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A STUDY ON CONSUMER PURCHASING

BEHAVIOUR OF INSTANT FOOD PRODUCTS


IN ANDHRA PRADESH
BY
PRAVEEN BABU CHIRUTHOTI
B.Sc. (Ag.)

THESIS SUBMITTED TO
PROFESSOR JAYASHANKAR TELANGANA STATE
AGRICULTURAL UNIVERSITY
IN PARTIAL FULFILMENT OF THE REQUIREMENTS
FOR THE AWARD OF THE DEGREE OF

MASTER OF BUSINESS ADMINISTRATION


(AGRIBUSINESS MANAGEMENT)

CHAIRPERSON: Dr. P. RADHIKA

SCHOOL OF AGRIBUSINESS MANAGEMENT


COLLEGE OF AGRICULTURE
RAJENDRANAGAR, HYDERABAD-500 030
PROFESSOR JAYASHANKAR TELANGANA STATE
AGRICULTURAL UNIVERSITY

2015

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DECLARATION

I, PRAVEEN BABU CHIRUTHOTI, hereby declare that the thesis entitled “A


STUDY ON CONSUMER PURCHASING BEHAVIOUR OF INSTANT FOOD
PRODUCTS IN ANDHRA PRADESH” submitted to the Professor Jayashankar
Telangana State Agricultural University for the degree of Master of Business
Administration in School of Agribusiness Management in the major field of Agribusiness
Management is the result of the original research work done by me. I also declare that no
material contained in the report has been published earlier in any manner.

Place: Hyderabad (PRAVEEN BABU CHIRUTHOTI)

Date: I. D. NO. RMBA/12-18

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CERTIFICATE
Mr. PRAVEEN BABU CHIRUTHOTI has satisfactorily prosecuted the course of
research and that thesis entitled “A STUDY ON CONSUMER PURCHASING
BEHAVIOUR OF INSTANT FOOD PRODUCTS IN ANDHRA PRADESH”
submitted is the result of original research work and is of sufficiently high standard to
warrant its presentation to the examination. I also certify that neither the project nor its part
thereof has been previously submitted by him for a degree of any university.

Date: (Dr. P. RADHIKA)


Chairperson

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CERTIFICATE

This is to certify that the thesis entitled “A STUDY ON CONSUMER


PURCHASING BEHAVIOUR OF INSTANT FOOD PRODUCTS IN ANDHRA
PRADESH” submitted in partial fulfillment of the requirements for the degree of
‘Masters of Business Administration’ of Professor Jayashankar Telangana State Agricultural
University, Hyderabad, is a record of the bonafide original research work carried out by
Mr. PRAVEEN BABU CHIRUTHOTI under our guidance and supervision.

No part of the thesis has been submitted by the student for any other
degree or diploma. The published part and all assistance received during the course of
investigations have been duly acknowledged by the author of the thesis.

(P.RADHIKA)
Chairperson of the Advisory Committee
Thesis approved by the Student Advisory Committee
Chairperson Dr. P. RADHIKA
Associate Professor
School of Agribusiness Management
College of Agriculture
Rajendranagar, Hyderabad – 500030
Member Dr. SEEMA
Professor & Head
School of Agribusiness Management
College of Agriculture
Rajendranagar, Hyderabad – 500030

Member Shri M.H.V.BHAVE


Associate Professor & Head
Department of Statistics & Mathematics
College of Agriculture
Rajendranagar, Hyderabad – 500030

Date of final viva voce:

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ACKNOWLEDGEMENTS

I am pleased to place my profound etiquette to my Major Advisor and Chairperson


of the Advisory Committee, Dr. P. Radhika, Associate Professor , School of Agribusiness
Management, College of Agriculture, Rajendranagar, Professor Jayashankar Telangana
State Agricultural University for her wise counsel, concrete suggestions, her inspiring,
meticulous and affectionate guidance, constant help and persistent encouragement during
the course of my study and prosecution of research work. I take it as a privilege and pride
to have an opportunity of working under her inspiring spirit.

I deem it my privilege in expressing my deep sense of reverence and gratitude and


indebtedness to Dr. Seema, Professor & Head, School of Agribusiness Management,
College of Agriculture, Rajendranagar, Professor Jayashankar Telangana State
Agricultural University and member of Advisory Committee for her encouragement and
guidance.

I equally owe my deep sense of gratitude to Sri. M. H. V. Bhave Professor & Head,
Department of Statistics and mathematics and member of my Advisory Committee for his
invaluable guidance, suggestions and support during my course of study.

It will be a great lapse on my part if I fail to extend my best regards to all my


teachers and well-wishers who have contributed in building up my present status. I also
thank to the staff of School of Agribusiness Management for their help during my thesis
work.

Language falls short of to express my undoubtfull gratitude, indebtedness, love and


affection to my beloved and venerable parents Smt. Gnana Pushpa Chiruthoti and Sri.
Prabhu Das Chiruthoti, who constantly educated, guided and moulded me into the present
position and whose boundless love, unparallel affection, dedicated efforts, encouragement
and moral support is a constant source of motivation for me in shaping up my career

It is time to surface out my genuflect love and affectionate gratitude to my brother


Vidya Sagar and all my family members whose everlasting love and encouragement were
my strongest assets during the course of my life with whose moral support I achieved this
level of education.

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My acknowledgement would be incomplete and meaningless without thanks to my
friends P.Chaitanya Bhavani, Arshiya, Vivek, Zainab, K.Uma Shankar, P.Nagarjuna,
B.Rajitha, Subba Reddy, Pruthvi Raj and Rajesh Yadav for their voluntary help, mood
refreshing gossip which helped me in completing the thesis.

I take it as a special privilege to thank all the authorities and staff of PJTSAU, who
provided me an opportunity to undertake the course and those who directly and indirectly
helped me in all my endeavours.

Date:

Place: Hyderabad (PRAVEEN BABU CHIRUTHOTI)


I.D. NO. RMBA/12-18

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LIST OF CONTENTS

CHAPTER NO. TITLE PAGE NO.

I INTRODUCTION 1-9

II REVIEW OF LITERATURE 10-16

III MATERIALS AND METHODS 17-22

IV RESULTS AND DISCUSSION 23-53

V SUMMARY AND CONCLUSIONS 54-62

LITERATURE CITED 63-65

APPENDIX 66-74

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LIST OF TABLES
Table Title Page
No. No
3.1 Salient demographic features of Hyderabad, Vijayawada and Titurpati 18
cities
4.1 Demographic information of respondents in the study area 25
4.2 Sales trend of major firms in instant products 27
4.3 Consumer awareness about various instant products 31
4.4 Consumer awareness about various brands 32
4.5 Source of information about instant food products to respondents 33
4.6 Percent of instant foods in total food purchase 34
4.7 Influencers of purchase decision 35
4.8 Consumer perception towards instant food 38
4.9 Future purchase behaviour of respondents- situations when they would 43
increase their purchase
4.10 Future purchase behaviour of respondents- situations when there is 44
decrease in demand
4.11 Parameters of quality 45
4.12 Nature of purchase decision 45
4.13 Preference of purchase location 46
4.14 Reasons for particular brand preference 51
4.15 Brand loyalty 52
4.16 Alternative purchase plans 53

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LIST OF ILLUSTRATIONS
Figure Title Page No.
No.
4.1 Sales of MTR 27
4.2 Sales of Nestle 28
4.3 Sales of ITC 28
4.4 Sales of Ruchi 29
4.5 Sales Of Hindustan Unilever Limited 29

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LIST OF SYMBOLS AND ABBREVIATIONS

& : And

% : Per cent

PJTSAU : Professor Jayashankar Telangana State Agricultural University

et al. : and other people

etc. : and so on

i.e., : That is

kg : Kilogram

Rs. : Rupee

viz. : namely

GDP : Gross Domestic Product

CAGR : Compound Annual Growth Rate

x
Author : PRAVEEN BABU CHIRUTHOTI

I.D. No. : RMBA012-18

Title of the thesis : A STUDY ON CONSUMER PURCHASE BEHAVIOUR


OF INSTANT FOOD PRODUCTS IN ANDHRA
PRADESH

Degree to which : MASTER OF BUSINESS ADMINISTRATION


it is submitted

Faculty : AGRICULTURE

Department : AGRIBUSINESS MANAGEMENT

Major Advisor : Dr. P. RADHIKA


Associate Professor
School of Agri Business Management
College of Agriculture
Rajendranagar, Hyderabad – 500030.

University : PROFESSOR JAYASHANKAR TELANGANA STATE


AGRICULTURAL UNIVERSITY
Year of submission : 2015

ABSTRACT
The term 'instant food' means simple, fast and convenient food, which is easy and
fast to prepare besides being hygienic, free from microbial contamination and also
convenient to eat. Canned foods, frozen foods, instant food mixes and dried foods come
under this category. A fast-paced urban lifestyle, increasing prevalence of nuclear family
structure, rising disposable income, increasingly larger number of globe-trotting consumers
with an experimental palate are all favourable demographic factors spurring the adoption of
instant food at global level. There are a variety of instant/ready-to-eat foods available in the
Indian market to choose from. There is a tremendous potential for commercial exploitation
of instant foods as this industry is in a nascent stage. The companies like ITC, Nestle,
MTR, Ruchi, Hindustan Unilever Limited share a major pie of the instant food market in
India.

The present study entitled “A study on consumer purchasing behavior of instant


food products in Andhra Pradesh” was taken up with following objectives:

1. To study the trends in sales of instant food products of major manufacturing firms in
India.

2. To study the extent of consumer awareness of Instant food products in the selected areas.
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3. To analyze factors influencing the buying behavior of Instant food products.

Secondary data was collected from the companies database which showed that there
is an increasing trend in the sales of instant food products.The primary data regarding
product awareness, brand awareness, and factors influencing consumer behaviour was
collected from the consumers through personal interview with the help of a pre-tested
questionnaire designed especially for the purpose. Extent of consumer awareness and
factors influencing the buying behavior were analyzed. The data was compiled, tabulated
and analyzed. General information of consumers, sales trends, product brand awareness,
instant food purchase, preference of purchase location, brand loyalty, influencers and nature
of purchase decision, alternative purchase plans are recorded in percentages. Source of
information and parameters of quality, are analyzed through Garrett ranking. Consumer
perception, future demand potential, brand preference are analyzed through Likert scaling
technique.
The analysis of sales trends of major firms in India over a period of 2009-2013
showed that there is an increasing trend in the sales of instant food products. Consumer
awareness about instant products was high with regard to atta and noodles with 70.67 per
cent and 63.67 per cent respectively. Brand awareness of Maggie (Nestle) was the hishest
with 93.33 per cent of the respondents being aware and it was followed by bambino with 90
per cent awareness. Mass media and print media are the major sources of information.
The major influencers of purchase decision are children with 58.67 per cent in
breakfast, 46 per cent in main course, 52 per cent in snacks categories. Consumers perceive
instant foods as easy to prepare- (67.33%), tasty-(65%), time saving- (50.67%), well
packed-(53.67%), convenience food-(59.67%) and expensive- (55.33%). A products quality
according to respondents is perceived through its packaging, price, place of availability,
nutritional value, preservatives, certification, ingredients and recipe presentation. The
purchase decision of the consumers is mostly planned rather than impulsive in nature. The
purchase locations are distributed among the super market chains, retail stores, mom and
pop shops.
It is suggested that a proper survey of the market and the tastes and needs of the
consumers of various age groups should be done in order to focus on the product
development and marketing. Innovative technology should be explored in order to increase
the shelf life of the product variants and simultaneously reduce the cost of the product.
Promoting the concept of wholesome and fortified foods in the instant products. The health
issues of the consumers should also be given importance accordingly with the palate and
more promotional activities should be carried upon to make the instant foods reach the vast
number of people.

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Chapter I

INTRODUCTION
1.1 PRELUDE

Food is any substance consumed to provide nutritional support for the body. It is
usually of plant or animal origin and contains essential nutrients such as carbohydrates,
proteins, fats, vitamins and minerals. Food is needed to produce energy, maintain life, or
stimulate growth. Historically, people secured food through two methods- agriculture,
hunting and gathering. Today, most of the food energy consumed by the world population
is supplied by the food industry.

India is one of the key food producers in the world, being second largest producer of
food next to China and also with the second largest arable land area in the world. It has the
potential to become biggest food industry with food and agricultural sector contributing 17
per cent to the Indian GDP. (A report by Corporate Catalayst India on Indian Food
Processing Industry)

Food accounts for the largest share of consumer spending in India. Increasing
incomes are always accompanied by a change in the food basket. Thus acceptability of
variety in food increases with the increasing income levels. (A report by Corporate
Catalayst India on Indian Food Processing Industry)

Food processing industry

Food processing is converting raw food and other farm produce into edible, usable
and palatable form. It is the conversion of clean, harvested, butchered or slaughtered
components into marketable food products with value addition so as to improve their
quality, reliability and shelf life. Further Food processing is about preservation of food
while providing greater potential for export. Food processing is a large sector and includes
industries that use agriculture, horticulture, plantation, animal husbandry and fisheries
inputs for manufacturing of edible products.

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Global Scenario

Innovations and new developments in food processing techniques lead to the


development of products such as juice concentrates, artificial sweeteners, colorants,
preservatives, dried instant soups, pre-constituted fruit juices, ready to eat foods, self-
cooking meals, variants in confectionary and bakery products etc. Instant packaged foods
such as biscuits, chocolates, bakery items, variety of fruit drinks, snacks attracted higher
percentage of consumers. In the past decade several new biscuits & confectionery units,
soya processing units and starch/glucose producing units have come up. The market size of
confectioneries is estimated at US$ 484.3 million growing at the rate of 5.7 per cent per
annum globally. Biscuits have a market of US$ 373.4 million, growing at 7.5 per cent per
annum. Other products like bread, chocolates are also growing at a significant rate. There is
a demand for Indian snack food (Ready-To-Eat) in overseas markets and the exports market
is estimated at US$ 33.4 million and is growing at around 20 per cent annually. (A brief
report On Food Processing Sector in India, October 2013)

MTR Foods Ltd.


MTR Foods Ltd is an ISO 9002 and HACCP certified company is amongst the top
five processed food manufacturers in India. They manufacture, market and export a wide
range of packaged foods to global markets that include USA, UK, Australia, New Zealand,
Malaysia, Singapore, UAE and Oman. (A report by Corporate Catalayst India on Indian
Food Processing Industry)

Hindustan Lever Limited (HLL)


HLL’s Foods segment is at 9 per cent, beverages are at 12 per cent of its businesses.
It caters mainly to the beverages, staples, snacks and dairy products with a wide range of
products like tea, instant coffee, biscuits, ice creams, salt, wheat flour, instant drinks, soups,
jams and squash. (A report by Corporate Catalayst India on Indian Food Processing
Industry)

ITC Ltd.
ITC made its entry into the branded & packaged foods business in August 2001
with the launch of the Kitchens of India brand. A more broad based entry was made in mid
2002 and the company currently has a wider portfolio in the confectionery, staples and
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snack foods segments. It caters to the staples and snacks food segment having a product
range of wheat flour, salt, ready to eat meals, biscuits, confectionaries, snacks and cooking
pastes. (A report by Corporate Catalayst India on Indian Food Processing Industry)

Nestle India Pvt. Ltd.

