“A STUDY OF EFFECT OF BRANDING ON CONSUMERS OF

FMCG PRODUCTS AND DURABLE GOODS”

Dissertation Submitted to the

D.Y. PATIL Deemed to Be University School of Management

In partial fulfilment of the requirements for the award of the

Degree of

BACHELORS OF BUSINESS ADMINISTRATION

Submitted by:

Rajveer Raj

(Roll No BBA017002)

Submitted To

Dr. Gagandeep Nagra

Associate Professor

D.Y. Patil Deemed to be University

School of Management

CBD Belapur, Navi MUMBAI

March 2020
1
“A STUDY OF EFFECT OF BRANDING ON CONSUMERS OF
FMCG PRODUCTS AND DURABLE GOODS”

Dissertation Submitted to the

D.Y. PATIL Deemed to Be University School of Management

In partial fulfilment of the requirements for the award of the

Degree of

BACHELORS OF BUSINESS ADMINISTRATION

Submitted by:

Rajveer Raj

(Roll No BBA017002)

Submitted To

Dr. Gagandeep Nagra

Associate Professor

D.Y. Patil Deemed to be University

School of Management

CBD Belapur, Navi MUMBAI

March 2020
2
 “EFFECT OF BRANDING ON
CONSUMER OF FMCG PRODUCT AND
DURABLE GOODS”

3
4
 DECLARATI
ON

I hereby declare that the dissertation “EFFECT OF BRANDING ON

CONSUMER OF FMCG PRODUCTS AND DURABLE GOODS”
submitted for the Full time BBA Degree at Dr. D.Y. Patil Deemed to be
University School of Management is my original work and the dissertation has
not formed the basis for the award of any degree, associate ship, fellowship or
any other similar titles.

SIGNATURE OF THE STUDENT

PLACE: - Navi Mumbai

DATE: -

5
 CERTIFICATE

This is to certify that the dissertation entitled “ EFFECT OF BRANDING ON

CONSUMER OF FMCG PRODUCTS AND DURABLE GOODS” is the
bonafide research work carried out by RAJVEER RAJ, student of Full Time
BBA, at D.Y Patil Deemed to be University School Of Management during the
year 2017-2020, in partial fulfilment of the requirements for the award of the
Degree of Bachelors in Business Administration and that the dissertation has
not formed the basis for the award previously of any degree, diploma, associate
ship, fellowship or any other similar title.

Dr. Gagandeep Nagra

Associate Professor
Department of Business Management
D.Y. Patil University
School of Management

Dr. R. Gopal
Director & HOD
D.Y. Patil University
School of Management

Place: - Navi Mumbai

Date: -

6
 PREFACE

While searching for a suitable topic for the BBA Dissertation, I happened to
meet a person from the FMCG Sector, who suggested to me the topic on the
FMCG Sector of India. During the course of the discussion, it transpired that the
problems that this sector faces.

The topic having aroused my curiosity, discussion were held in several people
in the FMCG Sector to understand the veracity of the above thought process and
also understand the real issues plaguing the industry.

All these aspects then resulted in the development of the project report
“EFFECT OF BRANDING ON CONSUMERS OF FMCG PRODUCTS
AND DURABLE GOODS”.

It is strongly hoped that this project covers all the values requirements of the
Project Study.

7
 ACKNOWLDGEMENT

In the first place, I thank the Dr. D.Y. Patil Deemed to be University, School of
Management, Navi Mumbai for giving me an opportunity to work on this
project.

I would also like to thank Dr. R. Gopal (Director & HOD) & Dr. Vani Kamath
Associate Professor Dr. D.Y. Patil Deemed to be University School of
Management, Navi Mumbai for having given me her valuable guidance for the
project.

I would be failing in my duty if I do not acknowledge with a deep sense of

gratitude the sacrifices made by my parents and thus have helped me in
completing the project work successfully.

SIGNATURE OF THE STUDENT

PLACE: - Navi Mumbai

DATE: -

8
 TABLE OF CONTENTS

Chapter TOPIC Page

No. No.

A. LIST OF TABLES 13-15

B. LIST OF FIGURES 16-17

C. LIST OF ABBREVATIONS 18

D. EXECUTIVE SUMMARY 19-20

1 INTRODUCTION 22-24

1.1 FMCG OVERVIEW 25

1.2 FMCG COMPANY OVERVIEW 26

MAJOR SEGMENTS OF THE FMCG

1.3 INDUSTRY 27-28

RURAL CONSUMER BEHAVIOUR

1.4 TOWARDS DURABLE GOODS 29

TOP PLAYERS IN FMCG SECTOR OR

1.5 DURABLE GOODS 30

FMCG OR DURABLE GOODS SECTOR IN

1.6 INDIA 31-32

1.7 THE FUTURE OF FMCG 33-40

1.8 RURAL MARKET AND RURAL 41-42

MARKETING

2. LITERATURE REVIEW 43
9
 2.1 RESEARCH IN INDIA 44-46

2.2 RESEARCH ABROAD 47-49

3. OBJECTIVES 49-50

4. DATA ANALYSIS & INTERPRETATION 52

4.1 BUYING FREQUENCY 53

4.2 PACKAGE SIZE 54-55

4.3 BUYING LOCATION 56

4.4 PURCHASE INFLUENCE 57-58

4.5 USAGE LONGEVITY 59-60

4.6 AREAS IN WHICH BRAND CAN IMPROVE 61

4.7 BRAND LOYALTY 62

4.8 SWITCH SIMULATOR 63-64

4.9 BRAND LOYALTY VS AGE 65

4.10 BRAND IMAGE 66-67

VARIOUS ATTRIBUTES AND THE BRAND

4.11 RATING ONE THEIR BASIS 68

SOURCE OF AWARENESS ABOUT THE

4.12 BRAND 69

4.13 AGE VS BRAND 70

4.14 ANNOVA TESTING 71-72

10
 4.15 OCCUPATION VS BRAND 73-74

5. RESEARCH METHODOLOGY 75

5.1 RESEARCH DESIGN 76

5.2 STATEMENT OF THE PROBLEM 76

5.3 RESEARCH DESIGN 77

5.4 HYPOTHESIS 77-78

5.5 DATA COLLECTION 78

5.6 PRIMARY DATA 78

5.7 DATA COLLECTION METHOD 78

5.8 SAMPLING 78

5.9 SCOPE OF THE WORK 79

5.10 LIMITATION OF THE STUDY 80

5.11 UTILITY OF THE STUDY 80-81

6. SWOT ANALYSIS 82-84

7. DEMOGRAPHIC PROFILING 85-104

8. QUESTIONNAIRE 105-108

9. ANNEXURE 109-110

11
10. LEARNING OUTCOMES 111-112

11. RECOMMENDATIONS 113-114

12. CONCLUSION 115-117

13. BIBLOGRAPHY 118-119

12
 LIST OF TABLES

TABLE
NO TABLE EXPLANATION PAGE NO

1. RURAL MARKET AND RURAL MARKETING 40

2. BUYING FREQUENCY 53

3. PACKAGE SIZE 54

4. BUYING LOCATION 56

5. PURCHASE INFLUENCE 57

6. USAGE LONGEVITY 59

7. AREA IN WHICH BRANDS CAN IMPROVE 61

8. BRAND LOYALTY 62

9. SWITCH SIMULATOR 63

10. BRAND LOYALTY VS AGE 65

11. BRAND IMAGE 66

12. VARIOUS ATTRIBUTES AND THE BRAND

RATING ON THEIR BASIS 68

13. SOURCE OF AWARENESS ABOUT THE

BRAND 69

14. AGE VS BRAND 70

15. ANNOVA TESTING 71-72

16. OCCUPATION VS BRAND 73

13
17. DEMOGRAPHIC OF CONSUMERS 86-88

18. SALIENT ASPECTS MODERATING THE

PURCHASE BEHAVIOR OF RURAL
RESPONDENTS OF ERNAKULAM FOR FMCG
PERSONAL CARE ITEM LIKE SOAPS &
DETERGENTS 89-90

19. MEDIA USAGE INFLUENCE ON RURAL

CONSUMERS ON THEIR PURCHASE OF
FMCG PERSONAL CARE GOODS LIKE SOAPS
& DETERGENTS 91

20. MOST PRIORITY ACCORDED IN THE

FAMILY ON EXPENDITURE SPENDING 92

21. MOST EFFECTIVE SALES PROMOTION

MEASURES INFLUENCING PURCHASE OF
FMCG ITEMS 93

22. INFLUENCE OF SED ASPECTS ON

CONSUMER PURCHASE BEHAVIOUR OF SU-
RURAL 94

23. T- TEST ON INFLUENCE OF PURCHASE

BEHAVIOUR SU-RURAL HH- CONTRAST OF
HUSBAND AND WIFE ON VARIOUS 95

24. SUMMARY OF 1W ANOVA ON ASPECTS

INFLUENCING PURCHASE BEHAVIOUR OF
RURAL AND SEMI-URBAN RESPONDENTS
FOR FMCG PERSONAL CARE PRODUCT
ATTRIBUTES 97-98

25. SHOP ATTRIBUTES SIGNIFICANT FOR THE

SU-RURAL CONSUMERS PREFERRED
CHOICE 99-100

14
 RANKING OF ATTRIBUTES IN THE
26. PURCHASE OF LAEDING BATHING SOAP
BRANDS 101

102
27. ATTRIBUTES ON DETERGENT BRANDS

SAILENT ATTRIBUTES CHOSEN IN THE

28. PURCHASE OF BATHING SOAPS:
DETERGENTS 103

29. HAVE YOU EVER HAD ANY SIDE EFFECTS

USING THIS BRAND OF TOOTHPASTE 107

15
 LIST OF FIGURES

FIGUR
E NO FIGURE EXPLANATION PAGE NO

1. EFFECTS OF BRANDING ON CONSUMER OF

FMCG PRODUCT AND DURABLE GOODS 4

2. RURAL MARKET AND RURAL MARKETING 42

3. BUYING FREQUENCY 54

4. PACKAGE SIZE 55

5. BUYING LOCATION 57

6. PURCHASE INFLUENCE 58

7. USAGE LONGEVITY 60

8. AREA IN WHICH BRANDS CAN IMPROVE 62

9. BRAND LOYALTY 63

10. SWITCH SIMULATOR 64

11. BRAND LOYALTY VS AGE 66

12. BRAND IMAGE 67

13. VARIOUS ATTRIBUTES AND BRAND RATING

ONE THEIR BASIS 69

14. SOURCE OF AWARENESS ABOUT THE

BRAND 70
16
15. AGE VS BRAND 71

16. OCCUPATION VS BRAND 74

17. QUESTIONNAIRE 106

18. WHICH AGE USE WHICH BRAND OF

TOOTHPASTE 107

17
 List of Abbreviation

1. CeX: - Customer Experience

2. &: -And
3. %: - Percentage
4. ABL: - Attitudinal Brand Loyalty
5. BBL: - Behavioural Brand Loyalty
6. BHV: - Brand Hedonic Values
7. BUV: -Brand Utilitarian Values
8. CBA: - Consumer Brand Affect
9. CBT: - Consumer Brand Trust
10.CFA: - Confirmatory Factor Analysis
11.CFI: - Comparative Fit Index
12.CSAT: - Consumer Satisfaction
13.FMCG: - Fast Moving Consumer Goods
14.GOF: - Goodness-Of-Fit
15.GTC: -Groceries, Toiletries and Confectionary
16.RMR: -Root Mean Square Residual
17.RMSEA: - Root Mean Square Error of Approximation
18.SEM: - Structured Equation Modelling

18
EXECUTIVE SUMMARY

19
 EXECUTIVE SUMMARY

India is the second largest consumer market in the world. The Indian consumer
“

profile has been developed and changed in terms of education, income,

occupation, and reference group and media habits. There is a shift in consumer
brand preference for durables products for the past decade with the influx of
modern technology. The consumer buying preferences are rapidly changing and
moving towards high-end technology products with acculturation. Products
which were once considered luxury items have become a necessity because of
the changing lifestyle and rising income levels. With growth in disposable
”

incomes, the demand for high-end products such as television, washing

machine, refrigerator, “and air conditioners has increased considerably. It is also
facilitated by the easy availability of finance and prevalence of nuclear families.
Increasing in demand for consumer durable in the market the fall in prices as
Indian consumers are continue to attach a high degree of importance to value
for money. The consumer is brand-conscious, but not necessarily brand-loyal,
and might even pick up a reliable private label if it offers good price and quality
values.”

