Customer Satisfaction in Paint Industry

A STUDY ONCUSTOMER SATISFACTION IN PAINT INDUSTRY,

VISAKHAPATNAM

DATA PROVIDED HERE IS NO ABSOLUTE…ITS ONLY FOR REFERENCE

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CONTENTS

CHAPTER – I

INTRODUCTION

Need for the Study Importance Objectives Methodology Limitations

CHAPTER – II

Industry Profile CHAPTER – III

A Profile of Visakhapatnam

CHAPTER – IV

Literature Review

CHAPTER – V

Data Analysis and Interpretation

CHAPTER – VI Summary Suggestion

CHAPTER – I

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INTRODUCTION

Marketing is managing profitable customer relationship. In the present highly

competitive economy, which can be called as buyers markets, it is the customer who

wields full power. The customers who were considered the ‘King’ is now treated almost

as god, emulating the highly successful marketing people of Japan. When the customer

expectations become higher and higher, superior market driven strategies and their

execution in the market are important. Companies have to be fully customer oriented to

succeed in the present competitive scenario, and should ‘think customers’, ‘live for

customers’, ‘smell customers’ and build ‘customer relations’.

Marketing is managing profitable customer relationships. The basic objective of

marketing is to attract new customers by promising and offering superior value and to

retain and grow current customers by delivering satisfaction. Marketing deals with

customers more than any other business function, and deals mainly with the customers.

Building customer relationships based on customer value and satisfaction is at the very

core of modern marketing Sound marketing is essential for the success of every company,

whether large or small, global or national.

Marketing is something which is going on around us. Marketing people are busy

calling for our attention always, to try a product or service. Marketing has become all

pervading and we see it everything we do. But there is much more to marketing than

meets the consumer’s casual eye. Behind it all is a massive network of people and

activities competing for our attention and purchases.

Earlier there was a concept where customer was treated as king. But now-a-days

customer is tread as God. Many firms are now enjoying the tremendous benefits of

customer relationship management. But one thing is true, if we want to build a long

lasting relationship with customers, we need to ensure their satisfaction at all the times.

Market

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A market is a place where buyers and sellers meet to buy or sell products, as in the

case of a fish market, vegetable market or grain market. But in marketing, a market refers

to the deferent groups of consumers for a product or service. Market need not be a place

as in the traditional sense. Here, the sellers or marketers are treated as the industry and

the buyers as the market.

Examples are the general consumer market, business market, global market and specific

markets like teenager’s market, children’s market, and education market.

A market is the set of actual and potential buyers of a product. Such buyers or

customers share a particular need or want that can be satisfied through exchange

relationships. The size of the market will depend on the number of people who exhibit the

need, have the buying power, and are willing to exchange their resources for what they

want.

Marketers work to understand the needs and wants of specific markets and to

select the markets that they can serve best. In turn, they develop products and services

that create value and satisfaction for customers in these markets. The result is profitable

long term customer relationship.

Definition:

Relationship marketing is the process of building long-term, trusting, and win-win

relationships with customers, distributors, dealers and suppliers.

________ Philip kotler.

“Marketing is an organizational function and a set of process for creating

communicating and delivering value to customers and for managing customer

relationships in ways that benefit the organization and its stakeholders.”

___ American marketing association

NEED FOR THE STUDY:

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In a competitive environment, an organization must provide target customers

more value than is provided by its competitors. Customer value is the difference between

all the benefits derived from a total product and all the costs and risks of acquiring those

benefits.

On the basis of the consumer analysis under taken in the step, the organization

identifies group of individuals, households or firms in the similar needs. These market

segments are described in terms of demographics, media performances, and geographic

locations. Management then select one or more of these segments as target market based

on the firms capabilities relative to those of its competition.

“Customer satisfaction in paints industry is of great importance in providing

valuable insights about customers of various paint producing companies”.

Marketing strategy seeks to provide the customer with more value than the

competition while still producing a profit for the firm. Marketing strategy is formulated in

terms of the marketing mix; it involves determining the product features, price,

communications, distribution and services that will provide customers with superior

value. This entire set of the characteristics is often referred to as the total product. The

total product is presented to the target market, which is consistently engaged in

processing information and making decisions designed to maintain or enhance its life

style or performance.

In order to develop a sound marketing strategy a firm should explore to the

information about customers. The quality of marketing strategy depends to a large extent

on the quality of information obtained about customers.

Visakhapatnam is a fast growing port and steel city in Asia Hence, an attempt

has been made to study customer satisfaction in paint industry, Visakhapatnam, AP India.

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Importance of Customer Satisfaction

The importance of customer satisfaction is apparent when you realize that, without

customers, you don't have a business. A single unsatisfied customer can send more

business away from your company than 10 satisfied customers. The more you focus on

customer retention and customer support, the more long-term business you'll get. It's

worth it to focus on customer satisfaction strategies, no matter how large or small your

company is.

Understanding the needs of the customer is critical.

A business relationship, just like any other relationship, relies on both people

getting their needs met. No matter what type of business you are in, all customers want

the same thing. They want to feel welcomed and appreciated by you and your staff. They

don't want to get the impression that they are just being used by you for money. Small

interactions like "Thank you" and a nice smile can go a long way toward customer

satisfaction.

Make sure your employees operate with the same principles.

A big part of customer satisfaction is reliability. If customers come to expect a

certain mode of behavior from you and your employees, you should deliver it to them

each and every time. Customers want to be able to rely on you. They expect consistent

delivery times (if applicable) and support. By training your employees to treat all

customers with the same respect, your customers will all have the same experience with

your company, which will increase customer satisfaction.

Be honest when you don't meet expectations.

Customer satisfaction is at its most important when something goes wrong in the

chain of delivery. Whether a customer was double charged or didn't receive what she

ordered, your employees need to handle the situation with the utmost care. Your

employee should apologize and take steps to rectify the situation. The phrase "the

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customer is always right" is at the core of a good customer satisfaction strategy. It doesn't

matter whether or not the customer misread the instructions or made the mistake; your

employee should take steps to make the customer happy.

Customer satisfaction is the foundation of a good business. Satisfied customers will

make a great foundation for return business, and they may also bring in their friends and

associates. Remember that customers are the heart of any business. Keep them satisfied,

and encourage them to tell their friends about their experiences with your business.

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OBJECTIVES

To understand the theoretical aspects of the customer satisfaction.

To review the profile of paint industry in Visakhapatnam.

To know about the loyalty of customers towards the paint manufacturing companies.

To know about the quality standards and requirement of consumers in respect of paints.

To analyze the perception of customers towards their satisfaction among different paint products and companies.

To give suggestion for the betterment in strategies to attract customers by different paint companies.

Methodology

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Primary data:

Primary data the company itself give the information .and we have gone to various

paints’ offices, such as Asian paints, burger paints, Nerolac paints, Shalimar paints etc,

and got the information about customers and their addresses from the company records

and management.

Sample size: Total sample size has been taken as 100.

I applied random sampling technique to analyze customer satisfaction in paints industry.

A pre-structure questionnaire has been prepared to obtain data and conducted interviews

with customers of different paints as per their convenience. The simple statistical tools

such as percentages, mean values and charts have been used to analyze the data.

Likerts 5 point scale has been used in the analysis to understand customer satisfaction in

respect of paints of different companies. The scale includes range of responses from very

good (5), good (4), average (3), bad (2), and very bad (1).

Secondary data:

Secondary data about business opportunity and customer base is obtained from various

books, magagience and journals. Customer phone numbers and addresses have been

taken from the records of various paint stores.

Limitation of the study

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Time is the first most constraint for the study. a period of 45 days is not sufficient

enough to study the customer satisfaction.

I have employed sampling technique in my study. A study which adapts sampling

technique may not give 100 percent fair result.

I have employed questioner in my study. The fairness of the result study depends

largely on the frankness of respondents and which cannot be taken for granted.

This study is confined Visakhapatnam region only and cannot be applied all the

places.

Customer satisfaction is a psychological feeling and it may alter in the future

period. So, we cannot confine to the results of the study for years to come

CHAPTER - IIINDUSTRY PROFILE

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THE INDIAN PAINT INDUSTRY

The Indian paint industry is an Rs 49 billion sector.

The demand for paints is relatively price-elastic but is linked to the industrial and

economical growth.

The per capita consumption of paints in India is very low at 0.5 kg per annum if

compared with 4 kgs in the South East Asian nations and 22 kgs in developed

countries. The global average per capita consumption is 15 kg.

In India the organized sector controls 70 percent of the total market with the

remaining 30 percent being in the hands of nearly 2000 small-scale units.

In India the industrial paint segment accounts for 30 percent of the paint market

while the decorative paint segment accounts for 70 per cent of paints sold in India.

In most developed countries, the ratio of decorative paints Vis-a -Vis industrial

paints is around 50:50.

All the industry majors have a vast dealership network and are required to

maintain high inventory levels.