It majorly caters to dairy products, beverages and snack foods, with products
ranging from instant coffee, condensed milk, dairy whitener and infant food to chocolates
and confectionaries. The company is focusing on launching new products in all product
segments. (A report by Corporate Catalayst India on Indian Food Processing Industry)

Indian Scenario

In India, majority of the population consume homemade food. Nevertheless,


consumption of branded and non branded processed food is increasing due to increase in
urbanization, breaking up of the traditional joint family system, desire for quality, changing
preferences in taste, willingness to try new cuisines, lack of time, need for convenience,
increasing number of working women, rise in per capita income, changing lifestyles and
increasing level of affluence in the middle income group.
The food processing industry in India is one of the largest industries in the country -
it is ranked fifth in terms of production, consumption, export and growth prospects. While
the industry is large in terms of size, it is still at a nascent stage in terms of development.
Out of the country’s total agriculture and food produce, only 2 per cent is processed. The
Ministry of Food Processing, Government of India has defined the following segments
within the food processing industry:
• Dairy, fruits & vegetable processing
• Grain processing
• Meat & poultry processing
• Fisheries
• Consumer foods including packaged foods, beverages and packaged
drinking water. (A report by Corporate Catalayst India on Indian Food
Processing Industry.
India is one of the largest emerging markets, with a population of over one billion.
India is one of the largest economies in the world in terms of purchasing power and has a

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strong middle class base of 300 million, hence with changing food habits there is a great
potential for processed foods. (Investors Portal of Mininistry Of Food Processing
Industries)
Considering the high potential for food processing industry in India, Government of
India is committed to encourage various activities for the development of this sector. Indian
government has been giving importance to the food-processing sector, by way of fiscal
incentives to encourage commercialization and value addition to agricultural produce, for
minimizing pre/post-harvest wastage, generating employment and export growth.

Some of the important measures taken up by the GOI are:


 The government gave five-year tax holiday for new food processing units in fruits
and vegetable processing.
 Subsidies are given for the purchase of latest mechanism and efficient machinery.
 All food processing industries shall be exempted from payment of market cess on
the procurement of raw material for the industry.
 The sale tax on inputs shall be adjusted against the tax payable, on the sales of the
finished products sold within the state. Further in respect of exports the input tax
shall be refunded by industries department, GOI.
 A 25 per cent airfreight subsidy will be given on the actual cost incurred on the
airfreight for export of perishables. (Report of KPMG for IBEF)

Andhra Pradesh Scenario

Andhra Pradesh has good potential for food processing industry. In India 12 percent
of value added food products come from the state of Andhra Pradesh and it is the second
highest contributor in creating value addition in food processing. The state witnessed higher
growth rate in food processing industries than that at the all-India level and where in the
food industry accounts for 22.36 percent of the industrial production in Andhra Pradesh
during the period. Out of the different segments of the food processing industry 65 percent
enterprises are in grain milling and other key segments are processing units of nuts, bakery
products and dairy products. Food Processing Industry in Andhra Pradesh is valued at INR
3.4 trillion (USD 70 billion) during the year with a CAGR of 14% (2009-2012). (Food
processing industry in India and Andhra Pradesh, 2014)

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1.2 INSTANT FOOD PRODUCTS

Instant food usually refers to precooked food that requires very little preparation
prior to eating it. This often tends to include foods that are dehydrated and just require the
addition of water to prepare. The very term 'instant food' means simple, fast and convenient
food which is easy and fast to prepare besides being hygienic, free from microbial
contamination and also convenient to eat.
In the modern days, where the life is at fast pace with the time very valuable to
every person, "Instant Foods" play an important role in everyone's day-to-day life. The
marketing concept behind the idea of instant food is that people in fast-paced, mobile
societies no longer have the time to cook and prepare food in the traditional manner, yet
they still want meals that are nutritious and taste good. Canned foods, convenience foods,
fast foods, frozen foods, instant products, dried foods, preserved foods, etc. all come under
instant foods.
The instant food mixes can be used for preparations of various snack foods,
breakfast foods, sweets and preparations with rice. The breakfast mixes include dosa mix,
vada mix, idli mix, upma mix, bonda mix, chapathi/parathas; the snack mixes include
noodles, soups, instant pop-corn mix, macaroni mix, nuggets, fries, cutlets, kababs, cake
mix, sausages, papads, pasta; the sweet preparation included gulabjamun mix, payasam
mix, badam mix, burfi mix; and the preparations with rice include biryani mix, tomato rice
mix, lemon rice mix and coconut rice mix, instant curry mix etc., The instant mix market in
India was approximately Rs.150 crore during the year 2003 and at the end of 2004, it was
around Rs.350 crore. And by March 2007 the size of the Indian Ready to eat market was
approximately Rs.600-700million (Indiantelevision.com. March 10, 2007).

The major food companies like ITC, Nestle, MTR, Kohinoor foods, Parle and
Haldiram’s play a significant role in this sector. Some companies participate with their
brands such as Aashirvaad, Kitchens of India, Yippie, Maggie and some companies directly
with their company names such as MTR gulabjamun mix, Nestle Cake mix etc. In the
recent past many MNC’s have entered the instant food market.

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For the convenience Instant Food Products are classified into three categories in the
study:
1. Breakfast products. e.g. dosamix,vada mix, idli mix, upma mix etc.
2. Main course (Lunch/dinner) products. e.g. Biryani mix, curry mix, pickles etc.
3. Snacks. e.g. gulabjamun mix, pasta, noodles, popcorn mix etc.
One of the major constraints this industry has to battle is the reputation of Ready to
eat foods being expensive and loaded with preservatives, additives, and other potentially
harmful fillers, food colors, and so on, which can give it a negative image in the mind of
the consumer.

Present status of Instant Food Products

According to the Ministry of Food Processing Industries, the size of the food
processing industry was about Rs.3,15,000 crores and included Rs.99,000 crores of value
added products in the year 2013. About 300 million upper and middle class people
consume processed food; 200 million more consumers are expected to shift to processed
food every year. The food processing industry accounts for 13.5% of the country’s
industrial output. It generates 18% of gross domestic product and employs about 19% of
the industrial labour at national level. Products like papad, pickle and spice mixes have
been hugely successful in recent years. The size of this particular segment alone is
estimated at about Rs 100 crore. Rabo India Finance had projected that the Indian food
processing industry would increase to Rs 11,500 billion by 2014-15. Instant food products
like ‘chapaties’, ‘subzies’ and portion packs of concentrated curries are fast becoming
regular diets, especially for young couples. The product range also includes foods like ‘rava
–idli’, ‘puri-bhaji’ and ‘dosa-vada’. Processed food products like pickles, chutneys, juices
and curry powders had made their entry into the kitchens of most middleclass households a
long time back. There are a whopping 15 crore middle class individuals, of which 60 per
cent are below 35 years — a segment that is increasingly depending on instant food
products. This throws open an ideal opportunity for small entrepreneurs who are eyeing this
segment for making a fortune. (Pradeepa and Kavitha, 2013)

Over the past five decades, India has taken giant steps in producing food grains,
milk, fruits and vegetables. The production of raw food materials is estimated to be worth
over Rs 60,000 crore. After primary, secondary and tertiary processing, the total size of the
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industry is estimated to be as high as Rs 1,10,000crore. This cost overrun reflects the
opportunities that food-processing industry offers to the economy as a whole and
entrepreneurs in individual. Big opportunities lie in upgradation from commodities to
packaged and branded convenient instant food products, which will offer value for money.
(Kavitha, 2012)

Varied range of instant food products are being made by keeping focus towards
children, youth and adults and products catering to those who lead a fast modern-day life.
Realizing the potential and in order to provide further boost, the government has exempted
from excise duty on condensed milk, ice cream, preparations of meat, fish and poultry,
pectins, pasta and yeast. Further, excise duty on certain ready-to-eat packaged foods is
reduced from 16% to 8%. The food processing industry will also be benefited from the
reduction in excise duty on paper, a cut in customs duty on major bulk plastics and a
reduction of customs duty on packaging machines, which would reduce packaging costs.
(Small and Medium sized Enterprises in Fruit Processing Sector, March 2014)

In the Indian market Tier-I and Tier-II cities are considered as emerging markets for
instant foods. So, more variants of instant food products have to be manufactured and
multiple product ranges can be brought in to satisfy the changing needs of the consumers.

Consumer purchasing behavior

Consumer purchases are likely to be influenced by physiological, psychological and


sociological factors. The commodities and services are bought by the consumer to satisfy
his basic needs, for comfort, pleasure, recreation and happiness. Every individual has
physiological need such as hunger, shelter, thirst, etc., which have to be satisfied for
survival.
The psychological factors like status prestige and social factors like friends,
neighbors, job and relatives influence their purchasing activities. People bear certain beliefs
and attitudes towards certain types of goods, brands of commodities and retail outlets based
on their previous experience. When there is a need, they are able to discover some new
commodities capable of satisfying their needs.
Before the commodities and brands are selected, these commodities must compete
successfully against alternatives in the market. Again selection of a particular commodity
depends on income of the consumer and how necessary this product is to the individual.
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Before the selected commodity is purchased, an individual requires information regarding
the various sources of supply of the commodity, its brands, relative merits and demerits,
uses and value of their characteristic features and services offered. The common sources
through which individual gathers information are from advertising, friends, retailers in the
locality, displays in shops and food labels.

Problem focus

Several firms have been engaged in production and marketing of instant food
products. Hence, the consumers have many options to choose from. In this context, a study
on consumer behavior was deemed to be relevant to understand the buying behavior and
preferences of different consumers. Understanding the consumer behavior would help the
firms in formulating strategies to cater to the needs of the consumer and thereby increase
their market share. Consumer’s taste and preference were found to change rapidly, and it is
necessary to understand these changes. Keeping in view the importance of consumer
buying behavior and consumption pattern, determination of various strategies regarding
product development, marketing and pricing aspects, the present study was undertaken with
the following objectives.

1.3 OBJECTIVES OF THE INVESTIGATION

1. To study the trends in sales of instant food products of major manufacturing firms in
India.

2. To study the extent of consumer awareness of Instant food products in the selected areas.

3. To analyze factors influencing the buying behavior of Instant food products.

1.4 SCOPE OF THE STUDY


The study was conducted in the selected Tier-I, Tier-II and Tier-III cities of Andhra
Pradesh, India. The study mainly focuses on the consumer awareness of instant food
products and analyzing the factors that influence the buying behavior of instant food
products. The study concentrates on sales of instant food products of major manufacturing
firms in India namely ITC, Nestle, MTR, Kohinoor foods, Parle, Ruchi and Haldiram’s.
Hence, this study would help in understanding the market for instant food products in

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Andhra Pradesh. It will give a broad picture about the present awareness levels of instant
food products among consumers, future scope, knowledge about the leading market players
and consumers brand loyalty towards the particular brands. This study throws a light on
understanding the factors that influence the buying behavior and purchasing patterns of
consumers which will help the manufacturing firms in developing the future marketing
strategies, in making modifications in present products and developing new ones and in
their pricing and packaging decisions.

1.5 LIMITATIONS OF THE STUDY

This study was based on primary data collected from sample consumers by
questionnaire survey method. Data has been collected mainly from the households and as
many of the consumers furnished the required information from their memory and
experience, the collected data would be subjected to recall bias. The study area was limited
to Tier-I, Tier-II and Tier-III cities of Andhra Pradesh which are Hyderabad, Vijayawada
and Tirupati respectively, hence the findings may not be applicable to other markets, as vast
differences may exist among the consumers with regard to demographic and
psychographics characteristics. Hence, the findings of the study may be considered
appropriate for the situations similar to study area and extra care should be taken while
generalizing the results.
1.6 STRUCTURE OF THE PROJECT REPORT
The study is presented in six chapters as follows

I) Introduction: The importance of the study, problem setting and objectives are
covered.
II) Review of literature: The available and relevant literature is thoroughly
reviewed.
III) Material and Methods: The methods and materials encompassing sampling,
data collection, analytical tools, concepts and terms are explained.
IV) Results and Discussion: The results and discussion based on analysis of data
collected is presented.
V) Summary and Conclusions: Summary and conclusions are presented along
with suggestions for improving the marketing and distribution of instant food
products.
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Chapter II

REVIEW OF LITERATURE
For a research work to be carried upon, the previous works done give an insight into
the background and provides a set of directions to the present research problem. Collection
of literature should be done to understand various related aspects of the issue. The analysis
of the collected studies gives way to further understanding of the problem and identifies the
aspects needed to be focused upon and would help the researcher to organize the research
on proper lines and bring about refinement in the study. The reviews have been presented
under the following headings.

2.1. Studies on the trends in sales of instant food products of major manufacturing firms in
India.

2.2. Extent of consumer awareness of Instant food products in the selected areas.

2.3. Factors influencing the buying behavior of Instant food products.

2.1. Studies on the trends in sales of instant food products of major


manufacturing firms in India.

Ganesan et al. (2012) made an attempt to understand the consumer behavior and
brand preference of Nestle Maggi noodles in Trichy, Tamil nadu. The study found out that
respondents prefer maggi 2- minute noodles, respondents have tasted all brands of nestle
magi noodles, respondents purchase nestle maggi noodles for its quality with low price,
television advertisements are a major factor in purchase decision compared to other media,
foremost influencer in purchase decision of the respondents is children, respondents were
expecting new varieties of maggi noodles from nestle, respondents consider that the
packing is attractive.
Bimalendu (2011) conducted a detailed study on marketing management of ITC
Aashirvaad atta. Though initially some kind of social social stigma was attached with
Aashirvaad atta due to ITC’s linkage with tobacco products, but it has established itself as
the number one branded atta among national branded players within barely two years of
launch due to significant investment in brand building activities and by scaling up the
supply chain to meet the market requirements in cost effective manner. Some of the
10
recommendations that can be incorporated for Aashirvaad atta are collaborating with
government for the supply of atta in military canteen, and also with fast food retail joints in
India by giving them some discount, company can try to export its atta to the countries
where wheat is currently being exported, an aggressive advertising strategy.
Arunmozhi (2011) undertook a study to predict factors influencing purchase of
Aashirvaad brand. From the study it is found that 74 per cent of people who are purchasing
atta are aware of the brand “Aashirwaad” and the company (ITC Ltd.) that produces it.
Consumers of atta are giving more importance to the quality than the price, for the reason
that atta is a food product. Media is playing a significant role in creating awareness for atta.
TV is considered as the powerful media to create awareness. It is found in the study that
product purchase decision is highly influenced by personal experience with the usage of the
brand. Suggestions were made by the researcher that ITC should communicate to the
consumers about the quality standards adhered to while manufacturing the product which
will led positive image towards Aashirvaad atta in the consumers mind. His research
findings state that women of the house has a greater influence on preference of a particular
brand of atta.
Ekta (2009) conducted a study on consumer perception towards MTR instant food
products to find out whether instant food segment is acceptable in India. The study
mentioned that price, freshness and taste are issues to contend with in this product segment.
Her findings conclude that distribution effectiveness and effectiveness of promotional
activities have a relation with consumer response to pricing of products. Advantages that
MTR has in comparison to other competitors brands is that the consumers feel the products
tastes like home food. The distribution network is widely spread and strong. MTR gains a
lot of free publicity due to word of mouth thus reducing their need for promotional
strategies. The research studies suggested that MTR should create awareness that instant
food can be used regularly and it does not have any harmful effects and MTR should also
increase their promotional activities.

