Perception and Preferences of Consumers in the Retail Sector: A Case Study in the City of Loja-Ecuador ()
1. Introduction
Consumer perception plays a crucial role in the success of businesses in today’s competitive market. This study focuses on the analysis of consumer perception in the retail sector of the city of Loja, considering different dimensions of consumption such as food, leisure, health, home, education, and technology, as well as the preferences and characteristics of consumers (Silva, 2021) . The research aims to understand how consumer perceptions influence their purchasing decisions and, consequently, the success of businesses in the retail sector.
In the past, consumers were considered rational agents who made decisions based solely on utility maximization and price. However, recent research, such as that by Raiteri (2016) , suggests that purchasing decisions are influenced by multiple factors, including cultural, social, personal, and psychological aspects. Moreover, it has been observed that 80% of purchases are made on impulse, indicating the need to adapt advertising and marketing to the needs and preferences of consumers.
The analysis of consumer perception is essential for businesses, as it allows them to understand their customers and tailor their products and services to their needs and preferences (Cossío Silva, Vega Vázquez, & Revilla Camacho, 2016) . By knowing consumers’ perceptions of a company’s products and services, the company can make informed decisions about how to improve or innovate its products and services, as well as how to enhance its marketing and advertising. In terms of products, services, and advertising, the analysis of consumer perception is a valuable tool for businesses, as it allows them to better understand their customers and adapt their products and services to meet their needs and preferences (Miranda et al., 2021) .
In the Ecuadorian context, it has been observed that consumers tend to be cautious when purchasing products, opting to buy more at a lower cost (Pesantes, 2019) . Neighborhood stores and other types of retail establishments have experienced a boom in entrepreneurship, but consumer perception may limit their growth. Therefore, this study focused on analyzing consumers’ perceptions of small and medium-sized enterprises in the city of Loja and their relationship with the development of the retail sector.
This article examines consumer perception in the retail sector of the city of Loja, analyzing the influence of different dimensions of consumption on purchasing decisions and how businesses can use these insights to improve their marketing and advertising strategies, as well as their products and services. The results of this study are expected to provide useful information for retail sector businesses in the city of Loja to enhance their competitiveness and achieve greater success in the market (Treviño et al., 2019; Pesantes, 2019) .
Based on the research question posed: “What is the perception of consumers in relation to small and medium-sized enterprises in the city of Loja?”, two hypotheses, alternative and null, were examined. The alternative hypothesis stated that: “Consumer perception is influenced by the different dimensions of consumption within the retail sector of the city of Loja,” while the null hypothesis asserted that: “Consumer perception is not influenced by these dimensions of consumption; thus showing that consumer perception in relation to small and medium-sized enterprises in the city of Loja is influenced by the different dimensions of consumption within the retail sector.
This suggests that small and medium-sized enterprises should pay attention to consumer preferences and expectations based on different dimensions of consumption to improve their market position and contribute to the growth and development of the retail sector in the region.
1.1. Consumer Perception
Analyzing consumer perception is essential for understanding their needs and preferences in the realm of products and services, as well as marketing and advertising strategies (Raiteri, 2016) . Consumer perception can be influenced by various factors, including cultural, social, personal, and psychological factors, leading to the need to research consumer behavior and needs, which can vary depending on the context (Miranda et al., 2021) . The study of consumer behavior covers aspects such as what they buy, why they buy, how they buy, when they buy, where they buy, and how often they buy (Gallo, 2017) . Product quality alone is not enough to ensure consumer satisfaction; it is also crucial to offer good quality service and proper customer care to retain customers (Pérez & Pérez, 2016; University of Jaén, 2020) . The store’s image and the perceived value of a brand are closely linked, highlighting the importance of properly managing a store’s image to gain market recognition (Solorzano Jaramillo et al., 2021) . The store’s image influences purchase intention and can improve organizational performance if marketing actions and the store’s image are managed correctly (Henao & Córdoba, 2007) . Consumer behavior is considered a choice process based on the utility that goods provide to individuals and can be limited by the available budget (Henao & Córdoba, 2007) . Although consumption is the main economic activity related to satisfying needs, the influence of advertising, reference groups, institutions, and the media can limit consumers’ freedom of choice (Cortés Jiménez & Zapata Agudelo, 2017) .