SECTOR COMMENTS

Paint is a mixture of four elements - solvents, binders, pigments and additives.

Solvents give the paint a liquid flow while the binder binds it to the surface. Pigments

impart color and opacity to the paint and the additives give it special resistance

properties.

SECTOR TRENDS

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The recession in the construction and automobile sector had thrown in shades of

grey across the Industry spectrum, but the revival in these sectors is cause for cheer for

the paint industry as well. The balance sheets of the industry majors are now painted with

bright colors

SECTOR SPECIFICS

On product lines, paints can be differentiated into decorative or architectural

paints and industrial paints. While the former caters to the housing sector, the automotive

segment is a major consumer of the latter. Decorative paints can further be classified into

premium, medium and distemper segments. Premium decorative paints are acrylic

emulsions used mostly in the metros. The medium range consists of enamels, popular in

smaller cities and towns. Distempers are economy products demanded in the suburban

and rural markets. Nearly 20 per cent of all decorative paints sold in India are distempers

and it is here that the unorganized sector has dominance. Industrial paints include powder

coatings, high performance coating and automotive and marine paints. But two-thirds of

the industrial paints produced in the country are automotive paints.

MARKET PROFILE

The leaders in the organized paint industry are Asian Paints (India) Ltd. (APIL),

Goodlass Nerolac Paints Ltd. (GNPL), Berger Paints, Jenson & Nicholson Ltd. (J&N)

and ICI (India) Ltd.

An Asian paint is the industry leader with an overall market share of 33 per cent

in the organized paint market. It has the largest distribution network among the players

and its aggressive marketing has earned it strong brand equity. The Berger Group and ICI

share the second slot in the industry with market shares of 17 per cent each. GNPL has a

market share of 15 percent in the organized sector.

The market can be further split into decorative paints and industrial paints. The

demand for decorative paints is highly price-sensitive and also cyclical. Monsoon is a

slack season while the peak business period is Diwali festival time, when most people

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repaint their houses. The industrial paints segment, on the other hand, is a high volume-

low margin business. In the decorative segment, it is the distribution network that counts

while in the industrial segment the deciding factor are technological superiority and tie-

up with automobile manufacturers for assured business.

APIL dominates the decorative segment with a 38 per cent market share. The

company has more than 15,000 retail outlets and its brands Tractor, Apcolite, Utsav, Apex

and Ace are entrenched in the market. GNPL, the number-two in the decorative segment,

with a 14 per cent market share too, has now increased its distribution network to 10,700

outlets to compete with APIL effectively. Berger and ICI have 9 per cent and 8 per cent

shares respectively in this segment followed by J&N and Shalimar with 1 and 6 per cent

shares.

The share of industrial paints in the total paint consumption of the nation is very

low compared to global standards. It accounts for 30 per cent of the paint market with 70

per cent of paints sold in India for decorative purposes. In most developed countries, the

ratio of decorative paints vis-Ã -vis industrial paints is around 50:50. But, with the

decorative segment bottoming out, companies are increasingly focusing on industrial

paints. The future for industrial paints is bright. In the next few years, its share would go

up to 50 per cent, in line with the global trend.

GNPL dominates the industrial paints segment with 41 per cent market share. It

has a lion's share of 70 per cent in the OEM passenger car segment, 40 per cent share of

two wheeler OEM market and 20 per cent of commercial vehicle OEM market.

It supplies 70 per cent of the paint requirement of Maruti, India's largest

passenger car manufacturer, besides supplying to other customers like Telco, Toyota,

Hindustan Motors, Hero Honda, TVS-Suzuki, Mahindra & Mahindra, Ashok Leyland,

Ford India, PAL Peugeot and Bajaj Auto. GNPL also controls 20 per cent of the

consumer durables segment with clients like Whirlpool and Godrej GE. The company is

also venturing into new areas like painting of plastic, coil coatings and cans. APIL, the

leader in decorative paints, ranks a poor second after Goodlass Nerolac in the industrial

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segment with a 15 per cent market share. But with its joint venture Asian-PPG Industries,

the company is aggressively targeting the automobile sector. It has now emerged as a 100

per cent OEM supplier to Daewoo, Hyundai, Ford and General Motors and is all set to

ride on the automobile boom. Berger and ICI are the other players in the sector with 10

per cent and 9 per cent shares respectively. Shalimar too, has an 8 per cent share.

PRICE SENSITIVITY FACTORS

Various factors that have influenced the pricing of paints are summarized below:

The industry is raw-material intensive. Of the 300 odd raw materials, nearly half

of them are imported petroleum products. Thus, any deficit in global oil reserves

affects the bottom line of the players.

The major raw materials titanium dioxide, phthalic anhydride and peutarithrithol

constitute 50 per cent of the total cost. Besides, this, there are other raw materials

such as castor, linseed and soybean oils, turpentine. The raw materials cost sums

up to a whopping 70 per cent. Any increase in the prices of these raw materials

could adversely affect paint prices.

Most of the paint majors have to import nearly 30 per cent of their raw material

requirements thus changes in import policies can affect the industry.

The prices of packing materials such as HDPE, BOPP and tinplate have reduced

considerably. However, the decision of the Central Government to ban import of

tinplate waste could lead to a spurt in the prices of the tinplate in the near future.

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TECHNOLOGY COLLABORATION

All the paint majors have tie-ups with global paint leaders for technical know-how.

Asian Paints has formed a JV with PPG Industries Inc to service the automotive OEMs.

Berger has a series of tie-ups for various purposes. It has a technical tie-up with

Herbets Gmbh of Germany in addition to its joint venture with Becker Industrifag. With

the agreement with Herbets coming to an end in 2001, Berger has now allied with the

Japanese major Nippon Paints to boost its OEM turnover since the Indian roads are being

flooded with Japanese automobiles. It also has an agreement with Orica Australia Pvt.

Ltd. to produce new generation protective coatings. The company also has tie-ups with

Valspar Corp and Teodur BV for manufacturing heavy duty and powder coatings.

Incidentally, ICI makes paints with the technical support of Herbets, which has

been recently acquired by E I Du Pont de Nemours of the US. Interestingly, Du Pont,

which is a leader in automotive coatings in the US, has a technical tie-up with Goodlass

Nerolac for the manufacture of sophisticated coatings for the automotive sector. Goodlass

also has technical collaborations with Ashland Chemcials Inc, USA, a leader in the

petrochemical industry, Nihon Tokushu Toryo Co and Oshima Kogyo Co Ltd, Japan.

OVERSEAS EXPANSION

If the global Goliaths are foraying into the Indian paints market aggressively, the

Indian paint companies are also spreading their wings. Asian Paint exports its paints to

over 15 countries. It also has joint ventures in Fiji, Tonga, Nepal, Vanuatu, Solomon

Islands, Australia, Oman and Mauritius. In October 1999 it acquired 76 per cent equity

stake in Delmege Gorsyth & Co (Paints) Ltd, the second largest paint company in Sri

Lanka with a 12 per cent market share in Sri Lanka's Paint Industry. Within a short span

of just five years, the company has emerged as the number one player in these markets.

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CONCLUSION

The industrial paints are slated to grow at an annual rate of 10 to 12 per cent per

annum for the next few years. The industrial paint manufacturers would benefit from the

burst in the passenger car sales. The two-wheeler industry has also registered a good

show in the current year. The commercial vehicles segment, a star performer last year

with 33 per cent growth, is expected to average a growth of only 15 per cent this year.

However, the raising titanium dioxide prices and the negligible growth in agriculture this

year will play spoilsport. Considering the past trend, the paint industry is expected to

show at least twice the growth of Indian GDP in the ensuing years. The reduction of

excise duties from a high of 40 per cent to 16 per cent in the last five years has made the

numerous small-scale units unviable, as they no longer have a price advantage over the

organized sector. This has helped the organized paint Industry a lot. The industry is in a

consolidation phase and only those Indian paint companies with a strong technical

alliance, better distribution network and an ability to compete in the global markets

would emerge victorious in the paint war.

The Indian Paint industry, estimated to be an Rs.21, 000 Cr. industry, has been growing

at a rate of above 15% for the past few years. The organized players of the industry cater

to about 65% of the overall demand, whereas the unorganized players take care of the

remaining 35%, in value terms. The unorganized players mainly dominate the distemper

segment.

The industry consists of two segments, namely

o Decorative segment – caters to the housing sector and

o Industrial segment - consists of powder coatings, floor coatings and other protective

coatings catering to the automobile, marine and other industries.

In the domestic market, Decorative segment accounts for 70% of the total demand for

paints whereas the industrial segment accounts for the remaining 30%. Globally, the

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demand for paints is almost equally distributed, where both the segments account for

close to 50% of demand.