11
2.2. Extent of consumer awareness of Instant food products in the
selected areas.

Baskar et al. (2013) examined the consumer awareness towards instant food
products in Cuddalore district, Tamil Nadu. It revealed that consumer buying behavior is
influenced by the traditional way of manufacturing process, ingredients and easy
accessibility. The research also concluded that consumers remain loyal to their brand.
Anand (2013) studied the brand preference of cold-drinks by the consumers in the
rural areas. Majority of the respondents feel that the price of cold-drinks should be reduced
and they prefer Coca-Cola and Limca more as compare to others categories. Majority of the
respondents feel that the price of cold-drinks should be reduced.
Bala et al. (2012) in their study made an attempt to analyze awareness levels and
buying behavior of instant food products by individual households in Hyderabad city,
Andhra Pradesh. The results of the study showed that all the respondents were aware of
pickles and sambar masala but only 56.67 per cent of respondents were aware of dosa/idli
mix. About 96.11 per cent respondents who were aware of dosa/idli mix and more than half
of the respondents who were aware of pickles and sambar masala preferred making them at
home. Low cost of home preparation and differences in taste were the major reasons for
non-consumption. Ready availability and time saved for preparation were the reasons for
consuming instant food products. Retail shops are the major source of information and
source of purchase of Instant Food Products. The average monthly expenditure on Instant
Food Products was found to be highest in higher income groups. The average per capita
purchase and per capita expenditure on Instant food Products had a positive relationship
with income of households. High price and poor taste were the reasons for not purchasing
particular brand whereas best quality, retailers influence and ready availability were
considered for preferring particular brand of products by the consumers.
Ramaiyan (2011) tried to predict the factors influencing purchase of Aashirvaad
brand atta using logistic regression. He has also identified the sources through which the
product awareness is created and analyzed the purchasing pattern behavior of consumers
and their concern for product quality. The study revealed that 74 percent of consumers are
aware of the brand “Aashirvaad”. Media is playing a significant role in creating awareness
for atta and there is a significant difference between the opinion of male and female
respondents towards the quality of atta. It was suggested to launch atta in small packs to
12
target the rural market, give free samples of other products of company along with atta and
target the housewives through door to door canvassing to promote the sales of atta.
Nandagopal and Chinnaiyan (2003) conducted a study on brand preference of soft
drinks in rural Tamil Nadu. The results of the study showed that the level of awareness
among the rural consumers about the brand of soft drinks was high which was indicated by
the mode of purchase of the soft drinks by "Brand Name". They found that the purchase
behaviour is influenced by product quality, followed by retail price. Good quality and
availability were the main factors, which influenced the rural consumers to buy a particular
brand of product. The major source of brand awareness was word of mouth followed by
advertisements, information given by family members, relatives and friends.
Kamalaveni and Nirmala (2000) in their study on consumer behaviour in instant food
products reported that, there is complete agreement between ranking given by the
housewives and working women regarding the reasons promoting them to buy Instant food
products. Age, occupation, education, family size and annual income had much influence
on the per capita expenditure of the Instant food products.
Srinivasan and Elangovan (2000) in his study consumer perception towards
processed fruits and vegetable products reported that, consumer with higher educational
level was found to consume more processed products. The quantities of processed fruit and
vegetable products were consumed more in high-income group. The tolerate limit of price
increase identified was less than 5%, any price change above this limit, would result in
discontinuance of the use of the particular processed product. Consumers preferred
processed products because of convenience of ready to eat form.
Puri and Sanghera (1989) conducted a survey to know the consumption pattern of
processed products in Chandigarh. Jam was found to be most popular irrespective of
income level. Orange squash consumption was maximum in both the high and middle-
income families. Pineapple juice consumption increased with a rise in the income.

2.3. Factors influencing the buying behavior of Instant food products.

Victoria and Ganesan (2014) attempted to analyze the role of sales promotion
towards instant food products and predict their demand. The study identified the
demographic and behavioral factors influenced by sales promotion. It was found that
majority of the consumers of instant food products are young generation people and

13
working people below 45 years who belong to nuclear family with moderate monthly
income. Instant consumption, time saving, taste and convenience are considered as major
factors influencing their purchase. Hence the study recommends manufacturers to pay
much attention to these factors while developing their sales promotion activities.
Anitha and Radhika (2013) conducted a study on consumer behavior towards
instant food products in the modern era. Study is based on the concept that consumer
buying behavior is complex and influenced by many factors which change according to the
changes in the lifestyle of modern human being. Some of the factors they identified which
would influence consumer behavior towards instant food products are income level,
influence of western countries, more global trade and travelling.
Heena and Rajini (2013) has conducted a study which highlighted the consumer
expenditure behavior on Food and Non Food items in India during 1987- 2002. The study
mainly examined the rural and urban consumer expenditure behavior on food and non-food
items and the study also examined the relationship between rural consumption expenditure
and rural household income in India during 1987-88 to 1999-2000. Findings of the research
reveal that during the study period both rural and urban Indian household, percentage share
of food expenditure has decreased, whereas on the other hand share of non food
expenditure has increased. The Compound Growth Rate (CGR) of food expenditure was
observed higher in the urban India rather than rural India. The regression result showed that
there was positive relation between household income and consumption expenditure in
rural part of India.
Malik et al. (2013) examined the impact of brand image and advertisement on
consumer buying behavior of different categories of products in Gujranuala city. Findings
showed that brand image and advertisement have strong positive influence and significant
relationship with consumer buying behavior. People perceive the brand image with positive
attitude. Teenagers in Gujranuala are more conscious about their social status so they prefer
branded products and advertisements affect their consumer buying behavior positively.
Palaneswari and Vijayalakshmi (2013) attempted to identify the important factors
that influence the purchase of instant food products. Study is relevant to present day market
conditions where it is flooded with wide variety of products. The study reveals that
influence of global trade, cheap and economical price and emergence of nuclear families
are the main reasons that make the respondents prefer instant food.

14
Karappuswamy and Arjunan (2012) analyzed the existing buying behavior of instant
food products in Coimbatore. It showed that expenditure on instant food products was found to
be highest in higher income groups. Major reason cited for non-consumption of instant food
products is that the respondents make these food products at less cost and with better taste.
Usha (2007) conducted a study on buying behavior of consumers towards instant food
products in Kolar district. It revealed that the average per capita purchase and per capita
expenditure of Instant food products had a positive relationship with income of households and
housewives are the major decision makers regarding consumption of instant food products.
According to the study dosa/idli consumers were found to be medium loyal, pickles and sambar
masala consumers belonged to higher loyalty group.
Ramaswamy et al. (2005) studied consumer behavior towards instant food products in
Madurai, the second largest city in Tamil Nadu and observed that consumers build opinion
about a brand on the basis of various product features and this will influence their decision
making process. According to the study, a large number of respondents (78per cent) laid
emphasis on quality and 76 per cent on price, while 64 per cent of respondents attached
importance to the image of the manufacturer and 50 per cent considered packaging as an
important factor and an equal percentage (50 per cent) felt longer shelf life as an important
factor while making a purchase decision.
Palkar (2004) conducted research on consumer preference of purchase of Ready To Eat
branded potato chips. On the basis of the research he found that consumer preference depends
mainly on taste, flavor and shape. There is no difference in consumption patterns across various
age groups. The study showed that spicy and salty flavor are preferred by children. Advertising
is effective to grab more attention of the masses. The study also mentioned that most
consumers are purchasing the product for time pass or taste and the companies should improve
upon the promotional schemes in their marketing strategy.
Nagaraja (2004) in his study on consumer behaviour in rural areas: a microlevel
study on buying behaviour of rural consumers has opined that, buying behavior of
consumers is very much influenced by experience of their own and of neighbor consumers
and also his own family. The involvements of his own family members was exerting
maximum influence on his purchases. Above all, the quality of the product and its easy
availability were the primary and the vital determinants of his buying behavior. Consumers
were influenced by touch and feel aspect of any promotional activity.

15
Shivkumar (2004) has conducted a study on buying behaviour of consumers
towards the products produced by SSI units which showed that the consumer, irrespective
of income groups, was mainly influenced to purchase by the opinions of their family
members. Consumers are also influenced by the dealers’ recommendation, followed by
promotional activities like advertisements by the company.
Rees (1992) in his study on revealed that the factors influencing the consumer’s
choice of food are flavor, texture, appearance, advertising, reduction in traditional cooking,
fragmentation of family and an increase in ‘snacking’ etc. Demographic and household role
changes and the introduction of microwave ovens have produced changes in eating habits.
Vigorous sale of chilled and other prepared foods is related to the large numbers, of
working wives and single people, who require and value convenience. Development in
retailing with concentration of 80 per cent of food sales in supermarkets is also considered
to be important. Consumers are responding to messages about safety and health eating.
They are concerned about the way in which food is produced and want safe, ‘natural’, high
quality food at an appropriate price.
Kumar et al. (1987) examined the factors influencing the buying decision making of
200 respondents for various food products in India. Country of origin and brand of the
products were cross-tabulated against age, gender and income. Results revealed that the
factors considered by consumers were independent of age, education and income. The
brand image seemed to be more important than the origin of the product, since the
consumers were attracted by the brands.
Sitamber and Manoher (1980) conducted a study on shopping behavior of
consumers with regard to food purchase and revealed that Indian consumers had no special
choice in choosing his particular shop for making a purchase. In most of the families, the
male head makes the purchases, restricting the choices of other members of the family to
limited variety of goods. He generally selects a shop, which is near to his residence and
where he goes on feet and occasionally uses a bicycle. Generally the average consumers
prefer to buy from the shop, where a credit facility is available and which is easily
approachable.

16
Chapter III
MATERIAL AND METHODS
This chapter presents a comprehensive view of the methodology adopted to
investigate the awareness of consumers about instant food products and factors influencing
the buying behavior of instant food products. This chapter covers the description of study
area, nature and method of data collection, sampling procedure and analytical tools applied
for interpretation of data in attaining the objectives of the study.
The contents of this chapter are presented under the following sub headings.

3.1 Description of study area.

3.2 Nature and sources of data.

3.3 Sampling procedure and data collection.

3.4 Analytical techniques employed.

3.1 DESCRIPTION OF STUDY AREA

The study was conducted in three different cities of Andhra Pradesh i.e, Hyderabad
which is a Tier-I city, Vijayawada which is a Tier-II city and Tirupati which is a Tier-III city.
These are the most densely populated cities in each category of cities, and these cities, and
these cities being developed have huge population who can afford instant foods.
3.2 NATURE AND SOURCES OF DATA

Primary data was collected from households which included consumers of instant
food products. Primary data regarding product awareness, brand awareness, and factors
influencing consumer behaviour was collected from the sample consumers with the help of
questionnaire by using survey method. Secondary data relating to trends in sales of instant
foods, major companies product line, product width, sales and population demographics was
collected from the published sources such as journals, books, periodicals, government offices,
companies’ records and websites.

17
Table 3.1 Salient demographic features of Hyderabad, Vijayawada and Tirupati cities

Sl. No Particulars Hyderabad Vijayawada Tirupati


1 Geographical data
i) Latitude 17.3660° N 16.5083° N 13.6500° N
ii) Longitude 78.4760° E 80.6417° E 79.4200° E
Geographical
iii) area(sq.kms.) 650.00 61.88 24.00
2 Population 6,809,970 1,048,240 287,035
a) Sex-wise
i) Male 3,500,802 524,918 145,977
ii) Female 3,309,168 523,322 141,058
iii) Sex Ratio 954 992 966
b) Literates 2,892,155 789,038 229,730
i) Male Literates 1,542,688 411,677 123,449
ii) Female Literates 1,349,467 377,361 106,281
c) Average Literacy 83.25 82.59% 87.55%
i) Male Literacy 86.99 86.25% 92.74%
ii) Female Literacy 79.35 78.94% 82.21%

Source: http://www.census2011.co.in/census/state/andhra+pradesh.html
http://www.census2011.co.in/district.php
http://www.census2011.co.in/census/state/andhra+pradesh.html

3.3 SAMPLING DESIGN AND DATA COLLECTION

3.3.1 Selection of instant food products

Based on cost and frequency of use of instant food products, the products such as
noodles, pasta, nuggets, pop-corn, French fries, kababs, cutlets, cake mix, papads, gulab
jamun mix, dosa/idli/upma/vada mix, pickles, sausages, instant curry mixes, sambar/rasam
powders and biryani masala were selected after discussion with the local consumers of the
study area about the consumption of instant food products. The particular products were
selected in such a way so as to represent the categories of breakfast, main course and snack
based categories.

18
3.3.2 Sample Selection

To study the buying behavior of consumers towards instant food products, simple
random sampling technique was adopted. In the initial stage, Andhra Pradesh state was
selected by the researcher. In the second stage, three of the cities were selected based on
population density from each category of Tier-I,II and III cities. In the next stage, few
random households at different locations in the city were selected to collect information
about buying behavior of the consumers in the selected cities. Hundred consumers from
each city were selected randomly totally accounting to 300 sample size.

3.3.3 Selection of the respondents

The total samples selected for the study was 300 respondents. In the first phase,
three cities (C1, C2 and C3) of Andhra Pradesh were selected purposively. In the next
phase, a total of 300 sample respondents were selected from these cities. Among 100
samples in each study area, the respondents were post classified into six income groups
(IG1, IG 2, IG 3, IG 4, IG 5 and IG 6) based on their income. Thus, total of 200 female and
100 male sample consumers representing various age groups and income levels were
selected for the study.

3.3.4 Classification of respondents

The respondents were classified into different categories based on gender and
income.

a. Income
Respondents with annual income between Rs. 100,000 to <200,000 were
considered to belong to income group 1 (IG1), those with income group between
Rs. 200,000 to <300,000 were classified into income group 2 (IG2), those with
income of Rs.300,000 to <500,000 were grouped as income group 3 (IG3), those
with income of Rs.500,000 to <800,000 were grouped as income group 4 (IG4),
those with income of Rs.800,000 to <10,00,000 were grouped as income group 3
(IG5) and finally those with income of more than Rs. 10,00,000 were categorized as
income group (IG6).

b. Gender
The respondents were classified into male and female respondents.
19
3.3.5 Collection of Data

To evaluate the objectives of the study, required data was collected from primary
sources as well as secondary sources.

Primary data

The data required for the study was collected from the selected respondents by
personal interview method using well-structured questionnaire. Information on the
following aspects was collected from 300 respondents (100 respondents from each selected
area).
1. General information from the individual respondents on their social, economical
and demographic characteristics like age, educational status, occupation, annual income,
family size and family type.
2. Awareness about various instant food products available in the market, various
brands available in the market, and sources of information.
3. Monthly family expenditure on food and non-food items in general and instant
food products in particular.
4. Information regarding the consumption pattern of instant food products and also
regarding decision making relating to instant food products and type of purchase.
5. Purchase pattern of instant food products and factors influencing the purchase.

