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Ch. J. S. Prasad and D. Raghunatha Reddy
The Indian food and grocery retail sector is in the transformation mode for various reasons like strong macro-economic fundamentals and the changing socio-economic scene are driving what were once traditional and small scale retail outlets into organised retail formats aimed at catering to the evolving tastes and needs of the discerning consumers. But the very fast changing trends in food and eating habits of consumers have contributed immensely to the growth of ‘Western’ format typologies such as convenience stores, departmental stores, supermarkets, specialty stores and hypermarkets. This has happened for various conspicuous reasons namely demand and supply, socio-cultural, demographic, psychographic, economic and technology advancements like a large segment of young population, a rapidly expanding middle class, rising income levels, growing literacy, increasing number of working women and nuclear family structures which in turn have created an enormous demand for consumer goods and paved way for modern retail formats. The ever changing consumer’s psychographic variables like activities, interests, opinions, values and lifestyles have also completely changed the formats namely convenience stores, supermarkets and hypermarkets etc. are the crystal clear reflections of tectonic shifts in demographic and psychographic changes of consumers. However, little is known about its actual influence and contribution to the organised retailing in food and grocery sector from an empirical analysis. Thus, understanding of demo-psychographic dynamics has become an imperative in designing modern food and grocery retail formats based on the purchase patterns. The study is purely based on primary data and necessary secondary data to reinforce the model. A total of 200 retail customers in Hyderabad actively participated in the survey. Findings, various managerial and marketing implications are extensively discussed. Key Words: Demographics, Psychographics, Convenience Stores, Supermarkets, Hypermarkets, Food and Grocery Retailing.
INTRODUCTION HE Retail sector is one of the fastest growing industry in India, catering to the world’s second largest consumer market. Retailing is being hailed as the future of Indian industry, spurred by country’s huge consumer market of Rupees 17 trillion at present and forecasts that aggregate consumption will grow to Rupees 70 trillion by 2025 (McKinsey Report, 2007). The Food and grocery is the second largest segment of the retail industry that constitutes 53 percent of the total private consumption expenditure (USD 154 billion) and 70 percent of total retail sales (KSA Technopak Report,
2007). According to IMAGES India Retail Report, 2007 of the Rupees 12, 00,000 crore retail market, food and grocery retail is by far the single largest block estimated to be worth a whopping Rupees 7, 43,900 crore, but more than 99 per cent of this market is dominated by the neighborhood kirana (grocery) stores. The food and beverage retail market in India is estimated at $4.6 billion (Rupees 21000 crore) and makes up for 2 percent of the country’s total retail market, out of which organised food and beverage retail market accounting for 5 percent of the total food and beverage market. The coffee retailing segment is estimated at $45 million (Rupees 200 crore)
low cost.2001 has been to the tune of 113 million and 68 million respectively is an obvious indicator of increasing demand for consumer goods. income/purchasing capacity. ft. Food Bazaar and Nilgiri’s (c) Hypermarkets: These are the largest stores offering food as one of their categories in an area of 40.g. ft. 2005). Figure 1: Organised Retail Market in India as per population projections VISION—The Journal of Business Perspective Vol. The population explosion has triggered a massive demand for consumer goods and services. Speed Mart and In and Out.g. it is imperative to understand the modern formats (a) Convenience Stores: These stores have an area of 500 . race. sociocultural. But the very fast changing trends in food and eating habits of consumers have contributed immensely to the growth of ‘Western’ format typologies such as convenience stores. ft. economic. They are open for long hours e. departmental stores. specialty stores and hypermarkets for various conspicuous reasons namely. low margins and high volume operators e. 4 October–December 2007 q q q . The ever changing consumer’s psychographic variables like activities. technology and government policies. psychographic. The burgeoning population growth has significant influence on growth and development of retail market shown in figure 1. consumer buying behavior and lifestyles in India too are changing and the concept of “value for money” and “value for time” is fast catching on in Indian retailing. and nuclear family structure have created an enormous demand for consumer goods and paved way for the modern retail formats. e. Each variable of the demographic factors has played its own unique role in the growth and development of modern retail formats like apparel. demographic. Big Bazaar and Giant (Lamba 2003). Thus. educational levels. The prices are generally higher and volumes are low-to-medium. Out of the total population of 1027 millions. 