The working of the Paint industry has been explained pictorially below:

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Raw Materials:

On an average, raw materials constitute ~56% of the total expenditure in paint

companies. Titanium dioxide is one of the major raw materials and price fluctuations in

its cost have direct and substantial impact on the cost of production. Crude oil derivatives

are the other major raw materials and have similar impact. Apart from these a large

number of other raw materials are used for adding/giving specific properties to the wide

product range offered by the industry.

End-User:

The decorative paints segment products find use in households and construction

whereas the industrial segment products find use in automotive industry, consumer

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durables industry and other OEM’s. Growth of the paint industry has been consistent with

the growth of Indian GDP. Paint industry has been growing at a rate of 1.5 to 2 times of

Indian GDP growth. The Decorative segment shows a seasonal trend with sales peaking

during the festive seasons in the months of September to November, whereas the demand

is low in the monsoons.

The top 5 companies make up more than 80% sales of the organized market.

The market share of the organized sector is continuously improving as consumer

preference is shifting towards better products offered by the leading brands. Established

Foreign companies have entered the Indian market by acquiring existing Indian

companies. Kansai Paints, Japan entered the Indian Market by acquiring Nerolac, Akzo

Nobel, the world’s largest Paint company, entered the Indian market by acquiring ICI

Paints (now Akzo Nobel India.)

Asian Paints is the market leader in the Indian Paint Industry and gets the major portion

of its revenue from the Decorative segment. Over the years, it has outperformed its peers

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in every aspect by wide margins. This is mainly due to its strong moat (competitive

advantage) which lies in its strong Brand Equity and an extensive Distribution Network.

The company’s Net sales, Net Profit and Book Value have grown with a 5 year CAGR of

22%, 27% and 28% respectively. Also the company’s debt is very low and its ROIC has

been 40% on an average over the last six years.

Kansai Nerolac holds the second position in the Indian Paint market, and is the market

leader in the Industrial Paint Segment, owing to its leadership position in the Automobile

Paint segment. It is the subsidiary of Kansai Paints Ltd., the leading Japanese paint

company. Berger paints has the third position and derives its major revenue from the

Decorative segment. Akzo Nobel (former ICI Paints) is the subsidiary of the world’s

largest Paint Company and is at the fourth position. Shalimar Paints is at the fifth

position.

Given below is the MoneyWorks4me assessment for a few Paint companies:

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http://stockshastra.moneyworks4me.com/learn/stock-shastra-5-great-brands-are-an-unbreachable-moat/

http://stockshastra.moneyworks4me.com/learn/stock-shastra-4-look-for-companies-with-unbreachable-moats/

The table above gives you a list of the top 5 companies from the Paint Industry. Due to

the very nature of the paint industry, it is best advised to invest in companies which have

created a strong brand equity for themselves and have a strong competitive advantage.

While such companies usually trade at a premium and are rarely cheap, you should look

to invest in them when they are available at a good discount. To find out the right price to

invest in these companies, become a member of MoneyWorks4me.com.

Disclaimer: This publication has been prepared solely for information purpose and does

not constitute a solicitation to any person to buy or sell a security. It does not constitute a

personal recommendation or take into account the particular investment objectives,

financial situations or needs of an individual client or a corporate/s or any entity/ies. The

person should use his/her own judgment while taking investment decisions.

CHAPTER - III

VISAKHAPATNAM PROFILE

Visakhapatnam District is one of the North Eastern Coastal districts of Andhra Pradesh

and it lies between 17o - 15' and 18o-32' Northern latitude and 18o - 54' and 83o - 30' in

Eastern longitude. It is bounded on the North partly by the Orissa State and partly by

Vizianagaram District, on the South by East Godavari District, on the West by Orissa

State and on the East by Bay of Bengal.

HISTORICAL ASPECTS AND ETYMOLOGY

Inscriptions indicate that the District was originally a part of Kalinga Kingdom

subsequently conquered by the Eastern Chalky’s in the 7th Century, A.D. who ruled over

it with their Head Quarters at Vengi. This District was also under the occupation of

various rulers such as the Reddy Rajahs of Kondaveedu, the Gajapathis of Orissa, the

Nawabs of Golkonda and the Moghal Emperor Aurangazeb through a Subedar. This

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territory passed on to French occupation in view of succession dispute among Andhra

Kings and finally it came under the British Reign.

There were no geographical graftings till 1936 in which year, consequent on the

formation of Orissa State the Taluks namely Bissiom, Cuttack, Jayapore, Koraput,

Malkanagiri, Naurangapur, Pottangi and Ryagada in their entirety and parts of Gunpur,

Paduva and Parvathipur Taluks were transferred to Orissa State.

The Visakhapatnam District was reconstituted with the remaining area and residuary

portions of Ganjam District namely Sompeta, Tekkali and Srikakulam Taluks in entirety

and portion of Parlakimidi, Ichchapuram, Berahmpur retained in Madras presidency.

With the passage of time, the reconstituted District was found administratively unwieldy

and therefore it was bifurcated into Srikakulam and Visakhapatnam districts in the year

1950. The residuary district of Visakhapatnam was further bifurcated and the Taluks of

Vizianagaram, Gajapathinagaram, Srungavarapukota and portion of Bheemunipatnam

Taluk were transferred to the newly created Vizianagaram District in the year 1979.

Coming to etymology of the name Visakhapatnam, tradition has it that some centuries

ago a King of Andhra Dynasty encamped on the site of the present Head Quarters Town

of Visakhapatnam on his piligrimage to Banaras and being pleased with the place, had

built a shrine in honour of his family deity called Visakeswara to the South of the

Lawson’s Bay from which the district has derived its name as Visakheswarapuram which

subsequently changed to Visakhapatnam. The encroachment of waves and currents of the

sea supposed to have swept away the shrine into off shore area.

PHYSICAL FEATURES

The District presents two distinct Geographic divisions. The strip of the land

along the coast and the interior called the plains division and hilly area of the Eastern

Ghats flanking it on the North and West called the Agency Division. The Agency

Division consists of the hilly regions covered by the Eastern Ghats with an altitutde of

about 900 metres dotted by several peaks exceeding 1200 metres. Sankaram Forest block

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topping with 1615 metres embraces the Mandals of Paderu, G. Madugula, Pedabayalu,

Munchingput, Hukumpeta, Dumbriguda, Araku Valley, Ananthagiri, Chinthapalli, G.K.

Veedhi, and Koyyuru erstwhile Paderu, Araku Valley and Chinthapalli taluks in entirety.

Machkhand River which on reflow becomes Sileru, drains and waters the area in its flow

and reflow and is tapped for Power Generation.

The other division is the plains division with altitude no where exceeding 75

metres watered and drained by Sarada, Varaha and Thandava Rivers and rivulets

Meghadrigedda and Gambheeramgedda. Since no major Irrigation system exists

significant sub regional agronomic variations exist in this division. Along the shore lies a

series of salt and sandy swamps. The coast line is broken by a number of bald head lands,

the important of them being the Dolphin's Nose which had afforded the establishment of

Natural Harbour at Visakhapatnam, Rushikonda(v) Polavaram Rock and the big

Narasimha Hill at Bheemunipatnam. Administratively, the District is divided into 3

Revenue Divisions and 43 Mandals.

DEMOGRAPHIC CHARACTERISTICS

The population of the district is 38.32 lakhs as per 2001 Census and this

constituted 5.0% of the population of the state while the Geographical area of the District

is 11161 Sq. KM. which is only 4.1% of the area of the State. Out of the total population

19.30 lakhs are Males and 19.02 lakhs are Females.

The Sex Ratio is 985 Females per 1000 Males. The District has Density of

population of 343 per Sq.Km. Agency area shows lesser Density and plain area higher

density. 39.90% of the population resides in the 10 Hierarchic urban settlements while

rest of the population is distributed in 3082 villages. Scheduled Castes constituted 7.60%

of the population while Scheduled Tribes account for 14.55% of the population of the

district.

The district has a work force of 16.03 lakhs constituting about 41.83 of the population

besides the marginal workers to a tune of 2.97 lakhs as per 2001 Census. The cultivators

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constitute 36.31% Agricultural Labourers 23.60% and the balance of 40.09% engage in

Primary, Secondary and Territory sectors as per 1991 census.

LITERACY

There are 20.02 lakhs literates forming 52.25% of the total population of the

District. Male literates constitute 69.7% while female literates forming 50.1%. The

literacy rate is 60.0% in the District

CLIMATE

The district has differing climatic conditions in different parts of it. Near Coast the

air is moist and relaxing, but gets warmer towards the interior and cools down in the hilly

areas on account of elevation and vegetation. April to June is warmest months. The

Temperature (at Visakhapatnam Airport) gets down with the onset of South West

Monsoon and tumbles to a mean minimum of 21.0o C by December after which there is

reversal trend till the temperature reaches mean maximum of 32.6o C by the end of May

during 2006-2007.