Secondary data

The secondary data on location, demography and other details about the study area,
major brands in instant foods, companies in the market, sales of instant foods was collected
from records of governments departments, agencies, company portals, web sources,
journals and magazines.

20
3.4 TOOLS OF ANALYSIS

The collected data were tabulated and analyzed. The tools used for analysis are as
follows.

Frequency and Percentages


The data was subjected to frequencies and percentages to know the distribution of
the respondents according to selected variables. Frequency was the number of times a
variable is repeated. Percentage was used for standardization of size by computing the
number of individuals that would be in a given category.

Tabular analysis

Tabular analysis was used to study the socio-economic characteristics of the sample
respondents like age, educational status, occupation, family size and type, consumer
awareness towards instant food products and brands. The buying behavior of consumers for
instant food products, purchase decision, place of purchase, frequency of purchase, quantity
per purchase and factors influencing the buying behavior were also analyzed using
percentages.

Garrett Ranking Method

The Garrett ranking technique was used to study the opinion of the consumers
regarding various attributes of instant food products.

The ranking given by the respondents to various attributes has been subjected to
Garrett ranking. Garrett percentages were calculated by using the following formulae.
Per cent position = 100 (Rij - 0.5)
Nj

Where,

Rij = Rank given for the ith items by the jth individual.

Nj = Number of items ranked by the jth individual.

21
By using score card prepared by Garret, scores were allocated to the percentage
values. Mean of Garret scores was calculated for each attribute. Attribute with higher mean
score is considered as the higher rank.

Likert scaling technique

Likert scaling technique was used to identify the problems of respondents in buying
and consumption of the instant food products. Likert-type scale assumes that the
strength/intensity of experience/response is linear, i.e. on a continuum from strongly agree
to strongly disagree, and makes the assumption that attitudes can be measured. Respondents
may be offered a choice of five to seven or even nine pre-coded responses with the neutral
point being neither agree nor disagree
In its final form, the Likert scale was used in a five point scale to allow the
farmer/trader express how much they agree or disagree with a particular problem.
1. Strongly disagree
2. Disagree
3. Neither agree nor disagree
4. Agree
5. Strongly agree

22
Chapter IV

RESULTS AND DISCUSSION


In the earlier chapters, a brief review of the past studies, relevant methodology
adopted and the general description of the study area were presented. The data collected
was tabulated according to the purpose and systematic analysis was carried out using
suitable techniques in accordance with the pre-determined objectives of the study. This
chapter deals with the presentation and discussion of results emerged from the research
work. The main focus here is to throw light on some of the causes responsible for the major
outcomes observed in the investigation. For easy understanding and convenience this
chapter is presented under the following heads.
4.1 Socio economic characteristics of the respondents.
4.2 Trends in sales of instant food products of major manufacturing firms in India.
4.3 Extent of consumer awareness of instant food products in the selected area.
4.4 Factors influencing the buying behaviour of instant food products

4.1 SOCIO ECONOMIC CHARACTERISTICS OF THE


RESPONDENTS.
This section provides a comprehensive understanding of sampled respondents data
with respect to occupation, residential status, income status, food habit and type of food
preference of the respondents was collected.
Table 4.1 presents the general information of selected samples in Hyderabad,
Vijayawada and Tirupati cities. It could be seen from the table that 16.67 per cent and
16.00 per cent of the respondents belong to the age groups 36-40 and 41-45. 14 per cent of
the respondents belong to the age group of 31-35. 13.33 per cent were the respondents in
the age group of 25-30. 10.67 per cent and 10.00 per cent of the respondents belong to the
age group 56-60 and 46-50 respectively and 9.33 per cent of the respondents belong to the
age group of 51-55 years..
Table 4.1 shows that 66.67 per cent are female respondents and 33.33 per cent are
male population respondents.

23
Table 4.1 shows the educational status of the respondents. 7.33 per cent of the
respondents are illiterates, 13.67 per cent of the respondents have completed their primary
school education, 18.33 per cent of the respondents have completed their high school
education. 14.33 per cent have completed 12th standard education. 24.67per cent of the
respondents are graduates, 15.67 per cent of the respondents are post-graduates and 6.00
per cent of the respondents hold a doctorate.
Table 4.1 depicts that 85.00 per cent of the selected sample contains nuclear
families and 15 per cent of the sample consist of joint families.
Table 4.1 shows that majority of the respondents i.e., 43.33 per cent belong to small
family size, 39.00 per cent of the respondents belong to medium size family and 16.67 per
cent of the respondents belong to large size family.
Table 4.1 shows that 68.00 per cent of the respondents are non vegetarians and
32.00 per cent of the respondents are vegetarians.
Table 4.1 shows that the data pertaining to the annual income was gathered. 28.00
per cent of the respondents come under the income group 3lakhs-5lakhs. 22.67 per cent of
the respondents fall in the income group range of 5lakhs-8lakhs, 16.33 per cent of the
respondents fall in the income group range of 2lakhs-3lakhs, 12.00 per cent of the
respondents fall in the income range of 1lakh-2lakhs, 11.67 per cent of the respondents
belong to the income group of 8lakhs-10lakhs and 9.33 per cent of the respondents belong
to the income group of more than ten lakhs per month.
Table 4.1 shows the occupational status of the respondents. 25.00 per cent of the
respondents are house wives, 24.00 per cent of the respondents are private employees,
19.00 per cent of the respondents hold business, 17 per cent of the respondents are students
and 14.67 per cent of the respondents are government employees.

24
Table 4.1. Demographic information of respondents in the study area
No. of
Particulars Categories respondents(300) Percentage
Age 25-30 40 13.33
31-35 42 14.00
36-40 50 16.67
41-45 48 16.00
46-50 30 10.00
51-55 28 9.33
56-60 32 10.67
Above 60 30 10.00
Sex Male 100 33.33
Female 200 66.67
Education Illiterate 22 7.33
Primary 41 13.67
High-School 55 18.33
Intermediate 43 14.33
Graduate 74 24.67
Post-graduate 47 15.67
Doctorate. 18 6.00
Family type Joint 45 15.00
Nuclear 255 85.00
Family size Small (below 5) 130 43.33
Medium ( 5-7) 117 39.00
Large (more than 7) 53 16.67
Food habit Vegetarian 96 32.00
Non - vegetarian 204 68.00
Family Income
(annually) Rs IG 1(1L to < 2L) 36 12.00
IG 2(2L to <3L) 49 16.33
IG 3(3L to <5L) 84 28.00
IG 4(5L to <8L) 68 22.67
IG 5(8L to <10L) 35 11.67
IG 6 ( > 10L) 28 9.33
Occupation Student 51 17.00
House wife 75 25.00
Government
employee 44 14.67
Private 72 24.00
Business 58 19.33

25
4.2 TRENDS IN SALES OF INSTANT FOOD PRODUCTS OF MAJOR
MANUFACTURING FIRMS IN INDIA

The year wise sales of the past five years of the selected major companies in instant
foods have been analyzed and presented in the table 4.2.
Table 4.2 shows the sales trend of MTR from 2009 to 2013. In 2009 the sale was
Rs.18797 crores which increased by 57 per cent in 2010 and became Rs.29518 crores. In
2011, the sale was Rs.33423 crores, an increase of 13.23 per cent over the previous year. In
2012, the sales was Rs.35739 an increase of 6.92 per cent over previous year and in 2013,
the sales increased to Rs.38707 an increase of 8.30 per cent.
Table 4.2 shows the sales trend of Nestle from 2009 to 2013. In 2009, the sales was
Rs.5129.4 crores, this increased to Rs.6254 crores with an increase of 21.93 per cent in
2010. The sales of Nestle instant products in 2011 was Rs.7673.6 with a gain percentage of
22.68. In 2012 the sales of the products was Rs.8902.3 crores with a gain percentage of
16.01 in sales and in 2013, the sales of the product increased to Rs.10393.6 crores with an
increase in sales of 16.75 per cent.
Table 4.2 shows the sales of ITC instant products. In 2009, the sales was Rs.2032
crores, which increased to Rs. 2893 in 2010 with an increase of 42.37 per cent. In 2011, the
sales was Rs.3712 crores with a gain in sales of 28.30 per cent, in 2012 the sales was
Rs.5537.39 crores with an increase in sales of 49.18 per cent and in 2013, the sales was
Rs.7033.83 crores with a growth percentage of 27.02.
The sale of Ruchi soya in 2009 was Rs.3708 crores which increased to Rs.3313
crores in 2010 with a gain in sales of 10.65 per cent. In 2011, the sales increased to Rs.3891
crores with a gain in sales of 17.44 percentage. In the year 2012, the sales of ruche soya
was Rs.5544 crores, with a drastic increase of 42.48 per cent and in 2013, the sales was
Rs.6348 crores with an increase of 14.50 per cent over the previous year.
The data with respect to the sale of Hindustan Unilever Limited products in instant
food category shows the sales of 2009 as Rs.4113.4 crores which decreased to Rs.3644.05
crores with a loss in sales of -11.41 per cent. In 2011 the sales was Rs.4057.05 crores with
an increase of 11.33 per cent in sales. In 2012, the sale of instant products in Hindustan
Unilever Limited was Rs.4332.06 crores with a slight increase in sales with 6.77 per cent
and in 2013, the sales was Rs.4802.35 with a growth percentage of 10.85.

26
Table 4.2 Sales trend of major firms in instant products (in Rs.crores)

Year MTR NESTLE ITC RUCHI SOYA HUL


2009 18797 5129.4 2032.00 3708 4113.4
2010 29518 6254.7 2893.00 3313 3644.05
2011 33423 7673.6 3712.00 3891 4057.05
2012 35739 8902.3 5537.59 5544 4332.06
2013 38707 10393.6 7003.83 6348 4802.35

Source: Annual reports of the listed companies.

Figure 4.1. Sales of MTR from 2009-2013


(in crores of Rs.)

MTR Sales
45000
40000
35000
30000
25000
20000 MTR Sales
15000
x axis- years
10000
y axis- sales
5000
0
2008 2009 2010 2011 2012 2013 2014

27
Figure 4.2. Sales of Nestle from 2009-2013
(in crores of Rs.)

Nestle Sales
12000

10000

8000

6000
Nestle Sales
4000 x axis- years
y axis- sales
2000

0
2008 2009 2010 2011 2012 2013 2014

Figure 4.3. Sales of ITC from 2009-2013


(in crores of Rs.)

ITC Sales
8000
7000
6000
5000
4000
ITC Sales
3000
2000
1000
0
2008 2009 2010 2011 2012 2013 2014

28
Figure 4.4. Sales of Ruchi Soya Industries
(in crores of Rs.)

Ruchi Soya Industries Ltd. Sales


7000

6000

5000

4000
Ruchi Soya Industries
3000 Ltd. Sales
2000
x axis- years
1000 y axis- sales
0
2008 2009 2010 2011 2012 2013 2014

Figure 4.5. Sales of Hindustan Unilever Limited

(in crores of Rs.)

Hindustan Unilever Limited Sales


6000

5000

4000

3000 Hindustan Unilever


Limited Sales
2000

1000

0
2008 2009 2010 2011 2012 2013 2014

The data with regard to the sales of various companies involved in instant food business
shows that there is an increasing trend in the sales of instant food products.

29
4.3 EXTENT OF CONSUMER AWARENESS OF INSTANT FOOD
PRODUCTS IN THE SELECTED AREA
4.3.1 Consumer awareness about various instant products
Table 4.3. shows the consumer awareness about various instant products. Among the
breakfast foods, the highest percentage of awareness was observed in atta i.e., 70.67 per
cent. 63.67 per cent was observed in noodles, the next places were occupied by dosa mix
and idli mix with 48.33 per cent and 41.00 per cent respectively. 35.67 per cent of the
consumers were aware of pasta. 33.33 per cent and 28.33 per cent of the consumers were
about vada mix and upma mix respectively.

Among the main courses, pickles occupied the first position with 90.00 per cent of
the respondents being aware. Sambar/Rasam powder occupied the next position with 74.33
per cent respondents being aware. 41.67 per cent of the consumers were aware of instant
biryani mix and 32.67 per cent of consumers were aware of instant curry mixes.
Table 4.3 also shows the consumer awareness levels about snacks. Majority of the
consumers i.e., 65.67 per cent are aware of gulab jamun and other sweet mixes. 64.67 per
cent of consumers are aware of papads and fryums. 53.33 per cent of consumers are aware
of macaroni, 46.33 per cent of the consumers were aware about popcorn, 44 per cent of the
consumers were aware of cake mix, 37.33 per cent of the consumers were aware of french
fries/sledges, 36.67 per cent were aware about nuggets, 26.67 per cent of the consumers
were aware of sausages and 18.33 per cent of consumers were aware of cutlets and kebabs.

30
Table 4.3. Consumer awareness about various instant food products.

Product Awareness level Level of awareness


Category Types of Products (No. of respondents) in per cent terms
Idli mix 123 41.00
Dosa mix 145 48.33
Vada mix 100 33.33
Breakfast Upma mix 85 28.33
Products Noodles 191 63.67
Pasta 107 35.67
Atta 212 70.67
Chapaties/Parathas 32 10.67
Instant biryani mix 125 41.67
Main Instant curry mixes 98 32.67
courses Sambar /Rasam powder 223 74.33
Pickles 270 90.00
Pop corn 139 46.33
Macaroni 160 53.33
French Fries/Sledges 112 37.33
Nuggets (Veg/Non-
Veg) 110 36.67
Snacks Cutlets and Kebabs
(Veg/Non-Veg) 55 18.33
Gulab jamun mix and
other sweet mixes 197 65.67
Cake mix 132 44.00
Papads & Fryums 194 64.67
Sausages 80 26.67

4.3.2. Consumer awareness about various brands


Table 4.4 shows the consumer awareness about various brands existing in the
market. Majority of the consumers i.e., 93.33 per cent are aware about Maggie, followed by
Bambino with 90 per cent awareness amongst the consumers. 86.67 per cent of the
consumers are aware of Aashirwad, 82 per cent are aware of Priya brand. 70 per cent of
consumers are aware of MTR, 68.33 per cent of the consumers are aware of Everest brand,
60 per cent of the consumers are aware of Top Ramen, 56 per cent of the consumers are
aware of Swastik, 54.33 per cent are aware of Knorr, 46.67 per cent are aware of Ruchi,
36.33 per cent are aware of Chings, 30 per cent of the consumers are aware of Yippie,

31
26.67 per cent are aware of Iyengar, 16.67 per cent are aware of Mc.Cain and 8.33 per cent
of the consumers are aware of Wai Wai.

