PROJECT REPORT ON:-

CONSUMER PERCEPTION TOWARDS SMARTPHONES

Submitted in partial fulfilment of MBA program

2013-15

Submitted To: Submitted By:

Mr. Surjit Kumar Kar ASHMEET SINGH KHANUJA

Assistant Professor

Marketing & Strategy

Certificate by Guide

This is to certify that major research project work done on

“CONSUMER PERCEPTION TOWARDS CONSUMER DURABLE

BRANDS (SMARTPHONE’S)” submitted to IBS Hyderabad, IFHE

University by ASHMEET SINGH KHANUJA,, KEERTHI

CHANDRA & GAYATRI PATRA in partial fulfilment of the

requirement for the Non-Class Participation - 2. This is a work carried

out by all of them under my supervision and guidance. This work has

not been submitted anywhere else for any other degree/diploma. The

original work was carried at ICFAI Business School, Hyderabad.

Date: 05 January 2014

Assistant Professor

Marketing & Strategy

IBS Hyderabad

IFHE University

Hyderabad, Andhra Pradesh

DECLARATION

We hereby declare that the research project work entitled

“CONSUMER PERCEPTION TOWARDS CONSUMER DURABLE

BRANDS (SMARTPHONE’S)” is submitted to IBS Hyderabad,

IFHE University, Andhra Pradesh is a record of original work done by

us under the guidance of Mr. ……… Kumar Kar, Assistant Professor,

Marketing & Strategy, …….. Business School, Andhra Pradesh and

this research project work has not been performed for the award of

any other degree or diploma and similar project if any.

ASHMEET SINGH KHANUA

KEERTHI CHANDRA

GAYATRI PATRA

MBA SEM -II 2013-15

ACKNOWLEGEMENT

We would like to express our deep gratitude to Mr. ……… Kumar Kar Assistant Professor (Marketing & Strategy), ICFAI Business School, IFHE University for his constant support, guidance and motivation which helped us immensely in completing this project. The insistence on taking up a relatively new topic helped us to understand the prospects how the consumer perceived about the consumer durable brands. We also would like to thank our respondents for giving us their valuable time and providing us with the information needed to carry out the research successfully.

ASHMEET SINGH KHANUJA

KEERTHI CHANDRA

GAYATRI PATRA

MBA SEM-II 2013-15

TABLE OF CONTENTS

SR NO.

CONTENTS

1 INTRODUCTION

2 LITERATURE REVIEW

3 OBJECTIVES AND HYPOTHESIS OF THE STUDY

4 RESEARCH METHODOLOGY

5 RESULTS AND DISCUSSION

6 LIMITATIONS

7 REFFERENCES

8 ANNEXURE

INTRODUCTION

A Smartphone is a mobile phone built on mobile operating system with enhanced and more advanced computing capability and connectivity than a normal mobile phone. The first Smartphone combine the function of a personal digital assistant (PDA) with mobile phone. Later, models added the functionality of media players, digital cameras, video cameras & GPS navigation system to form one multi tasking device. Many modern Smartphone also include high resolution camera with touch screen pad and web browser that display standard web pages. For high speed data accesses the Smartphone include WiFi function and mobile broadband. In recent years the rapid of development of mobile applications & of mobile commerce has been drivers of smart phone adaption.

The mobile operating system use by modern Smartphone includes Google’s android, Apple’s iOS, Nokia Symbian, Rim’s Blackberry OS, Samsung BADA, Microsoft Windows phone, and Hewlett-Packard’s web OS. Such operating system can be installed on different mobile phones and each device can receive multiple OS Software update over its life time. I n this project we discussed the importance of analysing the consumer perception towards durable brand’s with the help of Smartphone. Local and foreign brand choice affected by various factors such as brand image, country of origin, brand awareness, brand quality and so on…. In this era of globalisation consumer have become much more aware and the perceptions regarding durable brands are changing at a rapid pace. It has been seen that price & quality of the durable goods are considered to be major factors of making their brand choice. Consumer prefer low brand product because of lower price, similarly in case of Smartphone’s the increasing demand of low brand Smartphone’s are because of consumer’s affordable prices in India, As Indian consumer are more price sensitive. But consumers who want better quality and durability and for the status enhancement reasons prefer foreign brands, like in case of Smartphone’s the consumer who wants better quality, durability and consider status will prefer Apple Smartphone. Now in order to understand consumer perception we need to understand culture, so that behaviour of consumer is well understood. The perception consumers have of a business and its product or services whether it’s durable or non durable, have a effect on purchasing behaviour of the consumer that’s why companies spend lots of money in marketing themselves. They marketing themselves by providing excellent customer services and other influential programs which can favourable influence the perception of target consumer. With the help of careful planning and execution companies can influence those perception and foster profitable consumer behaviour. Consumers continually synthesise all the information they have about a company to make a decision about whether the company offers value for the money, in a sense consumer perception is an approximation of reality.

