Study on Consumer Behavior and Buying Preferences in india

7/23/2019 Study on Consumer Behavior and Buying Preferences in india

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Study of the Impact of Store Environment and Discounts/Offers on

Consumer Shopping Behaviour

A Research Report Sumitted in !artia" #u"fi"ment for the Degree of $asters inBusiness Administration

Sumitted By%

Avee Saroya E&'(Ashish Behara E&')Soumyasundar Sanya" E&**+ignesh Sri,ant E&*-

S.$BIOSIS IS0I010E O# $AA2E$E0 S01DIES

S.$BIOSIS I0ERA0IOA3 1I+ERSI0.4 !1E

Octoer ()'*


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Acknowledgement

5e ta,e this opportunity to e6press our gratitude to the peop"e 7ho have een instrumenta" in

the successfu" comp"etion of this pro8ect9

5e are e6treme"y than,fu" to !rofessor Dr Asha agendra4 the 2uide of this pro8ect9 She has

guided us on this research and correcting various documents and amending them 7ith

attention and care9 She has ta,en pain to go through the pro8ect and ma,e necessary

correction as and 7hen needed at each and every step9

5e e6press our than,s to the Director of Symiosis Institute of $anagement Studies4 !une

for e6tending his support9

5e 7ou"d "i,e to sho7 our greatest appreciation for the support e6tended to us y the

respondents4 7hich 7as vita" for the success of the pro8ect9

5e are a"so than,fu" to a"" my friends and a"so to various parents for their ,ind and

va"ua"e guidance4 7hom 7e consu"ted for the research 7or,9


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Table of Contents

So Chapters !age o

' Introduction

( Revie7 of 3iterature

: $ethodo"ogy

* Resu"ts

; Summary

< Conc"usion

- Bi"iography

= Appendi6


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List of Tables

S No Table Heading Page No.

' 2enera" Information of respondents

( #re>uency of purchase of househo"d goods

: !reference of ,no7ing shop,eeper at a persona" "eve"

* Capacity of refrigerators used y respondents

; !reference of randed foods over "oca""y manufacturedfood items

< Appea" of rand name ?5a"&$art@ over Indian retai" stores

- Response to acceptance of 5a"&$art amongst Indian

customers

= Response to 7hether #DI is good for Indian economy

Appea" of 5a"mart in association 7ith Bharti appea"ing

more than 5a"mart a"one

') Response to discounts attracting consumers

'' Response to "arge vo"ume discounts attracting consumers

'( Response to Indian Consumers preferring #resh food items

compared to pac,aged food


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List of Figures

S No Figure Heading Page No' Appea" of rand name 5a"mart more over Indian retai" stores

(Response to acceptance of 5a"mart amongst Indian

consumers

: Response to #DI eing good for the Indian Economy

* Response to "arge vo"ume discount attracting consumers


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Abstract

In order to ana"ye the impact of 5a"&$art store on the uying ehaviour of customers4 a

study 7as conducted on ')) respondents of different income ands and age groups at various

"ocations9 0he focus of the study 7as to see ho7 a customer ehaves 7ith respect to va"ue

added y high discounts on "arge vo"ume purchases9 In addition to an a""&inc"usive store the

study 7as a"so done to find out 7hether a customer@s uying decision is impacted y the

distance to the store and the attractiveness of "arge vo"ume processed foods in and Indian

ecosystem9 Based on these factors a >uestionnaire 7as prepared and f"oated amongst peop"e

and their response 7as recorded9 It has een oserved that though the idea of the 5a"&$art

mode" for customers generates interests4 they are yet not fu""y oriented to such a super store

7ith the constraints it rings of distance and insistence of "arge vo"umes9

Keywordsvo"ume discounts4 5a"&$art4 super&stores4 customer4 uying decision


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CHAPT!" #

$ntroduction

5a" $art 7ith its everyday "o7 prices phi"osophy has enefited mi""ions of consumers9 In

ear"y ());4 5a" $art4 the 7or"ds "argest retai"er proposed to e6pand its usiness into India4

7hich is the 7or"ds *th "argest retai" mar,et in the 7or"d9 Indias '=) i""ion retai" mar,et

