RESEARCH PROPOSAL

FACTORS AFFECTING CONSUMER PREFERENCES IN BUYING BEVERAGES- A COCA COLA AND PEPSI
COMPILED BY: SOURABH SAINI RAM SWARUP ARUN KUMAR SANJAY CHOUDHARY KRITI CHAUHAN

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lemon and orange flavours while non carbonated drinks principally comprise of mango flavour. but at the same time associated with explicit meanings (Fahyet al. However with the re-entry of MNC players like Pepsi in 1991 and Coca-Cola in 1993. As a result. it is vital that international marketers understand these differences and adapt their marketing strategies accordingly. Carbonated drinks include cola. This is acknowledged within the academic literature and steps are being taken to rectify this situation. One of the primary objectives that international marketers have is to create an image that is familiar worldwide. the market took a decisive shift in favour of these MNCs and over the years Coca-Cola and Pepsi has become the prominent players in the market. . Beverages can be principally classified into carbonated and non-carbonated. Coca-Cola and Thumbs up. Initially domestic players like Parle group dominated the Indian beverage market with brands like Thumbs up and Limca. Thumbs up was a brand from Parle until Coca-Cola bought it in 1993.INTRODUCTION Most of the world consumers have certain things in common: their values and attitudes. LITERATURE REVIEW As with much research on consumers there is a lot of terminological confusion and sometimes a lack of rigour. The carbonated cola products constitute 60% of the soft drink market and three prominent brands in this category are Pepsi. As today’s economies are becoming more entwined than ever. 2004). any possible method that can be used in supporting the building of global brands is appealing. Failure to do so could result in disaster for a company’s international products and marketing programs. The beverage industry in India is one of the most competitive with many international names operating in the market. as well as behaviour often differ.

customers may experience feelings of dissatisfaction. Weighing needs or preferences against provided product or service attributes results in the balance of satisfaction pointing in a negative or positive direction. beverages. This determines the way in which people evaluate companies’ or utilities’ performance. Customer satisfaction can be enhanced when their needs are met (in terms of both quality and quantity) and accord with their preferences. However.e. where the service provided conflicts with the prevailing needs or preferences. Consumer Acceptance Acceptance describes consumer willingness to receive and/or to tolerate. Consumer acceptance and satisfaction are related. despite the fact that satisfaction and acceptance can be thought of as lying on a continuous acceptance does not automatically lead to satisfaction. For example.Consumer Satisfaction Consumer satisfaction and acceptances are often considered in the literature to be closely linked yet these are distinct concepts. This is an economic definition and does not tap into ‘wishes’ or ‘dreams’ but for all practical purposes is an appropriate definition. a customer might accept the occurrence of a certain number of yearly supply interruptions given a certain price. Only when a consumer’s needs for a stated good or service are met. will they feel satisfied. Satisfaction is the fulfilment and gratification of the need for a stated good or service. here. Consumer Concerns These are expressed anxieties or unease over an object broadly defined. Preference and acceptance can in certain circumstances mean the . when the service provided corresponds with their preferences. depending on whether interests are conflicting or corresponding. i. At the other end of this dimension. Consumer Preferences This is used primarily to mean an option that has the greatest anticipated value among a number of options. as the first is a precursor of the latter.

in this case. A ‘social object’ in the present context might mean the beverage company. Unfortunately expectation is also used more loosely to mean a requirement or demand for something and in this sense is a kind of strong preference. supply system and service. or the beverage itself. One is the act of expecting or looking forward – a belief about what will happen in the future. imply that more than one state is possible and that there are some options. and in what circumstances. In most research the adequacy or otherwise of this awareness is anchored against the service provider or regulator’s perspective on the supply.same thing but it is useful to keep the distinction in mind with preference tending to indicate choices among neutral or more valued options with acceptance indicating a willingness to tolerate the status quo or some less desirable option. attitudes are important determinants of behaviour. supply system and service. Consumer Expectations The distinction between expectations and preferences is often blurred though the concepts are distinct. beverages which includes the company. A related but more technical use of expectation is to denote a more formal estimation of the probability of an event occurring. These first two definitions can be distinguished from preference in that preferences refer to some desired state and. Consumers and the Public . Expectation is used in three slightly differing senses in the literature. An attitude toward something should thus not be taken to imply that attitude consistent behaviour will automatically follow. Consumer Attitudes An attitude is a positive or negative evaluation of a social object or action. as in the above definition. Consumer Awareness Consumer awareness is the level of knowledge about. 1985) have attitude as a factor involved in determining behavioural choices however there is considerable continuing debate about when. Where consumer awareness does not equate with this industry perspective this is often termed a consumer (miss) perception. Many theories of attitudes (Ajzen.