RAINFALL

The District receives annual normal rainfall of 1202 MM, of which south-west

monsoon accounts for 72.0% of the normal while North-East monsoon contributes 13.9%

of the normal rainfall during 2006-2007. The rest is shared by summer showers and

winter rains. Agency and inland Mandals receive larger rainfall from the South West

Monsoon, while Coastal Mandals get similarly larger rainfall from North-East monsoon.

SOILS

Red Loamy soils predominate with coverage of 69.9% of the villages of the

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district. The Soils are poor textured and easily drained. Sandy loamy soils come next with

19.2% villages coverage, largely confined to the coastal areas of Nakkapalli,

Payakaraopeta, S.Rayavaram, Rambilli, Atchutapuram, Paravada, Visakhapatnam,

Pedagantyada, Gajuwaka and Bheemunipatnam Mandals and to certen streches in the

interior Mandals of Chodavaram, Narsipatnam, K.Kotapadu and Madugula.

Black cotton soils come up next having sizeable chunks of area in K.Kotapadu,

Devarapalli, Cheedikada, Paderu and Hukumpeta Mandals. 45% of the soils in the district

are low in organic content and 55% in Phosphorous content.

LAND USE

The total geographical area of the district is 11.16 lakh hectares of this 36.45%

alone is arable area while 39.53% is forest area. The rest is distributed among "Barren

and uncultivable land" about 11.7% and "Land put to non agricultural uses" about 9.0%.

Out of the arable area, the net area sowed form 27.2% while cultivable waste and fallow

(current and old) lands constitute about 9.2% during 2006-2007.

FLORA AND FAUNA

More than the one third of the area in the District is covered by forest. The forests

are of moist and dry deciduous type. The common species available in them are

Guggilam, Tangedu, Sirimanu, Kamba, Yagisa, Nallamaddi, Gandra, Vepa etc. Bamboo

shurbs are sparsely scattered. But forest area in the district has been showing a quiescent

pecline since 1955-56 perhaps due to podu practice, indiscriminate grazing and browsing.

To stem this, regeneration programmes are being carried out. Chinthapalli Teak

Plantation is an off shoot of this. The latest caper in this regeneration programme is

rising of Teak, Silver trees, coffee plantations, as the agency areas are found suitable

agronomically for coffee growth. Coffee plantations have been raised in about 10000

Acres in Chinthapalli, Minimuluru, Devarapalli and Ananthagiri regions by different

agencies for different purposes.

25

By the forest Department to conserve soil, by the Coffee board to evolve cultures

suited to on-traditional areas and by the Girijan Corporation and the I.T.D.A. to wean out

tribals from the pernicious practices of "Podu Cultivation.”

Regarding fauna the district has a livestock of 12.02 lakhs as per 2003 livestock Census.

In the Livestock, Cattle 29.4% Buffaloes 34.8% Sheep 16.5% and Goats 17.3% about

wild fauna Boars and Bisons are found in Forest areas of the district and isolated

instances of Cheetas and tigers.

ECONOMY

AGRICULTURE

Agriculture is the main stray of nearly 70% of the households. Though

Visakhapantam city is industrially developing, the rural areas continued to be backward.

Rice is a staple food of the people and Paddy is therefore the principal food crop of the

district followed by Ragi, Bajra and Jowar and Cash Crops such as Sugarcane,

Groundnut, Sesamum Niger and Chillies are important.

Since there is no Major Irrigation system, only about 36% of the cropped area is irrigated

under the Ayacut of the Medium Irrigation System and Mimnor Irrigation Tanks. The rest

of the cultivated area is covered under dry crops depending upon the vagaries of the

monsoon. The productivity of the crops is low.

ANIMAL HUSBANDRY

Animal Husbandry is an important allied economic activity to Agriculture. Next

26

to draught Animals which are main source of energy for Agriculture, Milch Animals,

Sheep and Goat are important for income generation of the rural households. A sizable

number of households earn subsidary income by selling milk to Visakha Dairy and in

Local markets. The total livestock of the district is 12.02 lakhs of which working animals

account for 2.14 lakhs while milch Animals account for 3.10 lakhs. Goats and Sheeps

totalling upto 4.06 lakhs are important for the livelihood of the considerable population.

FISHING

It is another important economic activity of the fishermen population living in about

59 fishery villages and hamlets on coastline stretching to a length of 132 KMs. covering

11 coastal mandals. About 13,000 fishermen families to ekeout their livelihood from

marine, Inland and brakish water fishing besides catching fish living around Thandava

and Raiwada reservoyers.

MINERALS

The District has mineral deposits of Bauxite Apatite (Rock Phosphate) Calcite,

Crystaline limestone confined to tribal tracts. Bauxite deposits at Sapparla, Jerrila and

Gudem of G.K.Veedhi Mandal are considered to be the largest in the country. Bauxite

deposits are also identified at Galikonda, Katuki, Chittemgodndi of Araku group deposits,

Katamrajukonda of Gurthedu sub-group of deposits. Phosphate Apatite is avilable in

Kasipatnam village of Ananthagiri mandal. Rich deposits of Crystaline limestone and

Calcite are mapped in Borra Caves and along the Valley up to Araku from Borra and

around Valasi village of Ananthagiri mandal. Ruby Mica is another mineral available in

the District essential for electrical and electronic industries. The mineral occurs in the

form of Phologopite and is confined to Borra tract. Quartz is another mineral found

mostly in Bheemunipatnam, Padmanabham, Devarapalli, K.Kotapadu and Ananthagiri

mandals. Vermiculate found near Kasipatnam of Ananthagiri mandal. Clay deposits near

Malivalasa of Araku mandal are identified. Limeshell useful for manufacture of chemical

27

grade lime is also available in the district. Red and Yellow ochre deposits are also

identified in Araku and Ananthagiri mandals.

INDUSTRIES

Industrial Development is conspicuous in Visakhapatnam urban agglomeration

with the large scale industries like Hindustan Shipyard, Hindustan Petroleum

Corporation, Coromandal Fertilisers, Bharat Heavy Plates and Vessels, L.G.Polymers

Ltd., Hindustan Zinc Plant and the recent giant Visakhapatnam Steel Plant and a host of

other ancillary Industries.

The Visakhapatnam Steel Plant is the biggest with an authorised share capital of

Rs.7466 crores with a licenced capacity of 2.8 Million Tonnes of salable steel 3.0 Million

Tonnes of Pig Iron and 8.32 lakhs Tonnes of By product. About 25,000 persons expected

to be employed. The project has provided employment to 16300 persons.

On the country side the agro based industries like Sugar Factories, Jute Mills and Rice

Mills are there besides brick and tile units. The District has 1063 registered factories

under factories Act functioning with a working force of about 77203 persons during

2006-2007.

POWER

Power consumption by industries is 43.669 Million KWH while it is 46.052 for

Agricultural purposes. All 3,335 villages in the District have been electrified including

solar power system during 2006-2007.

COMMUNICATIONS The District has a Road length of 6922 kms. Of which the National Highway 5 runs

to a length of 134.28 KMs. State Highways at a length of 343 KMs. And the balance

forms the roads maintained by Roads and Buildings, Zilla Praja Parishad and Mandal

Praja Parishads.

28

The number of Vehicles registered during 2006-2007 is 550737 of which 457012

are Motor Cycles. There are 647 Post Offices, 25 Telegraph Offices and 96 Telephone

Exchanges with 146114 telephone connections in the District.

EDUCATIONAL AND MEDICAL FACILITIES There are 3093 Primary Schools with 2.16 lakhs children on enrolment, 686 Upper

Primary Schools with an enrolment of 1.22 lakhs 578 High Schools with 2.02 lakhs

pupils on roll, 68 Junior, Degree and Professional Institutions with 0.46 lakhs students

during 2006-2007.

Regarding Medical facilities, there are 164 Government Hospitals and dispensaries both

Allopathic and Indian Medicine with 2819 bed-strength and 634 Doctors.

BANKING

There are 350 Bank Branches including Cooperative Banks in the district to look

after the credit needs of the people.

CHAPTER - IV

CUSTOMER SATISFACTION Customer satisfaction or dissatisfaction is the feeling derived by the consumer

when he compares the products actual performance with the performance that the expects

of it. Customers from their expectations on the basis of past buying experiences, advice

of their references group and the promises of the markets and their competitors. When the

product performance matches the expected performance, the customer experiences

satisfaction; when it falls short of the expectation, he experiences dissatisfaction. And

when the performance exceeds expectations the customer is highly satisfied or delighted.

” Satisfaction—fulfillment or gratification of need, desire or appetite. “

Complete customer satisfaction is achieved by understanding customer requirements

and delivering superior quality goods and services. Companies must provide the

customers with continuous flow of new ideas/offers and constantly enhance their service

levels to build up satisfaction among customers.

29

Concept of value

Different customers look for different benefits from the same products. Therefore,

the value of the product different from one customer to other. Value to customer refers to

the different between the benefits the derives from the product or service and the cost of

acquiring the product. The cost of the acquiring the product involves not only the cost of

the product but also other economic and non economic costs. The customer is happy

when the benefits and the cost match. The wider gap between the derived benefits and the

cost of acquisition, the happier customer is.