LITERATURE REVIEW

In this project we are going to discuss about the perceptions of consumer towards durable brand for which we have taken the example of Smartphone’s to analyse how the consumer perceive and what are the factors which affect the consumer perception regarding a particular product.

Perception:-Perception is the process by which we select, organise, and interpret

information input to create a meaning full picture of the world. It depend not only on physical stimuli but also on the stimuli relationship to the surroundings environment and on condition within each of us. One Person might perceive a fast talking sale person as aggressive and in sincere another person might perceive that as intelligent and help full. Each person will respond to the sales person differently. People perceive differently because of three perceptual processes…

1. Selective Attention2. Selective Distortion3. Selective Retention4. Subliminal Perception

Selective Attention:-Attention is the allocation of processing capacity to some

stimulus. An average person may be exposed to different ad’s brand communication a day. But we cannot possible attend these; we screen most stimuli out – a process called Selective Attention.

Selective Distortion:-Even noticed stimuli don’t always come across in the way the

sender intended. Selective distortion is the tendency to interpret in a way that fits our preconception. Consumer will often distort information to be consistent with prior brand and product belief and expectations.

Selective Retention:-Most of us don’t remember much of the information to which

we are exposed, but we do retain information that supports our attitude and beliefs. Because of selective retention , we are likely to remember good points about a product we like and forget good points about competing products. Selective retention again works for the strong brands.

Subliminal Perception:- The selective perception mechanism require consumers; active

engagement and thought . A topic that has fascinated armchair marketer for ages is subliminal perception. They argue that marketers embed covert , subliminal message in ads or packaging .consumers are not consciously aware of them, yet they effect behavior . although it’s clear that mental process include many subtle subconscious effects , no evidence support the notion that marketers can systematically control consumers at that level , especially enough to change moderately important or strongly held beliefs. Consumer perceived value of the Smartphone tradeoff between benefit and sacrifices perceiver by consumer, in which benefits are adopted from the technology of acceptance model.

Product Level:-

Kotler indicates that marketer needs to consider five product levels when planning market offering. Each level increases more consumer value. Five product levels are as follows:-

Core benefits Basic Product Excepted Product Augmented Product Potential Product

In case of Smartphone market the Core Value for the most buyers could be the convenience and timeliness of communication, including multi-media communication; at the second level, the basic might be concrete, communicable, and multi-function Smartphone product; at the third level, Smartphone user expect that the Smartphone is useful and quality, for example performance, camera, and screen pixels; at the fourth level, the augmented product can be the pleasing design and diversity. At the fifth level, the potential product is possibly the voice control system.

According to our survey the major determinant of mobile phone include branding, price, feature, appearance, & lifestyle. Therefore in this study branding, price, feature, appearance, lifestyle, & accessories are sub-assumed into the independent variable.

1. Branding:-Kotler and Keller suggested that branding could be divided in two parts –

brand awareness & brand image. Brand awareness refers to the ability of the customer to consider a brand under different circumstance. On the other hand Brand Image refers to the

perception about the brand which is reflected by the bran associations held in consumer memory. Consumer often choose that product brand that they are familiar with because a well known brand gives people perception of being safe.

2. Price:-Price of a product is nothing but the cost of product. Which is the reason the

people compare price with the quality of product, consumer generally perceived that if the price of the product is high then the quality of the product is better. When the utility of the two product is similar and their prices differ, consumer will choose the option which choose the product with lower price to maximise the utility.

3. Feature/ Appearance:-Appearance of the product can influence the consumer

perception easily because products with appealing look are able to catch consumer’s eyes and get once attention. Appearance of the product is now only satisfied by the needs visually but also a critical factor in marketing strategies, for example:- Apple made it product look appealing to a consumer with a snow white industrial design, which save the appearance of Apple product four years.

4. Lifestyle:-Some people think that if they have a good quality Smartphone it represent

their lifestyle. So lifestyle can be considered as the factor which distorted consumer perception.

OBJECTIVES OF THE STUDY

Objective of the study is to study the consumer perception towards durable brands. Here we have to study how consumer perceive durable brands, how consumer behaved and what are the factors which effect the consumer perception regarding durable brands. The study is based upon the primary data collected through an online survey.

HYPOTHESIS OF THE STUDY

H0: β0= β1= β2= β3= β4= β5= β6= β7=0

Ha: β0≠ β1≠ β2≠ β3≠ β4≠ β5≠ β6≠β7≠0

β0 = intercept β1 = Smartphone’s Technology β2 = Appearance β3 = Features β4 = Brand Value β5 = Size β6 = Accessories β7 = Price

H0 : These factors does not affect the perception of the purchasing behaviour of the consumers.

