Factors Affecting Purchase Decision in Indonesian E-Commerce

Industry
Arini Kusumawardhani1, Ervina Esmeralda2, Jonathan Pria Utama3, Adilla Anggraeni4
1,2,3,4
Business Management Program, Management Department, BINUS Business School Master Program, Bina
Nusantara University, Jakarta, Indonesia
[email protected], [email protected], [email protected],
[email protected]

Abstract Keywords
price discount; advertising
E-commerce is currently popular in Indonesia and has changed
the way a business is transacted. The E-commerce industry itself effectiveness; celebrity
has become a vital part of the economy in Indonesia. Many are endorser; brand awareness;
trying to get as many users as possible and competing with each purchase decision; e-commerce
other to be the top one with various marketing strategies, yet the
strategies have not always been considered sufficient. This is
quantitative research with data collection through questionnaires
to the 326 respondents, but 121 respondents did not pass the filter
questions and get 205 respondents for valid data. The data
analysis method used in this study is Partial Least Square (PLS).
The results show that price discount, advertising effectiveness,
and brand awareness have a significant positive effect on
purchase decisions. The results show that attractiveness has a
significant positive effect on brand awareness. The results also
show trustworthiness and expertise which has no significant effect
on brand awareness.

I. Introduction

The growth of internet users in Indonesia has increased by 17% in the past few years
(Haryanto, A. 2020). This shows that the internet has become part of people’s lives in
Indonesia and provides many benefits to society. Starts from helping the communication
process to facilitate online buying and selling transactions which can meet daily needs
instantly. The rapid growth of buying and selling transactions is shown by the number of e-
commerce that have sprung up.
The presence of e-commerce has changed the way a business transaction is conducted,
both in retail and in business-to-business processes. In 2020, 80% of people in Indonesia are
using e-commerce from mobile phones, allowing many small-scale businesses to easily and
cheaply market their products and compete nationally. This strengthens the e-commerce
industry which in fact has become a vital part of the economy in Indonesia (Hootsuite, 2020).
In the e-commerce industry itself, there are several business models that have been
widely recognized and implemented, namely Business-to-Business (B2B), Business-to-
Consumer (B2C), Consumer-to-Consumer (C2C), and Consumer-to-Business (C2B) (Topper,
2020). There are several examples of e-commerce that have implemented two models, which
are B2C and B2B, such as in Tokopedia, Shopee and Bukalapak. They not only offer a place
to sell and buy goods or services, but also provide a place for consumers to invest.
Shopee, Tokopedia and Bukalapak are the most visited e-commerce in Quarter 4 of
2020 (Databoka, 2021). In their journey to reach number one e-commerce in Indonesia, the
three e-commerce companies are competing using various marketing strategies to get as
many users as possible. One way is by doing advertising, where advertising is possible to
______________________________________________________________
DOI: https://doi.org/10.33258/birci.v4i3.2191 4173
 Budapest International Research and Critics Institute-Journal (BIRCI-Journal)
Volume 4, No 3, August 2021, Page: 4173-4186
e-ISSN: 2615-3076(Online), p-ISSN: 2615-1715(Print)
www.bircu-journal.com/index.php/birci
email: [email protected]