2007). Most of the food and grocery products reach the consumers through traditional markets which are unorganised (Baja et al. family size. REVIEW OF LITERATURE The demographic variables such as age. The size of the population is an important determinant of demand for many products and services. occupation. values and life styles have also completely changed the retail formats in India. increasing number of working women. The empirical study examines the impact of ever changing demographic and psychographic dynamics of the consumers on type of food and grocery retail formats. about 742 million live in rural areas and 285 million in urban areas (Census 2001). Food World. In the post-liberalisation. Mom and Pop stores are informal versions of convenience stores (b) Supermarkets: These stores operate in an area of 800 – 5000 sq. demographic forces like a large segment of young population. growing literacy. supply. opinions. They are selfservice. supermarkets. religion and community are the most decisive and wield significant influence on the prospects of retail business.g. rising income levels. The net addition of population in rural and urban areas during 1991.000 . interests.1000 sq. a rapidly expanding middle class. 11 No.22 Prasad and Reddy q and growing at the rate of 25 percent per year (KSA Technopak Report. usually located near residential areas or in petrol bunks. marital status. But the current Indian retailing is highly fragmented with an estimated 15 million retail outlets. demand.000 sq. The recent trends have indicated that this ever increasing demand for consumer goods will reach a new high in the years to come. food and grocery. Out of these.75. sex.
With the increasing urbanisation. 11 No. These middleincome earning segments that believe in good things of lifestyle and indulge in conspicuous consumption would have about $ 2.A Study on the Role of Demographic and Psychographic Dynamics in Food and Grocery Retailing 23 q The census figures for 2001 show that 54 percent of the population i. attitudes. lack of adequate leisure time compelled to seek the convenience of one-stop shopping where the speed and efficiency was the norm in order to make the best use of their time.2 percent in rural areas. which prefer to shop through organised outlets to a greater extent.000 plus per annum is growing at fast pace and this is primarily attributed to the rapid rise in the young earners (those in their mid twenties).e. Nearly 37 percent of the urban population constitutes chief earners who earn regular salaries/wages. clothing and consumer durables by the lower income category is as high as 74 percent while in the higher income category this forms only 57 percent of their expenditure. the purchase location is predominantly traditional outlets. opinions.5 percent. 540 million is below the age of 25. Psychographic Dynamics In the past few years the whole concept of shopping had been altered in terms of format and consumer buying behaviour. The concept of “value for money” had fervently changed the consumer behaviour towards the retail business in India. 2005). With an increase in doubleincome households. about 4 percent are extremely rich and about 10 percent have just graduated into the middle class and are feeling their way through the material world. growth in consumers who favour the emerging trends in retailing. 4 October–December 2007 . Traditional demographic variables cannot identify the complete characteristics of an evolutionary retail market because consumers in the same demographic group have very different psychographic make-up. the family lifecycle and the disintegration of joint family system has led to the formation of nuclear families tempting consumers to splurge on more consumer goods purchases in apparel. food. The number of people who earn over US$ 5. The largest young population in the world over 890 million people below 45 years of age is in India. Rapid changes have taken place in family sizes (5.6 percent levels of 1993 . About 2 million graduates every year of which 10 percent are engineers and are available for employability. This creates a whopping 600 million-plus effective consumers by the year 2010 (A. Personal and social motives were the most influential in increasing consumerism and creating necessity for modern retail formats that cater to meet the needs and preferences of consumers. Expenditure in urban areas accounts for 62 percent of income compared with 56. activities and lifestyles had mostly influenced the consumer behaviour in a rapid changing retail environment. The Intrinsic factors such as needs. as compared to the higher income category.100 million and will have about 325 million people in the 25 . Household income levels are expected to rise. motives.000 ($18. 2006). On an average the expenditure on consumables.e. 2005) contribute a lot in the emergence of retail outlets because lack of abundant time for doing all house hold chores and therefore save time. The annual growth in employment has accelerated from 1.000) a year – number to rise to 140 million by year 2011. 