Consumer durable penetration is one of the lowest in India and the untapped
“

potential is evidently enormous. Both manufacturers and traders would be

compelled to explore every conceivable method to improve operational
efficiencies, in order to achieve substantial and profitable business growth. The
Indian consumer durables market has undergone a major transformation since
the liberalization process, initiated in 1991. The market size, product
””

penetration, the variety and technology of products sold, have all experienced a
quantum leap. Improved product choice and decline in real prices, matched by
increased consumer incomes have driven the market growth rate to dizzy
heights”

20
 CHAPTER 1
INTRODUCTION

21
 INTRODUCTION

What Is A BRAND?

Brand recognition and other reactions are created by the use of the product
“

or service and through the influence of advertising, design, and media

commentary. A brand is a symbolic embodiment of all the information
connected to the product and serves to create associations and expectations
around it. A brand often includes a logo, fonts, colour schemes, symbols,
and sound, which may be developed to represent implicit values, ideas, and
even personality. ”

Concepts

Marketers engaged in branding seek to develop or align the expectations

“

behind the brand experience, creating the impression that a brand associated
with a product or service has certain qualities or characteristics that make it
special or unique. A brand image may be developed by attributing a
”

"personality" to or associating an "image" with a product or service,

whereby the personality or image is "branded" into the consciousness of
consumers. A brand is therefore one of the most valuable elements in an
“

advertising theme. The art of creating and maintaining a brand is called

brand management. A brand which is widely known in the marketplace
acquires brand recognition. When brand recognition builds up to a point
where a brand enjoys a critical mass of positive sentiment in the
marketplace, it is said to have achieved brand franchise. One goal in brand
recognition is the identification of a brand without the name of the company
present. For example, Disney has been successful at branding with their
”

particular script font (originally created for Walt Disney's "signature" logo)
22
which it used in the logo for go.com. "DNA" refers to the unique attributes,
essence, purpose, or profile of a brand and, therefore, a company. The term
is borrowed from the biological DNA, the molecular "blueprint" or genetic
profile of an organism which determines its unique characteristics.

“ Brand equity measures the total value of the brand to the brand owner, and
reflects the extent of brand franchise. The term brand name is often used
interchangeably with "brand", although it is more correctly used to
specifically denote written or spoken linguistic elements of a brand. In this
context a brand name constitutes a type of trademark, if the brand name
exclusively identifies the brand owner as the commercial source of products
or services. A brand owner may seek to protect proprietary rights in relation
to a brand name through trademark registration. ”

Brand energy is a concept that links together the ideas that the brand is
“

experiential; that it is not just about the experiences of customers/potential

customers but all stakeholders; and that businesses are essentially more
about creating value through creating meaningful experiences than
generating profit. Economic value comes from businesses’ transactions
between people whether they be customers, employees, suppliers or other
stakeholders. For such value to be created people first have to have positive
associations with the business and/or its products and services and be
energised to behave positively towards them – hence brand energy. It has
”

been defined as "The energy that flows throughout the system that links
businesses and all their stakeholders and which is manifested in the way
these stakeholders think, feel and behave towards the business and its
products or services." Attitude branding is the choice to represent a feeling,
23
which is not necessarily connected with the product or consumption of the
product at all. Marketing labelled as attitude branding includes that of Nike,
Starbucks, The Body Shop, Safeway, and Apple Inc.

"A great brand raises the bar -- it adds a greater sense of purpose to the
experience, whether it's the challenge to do your best in sports and fitness,
or the affirmation that the cup of coffee you're drinking really matters." -
Howard Schultz (CEO, Starbucks Corp.)

The act of associating a product or service with a brand has become part of
“

pop culture. Most products have some kind of brand identity, from common
table salt to designer clothes. In non- commercial contexts, the marketing of
entities which supply ideas or promises rather than product and services
(e.g. political parties or religious organizations) may also be known as
”

"branding".

24
1.1 FMCG OVERVIEW

The Indian Fast-Moving Consumer Goods (FMCG) industry began to shape

“

during the last fifty odd years. The growth of FMCG industry was not
significant between 1950’s to the 1980’s. The FMCG industry previously was
not attractive from investor’s point of view due to low purchasing power and
the government’s favouring of the small-scale sector. FMCG’s growth story
further continued following the deregulation of Indian economy in early 1990s.
With relatively lesser capital and technological requirements, a number of new
brands emerged domestically as well, while the relaxed FDI conditions led to
entry of many global players in this segment. These factors made FMCG market
in India highly competitive and one of the important contributors in the Indian
economy. In the mid - nineties, the growth of the sector was very fast where as
it declined rapidly at the end of the decade. The initial growth was due to
increase in product penetration and consumption levels. Riding on a rapidly
growing economy, in-creasing per-capita incomes, and rising trend of
urbanization, the FMCG market in India is expected to further expand to $100
billion by 2025.
”

1.2 FMCG Company Overview

25
Fast-moving consumer goods (FMCGs) are typically high-volume, low-value
“

items with high public visibility and a short life span, such as food, drink,
confectionery, toiletries, and household goods. As the name would imply, it is
one of the fastest growing sectors in the UK economy and is a multi-million-
pound industry. It encompasses a huge range of products and services in
manufacturing, distribution and retailing. If you think about some of the
products you use every day like cereal, soap, washing powder, frozen food, the
list is potentially endless. As more and more new products are launched on to
the market, the job opportunities continue to grow for those wanting to pursue
an FMCG graduate career. ”

FMCGs are products that move off the shelves of retail shops quickly, which
“

therefore require constant replenishing. Consumers look for the product that
offers most value to them, considering features (package, taste, price, weight),
concept (features and related benefits), information sources (for example,
advertising), and intangible characteristics such as brand image.
”

FMCGs fulfil a broad range of needs. Beverages quench thirst, provide

“

refreshment and taste and reflect lifestyles. Confectionery offers energy, taste,
rewards and gift opportunities. Companies cater for these fundamental needs in
a range of products which offer a huge variety of ingredients and styles.
”

Many brands become established names with whom consumers can identify.
“

This makes a company's protection of their reputation an essential ingredient of

their long-term success. FMCGs are also constantly seeking new and innovative
ways to satisfy the consumer's willingness to try new things. Consequently,
whenever they develop a new product, they have to build consumer awareness
through advertising and promotion. Consumers want to be informed, whether to
be reminded of their feelings about established favourites or to be told of new
product available on the marketplace.”

With choice, comes access to products. The aim of many working in FMCGs is
“

to make their products as widely available as possible, to ensure that they are
always within an arm's reach whether as an impulse or a considered buy. To
achieve this, FMCGs work with their customers in many different trade
channels.”

1.3 MAJOR SEGMENTS OF THE FMCG INDUSTRY:

26
1. Household Care: The detergents segment is experiencing health annual
“

growth rate of 10 to 11 per cent during the past five years. The detergent
market is equally dominated by the local and unorganized players which
shares decent percentage of the total volume. In urban areas, people give
preference to detergents in place of bars. Household care segment is featured
by intense competition and high level of penetration. With rapid urbanization
and increasing disposable income, introduction of the concept of small
packets and sachets, the household care products demand is growing fast. In
washing powder segment, HUL is the leader with ~38 per cent of market
share. Other leading players are Proctor & Gamble, Nirma and Henkel. ”

2. Personal Care: Personal care segment includes oral care products, skin care
“

products and cosmetics, hair care products, personal wash products etc. The
Indian skin care and cosmetics market is very large and valued at $274
million and is dominated by leading players like HUL, Colgate Palmolive,
Godrej Consumer and Gillette India. The coconut oil segment covers 72 per
cent share in the hair oil market. The hair care market can be divided into
hair oils, hair colorants & conditioners, shampoos, and hair gels. Marico
(with Parachute) and Dabur are the leading players in the branded coconut
hair oil market. Rural people prefer to buy sachet which makes up to 40 per
cent of the total shampoo sale. Again, HUL is the dominant player with
around ~47 per cent market share; P&G placed at second position with
market share of around ~23 per cent. Personal wash can be further
categorized into three segments i.e. Premium, Economy and Popular. Here
also, HUL is leading the market with market share of ~53 per cent; Godrej
stands at second position with market share of ~10 per cent. Increasing
disposable income of the Indian consumers, wide channel network of MNCs,
growth in rural demand for premium products are the key drivers for pulling
the future demand growth up in major FMCG categories ”

“ The skin care market is at a primary stage in India. With modernization, the
27
 life style has changed drastically, consumers have more disposable incomes
which give greater product choice and availability of the products give them
freedom to purchase.”

Moreover, people are becoming more alert and aware about personal
“

grooming. The leading player in this segment is Hindustan Unilever with a

market share of ~54 percent, Cavin are occupies second position with market
share of ~12 per cent and Godrej at third with a market share of ~3 percent.
”

The oral care market can be categorized into various sub-segments with
“

toothpaste -60 percent; toothpowder -23 percent; toothbrushes -17 percent.

Colgate-Palmolive is the leader of this segment with market share of ~49
percent, while HUL stands at second position with market share of ~30
percent. In toothpowders market, Colgate and Dabur are the leading players. ”

3. Food and Beverages: This segment comprises of the food processing

“

industry- packaged foods, health beverage industry- bread and biscuits,

chocolates & confectionery, Packed Mineral Water and ice creams. The
three largest consumed categories of packaged foods are packed tea, biscuits
and soft drinks. Tea market dominates the Indian hot beverage market.
Unorganized players enjoy the major share of tea market. Leading players of
organized tea market are HUL and Tata Tea. Major players in food segment
are HUL, Amul, Dabur, Nestle, ITC and Godrej. ”

1.4 Rural Consumer Behaviour towards Durable Goods:

28
Earlier, rural consumers made their purchasing of their requirements from
“

nearby towns. However, in recent times, a shift and a swing have been observed
in the buying behavior of the rural consumer who has started buying the
products locally. This change in consumer purchase habit has given a ray of
hope to the rural marketer. This provides the immense opportunities for
employment for the rural masses that can make their association with the
FMCG companies and the companies can get the channel partners to promote
and enhance their business in rural areas. This producer retailer chain can
ensure the supply of the products at the smaller retail outlets in villages. ”

Studies suggested that advice to the rural consumer by the retailer plays a very
“

important role in making the product known and familiar among rural masses
and it reduces the efforts of the companies at creating brand knowledge and
positioning the product in rural markets. A promotion campaign educating the
benefits of a product or brand along with hardcore distribution efforts can be
seen in rural markets in the FMCG category. Customer satisfaction is
essentially the highest point of a series of customer experiences or, the net result
of the good experiences minus the bad experiences. It occurs when the
customer’s expectations and their subsequent experiences are matched. ”

29
1.5 Top Players In FMCG Sector Or Durable Goods:
 Hindustan Lever Limited (HLL)
 ITC (Indian Tabacco company)
 Nestle India
 GCMMF (Amul)
 Dabur India
 Asian Paints (India)
 Cadbury India
 Britannia Industries
 Proctor and Gamble Hygiene & Healthcare
 Marico Industries

Secondary Players In FMCG Sector Or Durable Goods:

 Colgate-Palmolive (India) Ltd.
 Godrej Consumers Product Ltd.
 Nirma Ltd.
 Tata Tea Ltd.
 Parle Agro.