gain many users for its mass reach. There is also celebrity endorser, who can persuade
consumers and increase brand awareness. Not forgetting testimonials made by celebrity
endorsers that can give more trust to consumers. The latter is, with a price discount, where it
will encourage users to make purchasing decisions within e-commerce and it is possible to
increase purchases through this strategy (Awaludin, M., & Sukmono, S., 2020).
However, the use of these strategies has not always been considered sufficient.
Consumer behavior towards advertising is usually more objective and tends to pass the
information they do not need, so that the advertising effectiveness is questioned (Tang, M. &
Chan, T., 2017). There are also doubts and concerns on extreme or unreasonable price
discounts before they can finally buy the product (Agmeka, F., et al. 2019). The same thing
also comes from celebrity endorser strategy that has an important role in promoting its
products. Yet, celebrity endorsers tend to help products in creating brand awareness (Feiz,
R.S., et al. 2018) and the same does not necessarily lead consumers to the purchase decision
stage.
There are many different results in the same context within the digital marketing
literature point of view, which may leads to confusion. For instance, one mentioned that
celebrity endorsers have no effect on the purchase decision (Nggilu, M., et.al 2019), while the
other one mentioned it has a major effect on the purchase decision (Setiawan, B., & Rabuani,
C. C. 2019). There are also different research variables where previously advertising
effectiveness has not yet been examined to purchase decisions.
In addition, previous studies have focused on one e-commerce, while currently e-
commerce industry as a whole in Indonesia is an interesting phenomenon because many
compete with each other to become ‘top of mind’ for its users and its development is very
fast, so it is estimated that Indonesia will become world champions in the e-commerce
industry in the future (Yasyi, D. 2020). Therefore, in order to fill the research gap, the
research objective of this study is to examine the advertising effectiveness, celebrity endorser
and the mediating role of brand awareness, price discount as well as price discounts on the e-
commerce industry in Indonesia. The same is because each e-commerce company has a
unique strategy carried out and shows different effects respectively on consumer purchase
decisions.

II. Review of Literatures

2.1 Purchase Decision

Purchase decision is a stage in determining a choice in purchasing a product that will be
consumed. Awareness of the desired needs is the basis for the purchase decision to purchase a
product (Awaludin, M.N., & Sukmono, S. 2020). When buyers reach the evaluation stage, the
buyer forms a preference for the product and purchase intention appears for the product that
they really like (Maulana, T., & Susandy, G. 2019).
Purchase decision is an integrated process that combines knowledge to evaluate two or
more alternative behaviors and choose one of them (Setiawan, B., & Rabuani, C.C. 2019). A
great company attempts to get all of the consumer’s buying decision process and utilizes their
involvement in learning, selecting products, devouring, even up to the product is not useful
anymore (Khairunnisa, E.I., & Genoveva, G. 2019). There are 5 stages before the consumers
decide to do the purchasing which are:

Figure 1. 5 Stages before Consumers Decide to do Purchasing

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2.2 Price Discount
Discount is a reduction from the base price or from the price that stated on the label on
the package, this price reduction may be in the form of discount or other things such as
purchases with the addition of other free items (Maulana, T., & Susandy, G., 2019). Discount
is a kind of cost savings for buyers where is the seller reduced prices or something being sold
at a price lower than that item is normally sold for (Maulana, T., & Susandy, G., 2019).
The price discount is one of the strategies in marketing by reducing the price that is
already set by the seller to the buyer which makes a profit for both seller and buyer (Amanah,
D., & Harahap, D.A. 2018). Indicators of the price discount are frequency, type, and amount
of discounts fives by the seller (Amanah, D., & Harahap, D.A, 2018).

2.3 Advertising Effectiveness

Advertising is a form of promotion and channeling of ideas from products and services,
such as posters, brochures, print media advertisements, and others. Advertising can be an
effective thing to spread messages both to develop brands and to educate consumers (Luthfie,
H., & Marcelino, D., 2020).
Advertising can be effective to spread messages to either develop brands or to educate
consumers. EPIC model is an advertising effectiveness analysis model developed by AC
Nielsen, one of the world's leading marketing research firms. Epic Model and includes four
critical dimensions namely empathy, persuasion, impact and communication (Empathy,
Persuasion, Impact and communications - EPIC). EPIC model may be a measurement tool to
quantify the effectiveness of advertising with a communication approach developed by AC
Nielsen, one amongst the world’s leading research companies. Includes four dimensions,
empathy, persuasion, impact, and communication (Luthfie, H., & Marcelino, D., 2020). The
promotional mix concept according to (Philip in Amin 2019) consists of advertising, sales
promotion, personal selling, and public relations.

