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WINTER PROJECT REPORT

ON

"CONSUMER BUYING BEHAVIOR TOWARDS PATANJALI PRODUCTS"

SUBMITTED BY,

RAJPUROHIT SURENDRA (3107)

UNDER THE GUIDANCE OF

DR.MITALEE PITHAWALA

(ASSISTANT PROFESSOR)

IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF THE SUBJECT


IN THIRED YEAR ( SEM - IV ) BBA PROGRAMME

SUBMITTED TO,

D.R.PATEL & R.B.PATEL COMMERCE COLLEGE & BHANIBEN


CHHIMKABHAI PATEL BBA COLLEGE

BHARTHANA, SURAT

AFFILIATED TO

VEER NARMAD SOUTH GUJARAT UNIVERSITY

SURAT

ACADEMIC YEAR ( 2019-20 )

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INDEX

SR NO. PARTICULAR PAGE NO.

DECLARATION 5

ACKNOWLEDGEMENT 6

EXECUTIVE SUMMARY 7

LIST OF TABLES 8

CHAPTER 1: INDUSTRY PROFILE 9 TO 24

1.1 INTRODUCTION OF FMCG 9

1.2 OVERVIEW OF INDUSTRY 9

1.3 SECNARIO OF FMCG IN INDIA 11 TO 16

1.3.1 HOUSEHOLD CARE

1.3.2 PERSONAL CARE

1.3.3 FOOD AND BEVERAGES

1.4 ANALYSIS OF FMCG INDUSTRIES 16 TO 19

1.4.1 REASON FOR CHOOSING THESE INDUSTRIES

1.4.2 ITC LTD.

1.4 .3 HINDUSTAN UNILEVER LTD.

1.4.4 DABUR INDIA LTD.

1.4.5 GODREJ CONSUMER PRODUCTS LTD.

1.4.6 PROCTOR & GAMBLE

1.5 PEST ANALYSIS OF FMCG INDUSTRY 19 TO 21

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1.5.1 POLITICAL

1.5.2 ECONOMICAL

1.5.3 SOCIAL

1.5.4 TECHNOLOGY

1.6 OPPORTUNITIES IN THE FMCG SECTOR IN INDIA 21 TO 24

1.6.1 INDIAN FMCG COMPANIES

1.6.2 FUTURE OUTLOOK OF FMCG IN INDIA

CHAPTER 2: INTRODUCTION TO PATANJALI 25 TO 34

2.1 INTRODUCTION 25

2.2 MARKETING MIX OF PATANJALI 27

2.3 PRODUCT IN MARKETING MIX OF PATANJALI 27 TO 30

2.3.1.SOME OF THE SECTOR WHERE PATANJALI


PRODUCT ARE ALREADY DOING GREAT

2.3.2 PRODUCT WHERE PATANJALI IS PRESENT AND


BEATING COMPETITION ARE

2.4 PRICING IN THE MARKETING MIX OF PATANJALI 30


AYURVED

2.5 PLACE IN THE MARKETING MIX OF PATANJALI 31


AYURVED

2.6 PROMOTION IN THE MARKETING MIX OF PATANJALI 31


AYURVED

2.7 SALE & DISTRIBUTION 32

CHAPTER 3 : THEORITICAL FRAMEWORK 35 To 40

3.1 CONSUMER BUYING BEHAVIOR 35 TO 36

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3.1.1 STAGES OF THE CONSUMER BUYING BEHAVIOR

3.2 CONSUMER PERCEPTION 37 TO 39

3.2 1. PERCEPTION AND SENSATION

3.2.2 PERCEPTUAL PROCESS

3.3 FACTORS INFLUENCING PERCEPTUAL SET EXTERNAL 39


FACTORS

3.4 INTERNAL FACTORS SELF-CONCEPT 39

CHAPTER 4: RESEARCH METHODOLOGY

4 .1 RESEARCH OBJECTIVE

4.1.1 PRIMARY OBJECTIVE

4.1.2 SECONDARY OBJECTIVE

4.2 RESEARCH DESIGN

4.3 SOURCE OF DATA

4.4 POPULATION

4.5 SAMPLING AREA

4.6 SAMPLING UNIT

4.7 SAMPLING METHOD

4.8 LIMITATIONS

4.9 RATIONALE VOF THE STUDY

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DECLARATION

I, Surendra Rajpurohit , hereby declare that the project report titled "A study on Consumer buying
behavior towards patanjali product in Surat city during the period of 2019-20", has been done
under the guidance of Assistant Professor Mitalee Pithawala, submitted in partial fulfillment of the
requirement for the award of the degree of Bachelor of Business Administration to Veer Narmad
South Gujarat University, Surat Is my original workwork- Research - study carried out during sixth
semester and not submitted for award of any degree/diploma/fellowship of any other
institution/organization of university.

Sign:

Date:

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ACKNOWLEDGEMENT

Project never the accomplishment of an individual rather it is an amalgamation of efforts, ideas and
co-operation of a number of entities.

I would like to thank VEER NARMAD SOUTH GUJARAT UNIVERSITY for giving an
opportunity to work on valuable project.

We are greatly thankful to our, I/C principal Dr. Ashish K. Desai who gave us the opportunity for
training.

It is my privilege to express my deep sense of gratitude to my mentor Dr. Mitalee Pithawala for her
efforts, guidance, valuable comments and suggestions for making this project report. She helped me
to complete my report on practical study and gave contributions to improve and expand my practical
knowledge.

Finally, I express my intense gratitude to my parents whose blessings has helped me translate my
efforts into fruitful achievement.

Sign:

Date:

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EXECUTIVE SUMMARY

I bave mentioned all the information which is true and useful in knowing in-depth concept of FMCG
sector towards consumer buying behavior. This project report is written in according with the
'Bachelor of Business Administration (BBA)' programme; prescribe by Veer Narmad South Gujarat
University, Surat.

It offers the best opportunity for the management student to get fundamental knowledge and
experience to stand on their own feet and survive. This project report is based on my elective subject
of "A study on consumer buying behavior towards patanjali product in Surat city during the period of
2019-20" as a part of my project work. This report is prepared with the help of primary data.

Primary data was collected by direct from respondent with the help of questionnaire and This report
includes five chapters.

The first chapter is industry profile. It includes information and overview about FMCG sector.

The second chapter is company profile. It includes information about Patanjali and patanjali product.