FMCG giants such as ITC, Dabur, Godrej Consumer Products, Britannia,

“

Marico have been making sincere efforts to promote their products in rural
areas and for generating awareness among them, they have increased their
marketing efforts in rural India and smaller towns with the motive to establish a
local distribution networks and increase product visibility in the deep interior
parts of rural markets. Godrej has organized 'Rural melas' in order to access
potential rural consumers. Major domestic retailers like AV Birla, ITC, Godrej,
Reliance and many others have already set up farm linkages. ”

Hariyali Kisan Bazaars (DCM) and Aadhars (Pantaloon Godrej JV), Choupal
“

Sagars (ITC), Kisan Sansars (Tata), Reliance Fresh, Project Shakti (Hindustan
30
Unilever) and Naya Yug Bazaar have established rural retail hubs. ”

1.6 FMCG Or Durable Goods Sector In India:

The India FMCG sector is the fourth largest sector in the economy with a total
“

market size in excess of US$ 13.1 billion. Multinationals have made a strong
presence and is characterized by an intense competition between the organized
and unorganized segments, well connected distribution network, large number
of channel members and low operational cost. In India, companies enjoy the
advantage of having cheaper labour supply, availability of key raw materials
and presence across the entire value chain gives India a competitive advantage.
The FMCG market is having a bright future in India as per studies and is
expected to jump from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015.
Per capita consumption/expenditure as well as penetration level in most product
categories like hair wash, packaged foods, jams, skin care, toothpaste etc in
India is low indicating the immense opportunity which is left untapped. Indian
population is mushrooming and it is providing opportunities to multinationals as
well as the domestic players to grow. In India, the middle class and the rural
segments, presents an opportunity to producers of branded products to convert
consumers to branded products and this make-shift from unbranded to branded
indicates huge potential to grow in the same industry. Growth is also likely to
come from consumer 'upgrading' in the matured product categories. ”

 Indian FMCG sector is contributing Rs. 2 trillion in the total economy with
rural India contributing to a third of revenues.

 As per a study conducted by Booz & Company, FMCG sector is expected to

“

grow in the range of 12% to 17% upto 2020 and could touch a market size
between Rs. 4,000 to Rs.6,200 billion by 2020. ”

 Consumer preferences in rural markets have shown a paradigm shift over the
“

last few years. Their consumption basket looks very similar to that of urban
counterparts. Premium products are replacing basic versions and brands are
making their presence felt. Nielsen estimates that the FMCG market in rural
31
 India will mark US$ 100 billion by 2025, from the current level of US$ 12
billion. Moreover, the Government's efforts to improve the efficiency of
welfare programs with cash transfers will further boost rural consumption; it
plans to deposit US$ 570 billion in the accounts of 100 million poor families
by 2014. ”

 The rural FMCG market in India has grown 15% in 2011 (Nielsen Report,
“

2012). The Indian rural consumer market grew 25% in 2008 and reached
US$ 425 billion in 2010- 11 with 720-790 million customers (Quarterly
Report, CIITechnopak, 2011). According to FICCI Technopak Report 2009,
FMCG industry is projected to grow by 12% and reach a size of US $ 43
billion by 2013 and US $ 74 billion by 2018. ”

 During the year under review, the FMCG industry continued on a steady
“

growth trajectory. Riding on continued demand for branded food products,

personal care, household care, baby care and OTC products, the Indian
FMCG sector crossed the Rs. 2-trillion mark in fiscal 2012-13, as per AC
Nielsen. Future growth in the FMCG sector is expected to be driven by:
”

 Low per capita consumption: Per capita consumption levels in FMCG

“

categories such as skin care, shampoos and toothpastes are much lower in
India as compared to other markets and are expected to drive growth in
future. ”

 Favourable demographics: 65% of India’s population is below the age of 35

“

years, making India one of the youngest nations and an important aspect of
consumption growth. ”

 Low penetration levels of consumer products in most categories.

 Shift to branded products from unbranded products: Current level of

“

unorganized market in some of the FMCG categories bodes well for future
volume growth of branded products. ”

32
 Growth potential in rural markets.

1.7 The Future Of FMCG:

FMCG future has a great potential and is going to become a huge Rs 400,000-
“

crore industry by 2020. A Booz & Company research study reveals the trends
that will shape its future. Considering the above research study, the anti- ageing
skincare category blossomed five times between period 2007 and 2008. ”

Today, it has become a very lucrative and fastest-growing segment in the

“

skincare market. Procter & Gamble‘s premium anti-ageing cream Olay, covered
20 per cent of the market within a year of its launch in 2007 and today leads the
market with 37 per cent share. Around ten years ago, No one had predicted the
ready acceptance for anti- ageing lotions and creams. Similarly, Indian market
didn’t expect that Indian consumers would take oral hygiene seriously. Indian
consumers have become very sensitive when it comes to precautionary
measures for the safety of their oral organs. Mouth rinsing is picking up as a
habit among Indian consumers — mouthwash penetration is growing at 35 per
cent a year. Even Shampoo category has gained a good momentum in rural
areas and it was not predicted. Rural penetration of shampoos increased to 46
per cent last year.
”

Consumption patterns have revolutionized in the last five to ten years. The
“

consumer is trading newer experiences and is trying innovative things every

day. He is looking for products with better quality, functionality, price, value
for money etc. According to a recent published report by Booz & Company for
the Confederation of Indian Industry (CII), called FMCG Roadmap to 2020:
The Game Changers points out the key growth drivers for the Indian fast
moving consumer goods (FMCG) industry in the past ten years and identifies
the big trends and factors that will impact its future. FMCG sector has been
booming very fast and has seen robust year-on-year growth of approximately 11
per cent in the last decade, almost tripling in size from Rs 47,000 crore in 2000-
01 to Rs 130,000 crore now (it accounts for 2.2 per cent of the country‘s GDP).
In last 5 years, the FMCG sector has seen tremendous growth at almost 17 per

33
cent annually since 2005. It identifies robust GDP growth, increased income in
rural areas, opening up of rural markets, growing urbanization along with
evolving consumer lifestyles and buying behaviors as the key drivers of this
growth. It has been predicted that the FMCG industry is set to see a boom in its
annual growth and will grow at least 12 per cent annually to become Rs 400,000
crore in size by 2020. Even we can experience more brighter future if some of
the factors play out favorably, say, infrastructure investments pick up, GDP
grows a little faster, there is more efficient spending on government subsidy, the
government removes bottlenecks such as the goods and services tax (GST) and
so on, growth can be significantly higher. It could be as high as 17 per cent,
leading to an overall industry size of Rs 620,000 crore by 2020.”

Abhishek Malhotra (2010) told that the Indian GDP per capita is low but many
“

Indian consumer segments which constitute rather large absolute numbers are
either close to or have already reached the tipping point of rapid growth. The
FMCG sector is set for rapid growth over the next 10 years, and by 2020, the
industry is expected to be bigger in size, more economic, highly responsible and
more tuned to its customers. According to the facts based on research on
industry evolutions in other markets and discussions with industry experts and
practitioners, Booz & Company has identified some important trends and
explored few factors that will change the fortune of the industry in coming next
ten years. Some key factors related to evolution of consumer segments are as
follows:”

1. Accelerating “Premiumisation”: The rising income of Indian consumers

“

has become a major factor for big multinationals to operate their business in
India and rising disposable income has accelerated the trend towards
premiumisation or up trading. The upward trend of purchasing of premium
products can be observed prominently in the top two income groups — the
rich class with annual income exceeding Rs 10 lakhs, and the upper middle
class with annual income ranging between Rs 5 lakhs and Rs 10 lakhs. The
rich segment are willing to spend their part of income on purchasing of
premium products to satisfy their newly developed curiosity to consume,
emotional value and exclusive feel, and their behaviour is very much similar
to consumers in developed economies. They are well-informed and aware

34
 about various product options available in the market, and want to spend on
buying those products which suit their life-style. The upper middle class
have a curiosity to consume premium products and wants to emulate the rich
and up-trade towards higher-priced premium quality products which
represents the higher status in the society offer greater functional benefits
and experience compared to products for mass consumption. While these
two income groups account for only 3 per cent of the population, it is
estimated that by 2020 their numbers will double to 7 per cent of the total
population. The rich will grow to approximately 30 million in 2020, which is
more than the total population of Sweden, Norway and Finland put together.
Similarly, the upper middle segment will be a population of about 70 million
in 2020, which is more than the population of the UK. Over the next ten
years, these groups will constitute large enough numbers to merit a dedicated
strategy by FMCG companies. Abhishek Malhotra (2010) added that they
have seen companies focused on selling primarily to the mid segments.
Often, there is no clear segmentation being offered. Players would do well to
clearly separate their offerings for the upper and mid segments, ‖ and the two
should be treated as separate businesses with a dedicated team and strategy
for each.”

2. Evolving Categories: Categories are evolving at a brisk pace in the market

“

for the middle and lower-income segments. With their rising disposable
income and spending capability, these consumers are shifting from need to
want based products. For instance, rural consumers have shifted to
toothpastes from toothpowders and are now also demanding mouthwash
within the same category. Now in rural areas, consumers have voiced for
customized products, specifically tailored and designed according to their
individual needs and tastes. The complexities and competitiveness within
each category are increasing significantly. Initially shampoo had two
variants — normal and anti- dandruff. Now, the companies are marketing
anti-dandruff shampoos for short hair, long hair, oily hair, curly hair, and so
on. Everything is getting customized. The trend of mass production has
shifted to mass-customization of products which will categorize the buyer by
age, region, ethnic background, personal attributes and professional choices.
Micro-segmentation will amplify the need for highly customized market
35
 research so as to capture the specific needs of the consumer segment
targeted, before the actual product design phase gets underway. The market
of beauty products will expand by 20 per cent per annum as result of the
upgrading socio-economic status of consumers, especially women. Women
in middle-class category have become more conscious of their appearance
and looks, they are willing to spend more on improving it. Few product
categories such as colour cosmetics is growing with a rapid pace nearly by
46 per cent and sun care products is growing at 13 per cent have pushed this
trend rapidly.”