7as a potentia" opportunity for 5a" $arts g"oa" e6pansion9 Fo7ever efore the entry into

the Indian mar,et it faced cha""enges "i,e the strict #oreign Direct Investment regu"ations4

competition from the unorganised retai" sector Gconstituting =H of Indias retai" sector and

the gro7ing organised retai" sector9 5a" $art a"so had a series of 3aour 3a7suits that

a""eged "o7 7ages4 gender discrimination and i""ega" immigrant "aour9 0hese factors

hampered the companys image9 Anti g"oa"isation activists a"so "amed the company fore6p"oiting the "aour in shops of Bang"adesh4 China and other Asian countries to offer "o7

prices to customers9

O8ectives%

'9 0o assess the cha""enges that 5a"&$art faces in India due to #DI9(9 0o understand usiness mode" of 5a"&$art and its inf"uence on the customers in

distriution4 "ogistics and its acceptance in the Indian mar,et9

3imitations%

'9 0he study is "imited to the city of !une4 $aharashtra9

(9 0he data co""ected 7as restricted to midd"e income and upper&midd"e income

consumers on"y9


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CHAPT!" %

"e&iew of Literature

'9 Knee' %((%4 spo,e aout 5a" $art in India9 Fe mentions the Indian retai" sector and

ho7 5a" $art faces different cha""enges to enter into the mar,et9 0he study has

revie7ed various 8ourna" artic"es and artic"es from reputed "oca" ne7spapers in order

to give an idea of 5a"&$art@s successes and fai"ures in the internationa" mar,et9 Fe

found aout the e&randing issue4 the peop"e issue4 the gro7th issue4 the customer

issue and the performance issue faced y 5a" $art9 In addition to the genera"

cha""enges he a"so found aout the country specific cha""enges 7hich inc"uded poor

infrastructure4 po7er supp"y4 high 7astages in transit and high "ogistics cost4

differentia" and high ta6es4 inconsistency in government po"icies4 soaring cost of rea"estate and restrictions on foreign direct investment G#DI9

(9 )wens and *uinn' %((+4 7rote aout pro"ems re"ated to coordination et7een

retai" 8oint ventures9 0hey conducted a study to investigate the pro"ems encountered

in internationa" retai" 8oint ventures9 0hey found out that in a mar,et&driven 8oint

venture activity4 retai"ers appear to have a shorter and intensive ad8ustment period to

effective"y co&ordinate operationa" activity and ridge the corporate and ehaviora"

differences et7een themse"ves and the partner9:9 ,alton and -on' #//%said that the stores 7hich 7ere osessed 7ith ,eeping the

prices e"o7 competitor@s prices and ho7 the profit per item 7ou"d e "ess ut the

overa"" profit 7ou"d increase9 5a" $art ui"t a retai" "in, system that provides sa"esdata4 y item4 store and day4 to its vendor partners9 0hey hired personne" 7ho has

sound ,no7"edge of 7arehouse and distriution system4 data processing and

techno"ogy9 0hey 7ere doing 7e"" in terms of profit and customer service ut they did

not emphasis much on >ua"ity9*9 "obert' %((04 oserved that 7hen !R cou"d have actua""y he"ped the company4 the

e6ecutives at the company fa"tered in uti"iing the opportunities9 5hen 5a" $art

p"anned to e6pand y setting up supercenter stores4 it 7as opposed y the union

saying that the stores 7ere against the unionied "aour po"icies9 0he company 7as4

ho7ever reported to have out right"y opposed the move4 not a""o7ing any emp"oyee tointeract 7ith the union 7or,ers9

Toconclude4 5a"&$art@s vo"ati"e practices inc"uding the "aour po"icies have "ed to an

ostruction in its gro7th9 A"so4 5a"&$art 7ou"d have impact on the Indian retai" mar,et4 if

the Indian 2overnment opens up the restriction on #oreign Direct Investment in the retai"

sector9 0he ma8or reason ehind this is that the Indian cu"ture is eing inf"uenced y the

American cu"ture9 Fo7ever4 the Indian retai"ers are capa"e of adopting the est practices and

reading the minds of an ordinary Indian consumer9 0he Indian retai"ers shou"d come out 7ith

different formats and try to esta"ish their presence in a"most a"" parts of the country efore

5a"&$art esta"ishes itse"f in the Indian su&continent9


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CHAPT!" 0

1etodology

#. Selection )f To2ic

0he issue of #DI in $u"ti&rand retai" has een a hot topic of discussion in the recent past4

