Factors of consumer's choices: a reaveled preferences analysis for 3 in 1 coffee

Abstract

3in1 coffee is known as an important product of instant coffee market in Vietnam, especially in Ho Chi Minh City. The reason of that comes from the benefits which 3in1 coffee brings to consumers in term of convenience, product quality, and appropriate price. In the above context of 3in1 coffee market, the main objective of this study is to identify the determinants of consumer’s choices in 3in1 coffee market such as price, main ingredients, packaging, manufacturer, discount, and weight promotion. This study is a practical research with the basis of random utility theory. Specifically, empirical result is produced from the estimation of conditional logit model for the dataset which is collected from consumers in Ho Chi Minh City in 2016. The survey process relies on the revealed preference method with several additional hypothetical scenarios. The main finding of this study emphasizes the importance of main ingredients, packaging, and manufacturers of 3in1 coffee in consumer’s choices. It is recognized that price may not matter consumer’s choices. However, consumers love discount and weight promotion. In addition, several manufacturers enjoy positive marginal utility of price for consumers while the others enjoy the negative one. On the other hand, price changes may give small effects on choice probability of 3in1 coffee products. According to those empirical findings, implications have been employed for manufacturers in order to understand more about 3in1 coffee market, widen their market share, and increase their profits.