has become very complicated because consumers have developed a wide range of color associations for various products. Marketers should be aware that color is more important for value-expressive products as opposed to utilitarian type products (Ogden, et al., 2010; Akcay, et al., 2011). HYPOTHESES We would like to test the following hypotheses:1. Color is a very important factor in the purchase of many products by young Hispanic, African American and Caucasian consumers.2. Color preferences may vary by gender in the young consumer market.3. The importance of color might vary by various ethnic segments in different product categories.SAMPLE SIZE AND QUESTIONNAREIn this paper, we analyzed the importance of color in product purchasing decisions among theyoung adult ethnic population. We distributed 600 questionnaires and used convenience sampling among young adults with 477 usable questionnaires. The response rate was about 80%. The questionnaire was divided into four sections. The first section dealt with the importance of color for theyoung adult population when they make a decision about purchasing products. The second section asked respondents about the rate of importance for color in various product categories. The third section focused on favorite colors for different products that are frequently purchased by young adults. The last sectioncovered demographic variables such as ethnicity, gender, and age. We can summarize the demographics as follows,15% of the respondents were Caucasian, and 67% were Hispanic, 18% were African-American, with the remaining belonging to a few other ethnic groups such as Asians and Native Americans. Forty four percent of respondents were male and 56% were female. About 69% of them grew up in an urban setting, 14% grew up in the suburbs, and the remaining 17% grew up in rural areas. An overwhelming majority of the respondents, 73%, are from low-income families. Ninety two percent of them had a high school education and the majority were under 25 years old.METHODOLOGYWe used ordinal logit and multinomial logit models. We wanted to use these models because in determining the color preference it is important to control various other variables that might affect the color preference such as age, gender, where the respondents grew up, and family income. Also, it is much easier to analyze categorical variables using these models while controlling for other variables that might influence the color choice. We chose a model like this because of the categorical variables that we have in our survey. Logit models are derived from linear probability models, which are about dichotomous response variables. Because the expectation of a Bernoulli random variable is simply its probability, this can be used to advantage. Suppose Y is a Bernoulli variable and we would like to estimate it by a simple linear regression equationYi=β0+β1Xi+ui. Then the conditional expectation can be interpreted as its success probability:International Journal of Business and Social Science Vol. 3 No. 6; [Special Issue -March 2012]3E(Yi=1|Xi)=β0+β1Xi=Pi Yet there are some issues with this kind of interpretation because estimated values can be negative or greater than one. Hence, consider the representation of the probability in a different way Pi=E(Yi=1|Xi)=β0+β1Xi= 11+e−(β0+β1Xi) But after all this can be simply stated as Pi1−Pi=eβ0+β1Xi When we take the log of the above expression, call it Li we have the logit model – simply log it – Li=log  Pi1−Pi=β0+β1Xi Now the way we interpret the estimated regressand in terms of odds is that positive values of L indicate increasing odds for one and negative values indicate decreasing odds for one. The discussion above is for dichotomous outcome but we are interested ordinal multi values as well simply multinomial outcomes. In any case if the relevant coefficient is positive and significant then going from