‘the public’. STATEMENT OF PROBLEM This proposal aims to find out the various factors influencing the consumer decision while making a purchase of a beverage.While discussing definitional clarity it is worth acknowledging that ‘The consumer’ is not a representative of a single homogeneous group.67 million INR. Though the major portion of the market is still . Social scientists prefer to use the term ‘publics’ to reflect the idea that not all members of ‘the public’ share the same goals and values nor have the same relative power or status within any society. The beverage market in India is worth 2074.

Determine the reasons for consuming either beverage brand. the focus of the investigation will be on Coca-Cola and Pepsi’s advertisement and sponsorship as well as their brand. Although consumer perceptions on international brands’ marketing strategies. There was a growth of 31. A number of new brands have flooded the market. OBJECTIVES OF THE STUDY The overall purpose of this study is to gain a deeper understanding of different international and local factors affecting consumer preferences on a local market. We also study whether or not there is a relation between the above mentioned factors. The study aims to determine the factors influencing decision while purchasing beverages. We also want to explore the effect of international well-organized advertising campaigns having on consumers’ buying process.52% in the juice segment from 2007-2008. We have limited our research to the cola drink industry. To determine which commercial beverage tickles the choice. HYPOTHESES . PRIMARY OBJECTIVES To determine the factors influencing the consumer decision while buying beverages namely Coca-Cola and Pepsi. SUB OBJECTIVES     To determine the product attributes influencing purchase decision. Due to these changes in the beverage market there is a need to identify and evaluate the reasons for the shift in consumer purchase pattern. To determine the most preferred beverage among the given brands.dominated by the carbonated beverages there is a major shift towards the healthy options such as juices and buttermilk. rather than the entire soft drink industry. As a result of this phenomenal growth. a lot of competition has entered the market.

as well as their taste preferences. while Pepsi relies more on the appeal of celebrities and young people. Coca-Cola and Pepsi marketing strategy differ widely. 2001). 2001). as they are vulnerable to consumerism and media (Blackwell et al.People aged eighteen and younger have the highest level of knowledge of brand advertisement. but more importantly they need to feel accepted.Seeing as Coca-Cola and Pepsi seem to target different consumer’s age the choice of cola product differs. and the results provided that the majority did indeed choose Pepsi. following hypothesis is proposed: H3:. H2:. hence they are more influenced by it in their choice of products than any other age group. . particularly by their peers (Solomon et al. independence and approval to name a few. RESEARCH METHODOLOGY DATA COLLECTION: . where Coca-Cola depends heavily on tradition.Consumers explicitly prefer one brand but actually favour the taste of another. whereas the older age group are more positive towards Coca-Cola. More specifically the younger age group particularly have a more positive attitude towards Pepsi on the whole.In the 1980’s consumers’ were tested on whether they preferred the Pepsi product over that of Coca-Cola’s. As a result the following hypothesis is suggested. Coca-Cola was and still is today the leader within the cola drink market. Based on these results following assumptions are made: H1:. interestingly enough. As a result. Consequently they switch primarily targeted at them.We have used the data already collected by Rambabu Pentyala the use of a questionnaire as the main aim is to measure consumers’ understanding and experience of global advertising campaigns. specifically in that of their advertisements. According to theory. Yet. teenagers have a high need for belonging.