2004).2005 due to IT and IT enabled services. and 45 percent below 19 years.8 trillion a year to spend that is how any one would expect the true potential of retail business in India.4 people).5 percent during 1999 . with the lowest income group to comprise only 24 percent in 2004 from its current level of 31. T. food and grocery retail formats. the participation of women in the labour force and in professional and technical workforce in India is 34 percent and 21 percent respectively (source: NCEAR Report. The median age of an average Indian is about 25 years i. The 70 million-plus people earn over Rupees 8. perceptions. The positive change both direction and magnitude in demographics and the Indian consumer’s increasing disposable income has been highlighted by several studies.. Though the percentage contribution of consumables is relatively higher by the lower class.. The working age population between 15 and 64 years will increase by a staggering 71 million in India to reach 762 million by 2010 (UN Report.00. Salary hikes in India are also expected to increase at a faster pace than other developing countries.2000 to 2. The wealthy middle class is estimated at over 300 million and go up to 400 million by 2025.e. India’s middle-income group (popularly called middle class) is about 25% of the total population base of which. interests. The tool which helps q q q VISION—The Journal of Business Perspective Vol. All these portend a sustained growth in discretionary spending and reiterate the chronic need of modern retail formats. Increasing double income families in cities is another positive factor. The cumulative growth of the other income groups is likely to be about 7 percent i. Households in the top 4 income categories (over a lakh of annual income) account for about 53 percent of the total household consumption expenditure. The changing composition of work force and growing number of women employees in public and private organisations i.35 age group by 2020 (Sinha. Kearny Report.e. The average household income in urban areas has grown at a 5 percent Compounded Annual Growth Rate (CAGR) over the last decade. the Indian consumer was emerging as more trend conscious and wanted everything under one roof where diverse quality products are available.
psychographic duo in the growth and development of organised food and grocery retail formats. Most psychographic research attempts to segment customers in accordance with their activities. Other psychographics are values. then obtaining the self-consumer’s perceptions of a brand on the same traits. in California. the goals one lives for. According to Stanford Research Institute (SRI) people pursue and acquire products. 2002). 2001). the study has undertaken certain psychographic variables which reflect the quintessence of consumers’ ulterior motives and needs that are deemed to be satisfied by purchasing food and grocery products from the choice of modern retail formats like convenience stores. interests and opinions (AIO). 2003). Psychographics or lifestyle studies include attitudes or evaluative statements about the people. The second group consists of 18 instrumental value items. ideas. for people live their self-concepts in large measure by what they consume. One of the most popularised approaches to lifestyle research for markets segmentation is called values and lifestyles system (VALS). H1e: Consumer’s income levels have significant influence on purchasing from different types of food and grocery retail outlets. substance and character to their identities (Gonzalez and Bello. Values are end-states of life. HYPOTHESIS OF THE STUDY H1a: Consumer’s age has significant influence on purchasing from different types of food and grocery retail outlets. q VISION—The Journal of Business Perspective Vol. supermarkets and hypermarkets. In view of the above. H1c: Consumer’s family size has significant influence on purchasing from different types of food and grocery retail outlets. Sirgy (1982) in his study described the self-concept as an idea of what the person currently is and what he or she would like to become. H1b: Consumer’s gender has significant influence on purchasing from different types of food and grocery retail outlets. the first half of the instrument deals with ends and the second half consider means. consumer researchers Lynn Kahle et al. race. Psychologist Milton Rokeach has identified two groups of values. it is possible to identify the match or gaps between consumers’ self-concept and their perceptions of the personality of the brand. each group measuring different but complementary types of personal values. Furthermore. Psychographic research primarily allows us to understand why consumers behave the way they do (Schiff Man et al. Inc. institutions and reference groups and personal worth (c) needs and emotions. 11 No. namely culture. These three sets of factors together influence the pattern of activities (Sheth and Mittal. Lifestyles are determined by (a) a customer’s personal characteristics namely. H1d: Consumer’s occupation levels have significant influence on purchasing from different types of food and grocery retail outlets. Self–concept is self-image of who he or she is. To understand the role and contribution of consumers’ demo . 2002). OBJECTIVES OF THE STUDY The main objectives of the present study are: 1. 