Analyzing consumer perception is a valuable tool for businesses, as it allows them to better understand their customers and adapt their products, services, marketing, and advertising to meet their needs and preferences. Research in this field can provide useful information for improving product quality, customer care, store image, and ultimately organizational performance.
The following are several authors who contribute significantly to the perception of consumer consumption of products and services from different perspectives.
In the context of the national digital reality in Ecuador, Trujillo (2021) reveals that, despite the COVID-19 pandemic, it was determined that consumer behavior regarding generation influences the decision to purchase products. Millennials lead the list, being more comfortable with online shopping due to their familiarity with the digital age, compared to Generation X, Baby Boomers, and Zentennials (Trujillo, 2021) .
· Salazar Lozada et al. (2020) conclude that food is one of the factors prioritized in times of economic recession and that promotions, branded products, and proven quality are some of the motivations that encourage consumers to buy.
· ChoraPozo & Pérez Ramírez (2022) analyze different personal and psychological factors of the consumer and find that purchases tend to be made to meet a need, seeking information analytically before making a purchase.
· Villacís Cárdenas (2018) analyzes the evolution of the retail sector in Ecuador, noting that good commercial positioning is key to generating loyalty to its commercial brands. They also highlight that the sector had its peak growth from 2010 to 2014.
· Solórzano Jaramillo et al. (2021) evaluate consumers’ perception of the impact of store image on supermarkets in Machala, concluding that store image management is well-handled.
· Cárdenas & Monga (2019) investigate the importance of knowledge management in consumer perception of a collective brand, using “Los Helados de Salcedo” as an example and concluding that consumer perception is based on stimuli and positive product acceptance.
· Intriago Zevallos et al. (2021) The research investigates the perception of service quality in SMEs in the lodging sector of Portoviejo and demonstrates that the perception of quality significantly impacts the competitiveness of these businesses.
· Navas Olmedo et al. (2022) They indicate that social responsibility is part of the new organizational culture and that SMEs must incorporate it into their business model to contribute to value creation.
· Valarezo Romero et al. (2020) They find that a low percentage of companies demonstrate a presence on social media and that social media management in a company does not significantly influence profits.
· Solorzano et al. (2021) They highlight the importance of analyzing the characteristics of each consumer, their demands, and limitations when making a purchase.
· Solórzano Jaramillo et al. (2021) They emphasize the importance of product assortment in customers’ perception of a supermarket and how merchandise influences 89% of the image held about a supermarket.
· Moreno Morillo et al. (2021) They explain that consumer behavior is based on how customers and families must make decisions to allocate their available resources to related products.
· Intriago Zevallos et al. (2021) investigate the perception of service quality in SMEs in the accommodation sector of Portoviejo and demonstrate that the perception of quality significantly affects the competitiveness of these companies.
· Navas Olmedo et al. (2022) point out that social responsibility is part of the new organizational culture, and SMEs must incorporate it into their business model to contribute to value creation.
· Valarezo Romero et al. (2020) find that a low percentage of companies demonstrate a presence on social media and that social media management in a company does not significantly influence profits.
· Bermeo-Solorzano et al. (2021) emphasize the importance of analyzing each consumer’s characteristics, demands, and limitations when making a purchase.
· Solórzano Jaramillo et al. (2021) stress the importance of product assortment in customers’ perception of a supermarket, and how merchandise influences 89% of the image they have of a supermarket.
· Moreno Morillo et al. (2021) explain that consumer behavior is based on how customers and families must decide to allocate their available resources to related products.
1.2. Factors That Influence Consumer Perception
The factors that influence consumer perception are varied and can be both internal and external to the individual. Some of the main factors that affect consumer perception include (Schiffman et al., 2009) :
Personal factors: these include individual characteristics such as personality, needs, desires, motivations, previous experiences, attitudes, and expectations of the consumer. These factors can influence how the consumer processes information and makes purchasing decisions.
