Structural Equation Modeling Analysis Using the Partial Least Squares Method (SEM-PLS) for Modeling the Purchase of Swallow's Nest Drinks

Abstract

Consumer preferences are an individual's likes or dislikes regarding the products they consume. Consumer preferences are also the values that consumers consider when making a choice. Considerations in selecting a product type usually occur more frequently when there is sufficient or excess supply of materials. Various factors can influence a person's considerations regarding the products they choose and like. Purchase intent significantly influences the quantity and type of products to be purchased. Other influential factors include purchasing power, consumer perception, and subjective evaluation of a product. To address this issue, this study will develop an empirical research model using five research variables: purchase intent, purchasing power, consumer perception, and subjective evaluation. Among these five variables, the study will identify which ones require improvement. This study uses secondary company data from a questionnaire distributed to 42 respondents, followed by data analysis using SEM-PLS. The results of the study show that the SEM PLS consumer preference model has an AIC value for purchase intention of -31.511. A small AIC value indicates that the model is effective in identifying consumer preferences through the variables of purchase intention, purchasing power, consumer perception, and subjective evaluation. The results of the study show that purchasing power, consumer perception, and subjective evaluation have a significant influence on purchase intention. The purchasing power variable increases purchase intention by 0.543, the consumer perception variable by 0.349, and the subjective evaluation variable by 0.214. Recommendations for improvement are provided to Company X at the end of the study to further enhance the variables that contribute significantly.