Table 4.4 Consumer awareness about various brands

Awareness level
Sl.No Brands of Products (No. of respondents) Awareness per cent
1 MTR 210 70.00
2 Ruchi 140 46.67
3 Aashirwaad 260 86.67
4 Top Ramen 180 60.00
5 Yippie 90 30.00
6 Swastik 168 56.00
7 Wai wai 25 8.33
8 Maggie 280 93.33
9 Priya 246 82.00
10 Bambino 270 90.00
11 Everest 205 68.33
12 Iyengar 80 26.67
13 Mccain 50 16.67
14 Knorr 163 54.33
15 Chings 109 36.33

4.3.3 Source of information about instant food products


Table 4.5 shows the various sources of information to respondents about instant
foods. Mass media advertisements occupy the first position with a mean score of 66.42 and
first rank. Print media advertisements occupy the second rank with a mean score of 50.08,
demonstrations occupy the third rank with mean score 46.75, retailers display comes next
to demonstrations with a mean score of 39.83 and fourth rank. Consumers have given
friends/relatives fifth rank with a mean score of 38.50, sponsorship programs are given 6th
rank with a mean score of 38.25. Public campaigns have been given seventh rank with a
mean score of 36.25. Tents/taste samples get the eighth rank with a mean score of 35.08
followed by free samples with a mean score of 31.08 and ninth rank.

32
Table 4.5. Source of information about instant foods to respondents.

Sl.No Source of Information Mean Score Garett Rank

1 Retailers display 39.83 IV

2 Print media advertisements 50.08 II


Mass media advertisements
3 (TV/Radio) 66.42 I

4 Friends/Relatives 38.50 V

5 Free Samples 31.08 IX

6 Demonstrations 46.75 III

7 Sponsorship Programs 38.25 VI

8 Tents, Taste samples 35.08 VIII

9 Public campaigns 36.25 VII

4.4 FACTORS INFLUENCING THE BUYING BEHAVIOR OF


INSTANT FOOD PRODUCTS
4.4.1 Share of instant foods in total food products
Table 4.3.1 shows the share of instant foods in total food products bought by the
sample respondents. 10 per cent of the respondents have stated that they buy less than 2 per
cent of instant foods. 13 per cent of the respondents have said that 2-5 per cent of their total
purchase of food products are instant foods, 14.33 per cent of the respondents revealed that
share of 5-10 per cent of instant foods, for 32 per cent of the respondents share of instant
foods in their total purchase of foods is 10-15 per cent, and 30.67 per cent of the sample
respondents have said 15-25 per cent of their total food purchase forms instant foods.

33
Table 4.6 Percent of instant foods in total food purchase.

Share of instant foods


Sl.
in total purchase of No Of Consumers Consumer percentage
No.
foods
1 < 2% 30 10.00
2 2-5% 39 13.00
3 5-10% 43 14.33
4 10-15 % 96 32.00
5 15-25% 92 30.67

4.4.2 Influencers of purchase decision.

Table 4.7 shows the list of various influencers on purchase decision made by the
consumers in buying instant foods belonging to different categories- breakfast, main course
and snacks. Among the breakfast foods, 39 i.e., 13 per cent get influenced by parents, 176
i.e., 58.67 per cent get influenced by their children. 40 i.e., 13.3 per cent of the consumers
decision on instant breakfast foods is made by the influence of friends/relatives/peer group
and neighbours. 25 i.e., 8.33 per cent of the respondents get influenced by shopkeepers and
20 i.e., 6.6.7 per cent of the respondents get influenced by the promotional staff of the
company.
Among the main course, 51(17 per cent) of the respondents get influenced by
parents, 138(46 per cent) of the respondents get influenced by their children, 84(28.00) get
influenced by friends/relatives/peer group/relatives. 22(7.33 per cent) of the respondents get
influenced by the shopkeepers and 5(1.67 per cent) respondents get influenced by the
promotional staff of company.
Among snacks, 43(14.33 per cent) get influenced by parents, 156(52 per cent) get
influenced by their children, 53(17.67 per cent) get influenced by friends/relatives/peer
group/neighbours, 41(13.67 per cent) get influenced by shop keepers and 7(2.33 per cent)
of the sample respondents get influenced by the promotional staff of the company.

34
Table 4.7 Influencers of purchase decision

Sl.No. Influencers Breakfast Main course Snacks


1 Parents 39(13.00) 51(17.00) 43(14.33)
2 Children 176(58.67) 138(46.00) 156(52.00)
3 Friends/relatives/peergroup/neighbours 40(13.33) 84(28.00) 53(17.67)
4 Shop keepers 25(8.33) 22(7.33) 41(13.67)
5 Promotional staff of company 20(6.67) 5(1.67) 7(2.33)

4.4.3. Consumer perception towards instant food products.


Consumer perception towards instant foods is shown in the table 4.8. 34(11.33 per
cent) of the respondents strongly agreed that instant foods are healthy, 54(18 per cent) of
the respondents agree that instant foods are healthy, 67(22.33 per cent) of the respondents
remained neutral, 98(32.67 per cent) of the respondents disagree that instant foods are
healthy, 47(15.57 per cent) of the respondents strongly disagree that instant foods are
healthy.
28(9.33 per cent) of the consumers strongly agree that instant foods are highly
nutritious, 57(19 per cent) of the respondents agree that instant foods are highly nutritious,
78(26 per cent) of the respondents felt neutral, 77(25.67 per cent) of the respondents
disagree that instant foods are highly nutritious, 60(20 per cent) of the respondents strongly
disagree that instant foods are highly nutritious.
112(37.33 per cent) of the respondents strongly agree that instant foods are tasty,
83(27.67 per cent) of the respondents agree that instant foods are tasty, 42(14 per cent) of
the respondents were neutral with regard to taste factor, 34(11.33 per cent) of the
respondents disagree that instant foods are tasty, 34(11.33 per cent) of the respondents
disagree that instant foods are tasty and 29(9.67 per cent) of the respondents strongly
disagree that instant foods are tasty.
78(26 per cent) of the respondents strongly agree that instant foods are time saving,
74(24.67 per cent) of the respondents agree that instant foods are time saving, 56(18.67 per
cent) of the respondents remained neutral, 58(19.33 per cent) of the respondents disagreed

35
that instant foods are time saving and 34(11.33 per cent) of the respondents strongly
disagree that instant foods are time saving.
78(26 per cent) of the respondents strongly agree that instant foods are expensive,
88(29.33 per cent) of the respondents agreed that instant foods are expensive, 53(17.67 per
cent) remained neutral to the statement, 51(17 per cent) of the respondents disagreed that
instant foods are expensive, 30(10 per cent) of the respondent strongly disagree that instant
foods are expensive.
With regard to the ease of preparation, 123(41 per cent) of the respondents strongly
feel that instant foods are easy to prepare, 79(26.33 per cent) of the respondents agree that
instant foods are easy to prepare, 40(13.33 per cent) of the respondents remained neutral,
46(15.33 per cent) disagreed that instant foods are easy to prepare, 12(4 per cent) of the
respondents strongly disagreed that instant foods are easy to prepare.
45(15 per cent) of the respondents strongly agree that instant foods are quality
food, 56(18.67 per cent) of the respondents agree that instant foods are quality food,
46(15.33 per cent) of the respondents remained neutral, 80(26.67 per cent) of the
respondents disagree that instant foods are quality food, 73(24.33 per cent) of the
respondents strongly disagree that instant foods are quality food.
With respect to the availability of instant foods, 89(29.67 per cent) of the
respondents strongly agree that instant foods are available anywhere, 92(30.67 per cent) of
the respondents agree that instant foods are available anywhere, 60(20 per cent) of the
respondents remained neutral, 46(15.33 per cent) of the respondents disagree that instant
foods are available anywhere and 13(4.33 per cent) of the respondents strongly disagree
that instant foods are available anywhere.
83(27.67 per cent) of the respondents strongly agree that instant foods are trendy,
71(23.67 per cent) of the respondents agree that instant foods are trendy, 80(26.67 per cent)
of the respondents remained neutral to the statement, 30(10 per cent) of the respondents
disagreed that instant foods are trendy and 36(12 per cent) of the respondents strongly
disagree that instant foods are trendy.
Packaging is an important aspect for any FMCG good, more so in food products to
preserve the quality and taste of the product. 89(29.67 per cent) of the respondents strongly
agree that instant foods are well packed, 72(24 per cent) of the respondents agree that
instant foods are well packed, 72( 24 per cent) remained neutral to the statement, 38(12.67

36
per cent) disagreed that instant foods are well packed, 29(9.67 per cent) of the respondents
strongly disagreed that instant foods are well packed.
90(30 per cent) of the respondents strongly agree that instant foods are convenient,
89(29.67 per cent) of the respondents agree that instant foods are convenient, 48(16 per
cent) of the respondents remained neutral to the statement, 43(23.33 per cent) of the
respondents disagree that instant foods are convenient and 30(10 per cent) of the
respondents strongly disagree that instant foods are convenient.
With respect to the addition of preservatives, 124(41.33 per cent) of the respondents
strongly agree that preservatives are added to instant foods, 70(23.33 per cent) of the
respondents agree that preservatives are added to instant foods, 20(6.67 per cent) of the
respondents remained neutral, 46(15.33 per cent) of the respondents disagree that
preservatives are added to instant foods, 40(13.33 per cent) of the respondents strongly
disagree that preservatives are added to instant foods.
34(11.33 per cent) of the respondents strongly agree that instant foods are odd
flavoured food, 58(19.33 per cent) of the respondents agree that instant foods are odd
flavoured food, 54(18 per cent) of the respondents remained neutral, 78(26 per cent) of the
respondents disagree that instant foods are odd flavoured food, 76(25.33 per cent) of the
respondents strongly disagree that instant foods are odd flavoured food.
66(22 per cent) of the respondents strongly agree that instant foods are difficult to
store, 56(18.67 per cent) of the respondents agree that instant foods are difficult to store,
57(19 per cent) of the respondents remained neutral to the statement, 65(21.67 per cent) of
the respondents disagree that instant foods are difficult to store, 56(18.67 per cent) of the
respondents strongly disagree that instant foods are difficult to store. 55(18.33 per cent) of
the respondents strongly agree that instant foods are wholesome, 65(21.67 per cent) of the
respondents agree that instant foods are wholesome, 55(18.33 per cent) of the respondents
remained neutral to the statement, 68(22.67 per cent) of the respondents disagree that
instant foods are wholesome and 57(19 per cent) of the respondents strongly disagree that
instant foods are wholesome.

37
Table 4.8 Consumer perception towards instant food
S. Strongly Strongly
Description Agree Neutral Disagree
No. agree Disagree
1 Healthy 34(11.33) 54(18.00) 67(22.33) 98(32.67) 47(15.67)
2 Highly Nutritious 28(9.33) 57(19.00) 78(26.00) 77(25.67) 60(20.00)
3 Tasty 112(37.33) 83(27.67) 42(14.00) 34(11.33) 29(9.67)
4 Time saving 78(26.00) 74(24.67) 56(18.67) 58(19.33) 34(11.33)
5 Expensive 78(26.00) 88(29.33) 53(17.67) 51(17.00) 30(10.00)
6 Ease in preparation 123(41.00) 79(26.33) 40(13.33) 46(15.33) 12(4.00)
7 Quality food 45(15.00) 56(18.67) 46(15.33) 80(26.67) 73(24.33)
8 Available any where 89(29.67) 92(30.67) 60(20.00) 46(15.33) 13(4.33)
9 Trendy food 83(27.67) 71(23.67) 80(26.67) 30(10.00) 36(12.00)
10 Well packed 89(29.67) 72(24.00) 72(24.00) 38(12.67) 29(9.67)
11 Convenience food 90(30.00) 89(29.67) 48(16.00) 43(14.33) 30(10.00)
12 Preservatives added 124(41.33) 70(23.33) 20(6.67) 46(15.33) 40(13.33)
13 Odd flavored food 34(11.33) 58(19.33) 54(18.00) 78(26.00) 76(25.33)
14 Difficulty in storage 66(22.00) 56(18.67) 57(19.00) 65(21.67) 56(18.67)
15 Wholesome food 55(18.33) 65(21.67) 55(18.33) 68(22.67) 57(19.00)

4.4.4. Future purchase behaviour of respondents


The future action of the respondents with regard to their purchase behaviour have
been noted under different situations in table 4.9. 40(13.33 per cent ) of the respondents
have strongly agreed that they would buy more of instant products if they get more income,
69(23 per cent) of respondents have agreed that they would buy more of instant products if
they get more income, 100(33.33 per cent) of the respondents remained neutral to the
statement, 60(20 per cent) of the respondents have disagreed that they would buy more
instant products when they get more income and 31(10.33 per cent) of the respondents
strongly disagree that they would buy more instant products when they get more income.
75(25 per cent) of the respondents strongly agree that they would buy more instant products
when there are more reasonable prices, 90(30 per cent) of the respondents agree that they
would buy more instant products when there are more economical prices. 56(18.67 per
cent) of the respondents remained neutral to the statement, 58(19.33 per cent) of the
38
respondents have disagreed that they would buy more instant products when the prices
decrease and 21(7 per cent) of the respondents have strongly disagreed that they would buy
more instant products when there are more economical prices.
With regard to the appearance of the products, 60( 20 per cent) of the respondents
have strongly agreed that they would buy more buy more instant products when there is a
better appearance of the products, 87(29 per cent) of the respondents have agreed that they
would buy more instant products when there is a better appearance of the products, 69(23
per cent) of the respondents have remained neutral to the statement, 51(17 per cent) of the
respondents have disagreed that they would buy more instant products when there is a
better appearance of the products and 33(11 per cent) of the respondents have strongly
disagreed that they would buy more instant products when there is a better appearance of
the products.
With regard to the taste of the instant food products, 99(33 per cent) of the
respondents have strongly agreed that they would buy more instant products when there is a
better taste of the products, 97(32.33 per cent) of the respondents have agreed that they
would buy more instant products when there is a better taste of the products, 25(8.33) of the
respondents remained neutral to the statement, 45(15 per cent) of the respondents disagreed
that they would buy more instant products when there is a better taste of the products and
34(11.33 per cent) of the respondents have strongly disagreed that they would buy more
instant products when there is a better taste of the products.
With regard to the brand image, 75(25 per cent) of the respondents have strongly
agreed that they would buy instant products when there are more recognizable brands and
labels, 44(14.67 per cent) of the respondents have agreed that they would buy more instant
products when there are more recognizable brands and labels, 30(10 per cent) of the
respondents have remained neutral to the statement, 87(29 percent) of the respondents have
disagreed that they would buy more instant products when there are more recognizable
brands and labels and 64(21.33 per cent) of the respondents have strongly disagrees that
they would buy more instant products when there are more recognizable brands and labels.
With regard to the shelf life of the instant food products, 74(24.67 per cent) of the
respondents strongly agree that they would buy more instant products when there is a
longer shelf life to the products, 87(29 per cent) of the respondents have agreed that they
would buy more instant products when there is a longer shelf life to the products, 60(20 per