2.4 Celebrity Endorser

Celebrity endorsers are defined as people who receive public recognition and use this
on behalf of consumers by appearing in advertisements (Feiz, R.S., et.al 2018). Celebrity
endorser is the use of sources as popular or interesting figures in advertisements, so as to
strengthen the brand image in the minds of customers (Wahyuni Purbohastuti, A, & Hidayah,
A.A. 2020).
Celebrity endorser is the use of an entertainer, public figure, athlete and artist for the
success of a product (Nggilu, M., et.al 2019). To be able to create a more effective
communication, it is usually an acronym of Trustworthiness, Expertise, Attractiveness,
Respect, and Similarity (TEARS) (Rahardian, M., et al. 2019).

2.5 Trustworthiness
Trustworthiness can be interpreted as honesty, integrity, and also confidence of the
source. Of course, the messenger must be able to provide an objective motivational or
encouraging message (Wahyuni Purbohastuti, A, & Hidayah, A.A. 2020).
Trustworthiness of an endorser refers to the extent to which a celebrity as an endorser is
perceived by consumers as conveying a message of integrity, honesty and trust through
advertising (Kim, S.S., et al. 2018). Trustworthy endorsers were found to be useful for
enhancing brand credibility, dispelling doubts and promoting economic gain (Kim, S.S., et al.
2018).

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2.6 Expertise
Expertise is knowledge, experience and expertise possessed by the resource person for
the product or brand that is supported. A resource person will be more able to convey
persuasively when he is more familiar with the product or service being marketed (Wahyuni
Purbohastuti, A, & Hidayah, A.A. 2020). Bara (2019) states that advertising is commercial
communication about an organization and its products which are transmitted to a target
audience through mass media in printed media, direct mail
(direct posting.
Expertise is defined as a skill, experience and knowledge in making decisions.
Expertise also can be defined as competence, qualification, expert ability, mastery and
authority. The greater the level of expertise of an endorser that consumers can feel in an
advertisement, the greater the persuasiveness or effectiveness of an advertisement (Kim, S.S.,
et al. 2018).

2.7 Attractiveness
Attractiveness focuses on an endorser rated attractive by a particular group with
physical attractiveness. Physical attractiveness is the first thing that is very easy for
consumers to see. When an endorser is doing his job, this is where consumers determine their
buying decision behavior (Wahyuni Purbohastuti, A, & Hidayah, A.A. 2020). The
attractiveness of celebrities is likely from their appearance, beauty, outfits and manners
(Nguyen, K.T., & Huynh, H.T. 2018).

2.8 Brand Awareness

Brand awareness is the ability of consumers to be able to recognize or remember a
product or brand of a particular product (Khairunnisa, E.I. & Genoveva, G. 2019). Brand
awareness is the ability of a potential buyer to recognize or recall a brand. Awareness will
greatly influence consumer perceptions and behavior. So if the awareness of a brand is very
low, it can be ascertained that the equity of a brand is also low. Overall, the role of brand
awareness of the brand really depends on the level of brand awareness that is already
achieved by a brand (Awaludin, M.N., & Sukmono, S. 2020).
There are four levels related to brand awareness, which are (Setiawan, B., & Rabuani,
C.C. 2019):
1. Unaware of the brand, when consumers still have doubts or still not sure whether
consumers are familiar with the brand.
2. Brand recognition, when consumers are able to identify a brand that is mentioned.
3. Brand recall, when consumers are able to remember the brand without being given a
stimulus.
4. Top of Mind, when consumers immediately think of a brand that first comes to
consumers’ mind when talking about certain product categories.

2.9 Price Discount has Positive and Significant Effect on Purchase Decision
Price discount has a significant effect on purchase decisions. The results of this study
indicate that discount programs, namely discounted prices, will encourage consumers to buy
products (Agmeka, F., et al. 2019) (Novansa, H., & Ali, H. 2017). It can be concluded that
price discount has a significant effect on purchase decisions. Based on the description above,
a hypothesis can be generated as:
H1: Price discount has a positive and significant effect on purchase decisions.

