minor_report

Influence of Brand on Consumer Purchase Decision of Personal Care Products

Minor Project Report

Submitted by:Binita Kumari

2009MB11

MBA 2nd SemesterSchool of Management Studies,

Motilal Nehru National Institute of Technology(Deemed University), Allahabad

Under Guidance of:Dr. Piyali Ghosh

LecturerSMS, MNNIT

1

Preface

The topic of my minor project was “Influence of Brand on Consumer Purchase Decision

of Personal Care Products”. The objectives of my survey were to:

To identify brand as a determinant of consumer purchase decisions of personal care.

To identify the major factors in products purchase of personal care.

To identify the influence of reference group in prospect of purchase.

To identify costs vs. benefits of different brands of personal care products.

A survey was conducted in the city of Allahabad regarding the purchase decision of

personal care products. Respondents were asked certain questions like why people choose

one product or brand over another, how they make these choices, and how companies use

this knowledge to provide value to consumers etc. The report shows the actions a person

takes in purchasing and using the products and services, including the mental and social

processes that precede and follow these actions. Lots of literature review was done to get

the best results and references. Also some observations were found and added to the

report. The report will provide the readers a good insight into the prevailing conditions of

consumer decision making process for the purchase of personal care products.

2

Acknowledgement

It is a matter of great pleasure in presenting our efforts of developing of complete project

on ‘Influence of Brand on Consumer Purchase Decision of Personal Care Products’.

Our efforts have been successful due to co-operation of the entire Department, without

which a project of this magnitude, given restriction of time, could have not been possible.

I owe this project to Dr. Piyali Ghosh, whose expert guidance and priceless co-operation

as a faculty supervisor helped us throughout the research phase. I am also especially

thankful to Research Scholars, Ms Rachita Satyawadi and Ms Udita Mukherjee, who

provided their valuable guidance and insight to the project.

I am also thankful to Prof. Geetika and other faculty and administrative staff, who have

provided all facilities and cooperation in completing this project.

A word of thanks is due to the respondents, who have given us time in completing our

survey.

Binita Kumari 09MB11

3

Table of Contents

Topics Page no.

Introduction……………………………………… 5Personal Care Product Market……………….......11Literature Review………………………………..17Research Methodology………………………….19Analysis of Data…………………………………20Conclusions……………………………………...36Limitations………………………………………39

References……………………………………….40

4

1. Introduction

Brand is the image of the product in the market. Some people distinguish the

psychological aspect of a brand from the experiential aspect. The experiential aspect

consists of the sum of all points of contact with the brand and is known as the brand

experience.

Brand name is quite often used interchangeably within "brand", although it is

more correctly used to specifically denote written or spoken linguistic elements of any

product. In this context a "brand name" constitutes a type of trademark, if the brand name

exclusively identifies the brand owner as the commercial source of products or services.

A brand owner may seek to protect proprietary rights in relation to a brand name through

trademark registration.

1.1 Types of Brand Names

Brand names come in many styles. A few include:

Acronym: A name made of initials such as UPS or IBM

Descriptive: Names that describe a product benefit or function like Whole Foods

or Airbus

Alliteration and rhyme: Names that are fun to say and stick in the mind like

Reese's Pieces or Dunkin' Donuts

Evocative: Names that evoke a relevant vivid image like Amazon or Crest

Neologisms: Completely made-up words like Wii or Kodak

Foreign word: Adoption of a word from another language like Volvo or Samsung

Founders' names: Using the names of real people like Hewlett-Packard or Disney

Geography: Many brands are named for regions and landmarks like Cisco and

Fuji Film

Personification: Many brands take their names from myth like Nike or from the

minds of ad execs like Betty Crocker

5

The act of associating a product or service with a brand has become part of pop culture.

Most products have some kind of brand identity, from common table salt to designer

jeans. A brandnamer is a brand name that has colloquially become a generic term for a

product or service, such as Band-Aid or Kleenex, which are often used to describe any

kind of adhesive bandage or any kind of facial tissue respectively.

In present society and living way, brands not only represent the symbol of the

company or product but to a larger extent define the general life of a person. What the

person uses can reflect his taste of life, his status in the society, his economic background

and many other things. This makes a deep connection between the company and its

brand, with the consumer. In this two way relation both are dependent on each other for

various different reasons.

When budgets are tight, consumers are forced to make decisions about how to

spend their money. Because of this, economic downturns have an interesting way of

weeding out weak brands, while further strengthening the category leaders. Successful

brands have capitalized on market downturns by staying committed to their corporate

strategy, remaining steadfast in pursuit of their long-term corporate vision, and ultimately

enhancing their brands’ equity and position in the market.

1.2 Factors Influencing Behaviour of Buyers

Consumer behaviour is affected by many uncontrollable factors. Culture is one factor that

influences behaviour. Simply culture is defined as our attitudes and beliefs. But how are

these attitudes and beliefs developed? As an individual growing up, a child is influenced

by their parents, brothers, sister and other family member who may teach them what is

wrong or right. They learn about their religion and culture, which helps them develop

these opinions, attitudes and beliefs (AIO). These factors will influence their purchase

behaviour however other factors like groups of friends, or people they look up to may

influence their choices of purchasing a particular product or service. Reference groups

are particular groups of people some people may look up towards to that have an impact

on consumer behaviour. So they can be simply a band like the Sachin Tendulkar or your

immediate family members. Opinion leaders are those people that you look up to because

6

your respect their views and judgments and these views may influence consumer

decisions. So it maybe a friend who works with the IT trade who may influence your

decision on what computer to buy. The economical environment also has an impact on

consumer behaviour; do consumers have a secure job and a regular income to spend on

goods? Marketing and advertising obviously influence consumers in trying to evoke them

to purchase a particular product or service.