39
cent) of the respondents remained neutral to the statement, 44(14.67 per cent) of the
respondents have disagreed that they would buy more instant products when there is a
longer shelf life to the products and 35(11.67 per cent) of the respondents have strongly
disagreed that they would buy more instant products when there is a longer shelf life to the
products.
With regard to the advertisements, 66(22 per cent) of the respondents have strongly
agreed that they would buy more instant products when there are more advertisements,
70(23.33 per cent) of the respondents have agreed that they would buy more instant
products when there are more advertisements, 49(16.33 per cent) of the respondents
remained neutral to the statement, 57(19 per cent) of the respondents have disagreed that
they would buy more instant products when there are more advertisements and 58(19.33
per cent) of the respondents have strongly disagreed that they would buy more instant
products when there are more advertisements.
With regard to the wide products range, 88(29.33 per cent) of the respondents have
strongly agreed that they would buy more instant products when there are more variants
available, 91(30.33 per cent) of the respondents have agreed that they would buy more
instant products when there are more variants available, 34(11.33 per cent) of the
respondents remained neutral to the statement, 47(15.67 per cent) of the respondents have
disagreed that they would buy more instant products when there are more variants available
and 40(13.33 per cent) of the respondents have strongly disagreed that they would buy
more instant products when there are more variants available.
With regard to the fortification, 32(10.67 per cent) of the respondents have strongly
agreed that they would buy more instant products when fortification is done, 43(14.33 per
cent) of the respondents have agreed that they would buy more instant products when
fortification is done, 98(32.67 per cent) of the respondents remained neutral to the
statement, 78(26 per cent) of the respondents disagreed that they would buy more instant
products when fortification is done and 49(16.33 per cent) of the respondents have strongly
disagreed that they would buy more instant products when fortification is done. 79(26.33
per cent) of the respondents have strongly agreed that they would buy more instant products
when there is more wholesome food, 85(28.33 per cent) of the respondents have agreed that
they would buy more instant products when there is more wholesome food, 68(22.67 per
cent) of the respondents have remained neutral to the statement, 46(15.33 per cent) of the

40
respondents have disagreed that they would buy more instant products when there are more
wholesome food categories and 22(7.33 per cent) of the respondents have strongly
disagreed that they would buy more instant products when there are more wholesome food
categories.
With regard to the pack size, 79(26.33 per cent) of the respondents have strongly
agrees that they would buy more instant products when there are variable pack sizes, 72(24
per cent) of the respondents have agreed that they would buy more instant products when
there is availability of variable pack sizes, 45(15 per cent) of the respondents remained
neutral to the statement and 58(19.33 per cent) of the respondents have disagreed that they
would buy more instant products when there are variable pack sizes and 46(15.33 per cent)
of the respondents have strongly disagreed that they would buy more instant products when
there are variable pack sizes.
Table 4.10 shows the various situations where would be a fall in demand for instant
foods. 56(18.67 per cent) of the respondents strongly agree that they would not buy instant
products when the price increases, 72(24 per cent) of the respondents agree that they would
not buy the instant products when the price increases, 89(29.67 per cent) of the respondents
remained neutral to the statement, 46(15.33 per cent) of the respondents disagree that they
would not buy instant products when the price increases and 37(12.33 per cent) of the
respondents strongly disagree that they would not buy instant products when the price
increases.
With regard to the quantity, 64(21.33 per cent) of the respondents strongly agreed
that they would not buy instant products when the quantity decreases, 69(23 per cent) of the
respondents agree that they would not buy instant products when the quantity decreases,
56(18.67 per cent) of the respondents remained neutral to the statement, 67(22.33 per cent)
of the respondents disagreed that they would not buy instant products when the quantity
decreases and 44(14.67 per cent) of the respondents strongly disagreed that they would not
buy instant products when the quantity decreases.
With regard to the shelf life, 68(22.67 per cent) of the respondents have strongly
agreed that they would not buy instant products when there is a decrease in shelf life, 54(18
per cent) of the respondents agreed that they would not buy instant products when there is a
decrease in shelf life, 78(26 per cent) of the respondents remained neutral to the statement,
56(18.67 per cent) of the respondents disagreed that they would not buy instant products

41
when there is no improvement in shelf life and 44(14.67 per cent) of the respondents
strongly disagreed that they would not buy instant products when there is no improvement
in shelf life.
With regard to the health hazards, 80(26.67 per cent) of the respondents have
strongly agreed that they would not buy instant products when there is more awareness
about health hazards, 58(19.33 per cent) of the respondents have agreed that would not buy
instant products when there is more awareness about health hazards, 50(16.67 per cent) of
the respondents have remained neutral to the statement, 54(18 per cent) of the respondents
have disagreed that they would not buy instant products when there is more awareness
about health hazards and 58(19.33 per cent) of the respondents have strongly disagreed that
they would not buy instant products when there is more awareness about the health hazards.
With regard to the promotional activities, 55(18.33 per cent) of the respondents
have strongly agreed that they would not buy instant food products when there are
decreased promotional activities, 38(12.67 per cent) of the respondents have agreed that
they would not buy instant food products when there are decreased promotional activities,
88(29.33 per cent) of the respondents remained neutral to the statement, 77(25.67 per cent)
of the respondents have disagreed that they would not buy instant products when there are
decreased promotional activities and 42(14 per cent) of the respondents strongly disagree
that they would not buy instant products when there are decreased promotional activities.

42
Table 4.9 Future purchase behaviour of respondents- situations when they would
increase their purchase.

Description Strongly Agree Neutral Disagree Strongly


S.No agree Disagree
More Income 40(13.33) 69(23.00) 100(33.33) 60(20.00) 31(10.33)
1

More economical 75(25.00) 90(30.00) 56(18.67) 58(19.33) 21(7.00)


2
prices
Better appearance 60(20.00) 87(29.00) 69(23.00) 51(17.00) 33(11.00)
3

Better taste 99(33.00) 97(32.33) 25(8.33) 45(15.00) 34(11.33)


4

More recognizable 75(25.00) 44(14.67) 30(10.00) 87(29.00) 64(21.33)


5
labels and brands
Longer shelf life 74(24.67) 87(29.00) 60(20.00) 44(14.67) 35(11.67)
6

More advertisements 66(22.00) 70(23.33) 49(16.33) 57(19.00) 58(19.33)


7

More Variants 88(29.33) 91(30.33) 34(11.33) 47(15.67) 40(13.33)


8

32(10.67) 43(14.33) 98(32.67) 78(26.00) 49(16.33)


9 Fortification is done

More wholesome food 79(26.33) 85(28.33) 68(22.67) 46(15.33) 22(7.33)


10

Variable pack sizes 79(26.33) 72(24.00) 45(15.00) 58(19.33) 46(15.33)


11

43
Table 4.10 Future purchase behaviour of respondents- situations when there is
decrease in demand.
Description Strongly Agree Neutral Disagree Strongly
S.No agree Disagree
Price increases 56(18.67) 72(24.00) 89(29.67) 46(15.33) 37(12.33)
1
Quantity decreases 64(21.33) 69(23.00) 56(18.67) 67(22.33) 44(14.67)
2
No improvement in 68(22.67) 54(18.00) 78(26.00) 56(18.67) 44(14.67)
3 shelf life
More awareness 80(26.67) 58(19.33) 50(16.67) 54(18.00) 58(19.33)
4 about health hazards
Decreased 55(18.33) 38(12.67) 88(29.33) 77(25.67) 42(14.00)
5 promotional activities

4.4.5. Parameters of quality


Quality is an aspect which is reflected through various parameters. These
parameters include packaging, place of availability, price, nutritional value, addition of
preservatives etc. Table 4.11 shows the ranking given by the consumer respondents with
regard to the quality parameters of instant foods as a category. Packaging is given 1 st rank
with a mean score of 58.75, price is given 2nd rank with a men score of 56.42, place of
availability is given 3rd rank with 53.17 mean score, nutritional value is given 4th rank with
46.83 mean score, preservatives added are given 5th rank with a mean score of 44.67,
certification is given 6th rank with a mean score of 43.25, ingredients added are given 7th
rank with a mean score of 32.42 and recipe presentation is given 8th rank with a mean score
of 25.42.

44
Table 4.11 Parameters of quality
S.No. Parameters Total Score Mean Score Garett Rank
1 Price 16925 56.42 II
2 Preservatives 13400 44.67 V
3 Packaging 17625 58.75 I
4 Nutritional value 14050 46.83 IV
5 Ingredients 9725 32.42 VII

6 Recipe presentation 7625 25.42 VIII


7 Place of availability 15950 53.17 III

8 Certification 12975 43.25 VI

4.4.6. Nature of purchase decision


The purchase decision taken by the consumers regarding various categories of foods
have been listed in the table 4.12. Among the breakfast foods, 190(63.33 per cent) of the
respondents have said that they taken a planned decision and 110(36.67 per cent) of the
respondents have said that they take an impulsive decision. Among the main course,
140(46.67 per cent) of the respondents have said that they take a planned decision and
160(53.33 per cent) of the respondents take an impulsive decision. Among the snack foods,
198(66 per cent) of the respondents take a planned decision and 102(34 per cent) of the
respondents take an impulsive decision.

Table 4.12 Nature of purchase decision


Sl.No Category Planned Impulsive
1 Breakfast 190(63.33) 110(36.67)
2 Main Course 140(46.67) 160(53.33)
3 Snacks 198(66.00) 102(34.00)

4.4.7. Preference of purchase location


Table 4.13 shows the preference buying location of respondents for various types
of foods. Among the breakfast foods, 98(32.67 per cent) of the respondents prefer super
market chains, 43(14.33 per cent) of the respondents prefer discount stores, 103(34.33 per
cent) of the respondents prefer retail stores and 56(18.67 per cent) of the respondents prefer
45
mom and pop shops. With regard to main course foods, 64(21.33 per cent) of the
respondents prefer super market chains, 78(26 per cent) of the respondents prefer discount
stores, 112(37.3 per cent) of the respondents prefer retail stores and 46(15.33 per cent) of
the respondents prefer mom and pop shops. Among the snack foods, 78(26 per cent) of the
respondents prefer super market chains, 32(10.67 per cent) of the respondents prefer
discount stores, 94(31.33 per cent) of the respondents prefer retail stores and 96(32 per
cent) of the respondents prefer mom and pop shops.

Table 4.13 Preference of purchase location


Sl.No. Place of Purchase Break fast Main course Snacks
1 Super market chains 98(32.67) 64(21.33) 78(26.00)
2 Discount stores 43(14.33) 78(26.00) 32(10.67)
3 Retail stores 103(34.33) 112(37.33) 94(31.33)
4 Mom and pop shops 56(18.67) 46(15.33) 96(32.00)

4.4.8. Brand Preference


Table 4.14 shows the consumers opinions towards the brand preference. 75(25 per
cent) of the respondents strongly agree that brand image plays a major role in brand
preference, 96(32 per cent) of the respondents agree that brand image plays a major role in
brand preference, 60(20 per cent) of the respondents remained neutral, 36(12 per cent) of
the respondents disagreed that brand image plays a major role in brand preference and
33(11 per cent) of the respondents strongly disagree that brand image plays a major role in
brand preference.
With regard to the company image, 70(23.33 per cent) of the respondents strongly
agree that company image plays a major role in brand preference, 90(30 per cent) of the
respondents agree that company image plays a major role in brand preference, 80(26.67 per
cent) of the respondents remained neutral to the statement, 32(10.67 per cent) of the
respondents disagreed that company image plays a major role in the brand preference and
28(9.33 per cent) of the respondents strongly disagree that company image plays a major
role in brand preference.
With regard to the nutritional aspects, 88(29.33 per cent) of the respondents strongly
agree that nutritional aspects play a major role in brand preference, 100(33.33 per cent) of

46
the respondents agree that nutritional aspects play a major role in brand preference,
37(12.33 per cent) of the respondents remained neutral to the statement, 43(14.33 per cent)
of the respondents disagreed that nutritional aspects play a major role in brand preference
and 32(10.67 per cent) of the respondents strongly disagreed that nutritional aspects play a
major role in brand preference.
With regard to the taste, 122(40.76 per cent) of the respondents strongly agree that
taste plays a major role in brand preference and 178(59.33 per cent) of the respondents
agreed that taste plays a major role in brand preference.
With regard to the price,106(35.33 per cent) of the respondents strongly agree that
price plays a major role in brand preference, 73(24.33 per cent) of the respondents agree
that price plays a major role in brand preference, 38(12.67 per cent) of the respondents
remained neutral to the statement, 48(16 per cent) of the respondents disagreed that price
plays a major role in brand preference and 35(11.67 per cent) of the respondents strongly
disagree that price plays a major role in brand preference.
With regard to the packaging/labeling, 90(30 per cent) of the respondents strongly
feel that packaging/labeling plays a major role in brand preference, 99(33 per cent) of the
respondents agrees that packaging/labeling plays a major role in brand preference, 59(19.67
per cent) of the respondents remained neutral to the statement, 30(10 per cent) of the
respondents disagreed that packaging/labeling plays a major role in brand preference and
22(7.33 per cent) of the respondents strongly disagreed that packaging/labeling plays a
major role in brand preference.
With regard to the flavor, 139(46.33 per cent) of the respondents strongly agree that
flavor plays a major role in brand preference, 50(16.67 per cent) of the respondents agree
that flavor plays a major role in brand preference, 30(10 per cent) of the respondents
remained neutral to the statement, 67(22.33 per cent) of the respondents disagree that flavor
plays a major role in brand preference and 14(4.67 per cent) of the respondents strongly
disagree that flavor plays a major role in brand preference.
With regard to the quality, 127(42.33 per cent) of the respondents strongly agree
that quality plays a major role in brand preference, 161(53.67 per cent) of the respondents
agree that quality plays a major role in brand preference and 12(4 per cent) of the
respondents remained neutral to the statement.