1994). genetics. To examine the impact of consumers’ demographic and psychographic variables in various types of organised food and grocery retail formats. For this purpose... 4 October–December 2007 . which are designed to measure the relative importance of end states of existence (personal goals). which are the measurements of the basic approach an individual might make to reach end-state values. 2. Thus. (1986) developed a list of values (LOV) consisting of nine terminal values based on Rokeach’s (1973) terminal value survey instrument and is a crosscultural generalisation of the values and life styles system (VALS) so that the individual can easily be classified according to the level of importance that he assigns to each of them. place.. The first group consists of 18 terminal value items. From these profiles. Marketers can apply the principle of self-concept by obtaining a selfconcept profile of customers in terms of selected personality traits. these two concepts of actual self and ideal self influences a person’s consumption deeply. products and so on (Hawkins et al. self-concept and lifestyle.24 Prasad and Reddy q a retailer to segment the population is psychographics involving the use of psychological. sociological and anthropological factors. age and personality (b) his or her q q personal context. gender. An AIO instrument consists of large number statements with which a large number of respondents express degrees of agreement or disagreement (Blackwell and Miniard. services and experiences that provide satisfaction and give shape. Consumer researchers felt a need for values more directly relevant to everyday consumer behaviour. developed by SRI International.
15 percent have been with the retail outlet for more than 3 years and 7 percent are in the habit of changing retail outlets as per their convenience. 2003). opinions. Respondents were selected by using the stratified random sampling method and participation was voluntary. Hence. opinions. 4 October–December 2007 . A total of 250 customers were surveyed and only 222 customers responded and returned the survey instrument. 10 statements were adopted from the VALS instrument (VALS Survey) on the basis of the relevance to the Indian context. pp. 12 activities statements were used to understand their activities. Mitchell’s (1994) approach which is the famous statistical tool combination of factor analysis. Approximately 18 percent of the respondents visit retail outlets once in a week in a given month. values and lifestyles on organised food and grocery retail formats. income levels. As Chi-square (c2) test is very popularly known as test of independence of two categories and test of goodness of fit for the reason that enables us to ascertain how appropriate the distributions from the sample data fit empirically. etc. family size. This is an 88. 3. These results proved that respondents show a significant level of purchasing behaviour towards modern food and grocery retail formats. occupation. a 5-point agree-disagree scale was used and for the activities statements a 5 point (5 standing for frequently and 1 standing for never) scale was used and for the LOV a 7 point (extremely important and extremely unimportant) scale was used. Statistical tools like Mean. gender. values.A Study on the Role of Demographic and Psychographic Dynamics in Food and Grocery Retailing 25 q H1f: Consumer’s education levels have significant influence on purchasing from different types of food and grocery retail outlets. The test of concordance (goodness of fit) can be made just by inspection of the sample data. Moreover.25 do purchase from q q q METHODOLOGY The present study is based on an empirical analysis of retail customer’s demographic variables like age. activities and values. The resultant factors were identified by using eigenvalue greater than one criterion and for further analyses. only 200 were usable as 22 were rendered unusable because of incomplete data. Chi-square (c2) test was used to get the precision (Griffin. instead of using factor measures. education. interests. (1986) to understand the values that were important to the respondents since the selected list of values corresponding well to the needs of Maslow’s hierarchy as the respondents were described in terms of demographic variables on socio-economic classification (SEC). occupation. The principle component analysis was used with varimax rotation in all the three analyses (Hair et al. H2: Consumer’s psychographic variables like activities. occupation. opinions. education and psychographic variables like activities. 2.’s approach was used in factor analysing the responses from interests and opinions. Out of this. The respondents were VISION—The Journal of Business Perspective Vol. STATISTICAL RESULTS AND ANALYSIS Apart from the descriptive statistics shown in tables 1. segmented as per AIO list of inventory and LOV scale described in terms of demographic variables as well as socio-economic classification. 34 percent visit retail outlets more than two times in a given month. 48 percent visit retail outlets at least for once in a given month. interests. but such a test is obviously is inadequate. The population of this study is retail customers in the city of Hyderabad in India. For testing the H2 hypothesis. and lifestyle. 