Purpose of the Literature Review

Building on its longstanding work to improve the quality of services that affect public

well being, the Center for the Study of Social Policy has developed a Customer

Satisfaction Initiative. The Initiative tests whether successful consumer models used by

market industries to ensure customer service and satisfaction can be applied effectively to

improve the quality of services in targeted low-income neighborhoods. Goals of the

initiative are to:

Improve the responsiveness and effectiveness of service providers in target areas;

Link regular customer feedback to quality service improvement plans;

Change the power balance for customers in poor and vulnerable neighborhoods

and the organizations, agencies and workers that serve them; and

30

Promote a consumer base that is more informed and ready to take action in their

neighborhoods and communities.

In 2004, the Center commissioned a survey of customer satisfaction research and

reports to inform its development of the Customer Satisfaction Initiative. The survey

Customer Satisfaction: Improving Quality and Access to Services and Supports in

Vulnerable Neighborhoods helped the Center identify effective approaches used by

market-driven organizations to monitor and improve customer satisfaction. Further study

examined strategies for applying customer-driven quality improvement strategies to

public services, including European approaches and experiences with user involvement

and customer satisfaction in social services. This paper provides a brief synthesis of this

formative research. Although it draws primarily from the business world’s prolific study

of market-driven organizations, it also provides public sector examples and experiences.

Explores key components of customer-focused organizations, including:

Customer-oriented vision that is clearly defined and communicated;

Customer-oriented culture that embeds customer satisfaction throughout

organizational practices;

Focus on the total customer experience; and

Customer service standards and accountability.

Part 3 examines the critical role of frontline staff and strategies for ensuring that

employees have the capacity to put customer service first, including training, employee

empowerment, and recognition and rewards for performance.

Part 4 describes tools and strategies used to research and improve customer satisfaction,

including surveys, customer behavior research, complaint resolution approaches, testers

and “secret shoppers,” and continuous feedback loops.

31

The conclusion briefly describes the potential for applying customer satisfaction research

and customer service strategies in the public sector and among vulnerable populations

Why Organizations Focus on Customer Satisfaction

Businesses monitor customer satisfaction in order to determine how to increase their

customer base, customer loyalty, revenue, profits, market share and survival. Although

greater profit is the primary driver, exemplary businesses focus on the customer and

his/her experience with the organization. They work to make their customers happy and

see customer satisfaction as the key to survival and profit. Customer satisfaction in turn

hinges on the quality and effects of their experiences and the goods or services they

receive.

What is Customer Satisfaction?

The definition of customer satisfaction has been widely debated as organizations

increasingly attempt to measure it. Customer satisfaction can be experienced in a variety

of situations and connected to both goods and services. It is a highly personal assessment

that is greatly affected by customer expectations. Satisfaction also is based on the

32

customer’s experience of both contact with the organization (the “moment of truth” as it

is called in business literature) and personal outcomes. Some researchers define a

What The Research Tells Us:

satisfied customer within the private sector as “one who receives significant added value”

to his/her bottom line—a definition that may apply just as well to public services.2

Customer satisfaction differs depending on the situation and the product or service.

A customer may be satisfied with a product or service, an experience, a purchase

decision, a salesperson, store, service provider, or an attribute or any of these.3 Some

researchers completely avoid “satisfaction” as a measurement objective because it is “too

fuzzy an idea to serve as a meaningful benchmark.”4 Instead, they focus on the

customer’s entire experience with an organization or service contact and the detailed

assessment of that experience.

Customer satisfaction is a highly personal assessment that is greatly influenced by

individual expectations. Some definitions are based on the observation that customer

satisfaction or dissatisfaction results from either the confirmation or disconfirmation of

individual expectations regarding a service or product. To avoid difficulties stemming

from the kaleidoscope of customer expectations and differences, some experts urge

companies to “concentrate on a goal that’s more closely linked to customer equity.”

Instead of asking whether customers are satisfied, they encourage companies to

determine how customers hold them accountable.

In the public sector, the definition of customer satisfaction is often linked to both the

personal interaction with the service provider and the outcomes experienced by service

users. For example, the Urban Institute and Mathematical conducted customer

satisfaction surveys for the federal child support enforcement system.

33

Service Quality

Research identifies many characteristics that are associated with service quality. Business

researchers Benjamin Schneider and David Bowen assert that “service organizations must

meet three key customer needs to deliver service excellence:” security, esteem, and

justice.9 Research identifies an array of service quality factors that are important for

customers, including:

timeliness and convenience,

personal attention

,

reliability and dependability,

employee competence and professionalism,

34

empathy,

responsiveness,

assurance,

availability, and

tangibles such as physical facilities and equipment and the appearance of the

personnel.

Research shows that these characteristics also apply to citizen satisfaction with public

service quality. Timely service is an especially strong determinant of quality across

different types of public services. Fairness and outcomes are additional factors important

to public service customers.

Public sector quality improvement initiatives are on the rise worldwide as contracting and

private service provision has become more common. At the same time, European

researcher Dr. Jane Pillagers notes that consumer demand for more transparent, equitable,

and consumer-oriented services has produced a quality gap: a gulf in perceptions of

quality and the impact of services on the end user. She calls for rethinking quality

initiatives to interlink quality improvement with user involvement and participation and

with social equality and inclusion.11 The experiences of successful businesses both

support this perspective and offer experiences, tools and lessons for putting customers

first.

35

CUSTOMER-ORIENTED MISSION AND CULTURE

Not surprisingly, a primary concern of business research and literature is

building companies that excel at gaining and keeping customers. Studies show that

outstanding customer service organizations focus on a clear goal—satisfying the

customer—and design everything else with that aim in mind. From the top-down, these

organizations act to provide positive customer experiences. The focus on complete

customer satisfaction permeates the organization. Fifteen years ago, in the beginning

stages of the customer service revolution, Ron Zemke and Dick Sheaf canvassed 101

leading companies to see how they approached customer service. From this investigation,

they distilled five general operating principles that research and experience continue to

uphold:

36

1. Successful customer service companies listen to, understand, and respond—

often in unique and creative ways—to the evolving needs and constantly shifting

expectations of their customers.

2. These companies establish a clear vision of what superior service is, communicate

that vision to employees at every level, and ensure that service quality is

personally and positively important to everyone in the organization.

3. They establish concrete standards of service quality and regularly measure

themselves against those standards. They guard against the common mindset that

some margin of error is acceptable by establishing as their goal 100 percent

performance.

4. They carefully hire people, train them extensively so they have the knowledge

and skills to achieve the service standards, and then empower them to work on

behalf of customers, whether inside or outside the organization.

5. They recognize and reward service accomplishments, sometimes individually,

sometimes as a group effort, in particular celebrating the successes of employees

who go one step beyond the expected actions for their customers.

This section examines these principles and provides examples of how high performing

organizations put them into practice.

A. Customer-Focused Mission Statements

The management and customer service literature hammer home the importance of a

guiding vision that is clearly communicated through an organizational mission statement

and set of principles. An effective mission statement accomplishes three purposes:

1. It focuses and guides employee actions.

37

By providing a constant touchstone for employees, the mission statement

has a powerful role in reinforcing customer service. According to marketing

expert Barry Feig, a strong mission statement both inspires and challenges

employees.13 It can also help employees feel that they are part of something

important, another operating principle of high performing companies.

2. It helps set and manage customer expectations.

The American Airlines Customer Service Plan states: “We are in business

to provide safe, dependable, and friendly air transportation to our customers, in

the hopes that you will fly with us again and again.” The Customer Service Plan

then goes on to provide service goals, guarantees, and promises for customers and

employees. It is continually updated based on information from customer

research, including focus groups, discussions and surveys.

3. It contributes to instilling a culture of customer orientation.

The Ritz- Carlton Hotel is frequently cited as a company that exemplifies superior

customer service. When Horst Schulze took leadership of the company in 1983, he

launched a comprehensive program of quality management that grew to permeate the

organization. The Credo that defined the new direction begins with a clear statement:

“The Ritz-Carlton Hotel genuine care and comfort of our guests is our highest

mission.” The Credo was further translated into the Gold Standards for guests and

employees, which include the Motto, the Employee Promise, the Three Steps of

Service, and the Basics—twenty rules for and promises to all employees. After

intensive customer service training, every employee receives a wallet-sized copy of

the Credo and Standards.

38

B. Customer-Oriented Culture

Creating and instilling a “culture” of customer service in which employees are

encouraged and expected to go to great lengths to satisfy customers is another hallmark

of a successful organization. High performing organizations work to create an

environment where employees focus on customer satisfaction in each encounter, every

day. For many organizations, including public sector social services, this requires “a

massive culture shift away from what is convenient for the organization to what is needed

by the service users.”