Ha : These factors does affect the perception of the purchasing behaviour of the consumer.

RESEARCH METHODOLOGY

The Study: The study was causal in nature with survey method being used for data

collection.

Sampling Design

Population: The population included viewers from IBS Hyderabad & Other

personal contacts.

Sampling frame: Since the data was collected through personal contact the

sampling frame included general viewers from IBS Hyderabad & Other personal

contacts.

Sample size: Sample size was 148 respondents.

Sample elements: Individual respondents were the sample elements.

Tools used for data collection: Self designed questionnaires were used to

evaluate Audience Perception of Consumer Perception Towards Consumer

Durable Brand’s with an example of Smartphone’s. Data was collected on a 7

point Likert type scale, where 1 indicated minimum agreement and 7 indicated

maximum agreement.

Tools used for data analysis: After the collection of respondent from two days

online survey we analyzed the data on Regression and ANOVAs with the help of

SAS 4.2 Statistical Package.

RESULTS AND DISCUSSIONS

Hypothesis tested using Multiple Regression:

H0: β0= β1= β2= β3= β4= β5= β6= β7=0

Ha: β0≠ β1≠ β2≠ β3≠ β4≠ β5≠ β6≠β7≠0

Results Of Multiple Regression

Price and Brand value are the most important considerations in the buying behaviour.

Battery life plays an almost negligible role in the purchasing behaviour of consumers.

For α=.05, P value =.001, which implies that H0 is rejected. ie the variables considered affect the purchasing behaviour of the consumer.

Dependent mean= 0.61972, suggests the sample is slightly in favour of purchasing a Smartphone.

R2=0.4925 suggests that 49.25% of the variance is explained by the model.

Variance Inflation Factor is less than 5 for each of the variable, which suggests lack of multi-collinearity. That means that each of the variables in consideration is independent on its own.

The distribution of residuals for purchase suggests that the errors are equally distributed among the variables.

All the observations for which the the cook’s D statistic is above the horizontal line are influential. The influential observations can be used for further analysis to study their buying behaviour.

Outliers: an outlier is an observation with large residual. In other words, it is an observation whose dependent-variable value is unusual given its values on the predictor variables. An outlier may indicate a sample peculiarity or may indicate a data entry error or other problem.

Leverage: An observation with an extreme value on a predictor variable is called a point with high leverage. Leverage is a measure of how far an observation deviates from the mean of that variable. These leverage points can have an effect on the estimate of regression coefficients.

ANNOVA suggests the following:

55% of the sample rated 7 in how technology affects their purchase behavior.

35% of the sample rated 7 in how appearance affects buying behavior.

45% of the sample rated 7 in how features affects buying behavior.

40% of the sample rated 7 in how brand value affects buying behavior.

35% of the sample rated 6 in how value for money affects buying behavior.

30% of the sample rated 7 in how size of the phone affects buying behavior.

25% of the sample rated 6 in how accessories affect buying behavior.

25% of the sample rated 5 in how the battery life of the phone affects buying behavior.

35% of the sample rated 5 in how price affects buying behavior.

25% of the sample rated 7 in how lifestyle of the consumer plays a role in buying behaviour.

LIMITATION

1: Some of the people were not responsive.

2: Possibility of error in data collection because many of the respondents may

have not given a answer to the questionnaire.

3: Sample size is less to represent the whole population.

4: The time period of research was short.

5: Respondents behaviour may be casual.

6: Financial resources are not available.

REFERENCES

Marketing Management – Philip Kotler 14e

Marketing Research – Naresh K. Malhotra Fourth Edition

Statistics for Business and Economics – Anderson, Sweeney, Williams

ANNEXURE ANNEXURE 1

QUESTIONNAIRE

Consumer perception towards smartphone

NAME

OCCUPATION

Do you have a smart phone?o  YES

o  NO

The emergence of smartphones has changed the way we communicate with one another.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree , to 7,Agree,.

Agree

Do you get attracted by the appearance and design of smartphone and then want to own it?

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

My Purchase of smartphone depends on the features the smartphone provides.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

Brand name plays a vital role while purchasing any smartphone.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I consider the 'value for money' concept while purchasing a smartphone.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I prefer smartphones which are easy to carry and can be easily fit to my pocket.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

Accessories and other free benifits effect my purchasing decision.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I look towards the battery life factor if the number of technical applications and functions are less.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

Smartphones are generally high priced.

1 2 3 4 5 6 7

Disagree

Select a value from a range of 1,Disagree, to 7,Agree,.

Agree

I believe that the type of smartphone represents my life style.

1 2 3 4 5 6 7

DisagreeSelect a value from a range of 1,Disagree, to 7,Agree,.

Agree