7ith e>ua" 7eightage for4 as 7e"" as against9 In each case the idea" e6amp"e >uoted has een

the mode" of 5a"&$art9 0hey have a very specific and uni>ue usiness mode" that a""o7s

them to e effective in deve"oped mar,ets9 5e 7ou"d "i,e to study if this same mode" 7ou"d

actua""y 7or, in the Indian socia" and economic scenario9

%. Si3e of Sam2le

0he samp"e chosen for this study 7as restricted to ')) peop"e or fami"ies of the midd"e and

upper midd"e income group of society in the geographic "imitations of !une area9

0. Pilot Study

0o test the feasii"ity of the too" of data co""ection a pi"ot study 7as conducted on ()

respondents9 A >uestionnaire of ') >uestions 7as made and administered9 Based on the

resu"ts4 certain modifications 7ere made and fina" >uestionnaire 7as prepared9

4. Hy2otesis

Based on the resu"ts of the pi"ot study the fo""o7ing hypotheses 7ere formu"ated%

'9 Fypothesis '

H(% 0he enefits of convenience of avai"ai"ity and fami"iarity do not out7eigh the

enefits of vo"ume ased discounts at distant "ocations

H#% 0he enefits of convenience of avai"ai"ity and fami"iarity out7eigh the enefits

of vo"ume ased discounts at distant "ocations9

(9 Fypothesis (H(% 0he various practices of 5a"&$art has positive"y affected the image and operation

of the company

H#% 0he various practices at 5a"&$art has negative"y affected the image and operation

of the company in India9

5. 6ata Collection

Primary 6ata

A !rimary research4 invo"ved a >uestionnaire consisting of >uestions that try to ring out

re"evant data to meet the o8ectives of the research4 7as deve"oped and used for the survey9

0he response of the respondents 7as ta,en y f"oating a 2oog"e document or one on one

meeting9 A copy of fina" >uestionnaire is attached as Chapter = in appendi69Secondary 6ata


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It 7as co""ected from 8ourna"s4 oo,s J internet to gather 7or, done y other researchers

prior to the present study9

7. Analysis of 6ata

0he data co""ected 7as tau"ated and presented in the form of ta"es and graphs in Chapter *9

0he hypotheses have een re8ected/accepted9 Appropriate statistica" too"s have een app"ied

to esta"ish corre"ation among the varia"es9


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CHAPT!" 4

"esults and 6iscussions

Table #% 2enera" information of respondents

SNo 8eneral $nformation n9#(( Percentage

' Age Gin years

a9 ()&(* ( (H

9 (;&:) ** **H

c9 :)&*) (= (=H

d9 Aove *) ' 'H

( 2ender

a9 $a"e uency of purchase of househo"d goods9

SNo Fre:uency of 2urcase n9#(( Percentage

' Once a month H

( 07ice a month :) :)H

: 0hrice a month * *H

* $ore than three times a month '( '(H

6iscussion A"most have the peop"e purchase househo"d goods thrice a month9 :)Hpeop"e purchase them t7ice a month and the percentage e"o7 peop"e purchasing

househo"d goods "ess than t7ice a month and more than thrice a month is very "ess9

Table 0!reference of ,no7ing shop,eeper at a persona" "eve"


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SNo Preference of knowing

so2kee2er at a 2ersonal le&el

n9#(( Percentage

' .es - -H

( o (' ('H

6iscussion $a6imum peop"e4 i9e9 -H4 "i,e to ,no7 the shop,eeper persona""y9 0he

rest thin, it does not rea""y matter9

0his re;ectsthe nu"" hypothesis of Fypothesis '4 that states that4F)% 0he enefits of

convenience of avai"ai"ity and fami"iarity do not out7eigh the enefits of vo"ume

ased discounts at distant "ocations9 Fence the a"ternate hypothesis i9e9 F'% 0he

enefits of convenience of avai"ai"ity and fami"iarity out7eigh the enefits of

vo"ume ased discounts at distant "ocations is acce2ted

Table 4 Capacity of refrigerator used y respondents

SNo "efrigerator ca2acity


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SNo >randed food ?s Local food n9#(( Percentage

' Branded food


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0his re;ectsthe nu"" hypothesis of Fypothesis (4 that states4F)% 0he various

practices of 5a"&$art has positive"y affected the image and operation of the

company9 Fence the a"ternate hypothesis i9e9 F'% 0he various practices at 5a"&$art

has negative"y affected the image and operation of the company in India9 is acce2ted