3. Value At The Bottom: Bottom of the pyramid is that category of the society
“

which have existence in large numbers but they live their life with scarcity. The
bottom-of-the- pyramid or Bop consumers are those who earn less than Rs 2
lakhs per annum per household. The group comprises around 900 to 950 million
people. While the middle-class segment is largely urban, they have resources
and are mostly well-served and competitive, the BoP markets are largely rural,
less equipped with resources, poorly- served and uncompetitive. Still, BoP
consumers are not able to meet most of their basic needs: Water, Electricity
supply, Basic healthcare, financial services, mobile phones & communication
etc. And so, there is untapped opportunity. Abhishek Malhotra (2010) added
that the consumers have aspiration to consume better quality products, and their
income level has also improved. The segment was initially being targeted with
smaller packs and lower-priced products, say, Rs 2 Parle-G, Re 1 Chick
Shampoo, Re 1 Hajmola packets. But increasingly the demand will be high for
those products which delivers more value and contains nutrition (vitamins,
proteins etc.) and can be served as a meal. PepsiCo and Tata, big multinationals
are working on such products. The rural BoP population comprises about 78
percent of the total population. The segment is becoming an important source of
consumption by moving beyond the survival mode. As a result of rising
incomes, the growth of FMCG market in rural areas at 18 per cent a year has
exceeded that of the urban markets at 12 per cent. However, maximum demand
for FMCG is generated from urban areas while the rural market generates only
34 per cent demand of the FMCGs, given the current growth rates and
increasing trend, its share is expected to rise to 45-50 per cent by 2020. It will
36
require highly customized products at affordable prices with the potential of
large volume supplies. Various categories of products such as fruit juices, skin
creams and sanitary pads which had minimal demand in the rural markets
earlier have suddenly making its mark. While most FMCG players have made
their presence in rural areas and successfully making the products available to
cater the needs of rural masses, the next agenda of growth is expected to come
from increasing category penetration, development of customized products and
up-trading rural consumers towards better quality and higher price products. ”

4. Increasing Globalisation: Companies are enjoying the freedom of doing

“

business in India and they are taking it as an opportunity to expand in a big

way. Leading MNCs have taken the advantage of operating in the country
for years given the liberal policy environment, Tier 2 and 3 global players
will see the competition in coming next 10 years. In addition, larger Indian
companies are exploiting the opportunities internationally and also have an
access to more global brands, globally recognized products and fair
operating practices for international standards.”

5. Decentralization: Despite the complexity of the Indian market (languages,

“

cultures, distances) the market has mainly operated in a homogenous set-up.

Increased scale and spending power will result in more fragmented and
tailored business models (products, branding, operating structures). ”

6. Growing Modern Trade: Modern trade share will expand rapidly in

“

coming years and is predicted to account for nearly 30% by 2020. This
channel will fulfill the objectives of the existing traditional trade (8 million
retail stores which will continue to grow) and ensures distribution through its
carry & forward (C&F) model as well as more ways to interact with the
consumer. ”

37
7. Focus on Sustainability: Changes in climatic conditions globally,
“

increasing scarcity of many natural resources (e.g. water, oil) and consumer
awareness (e.g. waste) are leading to increased concerns for the
environment. Companies are getting pressure due to involvement of various
stakeholders for being environmentally responsible – from government
(through policy) to consumers (through brand choice) and NGOs (through
awareness). ”

8. Technology as a Game Changer: Technology has become more advanced

“

with the economic development. Increased and relevant functionality

coupled with lower costs will enable technology deployment to drive
significant benefits and allow companies to address the complex business
environment. This will be seen both in terms of efficiencies in the back-end
processes (e.g. supply chain, sales) as well as the front-end (e.g. consumer
marketing).”

9. Favourable Government Policy: Nowadays government policies have

“

become liberal for companies to operate in India, they have freedom to

export outside India and can import the raw-materials and finished products
from foreign countries. Liberal government policies have helped in creating
a more suitable operating environment. This will be achieved by pushing the
demand side upwards through increased income and education and parallel
supporting the supply side by removing bottlenecks and encouraging
investments in infrastructure. The effect of many of these change drivers –
technology, government policy, consumers, and channel partners – will
impact the business environment within the country. Winning in this new
world will require cementing and enhancing current capabilities and building
new ones to bridge gaps. In this new world FMCG companies will have 6
imperatives from a business strategy perspective:
”

1. Disaggregating the operating model.

38
 2. Winning the talent wars

3. Bringing sustainability into the strategic agenda

4. Re-inventing marketing for consumers

5. Re-engineering supply chains

6. Partnering with modern trade.

Another big trend that has been occurring is the emerging idea of many Indians.
“

It is to be noted that despite having complexities in culture, tradition, language,

belief and long distances, companies consider the Indian market as a
homogenous market. One product is used for the entire country — the same
Dabur Amla Hair Oil for Rajasthan and West Bengal, or the same Cinthol soap
for Punjab and Uttar Pradesh. Besides, same advertisements are shown on
television for these products across the country. Now, Major FMCG players
have realized the fact that India is no more a homogenous market and the taste,
preference, life style of consumers vary significantly. Various researches have
predicted that the economic growth of few states in India will exceed the growth
rate and total economic size of other countries. For example, by 2020,
Maharashtra ‘s GDP will exceed that of Greece, Belgium, and Switzerland, and
Uttar Pradesh ‘s economic size will exceed that of Singapore and Denmark. We
will see companies launching different products for different geographical
regions within the same country. Hindustan Unilever launched teas which has a
completely different taste in 2 different states. Pepsi has a different product in
Andhra Pradesh which is not sold anywhere else. Earlier, companies used
differentiation strategy at the country level; now they are using it at the state
level. FMCG players are adopting regional approach and they have to grow
regional in their thinking and move towards an increasingly decentralized
operating model in India. As consumer tastes and preferences differ across
”

states, companies can adopt a regional strategy in terms of product ingredients,

channel of distribution, positioning, promotion and marketing campaign.
Overall, regionalization or decentralization will be used an an important tool for
39
FMCG players for covering deep interiors of rural area. MNC presence across
the entire value chain has made the FMCG industry more competitive and
stronger in terms of brand building. It has been predicted that the FMCG market
will touch the figures of US$ 33.4 billion in 2015 from US $ 11.6 billion in
2003. FMCG companies are targeting the middle class and the rural segments of
the Indian population as they consider them to be the promising market for
developing their business, and give producers the opportunity to convert them
to branded products. Most of the FMCG categories like chywanprash, jams,
toothpaste, hair colors, skin care etc, in India, have low penetration level as well
as low per capita consumption, but the potential for growth is huge. The big
firms are getting the momentum and are growing bigger while small-time
companies are catching up the speed to grow as well.

Thrust on rural development since 1950 eventually made India into an attractive
“

rural market. Increased awareness along with rise in income levels influenced
the rural marketing environment in the country. Other factors that contributed to
the growth of rural markets are penetration of media, rising aspiration of rural
people and packaging revolution. Fast moving consumer goods (henceforth
referred to as FMCG) market has emerged as one of the most attractive rural
markets in India. An effective FMCG marketing strategy in a rural setup
essentially includes product variants, product categories, price points, sizes and
widespread distribution network. The general impression that the rural markets
are potential only for Agri-inputs is partly correct as there are opportunities to
market modern goods and services in rural areas in India. The rural FMCG
market in India has grown 15% in 2011. The Indian rural consumer market
grew 25% in 2008 and would reach US$ 425 billion in 2010-11 with 720-790
million customers. According to FICCI Technopak Report 2009, FMCG
industry is projected to grow by 12% and reach a size of US $ 43 billion by
2013 and US $ 74 billion by 2018. ”

40
1.8 Rural Market and Rural Marketing
Different experts and organizations have divergent views on what constitutes
“

the term, ‘rural’. Describes the word ‘rural’ as ‘place far away from towns and
cities’. A rural market broadly comprises of consumer markets, institutional
markets and services.”

According to this, rural marketing includes all those activities of assessing,

“

stimulating and converting the rural purchasing power into an effective demand
for specific products and with the aim of raising the standard of living. It is a
two-way marketing process of flow of goods and services from rural to urban
areas and vice-versa. Rural marketing is any marketing activity in which one
dominant participant is from rural area.
”

41
The Rural Buyer-Seller (Producer) Matrix that presents the scope of rural
marketing (Figure 1.1). On:

Shelf-I are the goods which are made by rural people in rural areas and
“

consumed by rural inhabitants. Examples include pottery, woolen, cotton and

silk fabric weaved by handlooms, vegetables and fruits, etc.
”

Shelf-II comprises of goods made and sold by urban people to rural areas like,
“

automobiles, bicycles, farm equipment, fertilizers, etc.

”

Shelf-III comprises of goods made in rural areas and consumed in urban areas
“

like, vegetables, agro-based products, products of cottage industries, etc.

”

42
Shelf-IV does not fall under the scope of rural marketing. Rural marketing mix
“

would comprise of 4 A’s viz., Acceptability, Affordability, Accessibility and

Awareness (Figure 1.2).”

CHAPTER 2

LITERATURE REVIEW

43
 LITREATURE REVIEW

2.1 RESEARCH IN INDIA

I. Sharma and Rao, in their article entitled “Problems of Rural Marketing in

“

India”, segmented the national market into rural and urban markets. Rural
markets having low population density UN integrated in terms of
communication and physical distribution facilities. They further define the
”

dimensions of rural marketing in terms of “population, income, and

consumption levels”.

II. Singh and Singh, in his article entitled “A Study of Brand Loyalty in
India”, found that consumers had single or multi-brand loyalty based on the
“

nature of product, such as necessities or luxuries. In addition, brand choice

and store loyalty were found to affect the brand loyalty of the consumer.
The factors that influence and strengthen loyalty to brand were quality of
product, habit of use and ready and regular availability.
”

III. Kumar et al. in their article entitled “Buying Behaviour of Rural

consumers”, point out that the factors influencing the buying decision -
“

making of consumers on various food products. The chief factors

influencing the consumers were country of origin, brand and the socio-
economic factors were age, education, and income. Finally, the study
identified brand image seemed to be more important than the origin of the
product. ”

IV. SanalKumar, in his article entitled “Buyer Behaviour in Rural Markets”,

focused new product awareness of rural consumers. He found that the rural
“

consumer uses multiple sources of information and television as one of the

important sources. Secondly, the male member of the household carried out
the actual purchase in rural markets, though the decision maker depends on
the type of product. Finally, the rural consumer was less aware of new
products. ”

44
 V. Jha and Mithileshwa, in their article entitled “Rural Marketing-Some
Conceptual Issues”, argued that the concepts „rural‟ and „marketing‟
“

though used very frequently in various forums, and had eluded a precise
and non-controversial definition. When both the concepts were joined, the
resulting concept „rural marketing‟ means different things to different
persons. They further suggested that various companies in rural areas
adopted the several innovative promotional measures.
”

VI. Shanmugsundaram, in his article entitled Soft Drink Preference in

“

Vellore Town of North Arcot District in Tamil Nadu, has identified that the
most preferred soft drink among respondents were Gold spot (26%),
followed by Limca (25%).Taste was the main factor for preferring of a
particular brand and among the media; television was played a vital role in
influencing consumer. Finally, tetra pack was most preferred one because of
convenience. Joshi (1993) in his article entitled Food Purchasing Habits and
Consumer Awareness among Rural and Urban Housewives, identifies that
majority of the urban respondents purchased the groceries such as cereals,
pulses , oil, spices and sugar on monthly basis. On the other, perishables
such as fruits, eggs and meat were purchased once a week and milk was
purchased daily. Regarding place of purchase, 83 per cent of urban and 99
per cent of rural respondents purchased all the groceries such as sugar, rice,
and wheat from fair price shops. Both rural and urban respondents purchased
groceries, perishables ready to use foods and commercially available foods
from retail shops. Price, quality, and weight of the product that were
considered the essential factors by both rural and urban respondents.”

VII. Rana, in his article entitled Impact of TV Advertisement on the Customer

“

Buying Preference, points out the impact of TV advertisement on branded

products at rural markets. He furthers expresses that among the media, the
impact of television advertisements on social behavior, including purchasing
behavior was the greatest. The reason is television has charm, instantaneous
transmission capability, and universality of appeal.
”

VIII. Yogesh Upadhyal, in his article entitled Brand Loyalty in Rural and Urban
“

Consumers, points out that the brand loyalty was identified among more than
sixty per cent of the rural and urban consumers in the product categories
45
 namely washing powder, washing soap, bathing soap, shampoo, tooth paste,
powder. However, it was not applicable for the other three products namely
spice, clothes and flour, and rice.”