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2.10 Advertising Effectiveness has a Positive and Significant Effect on Purchase
Decision
It was found that advertising effectiveness has an effect on purchase decisions (Luthfie,
H., & Marcelino, D. 2020). Advertisements have a significant positive effect on purchase
decisions (Luthfie, H., & Marcelino, D. 2020). Advertisement has a positive and significant
effect on consumer buying decisions as a result shows that advertising also plays a dynamic
role especially in adolescent behavior (Luthfie, H., & Marcelino, D. 2020).
H2: Advertising effectiveness has a positive and significant effect on purchase decisions.

2.11 Trustworthiness has a Positive and Significant Influence on Brand Awareness

According to research conducted by Reyhan, Edy, and Sunarti (2018), Trustworthiness
has a significant influence on brand awareness (Feiz, R.S., et. al. 2018). The study shows that
the changes that occur in the value of trustworthiness can have an impact on brand
awareness. Based on the description above, a hypothesis can be generated as:
H3a: Trustworthiness has a positive and significant influence on brand awareness.

2.12 Expertise has a Positive and Significant Impact on Brand Awareness

Expertise has a significant influence on brand awareness. This shows that the higher the
level of expertise, ability, experience, and / or knowledge the endorser has for the brand that
he or she is promoting. The ability of a brand to appear in the minds of consumers when they
are thinking about certain types of products will also increase (Feiz, R.S., et. al. 2018). Based
on the description above, a hypothesis can be generated as:
H3b: Expertise has a positive and significant impact on brand awareness.

2.13 Attractiveness has a Positive and Significant Impact on Brand Awareness

According to research conducted by Reyhan, Edy, and Sunarti (2018), Attractiveness
has a significant effect on brand awareness. This research shows that the increasing
attractiveness of consumers toward a product indicates that the brand that is being promoted
to appear in the minds of consumers (brand awareness) will also increase. (Feiz, R.S., et. al.
2018) (Rahardian, M., et. al. 2019). Based on the description above, it can be hypothesized
that:
H3c: Attractiveness has a positive and significant impact on brand awareness.

2.14 Brand Awareness has a Positive and Significant Influence on Brand Awareness
A study conducted by Awaludin and Sukmono (2020), indicates that if consumers are
very brand conscious then there is a higher likelihood of making a purchase decision because
awareness helps them dispel their doubts about the brand (Awaludin, M.N., & Sukmono, S.
2020). In line with research regarding the effect of brand awareness of e-commerce on
purchase decisions, it is found that brand awareness has a significant positive effect on
purchase decisions (Novansa, H., & Ali, H. 2017). The higher consumer awareness of a
brand will affect purchasing decisions on e-commerce. Based on the description above, a
hypothesis can be generated as:
H4: Brand awareness has a positive and significant influence on purchase decisions

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2.15 Conceptual Framework

Figure 2. Awaludin and Sukmono (2020)

Source: Researchers, 2021

III. Research Methods

3.1 Research Instrument

This is a quantitative research that uses a questionnaire of closed-ended with ordered
choices format. There are thirty-two (32) questions with a multiple-choice and Likert scale
from 1 – 5, where the value of 1 represents “strongly disagree” or “never” and the value of 5
represented “strongly agree” or “always”. (The appendix shows the measurement items). This
research focused on e-commerce users; aged <19 - >38 years old.

3.2 Data Collection Procedure

This research collected data from e-commerce user respondents with a purposive
sample. These users are specific only to the ones that used and have shopped Shopee,
Tokopedia and Bukalapak. Online-based questionnaire form is used through Google forms to
reach wider respondents in the Jabodetabek (Jakarta, Bogor, Depok, Tangerang dan Bekasi)
area since these provide the highest contribution of e-commerce sales.