58 percent have been with the retail outlet for 3 years. the test is good and strongly recommended for demographic variables (such as age.8% response rate. 4. income levels. Gonzalez et al. values and lifestyles have significant impact on purchasing from different types of food and grocery retail outlets.5 percent respondents from the age group 15 . education. family size. Out of 35 interest and opinion statements used. Hypotheses Testing For Demographic Variables It is conspicuous from the table 1 that 42. The study is based on primary data as well as secondary data. 5 and 6. family size. religion. and LOV scale with 7 values were used from the list of 9 values developed by Lynn Kahle et al. The questionnaire was framed with notable demographic and psychographic variables like age. income levels and psychographic variables consisting of activities. A psychographic instrument of 35 interest and opinion statements were used to understand the respondents’ interests and opinions of modern food and grocery retail formats.. cluster analysis and discriminant analysis was used.263). items which loaded highly on a factor were averaged. gender. 11 No. Standard Deviation and Chi-square tests were applied to test the H1 hypothesis. For the interest and opinion statements.) measured on nominal or ordinal scale. information on respondents association and choice of preferences of retail outlets from which they regularly purchase food and grocery items show that 20 percent have been with the retail outlet for less than one year.
. Thus. Majority of the respondents 42.4 members.5) is more than the table value (16. 11 No.812) at 1 percent significance level As the calculated c2 value (14. .2 members 7 12 21 40 3 -4 members 26 32 17 75 5 – 6 members 19 29 07 55 More than 6 members 09 15 6 30 Total 61 88 51 200 VISION—The Journal of Business Perspective Vol.35 do purchase food and grocery from supermarkets and 40 percent in the same group do purchase from hypermarkets.59) at 5 percent level of significance for 6 degrees of freedom.45 Years 21 18 11 50 45 Total Years and above 12 12 6 30 57 78 65 200 Table 2 reveals that male and female respondent’s patronage of food and grocery retail outlets is almost same irrespective of type of retail outlet.e. Therefore. Since the calculated c2 value (20. 4 October–December 2007 q q q .6 members of family size do purchase food and grocery items from supermarkets as they have felt that more large self-service outlets catering to varied shopper needs because of location in or near residential high streets. 42 percent of the respondents from 36 . demographic variable with respect to respondent’s family size has significant impact on type of food and grocery retail outlets. 40 percent of the respondents from age group 45 years and above do equal purchase from both convenience and supermarkets. 52. As the family size increases.35 Years 15 34 31 80 36 . Respondents 52 percent from housewife category do purchase from supermarkets.56) is more than the table value (16. Respondents 45 percent from business category purchase from hypermarkets.45 years age group do purchase from convenience stores and 36 percent in the same age group followed supermarkets for purchase. Most of the young and adults below 35 years of age do shopping from hypermarkets and supermarkets as they seek for a lot more varieties of branded and qualitative products. The age groups and retail formats are dependent with each other.812) at 1 percent level of significance for 6 degrees of freedom.26 Prasad and Reddy q hypermarkets.59) is more than the table value (12. Respondents from paid employee category are equally purchasing from super and hypermarkets.63) is less than the table value (5. Table2: Influence of respondents gender on Food and Grocery retail outlets Type of Retail Format Convenience Stores Supermarket Hypermarket Total Male 33 26 31 90 Female 29 41 40 110 Total 62 67 71 200 Table 3: Influence of Respondent’s Family Size on Food and Grocery Retail Outlets Type of Retail Format Convenience Store Supermarket Hypermarket Total 1. Respondents (42. consumer’s gender has not shown any significant influence on the type of food and grocery retail outlets.7 percent in 5-6 members and 50 percent in 5 .99) at 5 percent level of significance for 4 degrees of freedom. the alternative hypothesis (H1a) is accepted and it could be concluded that consumer’s age has significant influence on type of food and grocery retail outlets from which they purchase the products. As calculated c2 value (2. Table 1: Influence of Respondent’s Age on Food and Grocery Retail Outlets Type of Retail Format Convenience Store Supermarket Hypermarket Total 15 . alternative hypothesis (H1b) is rejected i. alternative hypothesis (H1c) is accepted i. both are independent with each other. Hence.e.2 do purchase from hypermarkets. Table 4 reveals that respondents (50 percent) and (33 percent) from student category purchase from supermarkets and hypermarkets respectively. Hence. null hypothesis is accepted.6 percent) in family size of 3 .25 Years 9 14 17 40 25 .5 percent from age group 25 . As calculated c2 value (21. It is evident from table 3 that respondents (52 percent) in family size 1. consumers do purchase from the nearest convenience stores and super markets and both are dependent with each other.
