The influences of hedonic and utilitarian motivations on user experience and engagement within the Australian tertiary student credit card market

There is strong agreement that consumers’ purchasing behaviours are shaped by a number of internal and external factors, driven by hedonic and utilitarian values and motives. While these have been explored in a number of retailing studies, scant research has examined how this affects credit card behaviour and credit card selection. With this in mind, this thesis aims to investigate the coexistence of hedonic and utilitarian motivations, compulsive buying behaviour, subconscious materialistic urges, normative influence and financial literacy, and how these factors influence credit card product selection and engagement. This information will help shape consumer credit card product development, design and pricing decisions, and remove guesswork in identifying product offerings best suited to consumer needs.

The population of interest examined in this research is Australian tertiary students, selected because of (1) the likelihood of respondents being new entrants to the credit card market; (2) the researcher’s knowledge of the Australian payments landscape; and (3) the location in which the research was undertaken. The thesis adopts deductive reasoning, a ‘top down’ approach for adding to theory, using previous literature to develop a framework for the cultivation of hypotheses, data collection and analysis, and validation. A quantitative research methodology was adopted for the purpose of the study, using a cross-sectional survey design deployed online by research panel provider Qualtrics. Data was collected over an 11-week period with a total of 832 responses captured. Given the research objectives being to further examine the underpinning values and motivations which shape credit card purchase intentions, covariance based structural equation modelling was undertaken to test the 15 proposed hypotheses detailed in the conceptual model.

Based on analysis of 795 valid responses from students, the research findings show a significant effect of both personal shopping values (hedonic and utilitarian motivations) and normative influence on credit card product uptake, with 7 of the 15 hypotheses accepted. The findings, however, also reveal an insignificant influence of other factors considered to shape a consumer’s buying behaviour, including materialism and compulsive buying tendencies, in this market. The results provide detailed insights contributing to the literature on credit card consumer behaviour, and provides implications for theory and practice alike. Noting, this research empirically contributes to literature by expanding the examination of customer engagement within the student credit card market, and complementing findings accentuating the importance of engagement strategies for financial service providers. The results of the study supports the influence of personal shopping values on a consumer’s susceptibility to normative influence, likelihood to succumb to materialistic urges and contribution to financial self-efficacy; presenting a fresh perspective on the drivers for product acquisition within this market. From which it seems that credit card selection and use behaviour is more complex and varied than originally thought, even with young consumers about to enter a transformative stage of their lives.