Introduction

This study on Indian consumer behavior is aimed at helping India’s No.1 two
wheeler manufacturer (Motor Cycles and Scooters), to get a better understanding of
the Indian market place thus enabling them to embark on selected strategies to
effectively reach the Indian consumers.

India is a big country with 28 states, over one billion people and 120
dialects/languages.

From the market perspective, people of India comprise different segments of

consumers, based on class, status, and income.

An important and recent development in India’s consumerism is the emergence

of the rural market for several basic consumer goods. Three-fourths of India’s
population lives in rural areas, and contribute one-third of the national income.
This rural population is spread all over India, in close to 0.6 million villages.

Among the total 164.8 million households in India, 80.7 million households
comes under low income group ( <US$ 581 ), followed by 50.4 million lower
middle income households ( US$ 581 to US$ 1162), 19.7 million middle income
group (US$ 1162 to US$ 1190 ), 8.2 million upper middle income group (US$
1790 to US$ 2465 ) and 5.8 million high income group (>US$ 2465).

Definition of Buyer Behavior:-

Buyer behavior is “all psychological, Social and physical behaviors of potential
customers as they become aware of evaluate, purchase, consume and tell others
about product & service.
Consumer Buying Decision Process
1. Problem identification
The buying process starts when the buyer recognizes a problem or need. The
need can be triggered by internal or external stimuli. Marketers need to identify
the circumstances that trigger particular need. By gathering information from a
number of consumers, Marketers can identify the most frequent stimuli that spark
an interest in a product category. They can then develop marketing strategies
that trigger consumer interest.

 Information Search:-
The consumer tries to collect information regarding various products/service.
Through gathering information, the consumer learns about completing brands
and their features. Information may be collected form magazines, catalogues,
retailers, friends, family members, business association, commercial, chamber of
commerce, telephone directory, trade fair etc. Marketers should find out the
source of information and their relative degree of importance to the consumers.
Personal Sources:
Family, friends, neighbor
Commercial Source: Advertising, sales persons, dealers,
Packaging, displays.
Public sources: mass media, consumer, rating organizations.
Experimental sources: Handling. Examine, using the product.

Evaluation of alternative:-
There is no single process used by all consumers by one consumer in all buying
situations. There is several First, the consumer processes, some basic concepts
are:
First, the consumer is trying to satisfy need.
Second, the consumer is looking for certain benefits from the
Product solutions.
The marketer must know which criteria the consumer will
use in the purchase decision
 Choice of purchasing decision:-
From among the purchase of alternatives the consumer makes the
Solution. It may be to buy or not to buy. If the decision is to buy.
The marketer up to this stage has tried every means to influence the purchase
behavior, but the choice is properly consumers. In the evaluation stage the
consumer forms preferences among the brands in the choice set. The consumer
may also for man intention to but the most preferred brand

Characteristic of Buyer Behaviors

The chief characteristics of the buyers behaviors are as

follow:-
(1)It consists of mental and physical activities which consumers
undertake to get goods and services and obtain satisfaction from
them.
(2)It includes both observable activities such as walking through
the market to examine merchandise and making a purchase and
mental activities-such as forming attitudes, perceiving advertising
material, and learning to prefer particular brands.
(3)Consumer behaviors are very complex and dynamic to
constantly changing. And therefore, management need to adjust
with the change otherwise market may be lot.
(4)The individuals specific behaviors in the market place is
affected by internal factor, such as need , motives, perception, and
attitudes, as well as by external of enviourmenatal influences such
as the family social groups, culture, economics and business
influences.
Different Segments Of Indian Consumers

The Socialites

Socialites belong to the upper class. They prefer to shop in specialty stores, go to
clubs on weekends, and spend a good amount on luxury goods. They are always
looking for something different. They are the darlings of exclusive
establishments. They go for high value, exclusive products. Socialites are also
very brand conscious and would go only for the best known in the market.

The Conservatives

The Conservatives belong to the middle class. The conservative segment is the
reflection of the true Indian culture. They are traditional in their outlook, cautious
in their approach towards purchases, spend more time with family than in
partying and focus more on savings than spending. Slow in decision making,
they seek a lot of information before making any purchase. They look for
durability and functionality but at the same time are also image conscious.