Cultural factors: the culture in which a consumer lives has a significant influence on their perceptions, preferences, and purchasing behaviors. This includes values, beliefs, norms, customs, and practices shared by a group of people.
Social factors: the social groups to which an individual belongs (such as family, friends, colleagues, and other reference groups) can also influence their perceptions and purchasing decisions. The opinions, recommendations, and behaviors of these groups can affect how the consumer evaluates and selects products or services.
Situational factors: external factors such as the physical environment, time, weather, geographic location, and specific circumstances can affect consumer perception and behavior. For example, a consumer may perceive a product differently in a luxurious store compared to a discount store.
Marketing factors: marketing strategies employed by companies, such as advertising, promotion, packaging, pricing, and distribution, can influence consumer perception. The way information about a product or service is presented and communicated can affect how the consumer perceives it and whether they decide to purchase it.
Cognitive factors: the consumer’s mental processes, such as attention, memory, learning, and problem-solving, also influence perception. Consumers may pay attention to certain stimuli while ignoring others, and the way they process and remember information can affect their perceptions and purchasing decisions.
Emotional factors: the consumer’s emotions and moods can also affect their perceptions and purchasing behaviors. Emotional experiences, such as happiness, sadness, fear, or anger, can influence how the consumer evaluates and selects products or services.
Understanding these factors and how they influence consumer perception is crucial for businesses, as it allows them to design more effective marketing and communication strategies that resonate with their customers and motivate them to buy.
1.3. Preferences in Consumer Perception
Consumer preferences are determined by factors such as proximity to shopping, types of products offered, price, brand image, and customer service (Alcívar, 2021) . Consumption influence includes dimensions such as social class, lifestyle, influencers, and personal preferences (Gómez & Sequeira, 2015) . The purchasing process encompasses need recognition, information search, evaluation of alternatives, purchase, and post-purchase (Mejía Vayas et al., 2020) .
Shopping schedules and purchase frequency are relevant indicators for structuring marketing strategies and retaining customers Ángeles et al. (2019) . The price-quality relationship is crucial for a product to be accepted (Alcalde, 2019) , and customer service is essential for building loyalty and generating higher sales (Gil López, 2020) . The quality of products in stores or warehouses close to consumers’ homes must be excellent (Colín, 2022) , and the store’s proximity is an important factor in the purchase decision.
1.4. Consumption Dimensions
For the following research, the following consumption dimensions are taken into account:
· Food: Nutrition is an essential element for good health, influencing the quality of food, the quantity of meals, and eating habits for human well-being, which leads to balanced nutrition.
· Leisure: Leisure consists of a way to use free time through an autotelic and autonomously chosen and performed occupation, which results in satisfaction or pleasure for the individual.
· Health: Health has been defined by the World Health Organization (WHO) not only as the absence of disease, which was the traditional concept until the mid-20th century, but as “a state of complete physical, mental, and social well-being, and not merely the absence of disease or infirmity.”
· Home: Whether large or small, the home is where much of a person’s life takes place; it’s where children grow, coexist, and share family experiences. In the home, people sleep, rest, and strengthen their emotional and mutual support relationships. Sometimes it also serves as a workplace. The home is an essential place for human development. In it, people can feel good, calm, protected, safe, and healthy. According to their beliefs, each person’s home should be comfortable, pleasant, safe, beautiful, welcoming, and harmonious.
· Education: Education is a phenomenon that we all know and have experienced because it is inherent in the development of the subject, so much so that without it, we could not speak of the human being. For these reasons, the term education is often used to give meaning to various everyday events related to education.
· Technology: Technology is an application of a set of knowledge and skills aimed at facilitating society’s problems and satisfying them in a specific area (Alzate, 2017) .
2. Methodology
An exploratory conclusive research approach was designed, based on a simple cross-sectional descriptive analysis, and using a categorical correlation with a correlational scope to determine the influence between consumer perception and the different dimensions of consumption within the retail sector in the city of Loja. A non-parametric statistical test was used to analyze the relationship between the variables.