The third chapter is theoretical framework & literature review. Theoretical framework includes
consumer buying behavior towards patanjali and literature review explains the previous study about
consumer buying behavior towards patanjali product.

The forth chapter is research methodology. Research methodology provides information about
sample size, sampling design, sampling unit; research instrument used problem statement, research
objective, research design, data collection methods and limitation of the study.

The fifth chapter is data analysis & findings. In it all the collected information are analyzed through
chart.

In bibliography which websites and books used in report is mentioned.

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LIST OF FIGURES

S.NO. DESCRIPTIONPAGE NO.

Figure 1 Product Segment of FMCG 12

Figure 2 Market Segment of FMCG in India 14

Figure 3 Growth Pattern of FMCG in India 15

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CHAPTER 1: INDUSTRY PROFILE

1.1 INTRODUCTION
Fast-moving consumer goods (FMCG) are also termed as consumer packaged goods (CPG). The
meaning of this goods can be clearly extracted from the word FMCG itself. These products are sold
in a fast space and the prices of these goods are relatively low. The perfect examples can be non-
durable products such as soft drinks, fast food/processed foods, medicines, cosmetic products and
many more consumable products. Further explaining the term non-durable, it includes all the goods
that should be used within three years and less. Because of this very fact, FMCG has a really short
shelf life that may be because of its demand or may be because of its non- durable nature.

FMCG are sold in a huge quantities but the profit margin is relatively low for the producers as
compared to the retailers. But as the products are sold in large quantities, the aggregate profit will be
enough to sustain the business.

The natures of FMCG are as follows:

 Low price
 Low involvement of buyers
 Repeated purchase
 Large quantities
 Easily Available
 High stock turnover

1.2 OVERVIEW OF INDUSTRY


FMCG companies are one of the most versatile business houses. It stands out as the biggest industry
in the world itself.

 FMCG companies are known for their brand name: Everyone around the global
knows the brand of FMCG, as they will be using it all the time. People recognize these
brands from their trip to supermarket or from the various sources of advisement. In ever
part of the home, you will find various brand of FMCG.

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 FMCG firms are flexible in nature: In FMCG industry there is never a dull moment as
it keeps changing as per the time and environment. The basic reason for its constant
evolution is change in demand of people and creating an urge for consumer to buy that
product. It keeps creating various needs for consumer. Another aspect is that the FMCG
moves really fast from the time they are bought in the store to the time the shelves are
being emptied to the time next stock is refilled.

 FMCG companies put efforts in employee and customer retention: Sustainability is


determined by the loyalty of the customer and its employee. FMCG focuses to retain its
customer in order to go strong and to earn profit. Moreover, it also focuses on keeping its
employee merry as satisfied employee equals to satisfied customer.
 FMCG firms are resistant to the recession: No matter how much fluctuation is in the
economy, FMCG firms are least affected. Consumers need to buy FMCG products, as
these are the basic necessity and essential commodities for them.

 FMCG industries focus on two “B “, Bigger and Better: This industry is getting bigger
as many brands are entering in the market and giving absolute competition. Moreover,
FMCG companies always focus on innovative ideas and technology to provide better
products to the customers.

 FMCG ultimate objective is to deliver what the consumers want: This industry has
been satisfying the everyday needs and wants of customer. It keeps the ends of the
customer in first place and tries its level best to deliver and fulfil their expectation and
necessity.
In context of the world, the top 10 FMCG companies (2018) are as follows:

 Nestle S.A.
 The Procter & Gamble Company
 Anheuser-Busch InBev
 Philip Morris International Inc.
 Coca-Cola Company
 Pepsico Inc.
 Unilever

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 British American Tobacco


 L'oreal
 Mondelez International, Inc

1.3 SCENARIO OF FMCG IN INDIA


India is one of the countries that cover large population of the world and more over; the GDP of
India is expected to increase in the nearby future. Because of this very factor, India has been in the
limelight for many FMCG companies. However, from 1950’s to the 80’s there were little
investments in the FMCG industries because the purchasing power of the people in India were really
low and moreover, the government of India was also in support of small scale sectors. The only
company that was able to sustain in this environment was Hindustan Unilever Limited, previously
known as Hindustan Lever Limited. This MNC Company had its manufacturing base in India.

HUL had been the main player till then. It was carrying out their business in a urbane manner.
Consumers however were limited to few choices but the entry of Nirma detergent powder bought a
change in the FMCG industry as a whole. This company focused on “value for money” approach and
made detergent affordable to low segment of people, which drastically changed the lifestyle of
Indian people. This opened the gate to many FMCG companies in India.

FMCG was no longer viewed as luxury products that were just targeted for the elite class of people.
It was regarded more as a day-to-day necessity for the masses in affordable price.
There were many global FMCG in the country for many decades but in the last ten years, many
domestic FMCG companies have entered the market such as Godrej, Dabur, Nirma, Emami,
CavinKare and more.

In the current scenario, FMCG sector is one of the important contributor to the India’s GDP and
more over it is the fourth largest sector of the economy in India. The most used products from the list
are toilet soaps, toothpaste, detergents, and shampoos, shaving goods, shoe polish, packaged food
items and household products. In this market about 2 trillion is covered by rural India in terms of its
revenue.
The major FMCG market Industry in India mainly comprises of;

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Household
Care

FMCG Personal
Care

Food and
Beverages

Figure 4: Product Segment

1.3.1 HOUSEHOLD CARE

The demand for household care in India has been growing rapidly. In the past five years, there has
been a annual growth rate of 10% to 11%. In the urban area, consumer prefers washing powder and
detergents to bars, as there is increase use of washing machines and purchasing power and aggressive
advertising as well. While in the rural areas, consumers are still using bars. Incase of detergents,
small and unorganized player’s holds majority of share. Vim bars, of HUL lead the market by
pleasing its customer. It provides superior product and performance and constantly comes with new
offering such as Anti-Germ Bar and Monthly Tub Pack. Vim liquid dish wash is one of the hit
products among many other dishwashing brands. Domex, again of HUL,on the other hand is the
leading FMCG product in the toiletries categories.

1.3.2 PERSONAL CARE


In India, personal care products are estimated to be USD 4 billion (25144 crore) p.a. The key
products include hair care, skin care, colour cosmetics, bath/shower products and fragrances.
Different segments have different trends. Bar soaps dominates the largest segment of this products
and second largest is the hair care products. Bar soaps is being growing at 5% per annum over the
last five years where as in the case of hair care products, its 9-10% per annum during the same
period.