e.e. value. price quality conscious. religious and leadership minded.G 12 28 20 60 q q Total 39 91 70 200 VISION—The Journal of Business Perspective Vol. were averaged. intellectual. the principal component analysis with varimax rotation was applied on 35 interest and opinion statements. for 6 degrees of freedom. fun and entertainment type.000 do shopping in hypermarkets for food and grocery products. Table 5: Influence of Respondents Monthly Income Levels on Food and Grocery Retail Outlets Type of Retail format Convenience store Supermarket Hypermarket Total Below Rs.000 do shopping from convenience stores. variety seeker. consumer’s increasing knowledge.812) at 1 percent level of significance for 6 degrees of freedom.488) at 5 percent level of significance for 4 degrees of freedom. occupation and type of retail formats for purchase of food and grocery products are dependent with each other. Respondents (50 percent) from above Rupees 30. Firstly. Hypotheses Testing For Psychographic Variables The scores on different statements. These aspects were novel idea.A Study on the Role of Demographic and Psychographic Dynamics in Food and Grocery Retailing 27 q Table 4: Influence of Respondent’s Occupation on Food and Grocery Retail Outlets Type of Student House. They are with 64. Since calculated c2 value (25.Paid BusiRetail Format wife Employee ness Convenience Store Supermarket Hypermarket Total 5 15 10 30 16 26 08 50 17 31 32 80 10 12 18 40 Total 66 72 62 200 Table 6 shows that respondent’s increasing literacy levels have proved the direct relation with the type of food and grocery retail outlet.68) is more than the table value (16. Hence.e. 11 No. leader. Therefore. 4 October–December 2007 . 2000030000 10 28 22 60 Rs. The 8 factors emerged in factor loading were innovator. utilitarian. utilitarian. As calculated c2 value (10. Hence. familyorientation. hence. income levels and types of food and grocery retail outlets are dependent with each other. socialisation.000 do shopping from supermarkets. which is acceptable and above the lower limit for social sciences and determined the statistical significance of each eigenvalue at 1 percent level of significance.2 percent of variance. leisure activity. It is apparent from table 5 that respondents (40 percent) from below Rupees 10. 1000020000 14 50 11 75 Rs. dependency among them is obvious. family oriented. alternative hypothesis (H1e) is accepted i. career oriented. uniqueness.49) is more than the table value (9. quality and price sensitive. belongingness. alternative hypothesis (H1d) is accepted i. consumer’s growing income levels and availability of disposable money in hand have significant influence on type of food and grocery retail outlet from which they do shopping. Therefore. innovation. accomplishment. 30000 above 6 7 12 25 Total 46 99 55 200 Table6: Influence of Respondents Education Levels on Food and Grocery Retail Outlets Type of Retail format Convenience store Supermarket Hypermarket Total SSC/ Diploma 14 18 8 40 Degree 13 45 42 100 q P. self respect. Multivariate analysis was carried out on the basis of 26 interest and opinion statements (Exhibit 1). 10000 16 14 10 40 Rs. Respondents (66 percent) from Rupees 10. the 12 activity and 7 LOV statements were used separately. intellectual. which indicated the same psychographic aspects. demographic variable with respect to consumer’s occupation levels have significant impact on type of food and grocery retail outlets. Hence. alternative hypothesis (H1f) is accepted i. awareness and educational levels have significant influence on types of food and grocery retail outlets.000 – 20. The factor analysis of opinion and interest statements emerged in 8 factors with eigenvalue greater than 1. values.