2.1. Data and Sample
The study was conducted in the city of Loja, Ecuador, a location with high commercial representation. The target population of the study was composed of consumers of the city of Loja who met the following criteria: having purchasing power, being in the city of Loja, and having pre-established shopping characteristics at the time of the survey. In order to obtain a convenient but significant sample population of the Loja consumer, a non-probabilistic sampling technique by convenience of the researcher was employed, in which a sample of 500 consumers from the locality was selected as significant inferential elements of the Loja consumer. Data was collected through a questionnaire developed by the researchers based on existing commercial trends in the locality, with categorical questions designed to measure the perceptions of the study elements. The questionnaire was administered using Google Forms for its online application.
2.2. Measurements and Indicators
To analyze the data obtained from the primary sources, a descriptive analysis of percentages and frequencies on basic study information was used. This analysis was based on the correlation of two groups of variables using Pearson’s Chi-square statistical test:
Variables:
V1: Consumption dimensions.
V2: Consumer perception.
The following research question was proposed:
What is the perception of consumers regarding the SMEs of the city of Loja?
2.3. Research Hypotheses
H0: Consumer perception is not influenced by the different dimensions of consumption within the retail sector of the city of Loja.
HA: Consumer perception is influenced by the different dimensions of consumption within the retail sector of the city of Loja.
To examine the relationship between the two mentioned variables, a correlation analysis was performed using Pearson’s Chi-square non-parametric statistical test, seeking the correlation between the analysis elements of both variables. It should be noted that the objective is not to identify the causality of the variables, but their association.
2.4. Operationalization of Variables
As shown in Table 1, a methodological analysis was conducted on the research hypothesis, variables, and factors associated with these variables.
Note. Details of the correlation factors.
3. Results
The analysis of the provided information allows us to observe that the retail sector in Ecuador has experienced significant growth in recent years, becoming a key and dynamic sector in the Ecuadorian economy and society (Villacís Cárdenas, 2018) . Consumption levels have increased in various products and services, reflecting the importance of this sector in the country.
Consumer perception plays an essential role in the choice of products and services (Schiffman et al., 2009) . That is why it is important to study consumer perception in relation to traditional consumption dimensions, such as food, health, leisure, home, education, and technology.
The analysis of Table 2 provided reveals the preferences of consumers in the city of Loja regarding these consumption dimensions. The results show that food and technology are considered the most important dimensions, with 69.6% and 55.2% of respondents rating them as “very important,” respectively. On the other hand, leisure is perceived as the least important dimension, with 31.4% of participants considering it “unimportant.” Education, health, and home present varied levels of importance, highlighting health as the third most important dimension after food and technology.
Consumer perception analysis is a valuable tool for understanding how consumers perceive products and services (Schiffman et al., 2009) , allowing companies to offer products and services that meet their customers’ needs and gain a larger market share. To achieve this, it is essential to consider consumer perception in relation to the different consumption dimensions and adapt business strategies according to these preferences.
The results of the research show the preferences of consumers in Loja, Ecuador, regarding various product criteria. Overall, consumers consider the price of the product (36.4%), the quality of the product (59.0%), the convenience of the product (38.2%), and the size of the product (42.6%) to be important or very important factors when making a purchase.
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Table 2. Dimensions of consumption according to their level of importance from the consumer’s perspective.
Regarding the sensory aspects of the product, such as the design and presentation (36.4%), the colors of the product (28.4%), the textures of the product (35.2%), the flavors of the product (35.8%), and the odors of the product (36.8%) are also important factors for consumers, albeit to a lesser extent than the criteria of price, quality, convenience, and size.
On the other hand, the brand of the product (30.4%) and the product environment (37.0%) are not considered as important by consumers. The durability of the product (31.2%) is also perceived as relatively less important compared to other criteria but still considered important by over 85% of consumers, as seen in Table 3.