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 In the case of hair care, coconut oil holds 72% share in the India’s hair oil market.
 The skin care market is in the initial stage in India. People are becoming more aware of it as
there is change in lifestyle, rise in income, more choices and ease in availability.
 Oral care, which is also the important part of personal care, can be segmented into toothpaste,
toothpowder and toothbrushes that holds 60%, 23% and 17% of market share respectively.

1.3.3 FOOD AND BEVERAGES


In India, food and Beverages come in fifth in terms of production, growth, consumption and export.
The packaged food segment is estimated to grow at 9% annually to become a 6-lakh crore industry
by the end of 2030. Ready to drink tea and coffee segment is estimated to be 2200 crore in the next
three years. The total soft drink that includes both carbonated beverages and juices segment is
expected to touch USD 1 billion. Coca cola and Pepsi are the leaders in the Indian soft drink market.

The following figure shows us the market segment of people in India in different category of FMCG
products.

Market Segment of FMCG

Baby Care 2%
Fabric Care 12%
Food Products 43%
Hair Care 8%
Household 4%
OTC Products 4%
Others 5%
Personal Care 22%

Figure 5: Market Segment of FMCG in India

As per the data from 2013, the food products occupy the majority of portion in FMCG followed by
personal care, fabric care, hair care, households, OTC products and baby care respectively.

Many companies influence the customers through heavy advertising, marketing, packaging, low
price strategy and more. Both rural and urban areas contribute the growth of this sector. Foreign
FMCG players are also willing to enter the market of India, as there are many growth opportunities

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for them.

The main factors or the drivers for the growth of FMCG sectors in India are;

 Per Capita Income


 Increase population
 Changing life style of people
 Support from Foreign Direct Investment (FDI)
 Low labour cost
 Availability of raw materials
 The following figure shows the revenue growth pattern of overall FMCG Industry in India.

Growth Pattern
50
45
40
35
Revenue ( billions)

30
25
20
15
10
5
0
2006 2007 2008 2009 2010 2011 2012 2013

Figure 6: Growth Pattern of FMCG in India

From the year 2006, revenue in FMCG has been increasing from 15.7 billion to 17.8 billion and
likewise. In the year 2013, revenue had reached to 44.9 billion. FMCG sector in India has grown
with compound annual growth rate (CAGR) of 16.2% during the year 2006-2013. This revenue and
growth pattern places FMCG Industry in the fourth largest position in India. There are various
reasons behind this such as increase in consumption pattern, change in lifestyle and high purchasing
power. But in the year 2012, there was a moderate growth rate of 9.24% because of high inflation
and reduced GDP growth.

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In India, there are plenty of FMCG companies. As per a study conducted by Nielsen, 62 of the top
100 brands are owned by MNCs and the rest by Indian companies. Among these 62 brands,
Hindustan Unilever owns 27.
The top 10 FMCG companies (2014) in India are namely;
1. ITC Limited
2. Hindustan Unilever Limited
3. Nestle India
4. Dabur India
5. Godrej Consumer Care private Limited
6. Colgate-Palmolive Company
7. Marico
8. Procter & Gamble
9. Britannia Industries
10. Emami
These leading companies are providing food to household care and beauty to personal care products.

1.4 ANALYSIS OF FMCG INDUSTRIES


In this report, we will be doing an industry analysis on 5 major FMCG companies of India. Namely:
1) ITC Limited
2) Hindustan Unilever Limited
3) Dabur India Limited
4) Godrej Consumer Products Limited
5) Procter & Gamble

1.4.1 Reason for choosing these Industries

 These Industries holds maximum number of shares


 These Industries covers 70% of the total FMCG market.
 Major of Indian people are using products from these brands.
 Consumers of India are more aware about these companies.
 Advertisement and promotion of these companies are hardcore in India.
Let’s take a glimpse into the background of each FMCG companies that we are going to analyse
upon.

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1.4.2 ITC Ltd:

ITC was established in 1910 as the Imperial Tobacco Company of India Limited but later in the year
1970, it was renamed as Indian Tobacco Company and further in the year 1974, it was named as
I.T.C Ltd. In 2001, periods were removed from the name.

It is an Indian conglomerate headquartered in Kolkata, West Bengal. Its businesses include mainly
five segments: FMCG, Hotels, Paperboards & Packaging, Agri Business & Information Technology.

It employs more than 25000 people at more than 60 locations all across India.

1.4.3 Hindustan Unilever Limited:

HUL was established in the year 1933 as Lever Brothers but in the year 1956, it renamed as
Hindustan Lever Limited as there was a merger between the Lever brothers, Hindustan Vanaspati
Manufacturing Company Limited and United Traders Ltd. Later in June 2007, it was again renamed
as Hindustan Unilever Limited. It is based in Mumbai.

It employs more than 16,500 workers in India and indirectly helps to assist the employment of more
than 65,000 people.

As per the research conducted by Nielsen, two out of three people use the products of HUL in India.
Moreover, HUL has more than 2 million direct retail store all across India and its products are
available in more than 6.5 million outlets in the country.

1.4.4 Dabur India Ltd:

Dabur is derived from the word “ Daktar Burman”. Dabur India was established in the year 1884 by
a physician names as Dr.SK Burman. This company is the India’s largest Ayurvedic medicine related
manufacturer. In June 2008, Fresenius SE, a German company bought 73.27% equity stake in Dabur
at a price of Rs.76.50 per share. Moreover, the same company also bought another 17.62% shares
through an open letter at the same price.Dr.SK Burman produced Ayurvedic medicine for various
diseases such as malaria and cholera. In the Ayurvedic Specialities Divison of Dabur, there is more
than 260 medicines treating various health related problems such as common cold to chronic
paralysis.

1.4.5 Godrej Consumer Products Limited:

Godrej Consumer Products Limited was founded in 2001. Its headquarter is in Mumbai,
Maharashtra. Its subsidiaries are;

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 Essence Consumer Care Products Pvt. Ltd


 Naturesse Consumer Care Products Pvt. Ltd
 Godrej Hygiene Products Ltd.
 Godrej Netherlands B.V.
GCPL products can be categorized into personal care and household care segment. It provides toilet
soaps, hair color, liquid detergent, air fresheners, household insecticides and many more. It provides
jobs to more than 1300 full time employees in India and moreover, it’s involved in many social
awareness activities as well.