IX. Kamalaveni and Nirmala, in their article entitled Consumer Behaviour in

“

Instant Food Products point out there was complete agreement between
ranking given by the housewives and working women regarding the reasons
promoting them to buy instant food products. The study also identified age,
occupation, education, family size, and annual income had greater influence.
”

X. Nagaraja, in his article entitled “Consumer Behaviour in Rural Areas: A

“

Micro Level Study on Buyer Behaviour of Rural Consumers in Kavali

Mandal”, points out that the level of utility was being influenced by the
changing tastes and preferences of the younger generation. The clever and
gimmicky advertisements did not attract the rural consumers. He further
suggests that the buying behaviour was highly influenced by experience of
their own and neighbours-consumers. ”

46
 2.2 RESEARCH IN ABROAD

I. Harold (1971) in his article entitled Personality and Consumer Behaviour,

“

comments that personality, or better yet, the inferred hypothetical constructs

relating to certain persistent qualities in human behaviour, have fascinated
both non-professionals and scholars for many centuries. The author found
that in the fields of marketing and consumer behaviour, the helps in
identifying personality data and to popularize individual requirements by the
marketers.”

II. Louden, David. et al. in their article entitled Consumers Behaviour Concept
“

and Application, identifies the consumers buying behaviour normally should

include the less observable decision processes that accompany consumption,
including where, how often and under what conditions consumers make their
purchases of desired goods and services. Therefore, their major activities and
strategies such as market opportunities analysis, target market selection and
marketing mix decision, are consumer oriented. ”

III. Peter and Jerry in their article entitled “Brand knowledge among
“

Consumers Relates to the Cognitive Representation of the Brand Consumers.

Brand knowledge can be defined in terms of personal meaning about a brand
stored in consumer memory, that is, all descriptive and evaluative brands
related information.”

IV. Jacob Hornik, in his article Estimating the Time Spent on Shopping
“

Activities” attempted to construct a unified model of shopping behaviour by

drawing on the households production approach. A formal treatment is
presented that takes into account the explicit relationships between
consumers temporal and monetary resources, stage in the family life cycle,
their subjective shopping preferences and shopping behaviour. Emerged
propositions make the study of time use for shopping increasingly amenable. ”

V. Zaltman and Wallaendor, in their article entitled Consumer Behaviour,

“

human behaviour in consumption process involves planning to make

47
 purchase, making purchases and using their varying degrees of satisfaction
to make their purchase. In all these activities, consumers are the target of
marketing attempts to influence by major entities such as business,
government agencies, and advocate groups and by social groups such as
one‟s family, friends, and peers.
”

VI. Jorin, in his article entitled Consumer behaviour is Changing and Offering
“

New Opportunities, examines changes in spending power and buying habits

of Swiss consumers since the beginning of the 20th century and in the more
recent past. Current trends include greater emphasis on health and safety of
foodstuffs and less attention to price, increased demand for low calorie light
products, and increased demand for organically grown foods. For young
people, more concern with enjoyment and less for health, with more meals
eaten from home and generally an increased demand for convenience foods.
The prospects for high quality branded products were seen to be good. ”

VII. Rees, in his article entitled Factors Influencing Consumer Choice , advances
“

factors influencing the consumer's choice of food are flavor, texture,

appearance, advertising, a reduction in traditional cooking, fragmentation of
family means and an increase in snacking‟ etc. Demographic and household
role changes and the introduction of microwave ovens had produced changes
in eating habits. Vigorous sale of chilled and other prepared foods was
related to the large numbers of working wives and single people, who
require value convenience. Development in retailing with concentration of
80 per cent of food sales in supermarkets was also considered important.
Consumers were responding to messages about safety and healthy eating.
They were concerned about the way in which food was produced and want
safe, „natural‟, high quality food at an appropriate price.
”

VIII. Alexander, in his article entitled Subcultures of Consumption: An

“

Ethnography of the New Bikers, explains the multiple dimensions of brand

knowledge. The reality that emerges from the varied activity in branding
through the years is that all different kinds of information may become
linked to a brand, including the following. a) Awareness b) attitudes c)
benefits d) images e) thoughts f) feelings g) experiences purchases he high
price products. Dhillon et al. (1995) in his article entitled Consumer
48
 Behaviour of Buyers for Durable Goods, studied the purchase behaviour in
Ludhiana, rural and urban respondents ranked nearby market and main
market as their first and second preference of order respectively for the
purchase of food items. Urban respondents visualized the factors little
differently to rural consumers and ranked quality, appearance, place of
buying and expiry date as first, second, third and fourth ranks.
”

IX. Brodowsky and Howard Glen, in their article entitled The Role of Country
“

of Origin in Consumers Purchase Decision, found that high and low,

ethnocentric consumers used the country information differently and hence
the model could be useful for managers when choosing a location for
manufacturing.”

X. Frank (1997) in his article entitled Correlates of Buying Behaviour of

“

Grocery Products, found that there was no significant association between

the socio-economic variables namely social class, gender, intelligence,
marital status, family size, and education of the buyers and their brand
loyalty.”

49
 CHAPTER 3
OBJECTIVES

3 Objectives:

50
 To analyze the influence of demographic variables on the buying behaviour
of consumers while purchasing apparels in organized retail outlets;

 To understand the factors that influence the buying behaviour of consumers

while shopping for apparels in organized retail outlets;

 To investigate the impact of Sales Promotions by organized retailers on

purchase intention for apparels; and

 To understand the influence of retail store location on consumers shopping

for apparels.

51
 CHAPTER 4
DATA ANALYSIS
&
INTERPRETATION

DATA ANALYSIS & INTERPRETATION

52
 We analyse the companies like Colgate & Pepsodent.

4.1 Buying Frequency:

BRANDS WEEKLY FORTNIGHTLY MONTHLY WHEN
NEEDED

COLGATE 1 1 25 22

PEPSODENT 0 1 14 6

25

20

15 Weekly
Fortnightly
Monthly When Need NNNNneeded

10

0
COLGATE PEPSODENT

53
 4.2 Package Size:

BRAND FAMILY MEDIUM SMALL

COLGATE 33 15 1
PEPSODENT 16 4 1

35

30

25

20 PACKAGE SIZE FAMILY

PACKAGE SIZE MEDIUM
PACKAGE SIZE SMALL
15

10

0
COLGATE PEPSODENT

The frequency of purchase mainly depends on the brushing habits and the
“

number of members in the family. 66% of the people preferred the family pack
while 31% preferred the medium pack. ”

Based on this survey, most of the respondents are unhappy about the price that
“

they pay for their favourite brand. This is evident from the fact that pricewise
the rating of the brand is very poor compared to product, availability and
promotion. Hence as far as the price is concerned, the company should consider
the views of consumer otherwise the consumer switches over to competitor’s
product is inevitable. Currently, price range varies from Rs. 05-10 for a small
pack in the economy segment, Rs15-25 for a medium pack in the regular
54
segment and Rs 40 and above for a family pack in the value-added segment.
Thus, analyzing economic factor is an important task for the company to fix the
price.
”

55
4.3 Buying Location:
BRAND LOCAL GENERAL SUPER MEDICAL
MARKET
COLGATE 18 11 13 7
PEPSODENT 7 6 5 3

18

16

14

12

10
BUYING LOCATION LOCAL
BUYING LOCATION GENERAL BUYING LOCATION SUPER MART
8
BUYING LOCATION MEDICAL

COLGATE PEPSODENT

The above data helps us conclude that respondents of all other brands buy
“

toothpaste from a local shop. The other buying locations such as a general store
or a super mart or a medical store have relatively less buyers. The only
exception that we found to this rule is the brand Sensodyne which people prefer
to buy from a general store or a super mart or even a medical store more than a
local store. ”

56
4.4 Purchase Influence:
BRAND RETAILER FAMILY FLAVOUR ADV LOOKS

COLGATE 6 14 12 16 1

PEPSODENT 6 5 8 1 0

16

14

12

10 PURCHASE INFLUENCE RETAILER

PERCHASE INFLUENCE FAMILY PURCHASE INFLUENCE FLAVOUR PURCHASE
8 PURCHASE INFLUENCE LOOKS

0
COLGATE PEPSODENT

Based on the study it is interesting to see that in the sample size of 100
“

respondents 27 of them prefer their brand of toothpaste only due to the “taste”
or “flavour” factor while 25 of them are influenced by their family tradition in
buying their preferable brand. ”

Further 23 people are influenced by advertisement and 20 people buy toothpaste

“

which is of their retailer’s choice. It is important for the manufacturer to keeps

these attributes in mind for deeper penetration into the market. It is also seen
that basically there are three kinds of purchase influences for any product.
Informational influence, normative influence, and identification influence.
57
Informational influence means that an individual uses the behaviour and options
of group member to gather useful information.”

Normative influence refers to an individual’s achieving group expectations and

“

gaining the respect of and sense of belonging to the group. Identification

influence occurs when an individual understands the values and norms of the
group.”

58
4.5 Usage Longevity:
BRAND >1 YEAR <1 YEAR

COLGATE 19 30

PEPSODENT 11 3

30

25

20

USAGE>1 YEAR
15 USAGE<1 YEAR

10

0
COLGATE PEPSODENT

It was seen that the penetration of toothpaste was high in Kolkata as all the 100
“

respondents who were questioned used toothpaste. It was also seen that 55 out
of 100 people have been using their brand of toothpaste for over a year while
the remaining 45 have been using their brand of toothpaste for less than a year.
This implies that a large part of the population have switched brands over the
last year which means that the toothpaste market is still lucrative and this factor
might encourage some new players to come into the market in the future
provided they have the right mix of strategy. This is already true with the brand

59
Sensodyne which was launched only last year and it is already competing
fiercely with global leaders like Colgate.
”

60
4.6 Areas In Which Brands Can Improve:

BRAND FLORIDE FOAMING COLOUR FLAVOUR

COLGATE 22 11 1 15

PEPSODENT 10 3 3 5

25

20

BRAND IMPROVEMENT FLORIDE

15
BRAND IMPROVEMENT FOAMING

BRAND IMPROVEMENT COLOUR

10
BRAND IMPROVEMENT IN
FLAVOUR

0
COLGATEPEPSODENT

 For Colgate the biggest improvement should be in its Fluoride content

“

followed by its flavour, foaming and colour.”