Table +% Response to acceptance of 5a"mart amongst Indian consumers

SNo "es2onse to acce2tance of ,almart amongst

$ndian consumers

n9#(( Percentage

' .es -' -'H

( o ( (H

yes no0%

10%

20%

30%

40%

50%

60%

70%

80%

Response to acceptance of Walmart amongst Indian consumers

Axis Title

Fig % Response to acceptance of 5a"mart amongst Indian consumers

6iscussion-'H peop"e fee" that the rand 5a"mart 7ou"d e accepted successfu""y

in India 7hereas (H fee" that the competition for 5a"mart in India is a"ready very

high 0herefore4 the rand 7ou"d not e accepted9

0his acce2tsthe nu"" hypothesis of Fypothesis (4 that states4F)% 0he various

practices of 5a"&$art has positive"y affected the image and operation of the

company9 Fence the a"ternate hypothesis i9e9 F'% 0he various practices at 5a" $art

has negative"y affected the image and operation of the company in India9 is re;ected


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Table @% Response to #DI eing good for Indian economy

SNo #DI good for Indian economy n9#(( Percentage

' .es ;: ;:H

( o *- *-H

Yes No44%

45%

46%

47%

48%

49%

50%

51%

52%

53%

54%

Response to FDI being good for the Indian Economy

Axis Title

Fig0 Response to #DI eing good for the Indian Economy

6iscussion;:H peop"e fee" that #DI 7i"" e good for the Indian Economy9 5hi"e the

rest *-H peop"e did not agree to it9

Table /% Appea" of 5a"mart in association 7ith Bharti appea"ing more than 5a"mart

a"one

SNo Better Appea" n9#(( Percentage' .es *' *'H

( o ; ;H

6iscussion0he appea" of 5a"mart in association 7ith Bharti eing etter 7as

accepted y 8ust *'H peop"e and disagreed y ;H9 Fence proving the partnership

7as not something peop"e 7ere very a7are of9

0his re;ectsthe nu"" hypothesis of Fypothesis '4 that states that4F)% 0he enefits of




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vo"ume ased discounts at distant "ocations is acce2ted

Table #( Response to discounts attracting consumers

SNo Discount attracts consumers n9#(( Percentage' Strong"y agree (' ('H

( Agree ;- ;-H

: either agree nor disagree '< '


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Table ##Response to "arge vo"ume discounts attracting consumers

SNo Discount attracts consumers n9#(( Percentage

' Strong"y agree ' 'H

( Agree uestion


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vo"ume ased discounts at distant "ocations is re;ected

Table #%% Response to Indian Consumers preferring #resh food items compared topac,aged food

SNo #resh food over pac,aged food n9#(( Percentage

' Strong"y agree (' ('H

( Agree *: *:H

: either agree nor disagree '; ';H

* Disagree ' 'H

; Strong"y disagree ( (H

6iscussionIn tota"


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Ca2ter 5

Summary

According to the study it can e seen ma6imum peop"e "i,e to ,no7 the shop,eeper

persona""y9 0his re8ects the nu"" hypothesis of Fypothesis '4 that states that4F)% 0he

enefits of convenience of avai"ai"ity and fami"iarity do not out7eigh the enefits of

vo"ume ased discounts at distant "ocations9 Fence the a"ternate hypothesis i9e9 F'%

0he enefits of convenience of avai"ai"ity and fami"iarity out7eigh the enefits of

vo"ume ased discounts at distant "ocations is accepted

$ost of the popu"ation possess "o7 capacity refrigerators9 0his sho7s that their

capacity to store "arge stoc,s of food supp"ies is "imited9 Bigger fami"ies4 especia""y

the higher income group4 prefer more than "arge refrigerators9 0his re8ects the nu""

hypothesis of Fypothesis '4 that states that4F)% 0he enefits of convenience ofavai"ai"ity and fami"iarity do not out7eigh the enefits of vo"ume ased discounts at

distant "ocations9 Fence the a"ternate hypothesis i9e9 F'% 0he enefits of

convenience of avai"ai"ity and fami"iarity out7eigh the enefits of vo"ume ased

discounts at distant "ocations is accepted9

A "arge part of the popu"ation prefer to uy randed food4 especia""y pac,ed or tinned

food4 though sma""er numer yet a "arge chun, of :(H peop"e4 prefer to uy "oca"

food from the sma""er retai" stores9 0his re8ects the nu"" hypothesis of Fypothesis (4

that states4F)% 0he various practices of 5a" $art have positive"y affected the image

and operation of the company9 Fence the a"ternate hypothesis i9e9 F'% 0he variouspractices at 5a" $art has negative"y affected the image and operation of the company

in India9 is accepted9 !eop"e find the rand 5a"mart fascinating ut not much over

Indian Retai" stores9 0he numer of peop"e preferring 5a"mart@s appea" over Indian