47
With regard to the quantity, 56(18.67 per cent) of the respondents strongly agree
that quantity plays a major role in brand preference, 167(55.67 per cent) of the respondents
agree that quantity plays a major role in brand preference. 15(5 per cent) of the respondents
remained neutral to the statement, 32(10.67 per cent) of the respondents disagreed that
quantity plays a major role in brand preference, 30(10 per cent) of the respondents strongly
disagree that quantity plays a major role in brand preference.
With regard to the availability of instant food products, 85(28.33 per cent) of the
respondents strongly agree that easy availability plays a major role in brand preference,
95(31.67 per cent) of the respondents agree that easy availability plays a major role in
brand preference, 43(14.33 per cent) remained neutral to the statement, 40(13.33 per cent)
disagreed that easy availability plays a major role in brand preference and 37(12.33 per
cent) strongly disagreed that easy availability plays a major role in brand preference.
With regard to the advertisements, 76(25.33 per cent) of the respondents strongly
agree that advertisements play a major role in brand preference, 96(32 per cent) of the
respondents agree that advertisements play a major role in brand preference, 36(12 per
cent) of the respondents remained neutral to the statement, 52(17.33 per cent) of the
respondents disagreed that advertisements play a major role in brand preference and
40(13.33 per cent) of the respondents strongly disagreed that advertisements play a major
role in brand preference.
With regard to the packaging, 98(32.67 per cent) of the respondents strongly agree
that standard packaging plays a major role in brand preference, 94(31.33 per cent) of the
respondents agree that standard packaging plays a major role in brand preference, 45(15 per
cent) ) of the respondents remained neutral to the statement, 34(11.33 per cent) of the
respondents disagree that standard packaging plays a major role in brand preference and
29(9.67 per cent) of the respondents strongly disagree that standard packaging plays a
major role in brand preference.
With regard to the retailers influence, 45(15.00 per cent) of the respondents strongly
agree that retailers influence plays a major role in brand preference, 39(13.00 per cent) of
the respondents agree that retailers influence plays a major role in brand preference,
50(16.67 per cent) of the respondents remained neutral to the statement, 77(25.67 per cent)
of the respondents disagree that retailers influence plays a major role in brand preference

48
and 89(29.67 per cent) of the respondents strongly disagree that retailers influence plays a
major role in brand preference.
With regard to the availability of variants, 78(29.67 per cent) of the respondents
strongly agree that availability of variants plays a major role in brand preference, 87(29.00
per cent) of the respondents agree that availability of variants plays a major role in brand
preference, 69(23 per cent) of the respondents remained neutral to the statement, 44(14.67
per cent) of the respondents disagree that availability of variants plays a major role in brand
preference and 22(7.33 per cent) of the respondents strongly disagree that availability of
variants plays a major role in brand preference.
With regard to the preservatives added to the instant food products, 67(22.33 per
cent) of the respondents strongly agree that less preservatives plays a major role in brand
preference, 89(29.67 per cent) of the respondents agree that less preservatives plays a major
role in brand preference, 39(13 per cent) of the respondents remained neutral to the
statement, 42(14 per cent) of the respondents disagree that preservatives plays a major role
in brand preference and 63(21 per cent) of the respondents strongly disagree that
preservatives plays a major role in brand preference.
With regard to the shelf life, 72(24 per cent) of the respondents strongly agree that
shelf life plays a major role in brand preference, 84(28 per cent) of the respondents agree
that shelf life plays a major role in brand preference, 36(12 per cent) of the respondents
remained neutral to the statement, 63(21 per cent) of the respondents disagree that shelf life
plays a major role in brand preference and 45(15 per cent) of the respondents strongly
disagree that shelf life plays a major role in brand preference.
With regard to the CSR activities, 45(15.00 per cent) of the respondents strongly
agree that CSR emphasis plays a major role in brand preference, 71(23.67 per cent) of the
respondents agree that CSR emphasis plays a major role in brand preference, 60(20.00 per
cent) of the respondents remained neutral to the statement, 79(26.33 per cent) of the
respondents disagree that CSR emphasis plays a major role in brand preference and 45(15
per cent) of the respondents strongly disagree that CSR emphasis plays a major role in
brand preference.
With regard to the free gifts, 80(26.67 per cent) of the respondents strongly agree
that free gifts play a major role in brand preference, 93(31.00 per cent) of the respondents
agree that free gifts play a major role in brand preference, 30(10.00 per cent) of the

49
respondents remained neutral to the statement, 73(24.33 per cent) of the respondents
disagree that free gifts play a major role in brand preference and 24(8.00 per cent) of the
respondents strongly disagree that free gifts play a major role in brand preference.
With regard to the promotional activities, 88(29.33 per cent) of the respondents
strongly agree that promotional activities play a major role in brand preference, 96(32.00
per cent) of the respondents agree that promotional activities play a major role in brand
preference, 38(12.67 per cent) of the respondents remained neutral to the statement,
36(12.00 per cent) of the respondents disagree that promotional activities play a major role
in brand preference and 42(14.00 per cent) of the respondents strongly disagree that
promotional activities play a major role in brand preference.

50
Table 4.14 Reasons for particular brand preference

Strongly Strongly
Sl.No Description Agree Neutral Disagree
agree Disagree
Brand image 75(25.00) 96(32.00) 60(20.00) 36(12.00) 33(11.00)
1
Company image 70(23.33) 90(30.00) 80(26.67) 32(10.67) 28(9.33)
2
Nutritional 88(29.33) 100(33.33) 37(12.33) 43(14.33) 32(10.67)
3
aspects
Taste 122(40.76) 178(59.33) _ _ _
4
Price 106(35.33) 73(24.33) 38(12.67) 48(16.00) 35(11.67)
5
Packaging / 90(30.00) 99(33.00) 59(19.67) 30(10.00) 22(7.33)
6
labeling
Flavor 139(46.33) 50(16.67) 30(10.00) 67(22.33) 14(4.67)
7
Quality 127(42.33) 161(53.67) 12(4.00) _ _
8
Quantity 56(18.67) 167(55.67) 15(5.00) 32(10.67) 30(10.00)
9
Easy availability 85(28.33) 95(31.67) 43(14.33) 40(13.33) 37(12.33)
10
Advertisements 76(25.33) 96(32.00) 36(12.00) 52(17.33) 40(13.33)
11
Standard 98(32.67) 94(31.33) 45(15.00) 34(11.33) 29(9.67)
12
packaging
Retailers 45(15.00) 39(13.00) 50(16.67) 77(25.67) 89(29.67)
13
influence
Availability of 78(29.67) 87(29.00) 69(23.00) 44(14.67) 22(7.33)
14
variants
Less 67(22.33) 89(29.67) 39(13.00) 42(14.00) 63(21.00)
15
preservatives
Shelf life 72(24.00) 84(28.00) 36(12.00) 63(21.00) 45(15.00)
16
CSR emphasis 45(15.00) 71(23.67) 60(20.00) 79(26.33) 45(15.00)
17
Free gifts 80(26.67) 93(31.00) 30(10.00) 73(24.33) 24(8.00)
18
Promotional 88(29.33) 96(32.00) 38(12.67) 36(12.00) 42(14.00)
19
activities

51
4.4.9. Brand loyalty
Table 4.15 shows the extent of brand loyalty of consumers. 90(30 per cent) of the
consumers said that they will definitely purchase only a particular brand, 210(70 per cent)
of the consumers said that they are not particular about the brand. 168(56 per cent) of the
respondents said that they recommend the brand to others, 132(44 per cent) of the
respondents said that they will recommend the brand to others. 159(53 per cent) of the
respondents said that they will purchase the brand even if you feel it is expensive,
141(47.00 per cent) of the respondents said that they will not purchase the brand when it is
expensive. 140(46.67 per cent) of the respondents said that they will purchase only the
brand even if the price increases, 160(53.33 per cent) of the respondents said that they will
not buy the brand when the price increases. 159(53 per cent) of the respondents said that
they would purchase the brand even in the absence of promotion, 141(47 per cent) of the
respondents said that they would not purchase the brand in the absence of promotion.
90(30.00 per cent) of the respondents said that they will not purchase any other brand, if
their preferred brand is not available, 200(70.00 per cent) of the respondents said that they
will purchase other brand when the preferred brand is not available.

Table 4.15 Brand loyalty

Sl No. Extent of brand loyalty Yes No


1 Will you definitely purchase only this
90(30.00) 210(70.00)
brand?
2 Would you recommend this brand to
168(56.00) 132(44.00)
others?
3 Will you purchase this brand even if
159(53.00) 141(47.00)
you feel it is expensive?
4 Will you purchase only this brand
140(46.67) 160(53.33)
even if the price increases?
5 Would you purchase this brand even
159(53.00) 141(47.00)
in the absence of promotion?
6 Will you not purchase any other
brand, if your preferred brand is not 90(30.00) 200(70.00)
available?

52
4.4.10. Alternative purchase plans
Table 4.16 shows the alternative purchase plans of the sample respondents. Among
the breakfast foods, 90(30 per cent) of the respondents said that they would go to other
store, 50(16.67 per cent) said that they would postpone the purchase, 120(40 per cent) said
that they will buy another brand. 40(13.33 per cent) of the respondents said that they will
place order to get required brand. Among the main course foods, 134(44.67 per cent) of the
respondents said that they would go to other store, 38(16.67 per cent) said that they would
postpone the purchase, 87(29 per cent) said that they will buy another brand and 41(13.67
per cent) of the respondents said that they will place order to get required brand. Among the
snacks, 95(44.67 per cent) of the respondents said that they would go to other store, 30(10
per cent) said that they would postpone the purchase, 155(51.60 per cent) said that they will
buy another brand and 20(13.66 per cent) of the respondents said that they will place order
to get required brand.

Table 4.16 Alternative purchase plans


S.No Alternative Purchase plan Break fast Main course Snacks

Go to other store 90(30.00) 134(44.67) 95(44.67)


1
Postpone the purchase 50(16.67) 38(16.67) 30(10.00)
2
Will buy another brand 120(20) 87(29.00) 155(51.60)
3
Place order to get required 40(13.33) 41(13.67) 20(13.66)
4 brand

It can be noticed that the preference for a particular brand is not dependent on a
particular factor, but depends on combination of factors.

53
Chapter V

SUMMARY AND CONCLUSIONS


Packaged instant foods brought the advantages of pre-prepared time-saving food to
homes of ordinary people. Food processing sector is indispensable for overall development
of an economy as it provides a vital linkage and synergy between the agriculture and
industry. The liberalisation of the Indian economy and world trade as well as rising
consumer prosperity has thrown up new opportunities for diversification in the food
processing sector and opened up new avenues for growth. Demand for processed and
convenience food is increasing constantly because of urbanisation, changing life-style and
food habits of the people.
Around 45 per cent of the population in India is below 20 years of age and the
young population is set to rise further. Packaged foods segment in India registered a growth
of 8 per cent in 2011-12. Noodles/Vermicelli is the fastest growing category in this segment
with a CAGR at 15 per cent. The market for branded noodles is estimated at 230 million
servings per year. The soups market is still small and nascent in India and is approximately
US$ 14 million in value. The market for culinary products is estimated at US$ 475,000 and
estimated to grow at 18 to 20 per cent per annum. Products like Tomato ketchup and jams
currently have low penetration levels, but are growing rapidly. Ketchups, for example, have
a penetration of just 3 per cent in India; however this category is estimated to be growing at
20 per cent per annum.
The Indian food processing industry has significant support from the well developed
Research and Development and technical capabilities of Indian firms. India has a large
number of research institutions like Central Food Technological Research Institute, Central
Institute of Fisheries Technology, National Dairy Research Institute, National Research and
Development Centre etc. to support the technology and development in the food processing
sector in India. This business is characterized by high volumes and low margins.
Penetration levels are yet quite low in this segment, with product acceptance largely
restricted to the urban population. Product innovation and branding play a key role in
success of these products.
With the rising income levels of the consumers and their changing tastes and
preferences, the demand for instant food products is undergoing a change both in

54
qualitative and quantitative terms. Hence, in the present investigation, an attempt was made
to know the consumer awareness, buying behaviour and sales trend of instant foods.

The study was under taken with following specific objectives:

1. To study the trends in sales of instant food products of major manufacturing firms in
India.

2. To study the extent of consumer awareness of Instant food products in the selected areas.

3. To analyze factors influencing the buying behavior of Instant food products.

Data was collected from both primary and secondary sources. The Primary data was
collected from households which included both consumers and non consumers of instant
food products. Primary data regarding product awareness, brand awareness, and factors
influencing consumer behaviour was collected from the sample consumers with the help of
questionnaire by using survey method. Secondary data relating to trends in sales of instant
foods, major companies product line, product width, sales and population demographics
was collected from the published sources such as journals, books, periodicals, government
offices, companies’ records and websites.
The total sample selected for the study was 300 respondents. In the first
phase, three cities (C1, C2 and C3) of Andhra Pradesh were selected purposively. In the
next phase, a total of 300 sample respondents were selected from these cities. Among 100
samples in each study area, the respondents were classified into six income groups (IG1, IG
2, IG 3, IG 4, IG 5 and IG 6) based on their income. Thus, total of 200 female and 100 male
sample consumers representing various age groups and income levels were selected for the
study.
The data collected from various sources were analyzed in multiple stages.
Various analytical tools were employed for analysis of collected data. Tabular analysis was
used to study the socio-economic characteristics of the sample respondents like age,
educational status, occupation, family size and type, consumer awareness towards instant
food products and brands. Consumer awareness about various instant products, brands, per
cent of instant foods in total foods purchase, influencers of purchase decision, nature of
purchase decision, preference of purchase location, brand loyalty, alternative purchase
plans were assessed using percentages. Garrett ranking was employed to know the source

55
of information about instant products to the consumers and parameters of quality. Likert
scale technique was employed to know the consumer perception towards instant food,
assess the rise and fall in demand and brand preference.

MAJOR FINDINGS OF THE STUDY


5.1 TRENDS IN SALES OF INSTANT FOOD PRODUCTS OF MAJOR
MANUFACTURING FIRMS IN INDIA
The sales trend of MTR from 2009 to 2013 shows an overall growth of 105.92 per
cent growth in the sales of the instant products of MTR growth year on year of 57 per cent
in 2009-2010, 13.23 per cent in 2010-2011, 6.92 per cent in 2011-2012 and 8.30 per cent in
2012-2013.
The sales trend of Nestle from 2009 to 2013 shows an overall growth of 102.62 per
cent growth in the sales of the instant products of Nestle with an year on year growth of
21.93 per cent in 2009-2010, 22.68 per cent in 2010-2011, 16.01 per cent in 2011-2012 and
16.75 per cent in 2012-2013.
The sales trend of ITC from 2009 to 2013 shows an overall growth of 244.67 per
cent growth in the sales of the instant products of ITC with an yearly division in growth by
42.37 per cent in 2009-2010, 28.30 per cent in 2010-2011, 49.18 per cent in 2011-2012 and
27.02 per cent in 2012-2013.
The sales trend of Ruchi soya from 2009 to 2013 shows an overall growth of 71.19
per cent growth in the sales of the instant products of Ruchi soya with an year on year
division in growth of 10.65 per cent in 2009-2010, 17.44 per cent in 2010-2011, 42.48 per
cent in 2011-2012 and 14.50 per cent in 2012-2013.
The sales trend of Hindustan Unilever Limited from 2009 to 2013 shows an overall
growth of 16.74 per cent growth in the sales of the instant products of Hindustan Unilever
Limited with an year on year growth of -11.41 per cent in 2009-2010, 11.33 per cent in
2010-2011, 6.77 per cent in 2011-2012 and 10.85 per cent in 2012-2013.

56
5.2 EXTENT OF CONSUMER AWARENESS OF INSTANT FOOD
PRODUCTS IN THE SELECTED AREA
5.2.1 Consumer awareness about various instant products
Among the breakfast foods, the highest percentage of awareness was observed in
atta i.e., 70.67 per cent. 63.67 per cent was observed in noodles followed by dosa mix and
idli mix with 48.33 per cent and 41.00 per cent respectively. Among the main courses,
pickles occupied the first position with 90.00 per cent followed by Sambar/Rasam powder
with 74.33 per cent. Among the snacks, majority of the consumers i.e., 65.67 per cent are
aware of gulab jamun and other sweet mixes, followed by papads and fryums with 64.67
per cent, macaroni and pop corn with 53.33 per cent and 46.33 per cent respectively.
5.2.2 Consumer awareness about various brands

Majority of the consumers i.e., 93.33 per cent are aware about Maggie (Nestle)
followed by bambino with 90 per cent awareness amongst the consumers. 86.67 per cent of
the consumers are aware of Aashirwad, 82 per cent are aware of Priya. 70 per cent of
consumers are aware of MTR. 68.33 per cent of the consumers are aware of Everest, 60 per
cent of the consumers are aware of Top Ramen.
5.2.3 Sources of information about instant food products
Mass media advertisements occupy the first position. Print media advertisements
occupy the 2nd position, demonstrations occupy the 3rd position followed by retailers
display, friends/relatives, sponsorship programs, public campaigns and taste samples
among sources of information about instant food products.