Many public and private organizations fail by relying on a single customer satisfaction

program or strategy, such as customer surveys, staff orientation sessions, or performance-

based compensation. Instead, success requires “a multi-dimensional program, including

management consulting, customer satisfaction measurements, employee feedback,

motivation programs, training and ongoing reinforcement.” Customer service and

responsiveness must be embedded in practices and operations throughout the

organization.

C. Total Customer Experience

Business experts recommend focusing on the entire customer experience with each

service contact. “It is the totality of the buying experience that will keep your customers

coming back for more.” More than just the basics of customer service create a favorable

experience for the customer; everything, conscious and unconscious, can affect it.

Successful service companies attend to every detail to ensure that the customer’s

physical, social, and psychological experience is pleasant.

Personal Contact and Relationships

Research shows that, in an increasingly impersonal world, customers want personalized

service. It is essential to customer satisfaction. “Customers experience service one-on

39

one, subjectively, impressionistically. An organization looks like the people who greet

them, write up their order, deliver something to them … it sounds like the last person the

customer talked to on the phone.”26 Honeywell and Contracting Business Magazine

conducted consumer focus groups to determine customer expectations and perceptions of

heating and air conditioning contractors. They learned that reliance on answering

machines and interactive telephone-computer communications were viewed as definite

negatives. Customers wanted not only a skilled technician, but also someone who was

easy to talk to, looked professional, enjoyed talking to the customer, and respected the

customer.

Proven techniques for putting customers at ease include simple courtesy, using each

customer’s name, answering customers’ questions, and remembering their names,

preferences, and personal things about them. One way staff members at an exemplary

Marriott Hotel in California put customers at ease is by using the customer’s name

several times at every interaction.28 At the Crown Paradise Resort in Cancun, Mexico,

and other hotels, the concierge frequently calls guest rooms to see if customers need fresh

towels, new drinks in the refrigerator, or other services. Wal-Mart places a greeter inside

every store who welcomes customers and is available immediately to answer questions or

provide customer directions. Other mass retailers have mimicked the practice. Wal-Mart

also requires employee, whenever within ten feet of a customer,

to smile and greet the customer. One of Ritz-Carlton’s basic rules for employees is to

“Escort guests rather than pointing out directions to another area of the Hotel.”

D. Customer Service Standards and Accountability

A fourth component of a customer-focused organization is a clear set of customer

service performance standards that is systematically reinforced. Standards of customer

service identify and communicate what constitutes satisfactory performance for all

employees and customers. They provide uniform measures for all staff and promote

consistently strong customer service. According to Mary Malone, a patient satisfaction

consultant to the hospital industry, “Behavioral change requires standards, not

suggestions.” Once those are in place, an organization can develop consistency by

40

“clearly communicating what is expected and, based upon those expectations, reinforce

positive behaviors and hold employees accountable for sub-standard service delivery.”35

Organizations take different approaches to identifying customer service standards and

they vary in detail. Emanuel Medical Center uses “CARING” as an acronym for its six

customer service standards, which are printed on the back of ID badges, flashed across

computers as screen savers, printed on T-shirts, and posted prominently throughout the

hospital:

Customers first

Accept responsibility

Reach out and help

Initiate contact

Nurture others

Give attention to detail.

The vice president of Crothall Health Care developed customer service standards for the

hospital housekeeping department by thinking about cleanliness from the patient’s

perspective. “One of the standard points of everyday cleaning is the floor around the

patient’s bed. However, when you think about it, patients spend most of their time

looking up toward the ceiling and lights, or at the wall at the foot of the bed.” The

housekeepers subsequently added light checks as part of their routine. At MidState

Medical Center, managers worked with staff to identify concrete behaviors that serve as

examples of the hospital’s standards of care. Those behaviors became standards of

conduct for staff and are backed by staff orientation and training, systems of employee

recognition and reward, and customer satisfaction feedback. Results from customer

satisfaction surveys are presented at staff meetings and all employees are involved in

41

identifying solutions for areas needing improvement. Staff is not only involved in

defining behavioral standards, but also in an accountability loop that uses those standards

to measure performance. Customer service standards provide a framework for

performance management and accountability. Saint Luke’s Hospital uses a performance

management system to ensure that every employee has action plans and goals that are

aligned with the hospital’s core values and service standards. The system is also linked to

employee compensation.

CHAPTER - IV

CHAPTER - V

TABLE NO: 5.1: AGE OF THE CUATOMERS

S. no Response No of

Respondents

Percent

1 Less than 25 years 30 30

2 Less than 25-35 years 45 45

3 Less than 35-45 years 15 15

4 Less than45-55 years 6 6

5 More than60 years 4 4

42

Total 100 100

Source: Field Study

Interpretation:

Most of the respondents (about 45 per cent) belongs to 25 to 35 years age group,

followed by less than 25 years age group (about 30 per cent), 35 to 45 years age group

(about 15 percent), 45 to 55 age group(about 6 per cent) and above 55 years age

group(about 4 per cent) (Table-5.1).

TABLE NO: 5.2: OCCUPATION OF THE CUSTOMERS


Respondents

Percent

1 Employee 30 30

2 Business 50 50

3 Professional 15 15

4 Others 5 5

Total 100 100

Source: Field Study

43

Interpretation:

The responses regarding occupation of customers have been obtained. As many as 50 per

cent of respondents occupation is business, followed by the employment (about 30 per

cent), profession (about 15 per cent )and other (about 5 per cent ) (Table-5.2).

TABLE NO: 5.3: GENDER OF THE RESPONDENTDS


Respondents

Percent

1 Male 90 90

2 Female 10 10

Total 100 100

Source: Field Study

Interpretation:

Majority of respondent customers, selected for the study are male (about 90 per cent).

Rest of them (about 10 per cent) is female customers (Table -5.3).

44

TABLE NO: 5.4: ANNUAL INCOME OF THE CUSTOMERS


Respondents

Percent

1 Less than 1 lakhs 25 25

2 Less than 1-2 lakhs 40 40



5 More than 4 lakhs 4 4

Total 100 100

Source: Field Study

45

Interpretation:

About 40 per cent of the respondent’s annual income is in the range of the 1 to 2 lakhs,

followed by the less than 1 lakhs (about 25 per cent), 2 to 3 lakhs (about 15 per cent) and

3 to 4 lakhs (about 16 per cent). Significantly only about 4 per cent of customers have

above 4 lakhs annual income (Table 5.4).

TABLE NO: 5.5: EDUCATION OF CUSTOMERS


Respondents

Percent

1 Yes 56 44

2 No 44 56

Total 100 100

Source: Field Study

Interpretation:

46

About 56 per cent of respondent customers are educated rest of them representing about

44 per cent are illiterates. (Table 5.5)

TABLE NO: 5.6

Response regarding purchase of paints

Response No. of Respondents Percent

New construction 55 55

Festival 35 35

Function 10 10

No reason 0 0

Total 100 100

Source: Field Study

47

Interpretation: The reason behind purchasing a product influences the purchasing behavior of the

customer. Satisfaction level depends on how well the product meets the customer

expectation. In our study 55 respondents purchasing paints on the occasion of new

construction, 35 respondents purchasing on festivals, 10 respondents purchasing on the

occasion of function.

48

TABLE NO: 5.7

Response regarding last use paint?

S. No Response No. of Respondents

Percent

1 Last year 10 102 2-3 years back 63 633 3-4 years back 25 254 Above 4 years 02 2total 100 100

Source: Field Study

49

Interpretation:

The reason behind purchasing a product influences the purchasing behavior of the


expectation. In our study 10 respondents purchasing paints on the last year ,63

respondents purchasing paints on 2-3 years back, 25 respondents purchasing paints on 3-

4 years back ,2 respondents purchasing paints on above 4 years.

50

TABLE NO: 5.8

Response regarding which company paints did you use or purchase?

S. no Response No. of Respondents

Percent

1 Asian paints 40 40

2 Berger paints 26 26

3 Nerolac paints 22 22

4 Shalimar paints 12 12

total 100 100

Source: Field Study

51

Interpretation:

Last time purchases and repeated purchases are the indication of customer satisfaction

with the product.

In our study 40 respondents purchased Asian paints, 26 respondents purchased Berger

paints, 22 respondents purchased Nerolac paints, 12 respondent purchased Shalimar

paints.

52

TABLE NO: 5.9

Response regarding name the brands of paints so far you remember


Percent





total 100 100

Source: Field Study

53

Interpretation:

Brand recognition and brand remembrance show the impact on customer behavior and

customers’ pre-purchase dissonance.

In our study 40 respondents remember Asian paints, 30 remember Berger paints, 18

remember Nerolac paints, and 12 respondents remember Shalimar paints immediately

after seeking the information from them.

54

TABLE NO: 5.10

Responses regarding influences of advertisement buy a particular brand of paints?

S. no Response No .of Respondents

Percent

1 Yes 67 67

2 No 33 33total 100 100

Source: Field Study

55

Interpretation:

Advertisements, no doubt, can influence the purchase decisions. But it may not be true in

all cases.