Overall, these results suggest that consumers in Loja are sensitive to both practical and sensory aspects of products. Retail companies in Loja can use this information to design marketing strategies that emphasize the quality, convenience, and size of the product while also considering sensory aspects such as the design and presentation, colors, textures, flavors, and odors of the product. On the other hand, the brand of the product and the product environment may not be decisive factors in consumers’ purchasing decisions in Loja, suggesting that companies may not need to emphasize these aspects in their marketing strategy.
Alcalde (2019) & Poyearleng et al. (2019) points out that quality is acceptable if accompanied by an appropriate price. A product with multiple significant factors is generally associated with a higher price, as it is considered of better quality. On the other hand, a product with fewer factors is perceived as lower quality and, therefore, is associated with a lower price.
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Table 3. Consumer perception by attribute.
Jiménez Marín et al. (2019) also highlight that consumer perception is guided by what their senses perceive, such as the environment of the place and the shapes and colors of the product. These elements allow the consumer to relate the product to external contexts, which can increase the likelihood of a sale. Additionally, the smell of a product can generate emotions and pleasure, while the taste processed through taste buds can tilt the consumer’s preference towards a specific product. These factors act as mediators of action when a customer is motivated to make a purchase and can be decisive when choosing a product.
The various factors that influence consumer perception have a considerable impact on their purchasing decisions. It is crucial for manufacturers and retailers to understand and address these perceptions to offer products that meet the needs and expectations of their customers, ultimately increasing their sales and market share.
4. Discussion
The main objective of this research study is to identify the factors that influence the purchasing decision of consumers in the retail sector of the city of Loja, focusing the analysis on consumer perceptions and consumption dimensions.
Consumer perception refers to the process by which a person selects, organizes, and interprets stimuli through their five senses. In this study, we seek to understand what combination of perceptions attracts consumers in the retail sector of the city of Loja. To do this, we analyze the following perceptions: product brand, product price, product design and presentation, product quality, convenience and comfort provided by the product, product size or proportion, product colors, product textures, product flavors, product smells, product durability, and the environment in which the product is found. These were then weighted according to consumer ratings in three broad groups, based on the importance of: Not Important, Important, and Very Important. See Table 4.
The table shows the distribution of the importance assigned to product factors in the weighting. It can be seen that the majority of respondents (80.6%) consider the product factors to be “very important” for empowerment. In contrast, only 4.0% of respondents consider the factors to be unimportant, and 15.4% of
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Table 4. Weighted degree of importance of product factors (Grouped).
respondents rate the importance of the factors as “important.” Considering the rating scale and the provided percentages, we can develop the following explanatory table in Table 5.
Table 5 summarizes the previously analyzed information, showing the relationship between the rating range and the percentage of respondents who rated the importance of the product factors in the empowerment within each category.
On the other hand, the same Table 4 was crossed with the consumption dimensions, which refer to the following consumption dimensions: food, leisure, health, home, education, and technology. We aim to identify the preferences of Loja consumers in relation to these dimensions. See Table 6.
To scientifically analyze the information provided, it is necessary to perform a descriptive analysis of the data and examine the general trends in the importance assigned to each product factor in different consumption categories. Below is a descriptive analysis of the data:
Food: Most respondents considered food to be a “very important” (61.4%) factor in empowerment. It is also observed that there is an increase in the importance assigned to food as the degree of importance increases.
Recreation: In comparison to food, recreation is considered a less important factor in empowerment. Although most respondents still consider it “very important” (23.8%), there is a higher proportion of people who consider it “not important” (2.0%) or “of little importance” (0.8%).
Health: Health is considered a “very important” factor by 50% of respondents. In addition, there is an increase in the importance assigned to health as the degree of importance increases.
Home: The importance assigned to home is lower compared to other consumption categories. However, 39% of respondents still consider it “very important.”
Education: Education is considered a “very important” factor by 48.4% of respondents. As the degree of importance increases, so does the importance assigned to education.