1.4.6 Procter & Gamble:

P&G, a multinational company, was established in the year 1837 in Ohio, America. In India, it was
founded in the year 1964 and now it serves more than 650 million consumers in the India. Its
headquarter is in Mumbai. It’s one of the renowned brands not just in India but also all across the
world. P&G is one of the major leaders in FMCG industry and the main reason behind their success
is superior product propositions and innovation in terms of technology.

In India, P&G operates under three entities; 1837

 “ Procter & Gamble Hygiene and Health Care Limited ”


 “ Gillette India Limited ”
 “ Procter & Gamble Home Products “

P&G provides jobs to more than 26,000 workers both directly and indirectly. In addition to this, it is
dedicated to sustainable growth in India. It also focuses on Environmental Protection and Social
Responsibility in the places it operates.

1.5 PEST ANALYSIS OF FMCG INDUSTRY


1.5.1 POLITICAL

 Tax Structure

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There is pretty complicated tax structure and there is high indirect tax. As far as uniformity is
concerned there is lack of uniformity also. Octroi is also high. There is entry tax and changing tax
policy.

 Infrastructure Issues

The effectivity of FMCG depends on the fact that how much government spends on the agricultural
infrastructure. It also depends on the power and transportation infrastructure a lot.

 Regulatory Constraints

There is requirement for multiplicity of permits and licenses for various states. There is outdated
labour law. The export procedure is very tiresome. The subsidy available is very confusing and time
consuming.

 Policy framework

Approval concerned to investment of FDI into Retail sector (single-brand retail &multi-brand retail,
License rules in setting up of Industry, Changes in Statutory Minimum Price (SMP) of commodities
and Priority sector classification of industry.

1.5..2 Economical

 GDP Growth

Growth of the industry is pretty consistent with the Indian economy.

 Inflation

Inflationary pressures decreases the purchasing power of money to a great extent. And the concept
of inflation has a substantial impact on the spending power of consumer. This has direct impact on
business investment

 Consumer Income

Increase in incomes is largely an outcome of economic growth across sectors. Over the past few
years, India has seen increased economic growth, with a continuing and substantial impact on
consumer disposable incomes leading good growth for the FMCG sector.

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 Private Consumption

The Indian economy, unlike other economies, has a very high rate of private consumption (61%)

 Urbanization

In India if we talk about rural areas, seventy % of its population lives in rural areas. And with the
rising concept of urbanization more people are getting exposed to the modern products and brands.
And there is a shift to branded and packaged goods and products.

1.5..3 Social

 Change in consumer Profile

As there is rapid urbanization and increased literacy and per capita income is also increasing, have
all caused rapid growth. There is change in demand also. It leads to a great demand opportunities. As
a matter of fact around 45 % of the population in India is below the age of 20 years.

 Change in Lifestyle

Changing Lifestyle of Indian consumers has led to focus on premium products among Indian FMCG
players. These days the market is very volatile and the lifestyle is changing with a great pace. Earlier
people used to be very traditional and they were not willing to change to a great extent, they were
like if they use a product then they cannot change their product. Today there are couple with single
income and couple with double income. Both have different lifestyle. Their purchasing power varies
to a great extent

 Rural focus

As market is getting saturated, companies are focusing on rural area for penetration, by providing
consumers with small-sized or single-use packs. These days’ companies are focusing more on the
rural areas a lot. They want to expand a lot in this segment to a great extent.

1.5..4 Technology
Adoption of ERP (like SAP and the like.), Supply Chain Optimization tools and Business
Intelligence Tools will help FMCG companies to integrate business processes across the enterprise,
suppliers and customer’s .And with this higher productivity can be achieved to a great extent. With
the level of competition and sluggish growth most FMCG corporates are looking at IT to reduce

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money in the supply chain, and flattenthe bottom line Marketing and advertising through mobile and
social media platforms. These days social network, yes social network, companies are using this
social network to a great extent as an advertisement tool and it is very much effective. But right now
from cost point of view, the cost is pretty high in this ad tool.

1.6 Opportunities in the FMCG sector in India

In the past few years, FMCG sector in India is growing at a rate of 11%. This double-digit growth
rate year by year indicates that the consumer demand has been increasing. There has been 17%
growth in this sector in last five years. The shows tremendous growth in the FMCG sector in India.

Changing customer demand is the important factor that FMCG should focus on and moreover,
companies are trying their level best to keep up with that. By doing this, they want to be a leader in
the sector and outperform than their competitors. This very fact indicates that the growth is inevitable
in the sector.

Moreover, rural area accounts for more than 700 million consumers, which is 70% of the Indian
population and 50% of the total FMCG market. Right now, there is approximately 400 million
working rural population. Average citizens in rural India have less purchasing power than urban
counterparts. Regardless of this, FMCG market has great potential, and FMCG consumers are
shifting from economy to premium products such as packaged water.

1.6.1 Indian FMCG companies


A mounting Indian populace, particularly the intermediate class and the pastoral segments, dowries
an prospect for manufacturers of branded foodstuffs to entice these novel regulars as well as
construction local makers of these things targets for MNC procurement in the FMCG sector.

In 2010, an unique number of inland and world-wide FMCG troupes alike took lead of this occasion
in India office for US$797.8 million in M&A deal-making, linked to a mere US$47.9 million the
year earlier due to gradually recovering global economy.

By contrast, the 34 M&A contracts within the FMCG group for 2010 in India were chiefly driven by
Indian companies observing to enlarge beyond their limits. Large Indian FMCG companies, such as
Dabur, Godrej and Emami, are flying up their international growth among ambitions to develop truly
multinational and worries about increased domestic flocking. Given India's important long-term
possible, persistent and cumulative FDI influxes into the country have heightened race within the

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FMCG sector in India—struggle that could erode current market stocks and latent for future growing
domestically. Therefore, Indian FMCG companies are very determinedly watching to strengthen
their global attendance.

Indian FMCG companies complete a total of 13 attainments in 2010, most of them global.
For instance, Dabur, Godrej and Emami are not latent on their leading locations in India, and are in
its place looking to increase wealth expenditures after US$218.8 million to US$656.5 million, in
instruction to found a tougher market position abroad. Godrej complete seven international
attainments in 2010, Marico complete in two attainments, Dabur made it in two attainments and
Emami was the one who did it in one attainments. In difference, their FMCG complements in Brazil
and China are not increasing globally at closely the same rate.