5.3 FACTORS INFLUENCING THE BUYING BEHAVIOR OF


INSTANT FOOD PRODUCTS
5.3.1 Share of instant foods in total food products
Ten per cent of the respondents buy less than two per cent of instant foods in their
total purchase of food products whereas for 13 per cent of the respondents the share was 2-
5 per cent of instant foods, for 14.33 per cent of the respondents it was 5-10 per cent of
instant foods, for 32 per cent of the respondents it was 10-15 per cent of instant foods and
for 30.67 per cent of the respondents it was 15-25 per cent.

57
5.3.2 Influencers of purchase decision
Among the breakfast foods, 13 per cent get influenced by parents, 58.67 per cent by
their children. 13.3 per cent of the consumers decision on instant breakfast foods is based
on friends/relatives/peer group and neighbours advice. 8.33 per cent of the respondents get
influenced by shopkeepers and 6.6.7 per cent of the respondents by the promotional staff of
the company.
Among the main course, 17 per cent of the respondents get influenced by parents,
46 per cent by their children, 28 per cent by friends/relatives/peer group/relative. 7.33 per
cent by the shopkeepers and 1.67 per cent by the promotional staff of company.
Among snacks, 14.33 per cent get influenced by parents, 52 per cent by their
children, 17.67 per cent by friends/relatives/peer group/neighbours, 13.67 per cent by shop
keepers and 2.33 per cent of the sample respondents by the promotional staff of the
company.

5.3.3 Consumer perception towards instant food products

Consumers opined diversely regarding various aspects of instant food products from
which their perception can be summarised as follows. 29.33 per cent agreed that instant
foods are healthy and 48.34 per cent disagreed with the health aspect of instant foods. 28.33
per cent agreed that they are highly nutritious and 45.67 per cent disagreed with the
nutritional aspect. 65 per cent agreed that they are tasty, 21 per cent disagreed with the
same. 50.67 per cent agreed that instant foods are time saving and 21 per cent disagreed.
55.33 agreed that the expensive, 27 per cent disagreed. 27 per cent agreed that they are
economical and 55.33 disagreed that they are economical. 67.33 per cent agreed instant
foods are easy to prepare whereas 19.33 per cent disagreed with this. 33.67 per cent agreed
that instant foods are quality foods whereas 51 per cent disagreed. 53.67 per cent agreed
that they are easily available and 19.66 per cent disagreed with this. 51.34 per cent feel that
they are trendy in nature. 53.67 per cent feel that they are well packed foods. 53 per cent
feel that instant foods are health hazardous. 59.67 per cent of the respondents feel that they
are convenience food. 64.66 per cent of the respondents feel that preservatives are added to
the instant foods. 51.33 per cent disagree that instant foods are odd flavoured foods. 40.67
per cent agree that they are difficult to store and 40.34 per cent disagree with this. 40 per
cent of the consumers agree that instant foods are wholesome in nature and 41.67 per cent
disagree that instant foods are wholesome in nature.
58
5.3.4 Future purchase behaviour of respondents

Sixty three per cent of the respondents have said that they will go for more of
instant products when they will get more income. 55 per cent of the consumers felt that
demand for the instant products increases when the prices are more economical. 59 per cent
agree that the demand will increase with the better appearance of the product. 65.33 per
cent agree that demand will increase with better taste. 39.67 per cent agreed that demand
will increase with the introduction of more recognizable brands and labels, whereas 50.66
per cent disagreed with the same. 53.67 per cent of the consumers said that demand will
increase with increased shelf life of the products. 45.33 per cent felt that demand will
increase with more advertisements. 59.33 per cent agreed that demand will increase with
introduction of more variants. 54.66 per cent of the consumers agreed that demand will
increase when the instant products become more wholesome in nature. 50.33 per cent of the
consumers said that the demand will increase when the instant products are made available
in variable pack sizes.

42.67 per cent of the consumers said that the demand will go down if the price of
the instant products increase. 44.33 per cent of the consumers agreed that the demand will
fall if the quantity of the products is decreased. 40.67 per cent agreed that demand will fall
if there is no improvement in shelf life, 46 per cent agreed that demand will decrease if
consumers become more aware about the health hazards. 31 per cent of the respondents
agreed that the demand will fall if the promotional activities are decreased whereas 39.67
per cent of the respondents disagreed with the statement.

5.3.5 Parameters of quality


Among the quality parameters listed, packaging of the instant products is given first
rank followed by price, place of availability, nutritional value, preservatives, certification,
ingredients and recipe presentation.

5.3.6 Nature of purchase decision


Among the breakfast foods 63.33 per cent take a planned decision and 36.67 per
cent take an impulsive decision. Among the main course, 46.67 per cent take a planned
decision and 53.33 per cent take an impulsive decision. Among the snack foods, 66 per cent
of the respondents take a planned decision and 34 per cent take an impulsive decision.

59
5.3.7 Preference of purchase location

Among the breakfast foods, 32.67 per cent of the respondents prefer super market
chains, 14.33 per cent prefer discount stores, 34.33 per cent prefer retail stores and 18.67
per cent prefer mom and pop shops. Among the main course foods, 21.33 per cent of the
respondents prefer super market chains, 26.00 per cent prefer discount stores, 37.33 per
cent prefer retail stores and 15.33 per cent prefer mom and pop shops. Among the snack
foods, 26 per cent of the respondents prefer super market chains, 10.67 per cent prefer
discount stores, 31.33 per cent prefer retail stores and 32 per cent prefer mom and pop
shops.

5.3.8 Brand Preference and loyalty

Fifty seven per cent of the respondents agreed that purchase decision is influenced
by the brand image. 53.33 per cent agreed that purchase decision is influenced by company
image. 62.66 per cent agreed that nutritional aspects play an important role in brand
preference. 100 per cent agree that taste plays a major role in brand preference. 59.66 per
cent agreed that price plays a major role in brand preference. 63 per cent agreed that
packaging/labelling play a major role in brand preference. 63 per cent agreed that flavour
plays a good role in brand preference. 96 per cent agreed that quality plays a good role in
brand preference. 74.34 per cent agreed that quantity plays a role in brand preference. 60
per cent agreed with easy availability, 57.33 per cent with advertisements, 64 per cent with
standard packaging, 58.67 per cent with availability of variants, 52 per cent with less
preservatives, 52 per cent with shelf life, 38.67 per cent with CSR emphasis, 57.57 per cent
with free gifts and 61.33 per cent with promotional gifts.
70 per cent of the respondents said that they will not definitely purchase only single
brand, 56 per cent said that they would recommend a brand to others, 53 per cent said that
they will go for a brand even if they feel it is expensive whereas 47 per cent said they
would not recommend the brand to others. 53.33 per cent of the respondents said that they
would not buy a brand if the price increases. 53 per cent said that they will go for a brand
even in the absence of its promotion. 69.30 per cent of the respondents said they will go for
another brand in the absence of a preferred brand.

60
CONCLUSIONS
It may be concluded from the study that there is a good scope for the entry of new
firms with instant products in to the market. The market is still nascent in stage with huge
growth potential. With new marketing strategies, the market share of the instant products
can be enhanced which is highly suitable to the changing lifestyle pattern of the consumers.

From the study it can be inferred that there are good number of brands established
in the Indian market, and these companies are slowly increasing their operations and
introducing new tastes and flavours to the consumers. The rate of growth of major firms in
the instant food category is showing an increasing trend.

Consumers are becoming aware of the different kinds of instant foods, new varieties
and flavours are being tried and accepted by the consumers. Consumers are becoming
accustomed to new cuisines and tastes. Atta and noodles are more of the consumer
demanded products in the instant products market. Consumers are aware of popular brands
like Nestle, Bambino, Aashirwad, Priya, MTR etc. Mass media and print media
advertisements play a major role in creating awareness to the consumers about the instant
products.
Majority of the respondents spend about 10-15 per cent of their total food
expenditure on instant foods per month. The influencers of the purchase decision taken by
the consumers in buying instant foods are children and peer group. Consumers perceive
instant foods as easy to prepare, trendy, time saving, well packed, convenience food and
expensive. Consumers said that they would go for increased purchase of instant products in
case of more income level, economical prices, better taste, longer shelf life and variable
pack sizes. They would go for decreased purchase of instant products when prices increases
and there is no improvement in shelf life. Most of the consumers also expressed concern
regarding preservatives added in the instant food.
Among the quality parameters, respondents have given the order of preference to
packaging, price, place of availability, nutritional value, preservatives, certification,
ingredients and recipe presentation. The purchase decision of the consumers is mostly
planned for breakfast and main course instant foods rather than impulsive in nature,
whereas in case of snacks, it is mostly impulsive decision. The purchase locations are
61
distributed among the super market chains, retail stores, mom and pop shops. The
conclusion can be drawn that the consumers prefer brands based on the taste, price,
nutritional aspects, packaging/labelling, flavour, quality, company and brand image, easy
availability and to an extent CSR activities of the firm. Majority of the consumers would
change the preferences for a particular brand in case of non-availability of the brand in a
particular store. However the consumers also suggest a particular brand to others.

SUGGESTIONS AND POLICY IMPLICATIONS


1) A proper survey of the market and the tastes and needs of the consumers of various
age groups should be done in order to focus on the product development and
marketing.
2) Innovative technology should be explored in order to increase the shelf life of the
product variants and simultaneously reduce the cost of the product.
3) Promoting the concept of wholesome and fortified foods in the instant products
would increase the acceptance level.
4) The health issues of the consumers should also be given importance accordingly
with the palate.
5) More promotional activities should be carried upon to create awareness about
instant foods to vast number of people.

62
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65
APPENDIX
Questionnaire for households
I GENERAL CHARACTERISTICS :
1. Name of the respondent :
2. Sex : Male/Female
3. Marital Status : Married/Single
4. Age 25-30 31-35 36-40 46-50
:
46-50 51-55 56-60 Above 60

5. Education : Illiterate/Primary/High- School/


Intermediate/Graduate/ Post-graduate/
Doctorate.
6. Address :

7. Place/City :
8. Family Income (annually) Rs :

Income 1L to < 2L 2L to <3L 3L to <5L 5L to <8L 8L to <10L > 10L

Y/N 9
9
9. Type of family : Joint/Nuclear

II AWARENESS ABOUT INSTANT FOODS :

1. Have you ever heard about Instant food products? Yes No

2. If yes, what all will come under instant food


products according to you?

Product Mark
Types of Products
Category
Idli mix
Breakfast
Dosa mix
Products
Vada mix

66
Upma mix

Noodles
Breakfast
Products Pasta

Atta

Chapaties/Parathas

Instant biryani mix

Main Instant curry mixes


courses Sambar powder/Rasam powder

Pickles

Pop corn

Macaroni

French Fries/Sledges

Nuggets (Veg/Non-Veg)

Snacks Cutlets and Kababs (Veg/Non-Veg)


Gulab jamun mix and other sweet
mixes
Cake mix

Papads & Fryums

Sausages

3. Which are the brands that you are aware of ?

S.No. Brands of Products Aware

1 MTR
2 Ruchi
3 Aashirwaad

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4 Top Ramen
5 Yippie
6 Swastik
7 Wai wai
8 Maggie
9 Priya
10 Bambino
11 Everest
12 Iyengar
13 Mccain
14 Knorr
15 Chings

4. What are the sources of information about instant food products?

Sl.No Source of Information Mark

1 Retailers display

2 Print media advertisements

3 Mass media advertisements (TV/Radio)

4 Friends/Relatives

5 Free samples

6 Demonstratations
Sponsorship
7
programs
Tents, taste
8
samples
9 Public campaigns

68
5. What is the percentage of instant food products in your total monthly
purchase of food products and how much you spend in a month on instant
foods?

S.No. Percentage Mark

1 < 2%

2 2-5%

3 5-10%

4 10-15 %

5 15-25%

6. Who are the influencers of purchase decision?

S.No. Main
Influencers Breakfast Snacks
course
1 Parents
2 Children
3 Friends/relatives/ Peer
group/neighbors
4 Shop keepers
5 Promotional staff of
company

7. How would you perceive Instant food products?


S.No Description Strongly Agree Neutral Disagree Strongly
agree Disagree

1 Healthy

2 Highly Nutritious

3 Tasty

4 Time saving

69
5 Expensive

6 Ease in preparation

7 Quality food

8 Available any
where
9 Trendy food

10 Well packed

11 Health hazardous

12 Convenience food

13 Preservatives
added
14 Odd flavored food

15 Difficulty in
storage
16 Wholesome food

8. In near future I would like to increase/decrease the purchase of instant food


products,

a. The quantity I purchase will increase if


S.No. Description Strongly Agree Neutral Disagree Strongly
agree Disagree

1 More Income

2 More economical
prices
3 Better appearance

4 Better taste

5 More recognizable
labels and brands
6 Longer shelf life

7 More advertisements

70
8 More Variants
9 Fortification is done
10 More wholesome
food
11 Variable pack sizes

b. The quantity I purchase would decrease if

S.No. Description Strongly Agree Neutral Disagree Strongly


agree Disagree

1 Price increases

2 Quantity decrease

3 No improvement in
shelf life
4 More awareness about
health hazards
5 Decreased promotional
activities by company

9. On what parameters do you judge the quality of instant food products?

S.No. Parameters Response


1 Price
2 Preservatives
3 Packaging
4 Nutritional value
5 Ingredients

6 Recipe presentation
7 Place of availability

8 Certification
10.
71
Nature of purchase decision

Sl.No Category Planned (P) / Impulsive (I)

1 Breakfast

2 Main Course

3 Snacks

11. Where do you buy instant food products?

Sl.No Place of Purchase Break fast Main course Snacks


1. Super market chains
2. Discount stores
3. Retail stores
4. Mom and pop shops

12. Reasons for brand preference

S.No. Description Strongly Agree Neutral Disagree Strongly


agree Disagree

1 Brand image

2 Company image

3 Nutritional aspects

4 Taste

5 Price

6 Packaging / labeling

7 Flavor

8 Quality

9 Quantity

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10 Easy availability

11 Advertisements

12 Standard packaging

13 Retailers influence

14 Availability of many
variants
15 Less Preservatives

16 Shelf life

17 CSR emphasis

18 Free gifts

19 Promotional
activities

13. What is the extent of your brand loyalty?

Sl No. Extent of brand loyalty Mark


1 Will you definitely purchase only this brand?
2 Would you recommend this brand to others?
3 Will you purchase this brand even if you feel it is expensive?
4 Will you purchase only this brand even if the price increases?
5 Would you purchase this brand even in the absence of promotion?
6 Will you not purchase any other brand, if your preferred brand is not available?

73
14. What are the alternative purchase plans, if preferred brands are not
available?

S.No. Alternative Purchase plan Break fast Main course Snacks


1 Go to other store
2 Postpone the purchase
3 Will buy another brand
4 Place order to get required
brand

74