Technology: Technology is considered a “very important” factor by 16.6% of respondents, being the least important factor in empowerment among the categories analyzed. Although there is an increase in the importance assigned to technology as the degree of importance increases, the proportion of people who consider it “very important” is lower compared to other categories.
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Table 5. Weighted empowerment rating.
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Table 6. Dimensions with perceptions according to the product.
It can be concluded that food, health, and education are considered the most important factors in empowerment, while recreation, home, and technology are considered less important in comparison.
Based on this descriptive information, the following hypotheses are proposed for analysis:
Alternative Hypothesis: Consumer perception is influenced by different consumption dimensions within the retail sector of Loja city.
Null Hypothesis: Consumer perception is not influenced by different consumption dimensions within the retail sector of Loja city.
In this study, the dependent variable is consumer perception, and the independent variable is consumption dimensions. It is considered that consumer perceptions about a product depend on the consumption dimension that is needed at a specific time.
By analyzing these variables and hypotheses, this study seeks to provide valuable information for merchants and entrepreneurs in the retail sector in the city of Loja, allowing them to better understand the preferences and perceptions of their consumers and adapt their marketing strategies and product offerings accordingly. For this reason, a non-parametric chi-square test was conducted to determine the correlation between both variables. See Table 7.
The analysis focuses on the relationship between consumer perception and the different dimensions of consumption within the retail sector of the city of Loja. Two hypotheses are proposed: the alternative hypothesis suggests that consumer perception is influenced by the different dimensions of consumption, while the
null hypothesis states that there is no such influence. To examine the relationship between these variables, Pearson chi-square tests are performed. The results are presented below for each factor:
· Food consumption importance level: Chi-square = 115.262, df = 8, Sig. = 0.000*.
· Recreation consumption importance level: Chi-square = 14.921, df = 8, Sig. = 0.061.
· Health consumption importance level: Chi-square = 61.711, df = 8, Sig. = 0.000*
· Home consumption importance level: Chi-square = 33.337, df = 8, Sig. = 0.000*.
· Education consumption importance level: Chi-square = 56.231, df = 8, Sig. = 0.000*.
· Technology consumption importance level: Chi-square = 15.854, df = 8, Sig. = 0.045*.
In most cases, the p-value (significance) is less than 5% (0.05), indicating that there is a significant correlation between consumer perception and the dimensions of consumption in the retail sector. The only exception is the importance level of recreation consumption, with a p-value of 0.061, suggesting that there is no significant correlation in that case.
Since the significance is less than 5% for most factors, the null hypothesis is rejected, and the alternative hypothesis is accepted. This indicates that consumer perception in the city of Loja is influenced by the different dimensions of consumption in the retail sector, except in the case of recreation.
5. Conclusion
Data on consumer perception and the dimensions of consumption in the retail sector in the city of Loja have been analyzed. The following are some conclusions:
Overall, consumers considered the product factors in question in terms of perceptions of all kinds to be very important, with 80.6% of respondents assigning high importance to these factors.
The distribution of consumer responses based on the importance of different dimensions of consumption (food, recreation, health, home, education, and technology) showed variations in the perception of each category. For example, food and education were considered more important, while recreation was perceived as less important.
Pearson chi-square tests showed a significant correlation between consumer perception and the dimensions of consumption in the retail sector, except in the case of recreation. This indicates that consumer perception is influenced by the different dimensions of consumption in the city of Loja, supporting the alternative hypothesis.
Based on the analyzed data, it can be concluded that consumers in the city of Loja consider the dimensions of consumption to be important in their decision-making in the retail sector. Businesses in this sector could benefit from understanding these perceptions and adapting their strategies and product offerings accordingly.
Although recreation did not show a significant correlation with consumer perception, it is still important not to completely disregard this category. Businesses in the retail sector could explore opportunities to better understand consumer perception in the area of recreation and improve their offerings and services based on consumer preferences.
This analysis provides valuable insights into consumer perception in the city of Loja concerning the dimensions of consumption in the retail sector. The results suggest that businesses in this sector could improve their strategies and product offerings to better align with consumer preferences and perceptions.