Assessing brand switching level and behaviour of growing-up milk products in Java: A structural equation modeling and multigroup analysis

Abstract

The biggest consumers of dairy products for children aged 1–3 years, which are referred to as growing-up milk (GUM), come from the middle and lower socioeconomic classes. More than 90% of Indonesians belong to this segment. In 2020, the proportion of the population living in rural and urban areas will be almost equal, namely 43.3% and 56.7%, respectively. Understanding brand switching behavior is essential to enabling GUM manufacturers to stay in business and thrive by retaining loyal customers. The aims of this study are (i) to assess the level of brand switching; (ii) to examine the determinant factors of brand switching behavior; and (iii) to compare the brand switching behavior of GUM consumers in rural and urban areas of middle and lower socioeconomic classes in Java. The research was conducted in 4 sub-districts in 2 provinces (East Java and D.I. Yogyakarta) using a guided interview method with a questionnaire. Research respondents were 419 consumers of GUM, and they were selected using the purposive sampling method. Data analysis used partial least squares - structural equation modeling (PLS-SEM) and multigroup analysis (MGA). The study found that the level of brand switching among GUM consumers in Java is 57%, which is considered high. The most important factor that influences the brand switching behavior of GUM consumers in Java's middle and lower socioeconomic classes is bad prior experiences, followed by variety seeking, bad product attributes, and customer dissatisfaction. A defective product is the most reflective indicator of a bad prior experience. There is no difference in brand switching behavior between rural and urban consumers in Java from the middle to lower socioeconomic classes. Therefore, GUM manufacturers are allowed to adopt the same marketing strategy to increase efficiency.