1.6.2 Future outlook of FMCG in India


In the year 2020, FMCG is expected to be an industry of Rs. 400,000 crore. The anti-ageing skincare
category has grown five times between the year 2007 and 2008. Today it’s the fastest-growing
segment in the skincare market. The famous brand such as Olay that is the premium anti-ageing
skincare brand of Procter & Gamble captured 20 per cent of the market within a year of its launch in
2007 and now dominates it with 37 per cent share. Indian consumers have become so much
conscious about skincare. In addition to this, oral hygiene has become a daily habit for the Indian
consumers. Mouth rinsing seems to be picking up as a habit. So mouthwash penetration is growing at
35 per cent a year. Rural penetration of shampoos increased to 46 per cent last year, way up from 16
per cent in 2001. Rural areas are slowly making tremendous use of FMCG products.Consumption
patterns have changed rapidly in the last five to ten years. The consumer is trying to experience new
things. Consumers are looking for products with better functionality, quality, value, and more. What
consumer ‘needs’ is fast getting replaced with what consumer ‘wants’. There are numerous drivers of
growth for the FMCG in India in the past ten years and there will be big drifts and elements that will
impact its upcoming.

The FMCG Industry witnessed robust year-on-year growth of approximately 11 per cent in the last
decade; this indicates that there was a boost in size from Rs. 47,000 crore in 2000 and 2001 to Rs.
130,000 crore.The ultimate drivers of growth of this FMCG industry is robust GDP growth, opening
up of rural markets, increased income in rural areas, growing urbanisation along with evolving
consumer lifestyles and buying behaviours.

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In the year 2020 the FMCG industry is expected to grow at least 12 per cent annually to become Rs.
400,000 crore in size. In addition to this, if some of the aspects work out well, like GDP grows a
little faster, the government removes tailbacks, infrastructure investments speed up, there is more
resourceful spending on government subsidy and so on, then growth can be drastically higher. In the
year 2020, it is expected to be 17% leading to an overall industry size of Rs. 620,000 crore. The
industry will become larger, more responsible and will be more single-minded to its customers by
2020.

CHAPTER 2 : INTRODUCTION TO PATANJALPATANJALI

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1.1 Introduction

Patanjali Ayurved Limited is an Indian consumer goods company. Manufacturing units and
headquarters are located in the industrial area of Haridwar while the registered office is located at
Delhi. The company manufactures mineral and herbal products.

Customer service: 1800 180 4108

Founded: January 2006

Revenue: 12,000 crores INR (US$1.7 billion, 2017–2018)

Number of employees: 2,00,000 (2011–2012)

Founders: Ramdev, Balkrishna

Subsidiaries: Advance Navigation and Solar Technologies Pvt. Ltd., Herboved, Inc.

Foundation of Patanjali brand and Ayurved patanjali: Firstly Baba Ramdev started 1divya Yog
Mandir in 1995 under the guidance of Swami Shankardev ji with the help of Acharya Balkrishna and
Acharya Karamveer. The main focus of this mission was to keep Yoga and

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Ayurved prior in world wide. To make it more popularize small camps and shivirs were started to
teach a huge number of people about yoga. Now it has become a multinational enterprise with its
many branches located in many countries like US, UK Nepal etc. By providing many resources like
raw material, human resources and technical knowhow, these institutions have also provided a lot of
success to this enterprise.
A news story in Business Standard quotes the Nielsen report, “Anticipate with Analytics: The Future
of FMCG”, and states that all the major Fast-Moving Consumer Goods (FMCG) players in India are
currently dealing with an extremely slow rate of growth. The report mentions names like HUL and
ITC in particular, whose growth rates have fallen from 13.2% and 11-12% to 3.2% and 7%,
respectively, and compares them to the over 2,000 cr turnover by Patanjali Ayurved Ltd., a recent
player in the market. The said report marvels at Patanjali’s success as a brand and tries to analyze the
factors that have made it a highly profitable venture within a very short span of time, in an era when
big FMCG giants are battling an industry-wise overall slowdown. According to a detailed report in
The Economic Times (PTI, 2016), Patanjali Ayurved clocked 1,200 cr in revenues during the fiscal
year 2013-14, and crossed 2,000 cr in the year 2014-15, which makes its turnover equivalent to that
of companies like Emami. Different reports peg the turnover of Patanjali Ayurved Ltd. to be between
2,000 to 2,500 cr in the fiscal year 2015-16. Started in 2006, Patanjali Ayurved Ltd. has moved from
selling its products from its ashram premises and tuck shops to dedicated outlets and now even
hypermarkets. Casual interactions with retailers and shopkeepers reveal how the big FMCG
corporates are changing their marketing strategies, even slashing down prices significantly to
compete with the Patanjali bandwagon.
According to a report published by Kotak Institutional Equities, Patanjali garnered a 4.5% market
share in the toothpaste segment, while Colgate’s share dropped by 0.6% to 57.3%
(Newsroompost.com, 2016). What makes a young company like Patanjali Ayurved Ltd. race ahead
and beat the veteran FMCG giants in their own game. This study attempts to address this question by
understanding the perceptions of consumers with respect to Patanjali products.
As a consumer we are all unique and this uniqueness is reflected in the consumption pattern and the
process of purchase. The study of consumer behavior provides us with reasons why consumers differ
from one another in buying using products and services. We receive stimuli from the environment
and the specifies of the marketing strategies of different products and services, and responds to the
stimuli in terms of either buying or not buying product. In between the stage of receiving the stimuli
and responding to it, the consumer goes through the process of making his decision.

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1.2 Marketing mix of Patanjali – Patanjali Marketing mix

Founded in 2006 by Acharya Balkrishna and Baba Ramdev, Patanjali Ayurved is an Indian FMCG
Company. Patanjali Ayurved happens to be the fastest growing FMCG Company in India. Patanjali
Ayurved imports herbs from Himalayas of Nepal.
Patanjali has a manufacturing unit in Nepal, working under the brand name of Nepal Gramudhyog.
India’s fastest growing FMCG company is valued at 3000 Crore and generated a revenue of 5000
Crore for the fiscal year of 2015-16.

Hindustan Uniliver and P&G are the FMCG companies, whose market share has been potentially
affected by Patanjali. P&G and Hindustan Uniliver are on back foot and trying to lure customers
back by providing huge discounts and impressive offers.