These average scores also put for examination in the agglomeration matrix and dendogram resulted three clusters to be most acceptable. 3.5% variance) I do shopping to keep up with the trends (.704) I do enjoy making my own decisions (.589) I agree with that higher the price of the product. 4 October–December 2007 .81 at significance level of 0. Factor 1-Innovator (Cronbach’s alpha= .5382. 5. the 6 LOV statements were factor analysed through principal component analysis with varimax rotation.642) I go shopping to make me feel better (.590) Other people usually follow my ideas (. opinions and values. it is good enough for me also (.Utilitarian (Cronbach’s alpha .5% variance) I go for shopping to find value for money (.728) I go for shopping to have a look at products being considered for purchase (. 3.2% variance) I like to lead others (. 5230. 4. 4.646) I can usually organise people to get things done (.792) My family is the single most important thing to me (.5742.4% variance) I like to have a lot of variety in my life (.608) In the second stage 10 activity statements were factor analysed by applying principal component analysis with varimax rotation.662) I always take opinion of my family before taking purchase decision (. The clusters were different across the values and AIO’s. All the four functions were statistically significant and means of functions q VISION—The Journal of Business Perspective Vol.28 Prasad and Reddy q Exhibit 1 Multivariate Analysis Principal components factor with varimax rotation results of interest and opinion statements with corresponding Cronbach’s alpha scores and factor loading of items. activities and LOV’s scores were used as independent metric variables for multiple discriminant analysis.678) Factor 5 Entertainment seeker (Cronbach’s alpha . 7890. 3. measured by Cronbach’s alpha. At the next stage two value scale scores three activity scale scores. MANOVA test was used to find out any differences exhibited on the basis of activities.605) Factor 8 Intellectual (Cronbach’s alpha. higher is the quality (.7246.690) A women’s life is fulfilled only if she can provide a happy home for her family (.590) Factor 6 Price/Quality sensitive (Cronbach’s alpha . 11 No.2% variance) I have more ability than the most people (.745) Factor 3.6% variance) I like doing things that are new and different (. were put to hierarchical clustering analysis by using Ward’s method and four clusters were resulted as most acceptable.6690) I like the challenge of doing something I have never done before (. 5.9% variance) q q The price of product is good indicator of its quality (.6590.763) Factor 2-Values (Cronbach’s alpha.653) I go for shopping to find different branded products I need (.679) Factor 4-Family orientation (Cronbach’s alpha . In the third stage.8% variance) If it is good enough for my wife. interests.612) I consider myself as an intellectual (.000.689) I like to have warm relationship with others while doing shopping (. Two factors with eigenvalue greater than 1 resulted with 56 percent of the variance and examined statistical significance of each eigenvalue at 1 percent level of significance.490) Factor 7 Leader (Cronbach’s alpha . The multivariate test using Wilks’ Lambda was conducted on marginal means obtaining value 0.521) I always like for branded products irrespective of the price tag (.714) I like to use new and different things in my life time (.4780. The average scores of the items were loaded highly on factors and had reliability. the four clusters were used as dependent variables and the averaged interests and opinions. Three factors with eigenvalue greater than 1 factorised with 58. 8 interest and opinion scale scores.524) I like being in charge of a group (. The four canonical discriminant functions account for 87 percent of the variance in the dependent variable. At the last stage. 4.623) I like to have excitement and fun in doing shopping (.3 percent of variance and examined the statistical significance of each eigenvalue at 1 percent level of significance.7468.745) I do shopping to see what new products are available (.