In our study 67 respondents said that their purchasing decision would definitely

influenced by Advertisements, and 33 respondents said that their purchasing decision

would not influenced by Ads.

56

TABLE NO: 5.11

Response regarding the likeability of advertising.


Percent

1 TV ad 46 462 Paper ad 20 203 Hoardings 19 194 Magazines 10 105 Radio ad 5 5Total 100 100

57

Source: Field Study

Interpretation:

Type of advertisement is very important in attracting customers. Advertisements are

useful devices in reducing pre-purchase and post-purchase dissonance. In our study 46

respondents like TV ads, 20 respondents like paper ad, 19 respondents like hoardings, 10

respondents like magazine ads, and finally, very few, 5 respondents like radio ad

58

TABLE NO: 5.12

Response regarding which company ad you see recently?


percent





total 100 100

59

Source: Field Study

Interpretation:

In our study 65 respondents saw Asian paints Ad, 23 respondents saw Berger paints Ad,

10 respondents saw Nerolac paints Ad, and only 2 respondents could remember that they

saw Shalimar paints Ad

This is clearly the indication that some paint company ads are not enough frequent to

remember.

60

TABLE NO: 5.13

Response regarding which factors effecting purchase paint?

S. no Response No ofRespondents

Percent

1 Price 20 202 Durability 60 603 Availability 5 54 Color variability 15 15Total 100 100

Source: Field Study

61

Interpretation:

Some consumers give importance to price, some may give importance to product

features, and some may give importance to product benefits.

Their satisfaction levels would also depend on customers’ perception and importance in

purchasing a product.

In our study 60 respondents give importance to durability, 20 respondents give

importance to price, 15 respondents give importance to color variability, and only 5

respondents give importance to availability.

62

TABLE NO: 5.14.1

Response regarding the opinion about Asian paints

S. no Response weights No of Respondents

Score

1 Very good 5 50 2502 Good 4 10 40

3 Average 3 10 304 Bad 2 28 565 Very bad 1 2 2total 100 378

Mean score =378/100=3.78

63

TABLE NO: 5.14.2

Response regarding the opinion about Berger paints

S. no Response Weights No of Respondents

Score

1 Very good 5 40 2002 Good 4 20 803 Average 3 15 454 Bad 2 18 365 Very bad 1 7 7total 100 368

Mean score=368/100=3.68

TABLE NO: 5.14.3

Response regarding the opinion about Nerolac paints


Score


Mean score=356/100=3.56

TABLE NO: 5.14.4

64

Response regarding the opinion about Shalimar paints


Score


Mean score=315/100=3.15

Interpretation:

Likert 5 point scale which includes the range of the customer perceptions from very good

(5), to very bad (1) has been used to measure the perceptions of customers and their

preference among various paints available in the market via Asian paints ,Berger paints,

Nerolac paints and Shalimar paints.

The mean score of the Asian paints (3.78), Berger paints (3.68), Nerolac paints (3.56)

and Shalimar paints (3.15). (Table 5.14.1 to 5.14.4)

65

TABLE NO: 5.14.5

Summary of mean score of different reasons

S. no Response Mean scores Ranks

1 Asian paint 3.78 1

2 Berger paints 3.68 2

3 Nerolac paints 3.56 3

4 Shalimar paints 3.15 4

Source: Field Study

Interpretation:

66

The mean score of Asian paints is (3.78) higher than others (Table -5.14.5).

Hence it is inferred that customers are very much preferred to purchase Asian paints

followed Berger paints (3.68) and Nerolac paints (3.56). Significantly Shalimar paints

with less mean score (3.15) is believed to be less preferred among all paints by

customers.

TABLE NO: 5.15

Response regarding the suggested you to buy the brand you are using?

S. no Response No of Respondents

Percent

1 Friends 10 102 Relatives 9 93 Neighbors 11 114 Builder 30 305 Painter 40 40Total 100 100

Source: Field Study

67

Interpretation:

Customers will be influenced by a variety of people around them. Based on the level of

influence by others, the marketer tries to devise his strategies. In our study people who

purchase paints are influenced by friends, relatives, neighbors, builder and painter.

Among 100 respondents the responses are like this, 10 respondents said that they were

influenced by friends, 9 respondents said relatives, 11 respondents said neighbors, 30

respondents said builder, and 40 respondents said that they were influenced by painter

while they were deciding on purchase of paints.

68

TABLE NO: 5.16

How much do you spend on painting?


Percent

1 Below 50000 37 372 50000-75000 32 323 75000-100000 17 174 100000 above 14 14Total 100 100

Source: Field Study

69

Interpretation:

Based on the money spent on the product by the consumers, the marketer has to develop

strategies to make them satisfied. This information is very important to a marketer in

deciding product price, quality, and product range etc…..

In our study we have taken four different ranges that are below 50000, 50000-75000,

75000-100000, and above 100000. We got responses that 37 people spend below 50000

on paints, 32 people spend 50000-75000, 17 people spend 75000-100000, and 14

respondents said that they spend 100000 rupees on paints.

70

TABLE NO: 5.17

How much life do you expect from paint?


Percent

1 6 months 6 62 1-2 years 25 253 2-3 years 55 554 More than 3 years 14 14Total 100 100

Source: Field Study

71

Interpretation:

Customer satisfaction depends to a large extent on how far the product meets the

customers’ expectations. In fact, durability is the most important factor one would expect

from paints.

In our study the responses for life expectancy of paints are like this, 6 respondents said

that they are expecting 6 months life from the paint that they are purchasing, 25

respondents expecting 1- 2 years, 55 respondents expecting 2-3 years, and 14 respondents

are expecting the life of paints for more than 3 years.

72

TABLE NO: 5.18

Whom do you approach to get your doubts on paints clarified?


Percent

1 Paint shop 36 362 Painter 39 33 Customer care 3 394 others 22 22Total 100 100

Source: Field Study

73

Interpretation:

Information search by customers before and after purchase of a product would definitely

influence pre-purchase and post purchase satisfaction.

In our study 36 respondents said that they were depending on paint shop for their doubts

to be clarifies, 39 respondents depend on painter, 3 respondents depend on customer care,

and 22 respondents said that they were depending on others other than the sources listed

in questionnaire.

74

TABLE NO: 5.19

How do you feel the ambience of paint stores?

S.no Response No of Respondents

Percent

1 Very good 35 302 Good 45 453 Bad 17 174 Very bad 3 3Total 100 100

Source: Field Study

75

Interpretation:

Paint store ambience also plays an important role on pre-purchase decision and pre-

purchase dissonance.

Usually paint stores are overcrowded with paint tins of various companies. Such an

ambience creates perplexity in the minds of consumers.

In our study on the ambience of paint stores only 3 respondents said that the ambience of

paint store was very bad, 17 respondents said bad, 45 respondents said good and 35

respondents said that the ambience of paint stores was very good.

76

TABLE NO: 5.20

Where do you prefer to purchase paints?


Percent

1 Retail shop 16 162 Paint store 44 443 Paint& hard ware

store18 18

4 Company’s exclusive store

22 22

Total 100 100

Source: Field Study

77

Interpretation:

Paints are available at retail paint stores, exclusive paint stores, paints and hardware

stores, and companies’ exclusive stores. Customer choice of preference is of great

importance in devising strategies in drawing attention and bringing satisfaction among

customers.

In our study of customer purchase location preference 16 respondents are willing to

purchase at retail stores, 44 respondents are willing to buy at exclusive paint stores, 18

respondents are willing to buy at paints and hardware stores, and 22 respondents are

willing to buy at companies’ exclusive showrooms.

78

TABLE NO: 5.21

What type of information you seek about paints?


Percent

1 About colors 25 252 About new

developments15 15

3 About special features

45 45

4 Other information 15 15Total 100 100

Source: Field Study

79

Interpretation:

Companies should be successful in providing information that is sought by customers.

Information plays pivotal role in making purchase decision and pre and post purchase

satisfaction.

In our study about the type of information sought by customers 25 respondents said that

they would mostly seek information about colors, 15 respondents seek about new

developments in paints, 45 respondents seek about special feature of that particular paint,

and 15 respondents said that they would seek about information other than listed in the

questionnaire.

80

TABLE NO: 5.22

Do you suggest others to use the paint you are satisfied in?


Percent

1 Yes 84 84

2 No 16 16total 100 100

Source: Field Study

81

Interpretation:

Customers would be interested to suggest the product if they are satisfied with that. But

in some products it may not be possible because the decision making involves many other

aspects apart from the aspects liked by others.

For the question that whether they are willing to suggest others the paint, 84 respondents

said ‘yes’ and 16 respondents said ‘no’.

82

CHAPTER - IV

SUMMARY

The reason behind purchasing a product influences the purchasing behavior of the


expectation. In our study 55 respondents purchasing paints on the occasion of new

construction, 35 respondents purchasing on festivals, 10 respondents purchasing on the

occasion of function.