1.3 Products in the marketing mix of Patanjali

Baba Ramdev is constantly pushing Indian people to start using Indian brands and save the
economical growth of the company. Patanjali is planning to take over all reputed brands dealing in
beverages and foods.

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Patanjali Ayurved produces products in the categories of personal care and food. The company
manufactures more than 900 products including 45 types of cosmetic products
and 30 types of food products. According to Patanjali, all the products manufactured by Patanjali are
made from Ayurveda and natural components Patanjali has also launched beauty and baby products.
Patanjali Ayurvedic manufacturing division has over 300 medicines for treating a range of ailments
and body conditions, from common cold to chronic paralysis.
Patanjali launched instant noodles on 15 November 2015. Food Safety and Standards Authority of
India slapped a notice on the company as neither Patanjali nor Aayush, which are the two brand
names under which Patanjali got licenses, have got any approval for manufacturing instant noodles.
In 2016, Patanjali has announced to enter the textile manufacturing centre. The company is reported
to manufacture not only traditional clothes such as Kurta Payjama but also popular western clothes
such as jeans. On 5 November 2016, Patanjali announced that it will set up a new manufacturing
plant Patanjali Herbal and Mega Food Park in Balipara, Assam by investing ₹1,200 crore(US$170
million) with the manufacturing capacity of 1,000,000 tonnes (2.2×109 lb) of goods per year. The
new plant will be the largest facility of Patanjali in India and will be operational by March 2017.
Patanjali already has around 50 manufacturing units across India.
1.3.1 Some of the sectors where Patanjali products are already doing great:
Foods – Including jams, biscuits, noodles, oats, pulses and many other lines of food products.
Beverages
Healthcare & Medicines
Personal care products
Cleaning agents

The list of Products offered by Patanjali is exhaustive. You can check all its products here

– http://patanjaliayurved.net/

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1.3.2 Products where Patanjali is present and beating competition are

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Dabur Honey: Patanjali Ayurved is providing people with option to buy quality honey at around
30% lesser price than Dabur.
Colgate: Patanjali Ayurved is preaching how Colgate cheated people in early days. And how
ayurveda is the best way to treat your gums and your teeth.
Patanjali Noodles: Patanjali Noodles rose to fame while Maggi was away from the market and has
done quite damage to Maggi, which once was the king of Noodle’s market.
1.4.Pricing in the marketing mix of Patanjali Ayurved
Two factors that have made Patanjali Ayurved the fastest growing FMCG company in
India are:
Use of Natural Ingredients and Ayurved and
Pricing. Pricing plays an extremely important role in putting Patanjali Ayurved ahead of its fierce
competitors. Hindustan Uniliver and P&G are trying their level best to cope up with the competition
but the love for Indian product growing in people is not helping them.

Patanjali is educating people about the benefits of using their products and are also using price
comparison as an effective marketing strategy. The pricing strategy is clearly penetrative pricing
because Patanjali knows that it cannot conquer the market with higher prices. Plus, if the ingredients
are natural and domestic, the cost of the product is

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lesser too. There is a drop of 25-30 percent of price in almost every product when compared to
International Brands which is helping Patanjali reach each and every household in India.

1.5.Place in the marketing mix of Patanjali Ayurved

Patanjali Ayurved is India’s fastest growing FMCG Company but it is not stopping it from
spreading its wing to neighboring countries like Nepal. Patanjali has a manufacturing unit in Nepal.
Patanjali also imports herbs from Himalayas in Nepal; the well-established trade relation is helping
Patanjali expand its wings in Nepal with great ease. With the growing outreach in India and Nepal,
Baba Ramdev surely will be aiming to overtake market in lot of other countries. With impressive
revenue of 5000 Crores, Patanjali is surely going to have a lot of fund for expansion and growth.In
India, 1000’s of stores are now selling Patanjali products, and these stores are exclusively selling
Patanjali, making the local retailer quake. The penetration levels will only rise further as the margins
in the product are good too.

1.6 Promotion in the marketing mix of Patanjali Ayurved:

Patanjali Ayurved goes with the Slogan “Prakriti ka Ashirwad”. Well, Patanjali Ayurved has
acquired the requisite fame and popularity among people because of the globally recognized Yoga
Guru, Baba Ramdev. This brand ambassador of Patanjali is single handedly responsible for the

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success of the brand. His contribution to people’s life through Yoga is incredible hence people felt
aligned towards him when he launched his very own Indian FMCG Company.

While a lot of people shifted to Patanjali Products because of Baba Ramdev, a pool of Indians started
following him when they realized how good and cheap Patanjali products actually are. Patanjali Ad
campaigns have always focused on surpassing information to people that “revenue of Patanjali is
for Charity and not for Brand Owners”. Secondly, it is better that the revenue generated from day
to day products remains within India rather then the profits going out to foreign companies. Till date,
Indians did not have many alternatives to foreign products but now they do have localised products.
Baba Ramdev took the opportunity in his hands and has started influencing Indians by sharing
information about price gap and how useful herbal Patanjali products actually are. Baba Ramdev has
ceased the opportunity with both hands and has made huge difference to the branding of Patanjali
Ayurveda. Now, Patanjali is also selling the products online through E-commerce, increasing their
penetration even further. Only time will tell how people from around the world are going to receive
Patanjali products as an alternative of products from Hindustan Uniliver and P&G.

1.7.SALE & DISTRIBUTION

Patanjali Ayurved sells through nearly 4,700 retail outlets as of May 2016.Patanjali also sells its
products online and is planning to open outlets at railway stations and airports. Patanjali Ayurveda

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has tied up with Pittie Group and Kishore Biyani's Future Group on 9 October 2015.As per the tie-up
with Future Group, all the consumer products of Patanjali will be available for the direct sale in
Future Group outlets.Patanjali Ayurveda products are also available in modern trade stores including
Reliance retail, Hyper city and Star Bazaar apart from online channels. Patanjali Ayurved, co-
founded by yoga guru Ramdev, is targeting Rs 10,000-crore revenue in 2016-17, after sales grew 150
per cent in the previous financial year to Rs 5,000 crore.

20

Patanjali Ayurved has also started its FMCG expansion in form of dealership and distributorship
channels across the country and expects wider growth in Overseas distribution as well.