The questions in the questionnaire were based upon theoretical framework and thus. unstructured questions were asked. These questions were of great relevance since it illustrated whether the respondents held favourable or non-favourable towards the brands. The questionnaire was divided into structured and unstructured questions accordingly.QUESTIONNAIRE: . Questions can be divided into following groups: CONSUMER PREFERENCE: the questionnaire initiated with an introduction to the consumption of cola drink and hence the questions were designed in such a way to give an overall view of the respondents’ relationship to cola as a soft drink. as well as the associations that go with them. ADVERTISEMENT: questions 13-15 are linked to the advertisement theory and provided with knowledge about respondents’ attitude towards advertisement in general and the extent in which advertisement influences consumers in their . A ratio scale was also used which allowed the respondents to classify or rank the objects i. as well as the different factors that influence consumer preference.where 5 represents “very good” while 1 represents “very bad”.e. as the majority were friends and family. BRAND: question 7-10 encompasses the respondents’ viewpoint on Coca-Cola and Pepsi as a brand respectively. 1-5. Questions 11 and 12 were specifically about the two brand’s logo and slogans. Finally in combination with the structured questions. 19-34: students >35: family.the respondents selected by Rambabu Pentyala were as follows: <18: the majority were seventh to ninth graders from North India region.The questionnaire allowed gathering specific information on how different consumers perceive international campaigns. friends and people from Hyderabad These respondents were selected on the basis of easy access. indicating once again which of the two brands were preferred over the other. where the respondents were able to clarify and express in detail their responses and opinions SAMPLE COLLECTION: .

the research has been conducted with a view of providing most relevant information. SIGNIFICANCE OF THE STUDY VALIDITY: in order to gain as high validity as possible. Moreover the questions provided with and insight into how familiar and open the respondents were of Coca-Cola and Pepsi’s advertisement and campaigns. the respondents were asked to fill in their age and preferred activity to see whether the theory about age correlates to the different age group’s responses. These questions provided with knowledge about the relationship between sponsorship and brand image and whether it is successful to sponsor different events. The need to satisfy customer success in any commercial enterprise is very obvious. OTHERS: finally.choice of products. The income of all commercial enterprise is derived from the payments . SPONSORSHIP: questions 16-18 are in accordance to the theory regarding sponsorship.

Bamossy. G. London: Simon and Schuster. The main task of Marketing Research is systematic gathering and analysis of information. as the number of respondents were limited the external validity of this study can be questioned. monitor marketing performance. customer and public to the marketer through information-information used to identify and define marketing opportunities and problems. and improve understanding of marketing as a process. It is therefore no surprise that Peter Ducker the renowned management Guru. According to American Marketing Association. Solomon M. 2001. 2005. If there is no customer there is no income and there is no business. Although. & Askegaard. Thus this study is helpful in providing an insight into what helps a customer decide his preference for a particular product and this in turn gives the company’s and idea of how they can bring about changes in their product. . Harlow England. has said “to satisfy the customers is the mission and purpose of every business”. generate.. D. refine and evaluate marketing actions.A. G. REFERENCES:Aaker. advertisement or sponsorship to stimulate customer preference for their product. Strategic market management. Then the core activity of any company is to attract and retain customers.consumer behaviour. New York: Financial Times.” Marketing Research plays a very significant role in identifying the needs of customers and meeting them in best possible way. “Marketing Research is the function that links the consumer.received for the products and services supplied to its customers.

org/wiki/Coca-Cola http://en.enotes. Miniard and J.html www.wikipedia.wikipedia. Engel.. J.mimi.coke. Principles of marketing. pp-1-21.hu/marketingweb/lowinvolvement_products. Kotler P. international marketing. Rambabu Pentyala.org/wiki/Pepsi http://business.com. Harlow Pearson Education Limited.Blackwell R. P. http://en.asp . vol.com/business-finance-encyclopedia/advertising http://en. 2001.5 (1) October 2011. Ohio: South Western. Armstrong 2005. Management Education and Research Institute.au/about_advert.