 For Pepsodent also, improvisation 1st needs to done in its fluoride

“

content followed by flavour colour and foaming. ”

 Clearly enough the first criterion for all the companies to improve their
“

product is in their fluoride content after which comes flavour foaming

and at last colour. ”

61
4.7 Brand Loyalty:

BRAND YES NO MAYBE

COLGATE 6 19 24

PEPSODENT 7 5 9

25

20

15
BRAND SWITCHING YES
BRAND SWITCHING NO BRAND SWITCHING MAY BE

10

0
COLGATE PEPSODENT

62
4.8 Switch Simulator:

BRAND PRICE OFFER ORAL OTHERS

REDUCE BENEFITS

COLGATE 7 6 16 0

PEPSODENT 3 0 13 0

16

14

12
SWITCH SIMULATOR PRICE
REDUCE
10
SWITCH SIMULATOR OFFER

8
SWITCH SIMULATOR ORAL
BENEFIT
6 SWITCH SIMULATOR OTHERS

0
COLGATE PEPSODENT

The reasons for a consumer to switch from a particular brand of toothpaste to a

“

particular one are many. But the majority of people are becoming more aware
of the oral health quotient offered by brands such as Sensodyne which is seen as
a driving force for brand switching in the recent times. Hence it is seen that the
overall mentality of the people is slowly shifting from being “brand loyal” to
becoming a health conscious one. But when it comes to comparisons among
brands about loyalty Colgate surprisingly emerges the winner among other
63
giants. Colgate in this regard had a very close fight while the Pepsodent users
seemed to be the least loyal towards their brand.
”

64
4.9 Brand Loyalty vs. Age:

0-15 years 15-25 years 25-35 years 35+ years

0 17 12 10

Most brand-loyal are the age group of 15-25 followed by 25-35 and later by
“

people above 35 years of age. As age increases people tend to be lesser brand-
loyal and there is a high possibility that as age gradually increases the concern
of the brand factor itself decreases. The greatest target of the toothpaste should
be the young blood. ”

65
4.10 Brand Image:
BRAND PRODUCT PRICE PROMOTION AVAILABILITY

COLGATE 146 137 136 156

PEPSODENT 61 50 60 60

160

140

120
CURRENT BRAND RATE PRODUCT
100
CURRENT BRAND RATE PRICE
80
CURRENT BRAND RATE
PROMOTION
60 CURRENT BRAND RATE AVAILABILITY

40

20

0
COLGATEPEPSODENT

Based on this study the preference for selecting toothpaste is mainly based on
“

brand, quality, and flavour. It was seen that Colgate still enjoys the majority
amongst the people closely followed by Close-up, Pepsodent and Sensodyne.
Hence well-established brands such as Colgate and close-up which have been
flourishing in the Indian market for decades control the market share of
toothpaste. This is attributed to the following fact. India is a country knows for
66
keeping its traditional values and hence a lot of people still blindly follow their
family traditions even while buying a particular brand of toothpaste. The
concept of brand image is slowly starting to change with the youth population
becoming more and more health conscious and trying out newer products
offering oral health benefits and hence it would be advisable for the brands to
concentrate more on the oral health care. ”

67
4.11 Various Attributes and the Brand Rating One Their Basis:

BRAND/ATTRIBUTE COLGATE PEPSODENT

FRESHNESS 161 214
CAVITY 178 190
ENEMAL 181 197
WHITENING 166 209
TASTE 176 217

COLOGATE PEPSODENT
FRESHNESS

400

200
TASTE CAVITY

WHITENING ENEMAL

Based on this study, product attributes play a crucial role in influencing the
“

consumers for decision making while buying a brand. Various attributes such as
breath freshening, cavity prevention, enamel protection, teeth whitening and
taste were taken into consideration. It was found that Colgate was a favourite
brand for breath freshening closely followed by close-up and Pepsodent. For
cavity prevention, Colgate was the preferred brand in enamel protection.
Colgate again won the majority in the teeth whitening and taste category.
Overall, it was seen that the health benefits of particular toothpaste had been the
driving force behind the consumer purchase behaviour of a brand and this shift
in the trend had been noticed very recently. ”

68
4.12 Source of Awareness About The Brand:

BRAND FAMILY FRIENDS ADVS AGENTS OTHERS

COLGATE 20 10 13 4 2

PEPSODENT 4 1 9 3 4

20

18

16
BRAND AWARENESS SOURCE
FAMILY
14
BRAND AWARENESS SOURCE FRIENDS
BRAND AWARENESS SOURCE ADVS
12

10
8 BRAND AWARENESS SOURCE
AGENTS
6 BRAND AWARENESS SOURCE OTHERS

0
COLGATE PEPSODENT

Based on the study conducted it was found that people were only aware of the
“

big players like Colgate & Pepsodent. It was additionally seen that Indian
brands which are supposed to be ayurvedic have little or no penetration in the
market. This goes to show that there is still scope for further improvement in the
marketing and advertising campaign for the two Indian brands to make them
competent with the market leaders like Colgate. ”

69
4.13 Age vs. Brand:
AGE COLGATE PEPSODENT
0-15 0 0
15-25 100 140
25-35 40 69
35+ 32 51

140

120

100

80
COLGATE
PEPSODENT
60

40

20

0
0-15 15-25 25-35 35+

For age group 15-25: 1st preference is Colgate, 2nd preference is Pepsodent

For age group 25-35: 1st preference is Colgate, 2nd preference is Pepsodent

For age group 35+: 1st preference is Colgate, 2nd preference is Pepsodent

Final word: Colgate emerges the clear winner in all age groups. Pepsodent as
“

always had a close fight. Pepsodent in spite of being the last choice seems to be
doing quite well if we take the time of existence factor into consideration.
”

70
4.14 ANNOVA TESTING:
To test whether the two attributes age and preference level of
a brand are associated or not.

Ho: The preference level of a brand is different in different age groups

H1: the preference level of a brand is not different in different age age
groups.

AGE GROUP COLGATE PEPSODENT

<15 0 0
15-25 21 15
25-35 12 3
>35 8 4

COLGATE PEPSODENT
9 81 -3 9
0 0 -9 81
-4 16 -8 64

5 97 -20 154

71
F calculated=Mean Sum of squares between samples (MSB) /MSE
=116.66/21.25
=5.489 F tabulated for 3, 8 degrees of freedom (Dof) = 7.5 F calculated < F
tabulated.
Hence null hypothesis H0 is accepted. Hence it is seen that the preference level
of a brand is different in different age groups.
72
4.15 Occupation vs. Brand:

OCCUPATION COLGATE PEPSODENT

SALARY 62 92
BUSINESS 23 29
STUDENT 73 112
OTHER 14 27

120

100

80
SALARY
BUSINESS
60 STUDENT OTHER

40

20

0
COLGATE PEPSODENT

Salaried: 1st preference is Colgate, 2nd preference is Pepsodent

Business: 1st preference is Colgate, 2nd preference is Pepsodent

Student: 1st preference is Colgate, 2nd preference is Pepsodent

Other: 1st preference is Colgate, 2nd preference is Pepsodent

“To wrap up Colgate is best among all occupations. Pepsodent are not close
competitors in this segment. It comes last in all occupations is still doing great

73
especially among business and student class. Based on this study demographic
factor like age and occupation influence people indirectly for decision making.
This is supported by following evidence. It was found that out of 100 people
questioned 41 were students who preferred the medium pack while 37% were
salaried and 12% were businessmen and this chunk of the population preferred
the family pack. Since the study was limited to Kolkata city people preferred
only known brands which have been existing in the market for many years such
as Colgate, Close-up and Pepsodent while lesser known brand such as
Sensodyne largely do not have much takers. ”

74
 CHAPTER 5
RESEARCH METHODOLOGY

75
Research Methodology

Research is a scientific and systematic research for patient information on a

“

specific topic. Research refers to a critical, carful and exhaustive investigation

or inquiry or experimentation or examination having as its aim the revision of
accepted conclusions, in the light of newly discovered facts.”

Research methodology is a way to systematically solve the research problem. It

may be understood as science of studying hoe research is done. The study of
“

methods by which we gain knowledge, it idea with the cognitive process

imposed on research by the problems arising from the nature of its subject-
matter .
”

5.1 Research Design: This research studies are concerned with describing the
“

characteristics of a particular individual or of a group. This study concerned

with specific predictions, with narration of facts and characteristics concerning
individual, group or situation are examples of descriptive study.”

5.2 Statement Of The Problem:

Consumer behavior research is the scientific study of the process’s consumers

“

use to select, secure, use and dispose of products and services that satisfy their
needs.”

Knowledge of consumer behavior directly affects marketing strategy. This is

“

because of the marketing concept, i.e., the idea that firms exist to satisfy
customer needs. Firms can satisfy those needs only to the extent that they
understand their customers. For this reason, marketing strategies must
incorporate knowledge of consumer behavior into every facet of a strategic
marketing plan. There is a widespread recognition that consumer behavior is the
key to contemporary marketing success. ”

Retailing has changed the fortune of several companies across the world. In this
“

booming retail market in India it became inevitable for the companies to learn
76
how to retain their market share as well as to enhance it. With the entry of
bigger players, the retail market is getting more and more organized and
structured. Competition will soon be very intense. Existing customers generate
larger margins and profits than the new ones.”

5.3 Research Design:

The focus of the study is to understand the factors influencing buying behaviour
“

of consumers while shopping for apparels in organized retail outlets in New

Delhi. It was therefore, decided to use explorative design, which befits into the
pattern of investigation. A structured questionnaire was used for the purpose of
collecting the data. New Delhi was divided into five zones and care was taken
to cover respondents from all the zones, so that the study will be representative
of entire New Delhi.”

5.4 Hypothesis:

The study tries to test the following main hypothesis:

Ha1: Demographic variables have an impact on the buying behavior of

consumers while shopping for products in organized retail outlets;
Ha2: Various store related factors influence the buying behavior of consumers
while shopping for products in organized retail outlets.

The hypothesis Ha1 is further divided into the following sub hypothesis:

Ha11: Gender has an impact on the buying behavior of consumers while

shopping for apparels in organized retail outlets.

Ha12: Age has an impact on the buying behavior of consumers while shopping
for apparels in organized retail outlets.

Ha13: Marital Status has an impact on the buying behavior of consumers while
shopping for apparels in organized retail outlets.
77
Ha14: Income has an impact on the buying behavior of consumers while
shopping for apparels in organized retail outlets.

Ha15: Education has an impact on the buying behavior of consumers while

shopping for apparels in organized retail outlets. Ha16: Profession has an
impact on the buying behavior of consumers while shopping for apparels in
organized retail outlets.

5.5 Data Collection:

To overcome the limitations of incompatibility, obsolescence, and bias, primary
“

data was collected. Considering the time and money constraints, sampling
method of data collection was suitable for the project. ”

5.6 Primary Data:

Primary data are those data that are collected for the first time, It is better to go
“

for primary data since it is first-hand information and there is less chances of
personnel bias and information can be collected with accuracy at the same time.
It could be re- tabulated and survey concerned in various forms this data can be
used. For collecting primary data, we have chosen the questionnaire method. ”

5.7 Data Collection Method:

Data has been collected through questionnaire method. The questionnaire was
“

designed in such a way to cover as many aspects of consumer behavior as

possible. Sample size: Total 100 persons were contacted and interviewed. ”

5.8 SAMPLING:
Here study of the consumer behavior of the people of New Delhi. Within the
“

city samples were collected from different areas to reduce the biases this may
come through difference in the level of income, attitude lifestyle etc. of the
people in different areas.”

78
5.9 Scope Of The Work:
In the present scenario, the researcher wants to foray into organized retailing in
“

the Indian sector in order to explore the different aspects that have impact on
consumers’ buying behavior. Retailing covers a very wide range of products
and services; hence the researcher has decided to focus only on the organized
apparel segment. There have been a few studies in the past which have
concentrated on organized apparel retailing in different cities in India. However
the researcher found that there was a gap in understanding the buying behavior
of consumers with respect to apparels in organized retail outlets. There was no
comprehensive study done to understand the factors that influence buying
behavior of consumers when they shop for apparels in organized retail outlets
especially in Metropolitan cities in India.
”

The researcher will concentrate the whole analysis based on a survey based
“

quantitative study in New Delhi. The agenda of the entire study is to know the
factors which influence the buying behavior of consumers while purchasing
apparels in organized retail outlets. Care has been taken to include all the major
formats of organized apparel outlets in the study. The research will be useful to
organized apparel retailers in Bangalore as well as other metropolitan cities in
India. This research intends to help the organized apparel retailers to understand
their customers better. The organized apparel retailers can concentrate on the
important factors which will lead to more customer footfalls and which will
actually enhance the purchase intention of customers. This study will be useful
for organized apparel retailers who are planning to open new apparel outlets. ”

 Limitation of the Study:

o The study is restricted to some state. Hence it may not be possible to
generalize the finding to the entire population of the country;

o Some of the respondents may not give accurate information, as they may not
like to reveal their actual identity, income etc;
79
o There may be some positive and negative biases of the respondents;

o Shopper’s may not have the patience to answer all the questions accurately;

o Consumers would like to portray themselves as trendy and elite and may not
give their actual preferences; and

o Promotions and sales may temporarily draw the attention of price conscious
“

customers who otherwise may go for unbranded apparels from smaller

unorganized retailers.”

o With all limitations and shortcoming, an honest enquiry was undertaken.