3.3 Data Analysis

This research used partial least squares (PLS) tools to validate the measurement and test
the hypothesis. PLS is best suited for testing complex structural models as it avoids two
problems which are factor indeterminacy and inadmissible solutions (Fornell, C., and
Bookstein, F.L. 1982). The measurement of this research is using confirmatory factor
analysis (CFA) which includes reliability and convergent validity. Reliability was evaluated
using a composite reliability score as they are recommended to have it larger than 0.7 (Hair,
J.T., et. al. 1998) and Cronbach's alpha which is larger than 0.6 (Hulin, C., et al. 2001).
For convergent validity, each item should have outer loadings above 0.7 and each
construct’s average variance extracted (AVE) 0.5 or higher. The AVE is the grand mean
value of the squared loadings of a set of indicators (Hair, J.T., et.al 1998). Moreover, in order
to determine the level of significance of each indicator weight, this research is applying a
bootstrapping routine where samples are drawn in a large number of subsample of the
original data which are 5,000 which can be used to compute a standard error of each model
parameter (Hair, J.T., et.al 1998).

3.4 Operational Variable Definition

The following is the operational definition of the variables used in this research:
1. Price Discount is a marketing strategy that reduces prices given by sellers to buyers,
which benefits both buyers and sellers (Perreault et al., 2017).

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 2. Advertising can be an inexpensive way to deliver a message, as well as to build brand
preferences or to educate consumers. Even in today's challenging environment, good
advertising can give a good result (Kotler & Keller, 2016:607). Advertising
Effectiveness has several dimensions (Harrie & Dandy, 2020), as follows:
- Empathy
- Persuasion
- Impact
- Communication
3. Celebrity Endorsers are well-known people who can influence others because of their
accomplishments.
The celebrity endorser dimensions according to Royan, (2004) on Budi & Celia (2019)
is as follows:
- Trustworthiness
- Expertise
- Attractiveness
4. Brand Awareness is one of the fundamental dimensions of Brand Equity. This is
considered a prerequisite for the Purchase Decision factor for consumers because Brand
Awareness is a major factor. (Budi & Celia, 2019). the dimensions are as follows:
- Unaware of Brand
- Brand Recognition
- Brand Recall
- Top of Mind Awareness
5. Purchase decision is a process that occurs psychologically. This begins with an interest
in the goods or services offered to consumers. Next, the consumer reaches the interest
stage and ends with a decision to buy the product or service. (Budi & Celia, 2019).
According to Genoveva (2019), the dimensions from purchase decision are as follows:
- Problem Recognition
- Information Search
- Alternative Evaluation
- Purchase Decision
- Post-Purchase Behaviour

3.5 Data Characteristic

Concerning the data results, this research has 326 respondents, but 121 respondents did
not pass the filter questions. Thus, this research took 205 respondents between the ages of
<19 and >38 years old who used e-commerce Shopee, Tokopedia and Bukalapak. However,
from those 205 respondents shows that Shopee is the most used (65.3%), followed by
Tokopedia (45.6%) and Bukalapak (12.6%). Hereby, characteristics of these research
respondents are shown in Table 1:
Table 1. Characteristics of Respondents
Description T otal Percentage
Answer
N Total 205 100%
Gender
Male 119 58%
Female 86 42%
Occupation (top 4)
Public Employee 18 8.8%
Private Employee 100 48.8%
Entrepreneur 31 15.1%
College Student 44 21.5%
Age

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 < 19 years old 23 11.2%
19-24 years old 63 30.7%
25-30 years old 96 46.8%
31-38 years old 21 10.6%
> 38 years old 2 1%
Domicile City
Jakarta 49 23.9%
Bogor 23 11.2%
Depok 22 10.7%
Tangerang 16 7.8%
Bekasi 95 46.3%
Average Spending Amount on E-commerce

IV. Discussion

4.1 Partial Least Square

Evaluation of measurement models can be seen from the results of convergent validity.
Convergent validity is seen from the generated outer loading value. Indicator outer loading
value greater than 0.7 is said to be valid. The outer loading value of this study can be seen in
Table 2.

Table 2. Outer Loading Values

>1 mil Rupiah 21 10.2%

1-3 mil Rupiah 58 28.3%
3-5 mil Rupiah 57 27.8%
5-7 mil Rupiah 35 17.1%
>7 mil Rupiah 34 16.6%

Based on Table 2, it can be seen that not all indicator variables have an outer loading
value greater than 0.7. It means several indicator variables must be removed. The outer
loading value of this study can be seen in Table 3.