REVENUE

Revenues
Year (In ₹ Crore)
2010-11 185

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2011-12 453
2012-13 841
2013-14 1,184
2014-15 2,006
2015-16 5,000
2016-17 10,561
2017-18 11,000

Future Group which has tied up with Patanjali sells about ₹30 crore (US$4.2 million) worth of
Patanjali products every month.
Turnover
Patanjali Ayurveda's annual turnover for the year 2014-15 increased to ₹2500 crore (US$370
million) as compared to previous turnovers of ₹1200 crore (US$180 million) (2013-14), ₹850 crore
(US$130 million) (2012-13) and ₹450 crore (US$67 million) (2011-12).

CHAPTER 3 : THEORITICAL FRAMEWORK


INTRODUCTION TO CONSUMER BUYING BEHAVIOR AND
CONSUMER PERCEPTION
3.1 Consumer buying behavior

Consumer buying behavior is the sum total of a consumer's attitudes, preferences, intentions, and
decisions regarding the consumer's behavior in the marketplace when purchasing a product or
service. The study of consumer behavior draws upon social science disciplines of anthropology,
psychology, sociology, and economics.

Need to understand:

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Why consumers make the purchases that they make? What factors
influence consumer purchases?
The changing factors in our society.

Consumer Buying Behavior refers to the buying behavior of the ultimate consumer. A firm needs to
analyze buying behavior for:
Buyers reactions to a firms marketing strategy has a great impact on the firms success.
The marketing concept stresses that a firm should create a Marketing Mix (MM) that satisfies (gives
utility to) customers, therefore need to analyze the what, where, when and how consumers buy.
Marketers can better predict how consumers will respond to marketing strategies.

3.1.1 Stages of the Consumer Buying Process


Six Stages to the Consumer Buying Decision Process (For complex decisions). Actual purchasing is
only one stage of the process. Not all decision processes lead to a purchase. All consumer decisions
do not always include all 6 stages, determined by the degree of complexity...discussed next.
The 6 stages are:

1. Problem Recognition(awareness of need)--difference between the desired state

and the actual condition. Deficit in assortment of products. Hunger--Food.

Hunger stimulates your need to eat. Can be stimulated by the marketer through product information--
did not know you were deficient? I.E., see a commercial for a new pair of shoes, stimulates your
recognition that you need a new pair of shoes.

2. Information search--
Internal search, memory.

External search if you need more information. Friends and relatives (word of mouth). Marketer
dominated sources; comparison shopping; public sources etc.
A successful information search leaves a buyer with possible alternatives, the evoked set.
Hungry, want to go out and eat, evoked set is
Chinese food
Indian food
Burger king
KFC etc

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3.Evaluation of Alternatives--need to establish criteria for evaluation, features the buyer wants or
does not want. Rank/weight alternatives or resume search. May decide that you want to eat
something spicy, Indian gets highest rank etc. If not satisfied with your choice than return to the
search phase. Can you think of another restaurant? Look in the yellow pages etc. Information from
different sources may be treated differently. Marketers try to influence by "framing" alternatives.

4.Purchase decision--Choose buying alternative, includes product, package, store, method of


purchase etc.

5.Purchase--May differ from decision, time lapse between 4 & 5, product availability.

6.Post-Purchase Evaluation--outcome: Satisfaction or Dissatisfaction. Cognitive Dissonance, have


you made the right decision. This can be reduced by warranties, after sales communication etc. After
eating an Indian meal, may think that really you wanted a Chinese meal instead.

3.2 CONSUMER PERCEPTION

In Indian scenario, perceptions is about a particular brand which is important because Indian
customers rely on the perception of their near and dear ones before actually buying or using the
product. The perception of the people around us affect our decision to buy or not to buy the product.
Perceptions are highly subjective and thus easily distorted. Thus in order to survive in the marketing
environment of a country like India, brands need to be positioned in the minds of people. India is
already an attractive destination for brands to set in due to favorable marketing conditions. India has
known to be a hub of Herbal brands as well since the herbal products are deeply associated with the
spirituality sentiments of the people. A WHO (World Health Organization) study estimates that
about 80 percent of world population depends on natural products for their health care instead of
modern medicines primarily because of side effects and high cost of modern medicine. The
worldwide herbal market products are around $6.2 billion and estimated to reach $5 trillion by the
year 2050.

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Consumer perception refers to the process by which a customer selects, organizes, and interprets
information/stimuli inputs to create a meaningful picture of the brand or the product.

Nature of perception :

Perception is the intellectual process.

Perception is the basic cognitive or psychological process.

Perception becomes a subjective process and different people may perceive the same event
differently.

3.2.1 Perception and Sensation

There is a distinction between sensation and perception. Sensation is the response of a physical
sensory organ. The physical senses are vision, hearing, tough, smell and taste. These senses are
bombarded by stimuli and reactions in particular sense organ take place because of these, e.g., of
sensation may be reaction of eye to colour, ear to sound and so on. Sensation precedes perception.
Perception is much more than sensation. Perception depends upon the sensory raw data. The
perceptual process adds to or/and subtracts from the sensory world. Perception is determined by both
physiological and psychological characteristics, of the organism. However, sensation only activates
the organs of the body and is not affected by such psychological factors as learning and motives.
Activation of eyes to see an object is sensation and the inference what is being seen is perception.
For managerial action, it is the latter which is important.

3.2.2.Perceptual Process

Perception is a process of receiving, selecting, organizing, interpreting, checking and reacting to


stimuli. This is like an input-through put-output process in which the stimuli can be considered as
'inputs' transformation of 'input' through selection, organization and interpretation as 'through puts'
and the ultimate behavior/action as 'output'. The whole perceptional process can be presented as
follows : These are explained one by one

Receiving Stimuli : The first process in the perception is the presence of stimuli. The stimuli are
received from the various sources. Through the five organs. It is a physiological aspect of perception

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process. Stimuli may be external to us (such as sound waves) and inside us (such as energy
generation by muscles).

Selection of Stimuli : After receiving the stimuli or data, some are selected. Others are screened out.
Two types of factors affect selection of stimuli for processing : external and internal factors. External
factors relate to stimuli such as intensity of stimuli, its size, movement, repetition, etc. Internal
factors, relate to the perceiver such as his/her age, learning, interest, etc. Normally, he will select the
objects which interest him and will avoid that for which he is indifferent. This is also called 'selective
perception'.

Organization of Stimuli : Organizing the bits of information into a meaningful whole is called
"organization". There are three ways by which the selected data, i.e., inputs are organized. These are
:

Grouping : In grouping, the perceiver groups the various stimuli on the basis of their similarity or
proximity. For example, all the workers coming from the same place may be perceived as similar on
the basis of proximity.