 Utility Of The Study:

o The study will be useful for organized apparel retailers while identifying new
“

store locations.”

o The study will help organized apparel retailers to understand importance of

“

sales promotions while inducing the consumers to buy apparels. The research
will also help the apparel retailers to understand which type of sales promotion
is most preferred by the consumers. ”

o This research enquiry will help mall developers and organized apparel retailers
“

to understand the importance of visual merchandising and store ambience in

attracting the customers. ”

o This research work will help the different formats of organized retail outlets
“

such as Department stores, exclusive apparel stores, hypermarkets, discount

stores, factory outlets etc in order to understand which type of apparels to stock
more (i.e., formal, casual, party wear) ”

80
o This research study will be of use for academicians and students in order to
“

understand organized apparel retail in some state and the factors influencing the
buying behaviour of consumers with respect to apparels in some state. ”

81
 CHAPTER 6
SWOT ANALYSIS

82
 SWOT ANALYSIS

Strengths:

 Low operational costs

 Presence of established distribution networks in both urban and
rural areas
 Presence of well-known brands in FMCG sector
 Deep roots in local culture & great understanding of consumer
needs

Weaknesses:

 Lower scope of investing in technology and achieving economies

of scale, especially in small sectors
 Low exports levels
 Counterfeit Products. These products narrow the scope of FMCG
products in rural and semi-urban market.

Opportunities:

 Untapped rural market

 Rising income levels, i.e. increase in purchasing power of
consumers
 Large domestic market- a population of over one billion.
 Export potential
 High consumer goods spending

Threats:

 Removal of import restrictions resulting in replacing of domestic

brands
83
 Slowdown in rural demand
 Tax and regulatory structure.

84
 CHAPTER 7
DEMOGRAPHIC PROFILING

85
DEMOGRAPHIC PROFILING

Table 1: Demographics of Consumers.

“The demographic profile of the sub urban and rural consumers is listed vide
Table 1 below which is self-explanatory on the demographic variables of Rural
and semi-urban HHs.”

S. Semi-
N Characteristic urba Rural
o s Variations n (%) (%)
21-30 years 9.21 9.39
31-40years 40.92 43.28
1 Age
41-50years 35.74 29.65
51-60years 14.13 17.68
Full NestI(child<10yrs) 21.49 198.66
Full Nest II (child >10&<18yrs) 33.86 28.16
2 FLC Stages Full NestIII (child >18yrs) 24.42 19.85
Empty Nest 11.84 18.6
Others 8.39 13.73
Nuclear- 1 to 4 members 66.61 33.13
Family Type- Joint â?? 5 to 9 members 29.32 49.12
3
size
Joint-10 to14 members 4.07 17.75

86
S. Semi-
N Characteristic urba Rural
o s Variations n (%) (%)
SSLC/School 2.96 8.75

Educational Graduation 14.57 33.9

4
qualifications Post- Graduation 40.6 35.42
Professional & higher 41.87 21.93
Government
36.81 16.57
employee/PSU/University
Private firms
employment/Schools/Colleges/Clini 25.93 40.65
Professional cs
5
category
Business/Law/Medical/Accountanc
26.16 21.32
y
Others self-
11.1 21.46
employed/Agency/Broker.
>=Rs.0.50 Lakh 10.13 8.95
Disposable Rs.25,000/-to 50,000/- 55.48 11.74
6 Income of HH
per month (Rs.) Rs.15,000/- to 25,000/- 25.72 58.48
Rs.5,000/- to 15,000/- 8.67 20.83
Self- owned independent house 21.96 62.46
Current Rented independent house 17.48 25.65
7 Dwelling habitat
adopted Self - owned Apartment/Villa 40.84 6.28
Rented Apartment/Villa 19.72 5.61

Religious belief Hinduism 32.77 43.35

8
affiliation Christianity 36.63 24.72

87
S. Semi-
N Characteristic urba Rural
o s Variations n (%) (%)
Muslim/Islam 21.76 28.61
Other religious beliefs 8.84 3.32

Table 2: Salient aspects moderating the purchase behavior of

rural respondents of Ernakulam for FMCG Personal care items
like soaps & detergents.

88
 Moderately
S. Most salient salient Least Salient
No Product Attributes attributes% attributes % Attributes%
Quality-Value for
1 68 21 11
money
Attractive Packaging
2 48 29 23
size
Brands image-
availability &
3 credibility with 58 24 18
celebrity
endorsements
4 Pricing-affordability 64 20 16
5 Retailor patronage 44 42 14
Product attributes
like Fragrance,
healthy and safer,
6 57 22 21
antiseptic, skin
friendly and
composition
Personal experience
7 53 29 18
from usage
Motivation for the
8 51 34 15
buy
9 Personal Attitude 67 26 7
10 Personality-Lifestyle 54 36 10
Other’s influence on
11 21 20 59
buy
12 SED aspects on buy 49 41 10

From the Table 2 above, it is obvious that ‘Quality’ is the highest influencing
“

factor with 68%, followed by Purchase attitude with 67% and Brand related
89
with 58%. The factor ‘Friends/Social Group’ has the lowest influence of 59%
followed by ‘Attractive packaging’ as the next lowest influencing factor 23%
among the rural respondents.
”

Table 3: Media usage influence on rural consumers on their purchase of

FMCG Personal care Goods like soaps & detergents

90
 S. Semi-Urban Rural
No Influence of mass media on HH (%) (%)
1 CTV 100 100
2 Print-Newspaper/Magazines 58 86
3 FM radio 33 81
4 WWW/Internet portals & Social networks 98 78
Exhibitions/Festival
5 69 46
Fairs/Hoardings/Display boards
6 WOM 35 89
7 Direct marketing 24 38

The Table 3 most prominent among the rural respondents is CTV and among
the semi urban respondents is again CTV but closely followed by the Internet.

Table 4: Most Priority accorded in the family on expenditure-

spending.
91
 Semi-
S. Urban Rural
No Important priorities in family spending (%) (%)
1 Money: Investments/Spending 23 14
Family members â??general welfare & assets
2 15 21
buildup for future; Food and happiness
3 Healthcare of members 10 10
4 Professional Education of Children 16 19
5 Investment on Children on Assets 11 15
6 Parental care/medical facilities availing 5 10
7 Profession/ career enhancement 6 4
8 Entertainment/relaxation /fashion/Leisure 8 3
Socialization/Social Club memberships/
9 6 4
Travel/Art & Community services
  Total 100 100

Among the semi urban respondents (Table 4), the top priority is for money
“

making and spending while among the rural respondents is for welfare of family
members. Notable is the higher priority accorded for imparting professional
education of children among both semi urban and rural respondents.”

Table 5: Most effective sales promotion measures influencing

purchase of FMCG items.
92
 S. Important priorities in family Semi-Urban Rural
No spending (%) (%)
Credits-Loans with EMI: Buy now pay
1 2 3
later
2 Discount Coupons 14 13
3 Price-off discounts 29 31
4 Freebies 12 13
5 Scratch & Win Card offers 8 10
6 Lucky draw 2 3
7 Extra quantity 17 14
8 Gifts 3 4
9 Bundling 13 9
  Total 100 100

The most popular sales promotion measure on FMCG goods opted by the
“

respondents is the Price-off discounts among both the semi urban and rural
respondents Table 5. ”

Table 6: Influence of SED Aspects on Consumer purchase

behavior of SU-Rural.
93
 Profile of Chi-
Consumer Square
S. Personal Value Table S/N Decision/Inferenc
No Influence (Calc) value S e
1 Age/FLC Stage 19.616 9.488 S H03 rejected
2 Gender 17.753 7.815 S H03 rejected
3 Family size 9.616 9.488 S H03 rejected
4 Educational level 17.967 12.592 S H03 rejected
5 Occupation 14.417 12.592 S H03 rejected
Disposable income
6 29.664 16.919 S H03 rejected
to spend
 Personality-
7 31.9727 9.488 S H01 rejected
Lifestyle
8 Purchase attitude 28.802 9.488 S H02 rejected
Consumption
9 24.334 16.919 S H01 rejected
Motive
Suggestions of
10 2.638 7.815 NS H03 accepted
others/family

Vide H03, the SED aspects (Table 6) except other’s opinion on the
“

consumers significantly influence the purchase behavior of the

Consumers. Also, the H01 and H02 are rejected; the consumption
motive, personality-lifestyles and purchase attitude significantly influence
the purchase behavior of the consumer. ”

Table 7: T test on influence of purchase behavior of SU/Rural HH:

Contrast of Husband and wife on various influencing aspects of FMCG-

94
Personal care products.

Enablers of purchase Mea t- Sig.(2- Remark for Null

N
Behaviour n value tailed) H04 @.05
5
Media appeal Hus 2.56 2.663 0.017 Rejected
6
4
  Wife 2.25
4
5
Packaging Lustre Hus 2.04 1.973 0.121 Accepted
6
4
  Wife 2.34
4
5
Brand liking Hus 2.52 2.512 0.022 Rejected
6
4
  Wife 2.82
4
5
Value for money Hus 2.73 2.816 0.009 Rejected
6
4
  Wife 2.89
4
Retailor patronage- 5
Hus 2.14 2.608 0.012 Rejected
offers 6
4
  Wife 2.53
4
Product-specific 5
Hus 2.1 2.518 0.021 Rejected
attributes 6
4
  Wife 2.53
4
Past experience- 5
Hus 2.44 3.155 0.001 Rejected
memory 6
4
  Wife 2.01
4
5
Consumption motive Hus 2.5 2.496 0.029 Rejected
6
4
  Wife 2.1
4

95
Enablers of purchase Mea t- Sig.(2- Remark for Null
N
Behaviour n value tailed) H04 @.05
5
Consumption attitude Hus 2.02 2.437 0.042 Rejected
6
4
  Wife 2.45
4
5
Personality-Lifestyle Hus 2.28 3.044 0.004 Rejected
6
4
  Wife 2.78
4
5
Other’s influence/SN Hus 1.93 1.068 0.288 Accepted
6
4
  Wife 1.77
4
5
Specific SED aspects Hus 1.57 2.453 0.033 Rejected
6
4
  Wife 2
4
Purchase decision 5
Hus 2.68 3.048 0.003 Rejected
style 6
4
  Wife 2.32
4

H04: There is no significant difference between wife and husbands on the

“

enablers of purchase behavior (Table 7). There exists no significant difference

between Husband and wife on the impact package lustre attraction and the
influence of others in influencing their purchase behavior towards FMCG
Personal care items. However there exist significant difference between the
husband and wife on the other variables listed above.
”

96
Table 8: Summary of 1w ANOVA on aspects influencing
purchase behavior of rural and semi-urban respondents for
FMCG-personal care product attributes

Sum of Mean Remark for

  F Value Sig.
Squares Square H05 @.05
Between
11.08 2.216 5.933** 0 Rejected
Groups
Quality-Value Within
35.11 0.374
Groups
Total 46.19
Packaging Lustre Between 2.363 0.788 1.31 0.28 Accepted
Groups
97
 Sum of Mean Remark for
  F Value Sig.
Squares Square H05 @.05
Within
57.747 0.602
Groups

Total 60.11
Between
5.831 1.166 2.371 0.05 Rejected
Groups
Branding Within
46.209 0.492
Groups
Total 52.04
Between
1,937 0.646 3.858** 0.01 Rejected
Groups
Fragrance/Aroma Within
16,063 0.167
Groups
Total 18
Between
0.163 0.054 0.112 0.95 Accepted
Groups
Price affordability Within
46.597 0.485
Groups
Total 46.76
Between
Past experience 10.347 3.449 4.417** 0.01 Rejected
Groups
Within
Groups 74.963 0.781

Total 85.31
Between
1.387 0.462 0.99 0.4 Accepted
Groups
Consumption-
Within
motive 44.803 0.467
Groups
Total 46.19
Between 0.6
0.03 0.177 0.597 Accepted
Groups 2
Other’s influence Within
28.43 0.296
Groups
Total 28.96
98
 Sum of Mean Remark for
  F Value Sig.
Squares Square H05 @.05
Between 0.0
3.59 1.368 2.413 Rejected
Groups 4
Product benefits Within
53.271 0.567
Groups
Total 60.11
Between 0.1
2.397 0.799 2.1 Accepted
Groups 1
Consumption-
Within
frequency 36.513 0.38
Groups
Total 38.91
Between 4.704*
6.67 2.223 0 Rejected
Groups *
Uniqueness-
Within
Visibility 45.37 0.473
Groups
Total 52.04

H05: There is no significant difference in the influence of aspects on the

purchase behavior of rural and semi-urban consumers (Table 8). H05 is rejected
for aspects like quality-value, brand liking, fragrance/ aroma, past experience,
product benefits and uniqueness-visibility, and accepted for aspects like
consumption frequency, other’s influence, consumption motive, affordability
and packaging lusters.