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 Table 3. Outer Loading Values

Based on Table 3, it can be seen that all indicator variables have an outer loading value
greater than 0.7. It means all indicator variables are valid. There are no indicator variables
that must be removed. The construct has good reliability if the Composite Reliability value >
0.7, and the Cronbach’s Alpha value > 0.6. Construct has good validity if the AVE value is
above 0.5. The following Composite Reliability, Cronbach’s Alpha, and AVE values can be
seen in Table 4.

Table 4. Values of Composite Reliability, Cronbach’s Alpha, AVE

Based on Table 4, not all constructs are reliable. This is because the price discount has
Cronbach’s Alpha values <0.6. It means the validity value of one of the price discount
indicators must be removed. The outer loading value of this study can be seen in Table 5.

Table 5. Outer Loading Values

Based on Table 5, it can be seen that all indicator variables have an outer loading value
greater than 0.7. It means all indicator variables are valid. There are no indicator variables
that must be removed.

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 The construct has good reliability if the Composite Reliability value > 0.7, and the
Cronbach’s Alpha value > 0.6. Construct has good validity if the AVE value is above 0.5.
The following Composite Reliability, Cronbach’s Alpha, and AVE values can be seen in
Table 6.

Table 6. Values of Composite Reliability, Cronbach’s Alpha, AVE

Based on Table 6, all constructs are reliable. This is because all constructs have
Composite Reliability values above 0.7 and Cronbach’s Alpha values > 0.6. Besides being
reliable, all constructs are valid. This can be seen from all constructs that have AVE values
above 0.5.
The next construct validity test is evaluating discriminant validity by comparing the
AVE square root values with correlations between constructs. If the AVE square value of
each construct is greater than the correlation value between constructs and other constructs in
the model, then it is said to have a good discriminant validity value. The comparison of AVE
square root results with correlations between constructs can be seen through The Fornell-
Larcker Criterion (Table 7).

Table 7. The Fornell-Larcker Criterion

Table 7 shows the bold diagonal value is the AVE square root value while the other
value is the correlation value between constructs. AVE square root values for advertising
effectiveness, attractiveness, brand awareness, expertise, price discount, purchase decision
and trustworthiness are greater than the maximum correlation value with other constructs
listed in the same row and column. This means that the discriminant validity is fulfilled.

4.2 Evaluation of Structural Model

The evaluation of the structural model looks at the relationship between constructs and
their significance value as indicated by the t-statistic or p- value based on PLS output. The
path coefficient can be seen in Table 8. The path coefficient that has a p- value <0.05
(significance level of 5%) is declared significant.

Table 8. Path Coefficient

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 Based on Table 8, the relationship test between constructs shows that the construct of
Advertising Effectiveness has a positive effect on Purchase Decision with a construct
coefficient value of 0.414 and is significant because of the p- value (0,000) <0.05. The
construct of Price Discount has a positive effect on Purchase Decision with a construct
coefficient of 0.112 and is significant because the p-value (0,042) <0.05. The Brand
Awareness construct has a positive effect on Purchase Decision with a construct coefficient
of 0.468 and is significant because the p-value (0,000) <0.05.
Attractiveness has a positive and significant effect on Brand Awareness with a
construct coefficient of 0.668 and p-value of (0.000) <0.05. The construct of expertise has a
positive effect on Brand Awareness with a construct coefficient of 0.010 and is not
significant because the p-value (0,879) >0.05. The construct of Trustworthiness has a positive
effect on Brand Awareness with a construct coefficient of 0.132 and is not significant
because the p-value (0,209) >0.05.
The evaluation of the structural model is also done by looking at the value of R-Square.
The R- Square value of Brand Awareness is 0.586. R-Square value of the purchase decision
is equal to 0.724.