Last time purchases and repeated purchases are the indication of customer satisfaction

with the product. In our study 40 respondents purchased Asian paints, 26 respondents

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purchased Berger paints, 22 respondents purchased Nerolac paints, 12 respondent

purchased Shalimar paints.

Brand recognition and brand remembrance show the impact on customer behavior and

customers’ pre-purchase dissonance. In our study 40 respondents remember Asian paints,

30 remember Berger paints, 18 remember Nerolac paints, and 12 respondents remember

Shalimar paints immediately after seeking the information from them.

Advertisements, no doubt, can influence the purchase decisions. But it may not be true in

all cases. In our study 67 respondents said that their purchasing decision would definitely

influenced by Advertisements, and 33 respondents said that their purchasing decision

would not influenced by Ads.

Type of advertisement is very important in attracting customers. Advertisements are

useful devices in reducing pre-purchase and post-purchase dissonance. In our study 46

respondents like TV ads, 20 respondents like paper ad, 19 respondents like hoardings, 10

respondents like magazine ads, and finally, very few, 5 respondents like radio ad

Some consumers give importance to price, some may give importance to product

features, and some may give importance to product benefits.

Their satisfaction levels would also depend on customers’ perception and importance in

purchasing a product. In our study 60 respondents give importance to durability, 20

respondents give importance to price, 15 respondents give importance to color variability,

and only 5 respondents give importance to availability.

We asked respondents to rate each company separately. When we asked about Asian

paints 50 people rated it very good, 10 people rated it good, 10 rated average, 28 rated it

bad, and only 2 rated it very bad.

84

Respondents rated Berger paints as like this, 40 rated very good, 20 rated good, 15 rated

as average, 18 rated bad, and 7 rated very bad. This data shows us that it is showing

consistent performance. But it should try to increase its performance in order to get good

number of satisfied customers.

Respondents rated Nerolac paints as like this, 28 rated very good, 18 rated good, 38 rated

as average, 14 rated bad, and 2 rated very bad. This data shows us that it is showing


number of satisfied customers. People who rated average for Nerolac paints are quite

large in number. So, it should meticulously plan its marketing strategies to make them

satisfied customers.

Respondents rated Shalimar paints as like this, 10 rated very good, 20 rated good, 50

rated as average, 15rated bad, and 5 rated very bad. This data shows us that it is showing


number of satisfied customers. People who rated average for Shalimar paints are quite

large in number. So, it should meticulously plan its marketing strategies to make them

satisfied customers otherwise there are chances to turn out those customers as dissatisfied

and they may become the part of other companies’ customer base.

Customer satisfaction depends to a large extent on how far the product meets the

customers’ expectations. In fact, durability is the most important factor one would expect

from paints. In our study the responses for life expectancy of paints are like this, 6

respondents said that they are expecting 6 months life from the paint that they are

purchasing, 25 respondents expecting 1- 2 years, 55 respondents expecting 2-3 years, and

14 respondents are expecting the life of paints for more than 3 years.

Paints are available at retail paint stores, exclusive paint stores, paints and hardware

stores, and companies’ exclusive stores. Customer choice of preference is of great

85

importance in devising strategies in drawing attention and bringing satisfaction among

customers.

In our study of customer purchase location preference 16 respondents are willing to

purchase at retail stores, 44 respondents are willing to buy at exclusive paint stores, 18

respondents are willing to buy at paints and hardware stores, and 22 respondents are

willing to buy at companies’ exclusive showrooms.

Companies should be successful in providing information that is sought by customers.

Information plays pivotal role in making purchase decision and pre and post purchase

satisfaction.

In our study about the type of information sought by customers 25 respondents said that

they would mostly seek information about colors, 15 respondents seek about new

developments in paints, 45 respondents seek about special feature of that particular paint,

and 15 respondents said that they would seek about information other than listed in the

questionnaire.

Customers would be interested to suggest the product if they are satisfied with that. But

in some products it may not be possible because the decision making involves many other

aspects apart from the aspects liked by others.

FINDINGS

Most of the people are purchasing paints on the occasion of new constructions.

Paints users are purchasing paints mostly once 2-3 years.

Advertisements influence is a lot on the purchase decision of paints , and among

various types of ads than any other type of advertisements.

86

Among various paint companies Asian paints is giving adds more frequently .

Among the various factors price and durability are more important factors

considered by the customers while taking purchase decision.

Many of the respondents like Asian paints. It may be due to frequent ads

reasonable price and expected durability of the Asian paints products.

Customers are highly influencing by painter as well as builder in choosing a

particular paint of a paint company.

Most of the peoples are spending below 50,000 rupees on paints.

Customers using paints are expending 2-3 years of life from paints.

Customers are depending to a large extent on painters and paints shops to get their

doubts clarified.

Customers are asking about colors and recent developments in paints.

Most of the customers are willing to buy at exclusive paint stores where various

companies’ paints are sold.

87

SUGGESTIONS

Paint companies should concentrate on the period of purchase to devise

advertising and other marketing mix strategies to draw more customer attention

and satisfaction.

Many paint companies are not giving ads .companies like Shalimar should

concentrate on ads in TV and news paper.

Paint companies should position themselves as leaders in durability and reliable

prices for their products.

88

It recommended that companies should devise strategies to lure painters as well as

they are the greatest influences on customers.

Companies are advised to conduct meetings in order to make pointers and point

store people more aware of the information about their products.

Every company should ensure that their products are displayed well in exclusive

paint store as many customers like purchase paint at that place.

Companies should concentrate on developing word of mouth communication.

ANNEXURE

CUSROMER SATISFACTION ON PAINT INDUSTRY

Name and Address: Phone No:

Age: - ( ) >25 years Occupation: - ( ) Employee

( ) >25-35 years ( ) Business

( ) >35-45 years ( ) Professional

( ) >45-55 years ( ) others

( ) > 55 years

89

Sex:- ( ) Male ( ) Female Annual Income:- ( ) < 1 lakhs

( ) <1-2 lakhs

( ) < 2-3 lakhs

( ) < 3-4 lakhs

( ) > 4 lakhs

Education: family type: - joint family ( ) Individual family ( )

1. Why do you purchase paints?

(a) New construction (b) Festival

(c) Function (d) other reasons

2. When did you last use paint? (a) Last year (b) 2-3 years

(c) 3-4 years (d) above 4 years

3. Which company paints did you use or purchase?

(a) Asian paints (b) Berger paints

(c) Nerolac paints (d) Shalimar paints

4. Name the brands of paints so far you remember (a) Asian paints (b) Berger paints

90


5. Does advertisement influence you to buy a particular brand of paint?

Yes ( ) No ( )

6. Which type of advertisement you like the most?

(a) TV (b) paper ad

(c) Hoardings (c) magazine

(e) Radio ad

7. Which company ad did you see recently?

(a) Asian paints (b) Berger paints


8. Which of the factors the most important to you to purchase paint?

(a) Price (b) durability

(c) Availability (d) color variability

9. How did you feel after usage of?

I. Asian paints

(a) Very good (b) good (c) Average (d) bad

(e) Very bad

II. Berger paints

91

(a) Very good (b) good (c) Average (d) bad

(e) Very bad

III. Nerolac paints (a) Very good (b) good (c) Average (d) bad

(e) Very bad

IV. Shalimar paints (a) Very good (b) good (c) Average (d) bad

(e) Very bad

10. Who suggested you to buy the brand you are using?

(a) Friends (b) relatives

(c) Neighbors (d) builders

(e) Painters

11. How much do you spend on painting?

(a) Below 50,000 (b) 50,000-75,000

(c) 75,000-1, 00,000 (d) 1, 00,000 above

12. How much life do you expect from paint?

(a) 6 months (b) 1-2 years

92

(c) 2-3 years (d) more than 3 years

13. Whom do you approach to get your doubts on paints clarified?

(a) Paint shop (b) painter

(c) Customer care (d) others

14. How do you feel the ambience of paint stores?

(a) Very good (b) good

(c) bad (d) very bad

15. Where do you prefer to purchase paints?

(a) Retail shops (b) Paint stores

(b) Paint & hard ware stores (d) Companies exclusive stores

16. What type of information you seek about paints?

(a) About colors (b) About new developments

(c) About special features (e) other information

17. Do you suggest others to use the paint you are satisfied in?

Yes ( )

No ( )

93

BIBLIOGRAPHY

Marketing management _____ Philip kotler

(Analysis, planning, implementation control)

Marketing management

______V.S. Rama swami, S. Nama kumari

Introduction of marketing theory

_______ Adrian palmer

Marketing management

_____ Rajan saxena

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WWW.WIKIPIDIA.COM

WWW.GOOGLE.COM

DATA PROVIDED HERE IS NO ABSOLUTE…ITS ONLY FOR REFERENCE

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Customer Satisfaction in Paint Industry