Brands is **H as compared to the Indian Brand@s appea" 7hich is ;


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hypothesis of Fypothesis '4 that states that4F)% 0he enefits of convenience of

avai"ai"ity and fami"iarity do not out7eigh the enefits of vo"ume ased discounts at

distant "ocations9 Fence the a"ternate hypothesis i9e9 F'% 0he enefits of

convenience of avai"ai"ity and fami"iarity out7eigh the enefits of vo"ume ased

discounts at distant "ocations is re8ected9


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Ca2ter 7

Conclusion

0he first o8ective 7as to assess the cha""enges that 5a"&$art faces in India due to #DI9 It is

7e"" ,no7n that #DI in mu"ti&rand retai" is a stic,y su8ect among "egis"ators9 0he study has

sho7n that even the popu"ation is not very sure of the enefits It cou"d get from #DI in the

retai" sector9 0hough a s"im ma8ority fee" #DI is good a "arge chun, do not agree 7ith it and

hence hampering the image of 5a"&$art as a foreign chain4 7ith in the country9 #or this

reason the "in, 7ith Bharti has proved usefu" to retain a positive image 7ith the Indian

consumer9

0he second o8ective 7as to understand usiness mode" of 5a"&$art and its inf"uence on the

customers in distriution4 "ogistics and its acceptance in the Indian mar,et9 #rom the study 7e

can see that most of the peop"e are sti"" not very open to the concept of purchasing goods in

high vo"ume4 7hich is the core competence of 5a"&$art usiness mode"9 0he Indian

popu"ation prefers uying products 7hich 7i"" remain fresh from "oca" vendors than

processed goods9

"!C)11!N6AT$)NS

0he study hence proves that the association of 5a"&$art 7ith Bharti is he"pfu" for 5 so as to

cover the grounds in terms of understanding the "oca" mar,et of India9 0hey shou"d a"so try

setting up shops 7hich is easi"y accessi"e "i,e Re"iance stores and Big Baars to the

customers un"i,e the mode" they use in the 1SA of having a ig retai" stores 7hich is sti"" not

feasi"e in a deve"oping country "i,e India9


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Ca2ter +

>ibliogra2y

'9 Kha4 S and Singh4 B9G()':4 Apri"9 Impact of amient music and affai"ity of sa"espersons on consumer ehaviour in a rea" retai" setting 7ith emphasis on gender

difference9 Indian Kourna" of $ar,eting9(9 $ichon4 R4 Cheat4 K C4 0ur"ey 3 5 G()):4 Ku"y9$a"" atmospherics% the interaction

effects of the ma"" environment onshopping ehaviour9Kourna" of Business Research

;= G()); ;-


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Ca2ter @

Appendi6

E"icit Information on Suitai"ity of 5a"&$art $ode"for the Indian $ar,et

Dear Respondent4

5e4 the students of $asters of Business Administration from Symiosis Internationa"1niversity4 !une4 are conducting a survey on ?Suitai"ity of 5a"&$art mode" in India@9 5esee, your co&operation in ans7ering the >uestionnaire given e"o79 5e assure you that theinformation provided y you 7i"" e ,ept strict"y confidentia" and 7i"" e used for academic

purposes on"y9

Mind"y put a tic, against the appropriate ans7ers9

8eneral information

'9 ame% NNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNNN

(9 2ender% $a"e #ema"e

:9 Age Gin years% ( (&(* years (;&:) years :)&*) years *) years

*9 Income group :&; "a,hs ;&') "a,hs ') "a,hs

Gper annum

S2ecific $nformation

'9 Fo7 often do you go to purchase househo"d items and provisionsPa9 Once a month

9 07ice a monthc9 0hrice a monthd9 $ore than thrice a month

(9 Is it etter to ,no7 the shop,eepers on a persona" noteP

.es

o

:9 5hat is the capacity of the fridge you useP


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'


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"i,es of the foreign retai"erP

3arge vo"ume discounts attract consumers%

Strong"y disagree Disagree either agree nor disagree

Agree Strong"y agree

'(9 Indian Consumers prefer #resh food items as compared to Canned or pac,aged fooditems%

Strong"y disagree Disagree either agree nor disagree

Agree Strong"y agree

Documents

Study on Consumer Behavior and Buying Preferences in india