Closure : When faced with incomplete information, people fill up the gaps themselves to make the
information meaningful. This may be done on the basis of past experience, past data, or hunches. For
example, in many advertisement, alphabets are written by putting electric bulbs indicating the shape
of the concerned alphabets but broken lines. In such cases, people tend to fill up the gap among
different bulbs to get meaning out of these.

Simplification : People identify main stimulus features and assesses how they are organized. He
interprets a stimulus situation, the perceiver simples the information.

3.3.Factors Influencing Perceptual Set External Factors

Size : Bigger size attracts the attention of the perceiver

Intensity : A loud sound, strong odor or bright light is noticed more as compared to a soft sound,
weak odor or dim light.

Repetition : A repeated external stimulus is more attention getting than a single one. Advertisers use
this principle.

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Novelty and Familiarity : A novel or a familiar external situation can serve as attention getter.

Contrast : It is a kind of uniqueness which can be used for attention getting. Letters of bold types,
persons dressed differently than others, etc., get more attention.

Motion : A moving object draws more attention as compared to a stationary object. Advertisers use
this principle.

3.4.Internal Factors Self-concept

The way a person views the world depends a great deal on the concept or image he has about
himself. The concept plays an internal role in perceptual selectivity.

Beliefs : A person's beliefs have profound influence on his perception. Thus, a fact is conceived not
on what it is but what a person believes it to be.
Expectations : These affect what a person perceives. A technical manager may expect ignorance
about the technical features of a product from non-technical people.

Inner Needs : The need is a feeling of tension or discomfort, when one thinks he is missing
something. People with different needs experience different stimuli. According to Freud, wishful
thinking is the means by which the Id attempts to achieve tension reduction.

Response Disposition : It refers to a person's tendency to perceive familiar stimuli rather than
unfamiliar ones.

Response Salience : It is the set of disposition which are determined not by the familiarity of the
stimulus situations, but by the person's own cognitive predispositions. Thus, a particular problem
may be viewed as a marketing problem by marketing personnel, a control problem by accounting
people and human relations problem by personnel people. Perceptual Defense : It refers to the
screening of those elements which create conflict and threatening situation in people.

1.Denying the existence or importance of conflicting information.

2.Distorting the new information to match the old one.

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3.Acknowledging the new information but treating it as a non-representation exception. The factors

that influence perception may be broadly divided into three categories :

(a) Factors that reside in the 'Perceiver' (i.e., attitude, motives, interests, past experiences and
personality, expectations)
(b) Factors of the 'situation' and-factors connected with the 'Target'.

(c) Factors that determine the preferred location of a brand on each of the relevant dimension in
perceptive mapping.

CHAPTER 4 : RESEARCH METHODOLOGY

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Research methodology is a systematic way to solve the research problem. It is the process used to
collect information and data for the purpose of making business decisions. The methodology may
include publication research, interviews, surveys and other research techniques, and could include
both present and historical information.

This study is totally a survey based model. The consumers are in the different age group are given
questionnaire to get the feedback. Based on their input the analyses were done and results arrived.
The literature reviews are done based on the secondary information’s available in the well known
articles from good publishers and internet sources.

4.1 Research Objectives

4.1.1. Primary Objective

To measure the customers perception and buying behaviour towards Patanjali Products in Surat City
during November 2018 to February 2019.

4.1.2. Secondary Objective


The main objective of the study is to study the buying motives of the customers regarding
purchasing patanjali products.
To know the attributes that a customer keeps in mind while buying ‘PATANJALI’ products.
To study the satisfaction after using ‘PATANJALI’ products.
To study the customer perception of ‘PATANJALI’ in the minds of consumers.
To evaluate and suggest the valuable factors which will help to increase the sales and
revenues.

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To know the source of consumer preference.

4.2 Research Design

Descriptive research design is used in order to know what the consumers perception and buying
behavior is towards the Patanjali products. Descriptive research is used as it a quantitative research
method which helps in collecting quantifiable information to be used for statistical analysis, as the
variables used in descriptive research are not influenced by any external factors, as it is a cross
sectional study and because the data collected through descriptive research method can also be used
to conduct further research using different techniques.

4.3 Source of Data

The data collected is primary in nature, with the help of a structured questionnaire a survey had been
conducted through which the data has been collected. A structured questionnaire was used in order to
collect responses as it is a quantitative method of research and requires low level of engagement of
the researcher and helps in obtaining a high number of responses.

4.4 Population

A research population is generally a large collection of individuals or objects that is the main focus
of a scientific query. It is for the benefit of population that researches are done. Here my research
population includes the all people residing in Vesu, Adajan, Bhatar and Athwagate area of Surat city
under the age group of 20 years and above. However, due to the large size of population, one often
cannot test every individual in the population because it is too expensive and time consuming. This is
why researchers rely on sampling techniques.

4.5 Sampling Area

In this the sampling areas are the areas of Surat City like:

Vesu, Adajan, Athwagate, Bhatar

4.6 Sample Unit

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In this study the sample units are those consumers who consume Patanjali products from the
Patanjali outlet and exclusive stores.

4.7 Sampling Method

Descriptive statistics (Cross Tabulation, Chi Square test and graphs) was used to measure the Buying
behavior and consumer Perception towards the Patanjali products. Chi square test of independence
was conducted to verify the independence between the socio economic factors and there purchase
intention.

4.8 Limitations

The survey was conducted only over 300 respondents in Bhatar and Adajan area of Surat city and

The respondent’s answers may have an element of social desirability.

The research is restricted to only 300 respondents due to time and budget constraints.

The research is limited to Surat city only, and even to only a limited number areas in it.

4.9 Rationale of the study

Statement of the problem Consumers are the masters of their money and they have an enormous
influence on the economic market change because they possess the ability to implement and
coordinate their choice of spending or saving in the purchase decision. Consumers are influenced by
their attitude towards the product and therefore marketers need to implement their strategies and
tactics frequently in order to achieve more consumers. Satisfaction and accurate target in finding out
what customers are aware and their buying perception and there by offering products according to
this needs will help the industry stake holders to enrich their customer experience and accelerate
growth of the market. The process that turns marketing plans into marketing actions In order to fulfill
strategic marketing objectives it is called marketing plan but most of the markets are still challenged
by their marketing. Hence this research aims to explore the consumer’s perception towards Patanjali
products.

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