99
Table 9: Shop attributes significant for the SU-Rural Consumers preferred
choice.

T-test for Retail shop aspects influencing the purchase behaviour

of Consumers
S.No Store Attributes Standard Sig.@P<.0
. preferred Mean Deviation t 5
Consistent location of
12.644 -
1 items for ease of finding 3.80692 0.68
8 0.413
items
Availability of 12.595 -
2 3.65279 0.492
advertised products 6 0.688
3 Easy to read signs/price 13.276 3.60332 2.914 0.004
100
 T-test for Retail shop aspects influencing the purchase behaviour
of Consumers
S.No Store Attributes Standard Sig.@P<.0
. preferred Mean Deviation t 5
stickers
Helpful cashiers,
13.103
4 baggers, other store 3.45383 2.087 0.038
8
personnel
Help in finding items in
5 12.276 3.50855 -2.46 0.014
store
Placement of items on
11.885 -
6 lower shelves for ease of 3.94037 0
2 4.087
reach
Personal items suited to 11.868 -
7 3.59364 0
my need 9 4.569
Packaging/ sizes suited
12.226 -
8 to my age/household 3.67821 0.01
8 2.602
needs
13.240
9 Quality of products 3.31491 2.963 0.003
4
Attractive prices for 13.816
10 3.37547 6.177 0
products 9
Store reputation and 13.191
11 3.4872 2.547 0.011
location 3
Accepts coupons from 12.628 -
12 3.67348 0.608
Lucky draws 4 0.514
Option to return items
13 13.194 3.50547 2.548 0.01
for replacements

The shop aspects like consistent location of items in the shop, availability of the
“

advertised products and acceptance of coupons of lucky draws are not

statistically significant Table 9. ”

101
Table 10: Ranking of attributes in the purchase of leading Bathing Soap
Brands.

YARDL PEAR LU CINTHO REXON HAMA

Soap Attributes Y S X L A M
Ranking 1 2 3 4 5 6
Fragrance 3 24 33 22 10 8
Quality 66 23 7 3 1 0
Brand Image 9 18 34 24 11 4
Price
17 28 24 16 6 9
affordability

102
 YARDL PEAR LU CINTHO REXON HAMA
Soap Attributes Y S X L A M
Ranking 1 2 3 4 5 6
Packaging 4 5 2 27 38 24
Other aspects 1 2 0 8 34 55

Table 10, consumers are more quality and price oriented. Also, they are
conscious about the brand image. Fragrance and packaging are least influencing
attributes on the respondents.

Table 11: Attributes on Detergent Brands.

SUR SUNLIGH UJAL HENK RI WHEE

DETERGENT F T A O N L
Attributes ranking &
No. 1 2 3 4 5 6
Fragrance 11 17 41 21 7 3
103
 SUR SUNLIGH UJAL HENK RI WHEE
DETERGENT F T A O N L
Attributes ranking &
No. 1 2 3 4 5 6
Quality 43 34 16 6 1 0
Brand Image 13 16 27 26 11 7
Price affordable 27 28 14 9 6 16
Packaging 6 5 2 33 43 11
Other aspects 0 0 0 5 32 63

Table 11, Consumers are more quality and price oriented. Also, they are
conscious about the brand image. Fragrance and packaging also play important
role for purchasing detergent powder.

Table 12: Salient attributes chosen in the purchase of Bathing

Soaps / Detergents.
104
 Attributes (No.)/100 Bathing soap Deterg. Powder
Fragrance 19 18
Quality 33 36
Company image 16 13
Price 23 19
Packaging 6 11
Others 3 3

Table 12, on the salient attributes for soaps and detergent, quality is the most
influencing attribute in the purchase, while price is also an important attribute
driving the purchase behavior.

105
 CHAPTER 8
QUESTIONNAIRE

QUESTIONNAIRE

1. What percentage of consumer awareness for using toothpaste?

106
 a) Colgate b) Pepsodent

5
4.5
4
3.5
3
2.5
2 2017
1.5 2016
1
0.5
0

ColgatePepsodent

2. Which age use which brand of toothpaste?

107
 a) Colgate b) Pepsodent

5 Pepsodent
Colgate
4
3

0 0-15 15-25 25-35 35+

3. What is your favourite brand of tooth paste?

a) Colgate b) Pepsodent

4. What attracts you to the product you choose?

a) Flavour c) Frothiness

b) Packaging d) Price

5. Have you ever had any side effects using this brand of toothpaste?

108
 a) Colgate Yes No
b) Pepsodent Yes No

6. Brand rating as per usage of toothpaste?

(Give stars out 10)

a) Colgate**********
b) Pepsodent **********

109
CHAPTER 9
ANNEXURE

110
ANNEXURE

111
 CHAPTER 10
LEARNING OUTCOMES

112
 LEARNING OUTCOMES

In evaluation this Project Study has been an exceptional and rewarding revel
“

in. I have been able to meet and network with so many people that I am positive
might be capable of assist me with possibilities inside the future. One most
important aspect that I have discovered via this project study is time
management skill as well Team work. ”

When I first started, I did no longer assume that i was going to make. Once I
“

realized what I had to do I organized my day and work in order that I was now
not overlapping or losing my hours. I discovered that I needed to be organized
and have questions prepared for when it was the ideal time to get remarks. From
this project study and time management I had to discover ways to motivate
myself through being in the floor for so many hours.
”

I got here up with diverse proposals and ideas that the corporation is still
“

searching into the use of. I enjoy this line of labor and hope the employer
reaches Fortune 500 listing someday. I will continue to work hard in my role
and wish to maintain to study the industry and meet new people. This turned
into an outstanding revel in.
”

113
 CHAPTER 11
RECOMMENDATIONS

114
 RECOMMENDATIONS

 The companies should give more emphasis on advertising and sales promotion
“

and the toothpastes should sport medicinal values which would help in
combating oral health issues. ”

 The customers are becoming king as they have a whole lot of choices. Hence
“

the companies should try to be cost effective and pass on the saved amount to
the customer .”

 Retailers are still the place to buy toothpaste. So the companies should focus on
“

retailers also who is also a customer for their products.

”

 The companies should try to launch new products after thorough research of the
“

consumers as they are becoming more dynamic day by day. ”

 The companies should target the youth of the country preferably the age group
“

of 15-35 as slowly they are also bringing changes in their purchase decisions as
well as in their family purchases.”

 The brands like close up and Sensodyne which are less popular should plan to
“

launch new flavours, to attract customers who would like to change from their
existing brand. ”

 They should bring about some changes in their packaging and labelling

115
CHAPTER 12
CONCLUSION

116
 CONCLUSION

Several leading brands of bathing soaps and detergents are prevailing in the
“

market at Ernakulam and promoted by leading manufacturers like HUL, P&G,

Godrej, Ujala Laboratories etc. This study focused on gaining insight into the
influence of various factors on the purchase behavior of rural/semi urban
consumers. The factors included were related to the personal care brands on
bathing soaps and detergents. From the study it is evident that quality of
personal care brands was given more emphasis and the difference in
educational level of respondents is significant in case of certain factors
namely quality, pricing and the retailer. With increased education the rational
thinking of rural consumers improved, impulse buying can be reduced. Kerala
is well known for literacy. The educated consumers make more rational
decisions even though they belong to the rural regions. Income had a
significant difference across Marital Status and Gender of respondents in
influencing their purchase decision. Majority of the consumers did not mind
visiting towns/city to purchase good quality brands of Personal care products.
Further, the marketers must constantly monitor the rural consumer purchase
behavior through local retailers and seek their assistance in curbing fake local
brands. The findings of the empirical study indicate that unless the brand to be
promoted is in the consideration set of the consumer, sales promotion by itself
is unlikely to have any major impact. Clearly this shows that marketers need
to invest into brand building exercise so that his/her brand appears in the
consideration set of the target consumers and then on the sales promotion
activities. Sales promotion should not be used in isolation but needs to be
integrated with other tools and in line with the overall positioning of the
brand. Also, the importance of the role of mass media came out clearly in the
study. Companies need to create sufficient awareness about sales promotion
schemes through mass media in order to create awareness among rural
consumers. FMCG products are low involvement products characterized by
brand switching behavior from consumers. Also the consumer visiting the
shop for the purchase of soap/detergent is the final decision maker of the
brand. Hence it is essential that companies need to design attractive, striking,
visible POPs for scheme announcements. With respect to nature of scheme,
the finding suggested that premium (free gift) was most popular with
companies, while both retailers and consumers preferred price offs. Hence, it
is necessary that the perceived value of a free gift shall be appealingly high
for the target consumers. Repetitive use of the same premium product for a
prolonged period may have negative effect on the brand loyal consumers. ”

117
When the company is giving its own product free as premium, it needs to
“

ensure the quality of the product from it as it is likely to jeopardize the image
of both its products. The findings exhibited that both the retailers and
consumers perceived that sales promotion activities carried out by the
companies were for increasing sales in short term and clearing excess stocks.
What this implies is that companies need to use sales promotion
synergistically and communicate so that they provide value to the target
audience and enhance brand quality/image perceptions. Companies need to
systematize information flow regarding sales promotion activities particularly
at dealer and retailer level. Ensuring proper information flow and devising
checks and measures to reduce misappropriations and implementation flows
should be considered critical aspects for the success of sales promotion
activities by the companies. As retailing is fragmented, direct reach by
companies is not feasible. Through dealers and proper feedback mechanism,
companies can keep track of the market. From the study it was found that
smaller retailers felt neglected and not enthused to implement the schemes,
particularly when additional handling, stocking, accounting was required on
the part of a retailer without compensatory margins. It can be seen that the
retailer and consumer perceptions matched with respect to preferences of
schemes, underlying motivations and role of mass media. This implies that the
retailer would be a rich source of information about the consumer and the
likely response to sales promotion activities. Developing a system to tap such
responses from time to time both at retailer and consumer level would be
helpful for planning future sales promotion activities. In order to build trust
and commitment companies should tap preferences, perceptions of retailers as
well as consumers through relationship marketing, and herald online shopping
from home. ”

118
 CHAPTER 13
BIBLOGRAPHY

119
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