They prefer high value consumer products, but often have to settle for the more
affordable one. These habits in turn affect their purchasing habits where they are
trying to go for the middle and upper middle level priced products.

The Working Women

The working woman segment is the one, which has seen a tremendous growth in
the late nineties. This segment has opened the floodgates for the Indian retailers.
The working woman today has grown out of her long-standing image of being the
homemaker. Today, she is rubbing shoulders with men, proving herself to be
 equally good, if not better. Working women have their own mind in decision to
purchase the products that appeal to them.

India’s Rich

India’s rich can be categorized into five major categories as follows:

The Rich

The rich have income greater than US$11,000/- per annum. Total household
having such incomes are 1,058,961. These people are upwardly mobile. Some
of them in this category are Double Income No Kids (DINK) households. They
spend more on leisure and entertainment-activities than on future looking
investments. Across the category, backgrounds are distinctly middle class. They
aspire, therefore, to attain the super-rich status.

The Super Rich

The Super Rich have income greater than US$22,000/- per annum. Total number
of households is 320,900. There are less DINK families here than in the rich
category. The Super Rich are mainly professionals and devoted to consumerism.
They buy many durables and are status conscious.

The Ultra Rich

The Ultra Rich have income greater than US$44,000/- per annum. The number
of households in this category is 98,289. There is no typical profile of the ultra-
rich. There are some DINK households of middle-level executives. Some single
earning households are of first generation entrepreneurs. Some rich farmers,
who have been rich for a long time, belong to this category.

The Sheer Rich

 The Sheer Rich is made up by households having income exceeding
US$110,000/- per annum. Such households are 20,863. They do not have a
homogenous profile. There are joint families as well as nuclear families in this
category. They consume services greatly. They own multiple cars and houses.
They aspire to social status and power.

The Obscenely Rich

The Obscenely Rich is made up of households having income exceeding

US$222,000/- per annum. There are hardly 6,515 such households in India.
They are first-generation entrepreneurs who have made it big. Some of them are
techies. A variety of people belong to this category. They are just equivalent to
the rich in the developed countries. They crave for exclusivity in what they buy.
Most premium brands are relevant to them.

Rural Consumer

About three quarters of the Indian population are in the rural areas and with the growing
middle class, specially in the Indian cities, the spill over effect of the growing urban
middle class is also felt in the rural areas.

The Indian rural market has been growing at 3-4% per annum, adding more than 1
million new consumers every year and now accounts for close to 50% of the volume
consumption of fast-moving consumer goods (FMCG) in India. The market size of the
fast moving consumer goods sector is projected to more than double to US$ 23.25
billion by 2010 from the present US$ 11.16 billion. As a result, it is becoming an
important market place for fast moving consumer goods as well as consumer durables.
Marketing Strategies

Online marketing
 A study by the Confederation of Indian Industry (CII) and the International Trade Centre
predicts that e-commerce activity in India will rise from US$ 0.10 million in 2000-01 to
US$ 5.8 billion in 2005-06, of which the business to business segment will account for
US$ 5.41 billion.
Celebrity Influence
This is an important tool which is able to influence Indian consumer buying behavior. In
India, celebrities are being increasingly used in marketing communication by marketers
to lend personality to their products. With the visual media becoming more popular the
use of celebrities in the TV media has increased. Celebrities create headlines. Their
activities and movements are being closely watched and imitated. What they endorse
sell like hot cakes. It is not surprising therefore that using celebrities in advertisements
has become common practice.

Freebies
Indian consumer buying behaviour is influenced by freebies. Freebies are consumer
products given free of charge as gifts to purchases of selected products above a certain
value. TVs, washing machines, refrigerators, and ready made clothes are some of the
product categories in which freebies are given to Indian consumers. Eco-Friendly
Products
The environmental awareness in India has started affecting marketing of products based
upon their eco-friendliness. In general, Indian consumers are likely to buy
environmentally responsible products and packs.
Conclusion

Top class, middle class and lower class are income related classifications of the
population and each of this class has its own consumption pattern.

For the Indian market, Motor Cycles and Scooters manufacturer should see the
substantial middle class and base the market demand/projections on this roughly
estimated at 250 million people with substantial disposable income.