Hence. Location of the store is very important for them. They do not indulge in much unplanned purchase.2 percent) This kind of consumers hardly shows interest either in window shopping or socialisation at all. 4 October–December 2007 .e. The working women create a huge demand for timesaving products and services. nevertheless. 11 No. Hedonic Consumers (16.A Study on the Role of Demographic and Psychographic Dynamics in Food and Grocery Retailing 29 q differed across four clusters and further examinations of the structure matrix and functions at group centroids. Utilitarian Consumers (34.8 percent) These kinds of consumers are high on need-based buying. In the fast changing face of organised retailing especially in food and grocery. 1. the alternative hypothesis (H2) is accepted i. which is considered as an acceptable size. 4. pleasant ambience. it is felt that for a consumer research as this. Hence it is imperative to bear in mind that consumer behaviour and shopping habits with regard to demo–psychographic duo conspicuously influence the choice of food and grocery retail outlets. LIMITATIONS AND FUTURE STUDY Although most of the objectives of the study were fully met. Conventional consumers (28.4 percent. simultaneously c2 tests of association and cross-tabs between clusters shows the results of four clusters. They are moderate in frequent purchasing and do purchase food and grocery products from supermarkets. The leave-one-out cross-validation option. using a larger q q q VISION—The Journal of Business Perspective Vol. The results show that 85. Socialisation Type Consumers (20. the sample size of respondents. This group has more female consumers than male in middle and upper middle income levels. consumer’s psychographic dynamics plays a great role in selecting the type of food and grocery retail outlets. These shoppers are low on needbased buying. First. Frequency of purchase is more than 2 times in a month and do purchase food and grocery products from type of convenience stores and supermarkets. Window shopping and storage display is important to them. Second. the hit ratio was 82.2 percent) These are the sort of consumers who use products or services for the sake of intrinsic enjoyment rather than to solve some problems. although 200 was achieved in this study. family size and income levels are the major determinants for type of food and grocery retail outlets. Although consumer’s involvement of shopping for food and grocery items is very low. offering self-service. 3. Such focus could limit the generalisations of the findings to the entire organised retail outlets in India. They least show interest in product quality and assortment. Students consist of equal number of male and female are proportionately more than non-students. It is an up hill task to serve today’s pragmatic and enigmatic consumer because consumer is looking for huge variety of quality products. The study shows that consumer’s education. Location of the outlet is somehow important for them. a few limitations were identified in the course of this study. Location of the store is immaterial for them because of having sole interest in quality products and variety of brands. 2. high on idea shopping and have high unplanned purchases. They do purchase from supermarkets and hypermarkets where they can meet their social groups and fulfil needs. yet it is in metamorphosis state due to increasing levels of consumer awareness and availability of manifold branded products on qualitative and competitive basis. and store services like assistance. promotions. occupation. The frequency of purchase is at least once in a month. baggage. They are high in window-shopping.8 percent) These are the sort of consumers like to socialise with their near and dears. the study focuses on only the nascent organised retail outlets in Hyderabad. shopping for products is no more a matter of non-fun mundane activity but an exciting and entertainment activity. Propensity to purchase is more in male consumers than female. Location of the store is not important criteria for purchase of items. low on idea shopping and never resort to unplanned purchase. interests and opinions and values for the purchase of items from the retail outlets. credit facilities etc. MANAGERIAL IMPLICATIONS This empirical analysis has a great number of managerial implications on organised food and grocery retail outlets. revealing a sense of strength of the estimate in using each respondent as valid. The rapid sea changes occurring in consumer’s demographic and psychographic profiles posed a great challenge for organised retailers to identify the required style and type of food and grocery retail format. They have the highest propensity to spend more and do purchase food and grocery items from hypermarkets. They are moderately need based and not much of ideashoppers.5 percent of the cases correctly classified. The psychographic segments are differed in terms of consumer’s activities.
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