V. Conclusion

The main objectives of this study were to identify the relationship among price
discount, advertising effectiveness, and brand awareness towards purchase decision as well as
to identify the relationship among trustworthiness, expertise and attractiveness towards brand
awareness. The first conclusion of this study is to examine the effect of price discount on
purchase decisions. The result of the PLS analysis is consistent with our hypotheses.
Several authors state that price discount has an effect on purchase decisions, deriving
from prior experience (Agmeka, F., et.al. 2019) (Novansa, H., Ali, H. 2017). Our results also
suggest that there is a positive effect of price discount on purchase decisions.
The second conclusion is the effect of advertising effectiveness on purchase decisions.
The result of the PLS analysis is consistent with our hypothesis. Another author states that
advertising effectiveness has an effect on purchase decisions, deriving from prior experience
(Luthfie, H., & Marcelino, D. 2020). Our results also support a positive effect from
advertising effectiveness on purchase decisions. The third conclusion is the effect of
trustworthiness on brand awareness, the effect of expertise on brand awareness, and the effect
of attractiveness on brand awareness. For attractiveness the results of PLS analysis are
consistent with our hypothesis. Another author also states that attractiveness has an effect on
purchase decisions, deriving from prior experience (Feiz, R.S., et. al. 2018).
Our results also indicate that there is a positive effect of attractiveness on brand
awareness. However, the results of trustworthiness and expertise show that these two
variables have no significant influence on brand awareness. Expertise is not something
crucial to have for a celebrity endorser to attract their target as long as they are considered
attractive. E-commerce can keep on choosing celebrity endorsers with higher attractiveness in
order to lead to brand awareness. Meanwhile, for trustworthiness, endorsers tend to promote
many brands towards products in the same category which may raise customer doubts on
their credibility as well as honesty in promoting the brand. The results of the PLS analysis are
consistent with our hypothesis. Several authors state that brand awareness has an effect on
purchase decisions, deriving from prior experience (Awaludin, M.N., & Sukmono, S. 2020)
(Novansa, H., & Ali, H. 2017). Our results also support a positive and significant effect from
brand awareness on purchase decisions.
From a managerial standpoint, this research provides the companies to ensure what
really matters for customers in purchase decisions. Price discounts are certainly very

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attractive to consumers, because they can get what they really need at a lower price. But they
should arrange it very carefully because if they give it too often this can make consumers feel
that the price discount is already a normal price. The company also should pay attention to
effectiveness from the advertising itself. Because advertising is a good place to spread
messages both to develop brands or to educate consumers, they should use the EPIC model to
measure the effectiveness of the advertisement.
The good of the brand awareness will positively affect purchase decisions. Rapid
development of ecommerce makes competition getting tougher. Ecommerce companies are
also asked to be able to compete competitively to retain consumers, one of which is by
building brand awareness in the minds of consumers. Companies that have a strong brand are
certainly very easily recognized by the public and are also able to survive in this tight
competition. For now, social media is an important part of brand marketing. Through social
media, a brand can interact with consumers and potential consumers directly. Companies
have to create a brand experience that suits consumers desires and involves them as a part of
your brand narrative. This can help to increase consumers’ trust in your brand which is more
difficult to build through traditional marketing and advertising methods. Companies also have
to continue with influencer marketing to promote a product through social media such as
Instagram, Youtube, Twitter, etc. What is meant by influencers here is people who have a lot
of followers on social media and have a good appearance and someone has a high level of
attractiveness to influence their followers on social media.
There are several limitations of this research that should be considered when
interpreting its findings. Firstly, we did not research the brand awareness indicators as
mediating effect of advertising effectiveness and purchase decisions due to time and
complexity. This variable can be an important thing for a company to consider to create new
customers and retain old customers by always being active in promoting products, one of
which is by advertising. This research only takes respondents form Jabodetabek area, these
results may not be in line if research is conducted with respondents from all over Indonesia.
This limitation of the study would be interesting for future researchers if the future researcher
can conduct research with brand awareness, advertising effectiveness and price discount also
purchase decisions as a variable and conduct with respondent form all over Indonesia.

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