People’s social status will also impact their behaviour. What is their role within

society? Also characters have an influence on buying decision. Whether the person is

extrovert (out going and spends on entertainment) or introvert (keeps to themselves and

purchases via online or mail order) again has an impact on the types of purchases made.

1.3 Consumer Buying Behaviour

What influences consumers to purchase products or services? The consumer buying

process is a complex matter as many internal and external factors have an impact on the

buying decisions of the consumer.

When purchasing a product there are several processes, which consumers go through.

There are five stages of consumer purchase behavior:

1. Problem/Need Recognition

2. Information Research

3. Evaluation of purchases

4. Purchase of decision

5. Post purchase behavior

7

These will be discussed below:

i. Problem/Need Recognition

How do you decide you want to buy a particular product or service? It could be that

your DVD player stops working and you now have to look for a new one, all those DVD

films you purchased you can no longer play! So you have a problem or a new need. For

high value items like a DVD player or a car or other low frequency purchased products

this is the process we would take. However, for impulse low frequency purchases e.g.

confectionery the process is different.

ii. Information Search

So we have a problem, our DVD player no longer works and we need to buy a new

one. What’s the solution? Yes go out and purchase a new one, but which brand? Shall we

buy the same brand as the one that blew up? Or stay clear of that? Consumer often go on

some form of information search to help them through their purchase decision. Sources of

information could be family, friends, neighbours who may have the product you have in

mind, alternatively you may ask the sales people, or dealers, or read specialist magazines

like What DVD? to help with their purchase decision. You may even actually examine

the product before you decide to purchase it.

iii. Evaluation of Different Purchase Options

So what DVD player do we purchase? Shall it be Sony, Toshiba or Bush? Consumers

allocate attribute factors to certain products, almost like a point scoring system which

they work out in their mind over which brand to purchase. This means that consumers

know what features from the rivals will benefit them and they attach different degrees of

importance to each attribute. For example sound maybe better on the Sony product and

picture on the Toshiba, but picture clarity is more important to you then sound.

Consumers usually have some sort of brand preference with companies as they may have

had a good history with a particular brand or their friends may have had a reliable history

with one, but if the decision falls between the Sony DVD or Toshiba then which one shall

8

it be? It could be that the review the consumer reads on the particular Toshiba product

may have tipped the balance and that they will purchase that brand.

iv. Purchase Decision

Through the evaluation process discussed above consumers will reach their final

purchase decision and they reach the final process of going through the purchase action

e.g. The process of going to the shop to buy the product, which for some consumers can

be as just as rewarding as actually purchasing the product. Purchase of the product can

either be through the store, the web, or over the phone.

v. Post Purchase Behaviour

Post purchase behaviour is a common trait amongst purchasers of products.

Manufacturers of products clearly want recent consumers to feel proud of their purchase,

it is therefore just as important for manufacturers to advertise for the sake of their recent

purchaser so consumers feel comfortable that they own a product from a strong and

reputable organization. This limits post purchase behaviour. i.e. You feel reassured that

you own the latest advertised product.

1.4 Maslow’s Hierarchy of Needs

Abraham Maslow’s hierarchy of needs theory sets out to explain what motivated

individuals in life to achieve. He set out his answer in a form of a hierarchy. He suggests

individuals aim to meet basic psychological needs of hunger and thirst. When this has

been met they then move up to the next stage of the hierarchy, safety needs, where the

priority lay with job security and the knowing that an income will be available to them

regularly. Social needs come in the next level of the hierarchy, the need to belong or be

loved is a natural human desire and people do strive for this belonging. Esteem need is

the need for status and recognition within society, status sometimes drives people, the

need to have a good job title and be recognized or the need to wear branded clothes as a

symbol of status.

9

Self-actualization is the realization that an individual has reached his/her potential in life.

The point of self-actualization is down to the individual, when do you know you have

reached your point of self-fulfillment?

But how does this concept help an organization trying to market a product or service?

Marketing is about meeting needs and providing benefits, Maslow’s concept suggests that

needs change as we go along our path of striving for self-actualization. Supermarket

firms develop value brands to meet the psychological needs of hunger and thirst. Harrods

develops products and services for those who want have met their esteem needs. So

Maslow’s concept is useful for marketers as it can help them understand and develop

consumer needs and wants.

1.5 Types of Buying Behaviour

There are four typical types of buying behaviour based on the type of products that

intends to be purchased. Complex buying behaviour is where the individual purchases a

high value brand and seeks a lot of information before the purchase is made. Habitual

buying behaviour is where the individual buys a product out of habit e.g. a daily

newspaper, sugar or salt. Variety seeking buying behaviour is where the individual likes

to shop around and experiment with different products. So an individual may shop around

for different breakfast cereals because he/she wants variety in the mornings! Dissonance

reducing buying behaviour is when buyer are highly involved with the purchase of the

product, because the purchase is expensive or infrequent. There is little difference

between existing brands an example would be buying a diamond ring, there is perceived

little difference between existing diamond brand manufacturers.

10

2. Personal Care Product Market

2.1 Global Scenario

The global personal care products market is estimated at $338 billion in 2008,

representing a compound annual growth rate (CAGR) of 3.5% for the period spanning

2004–08. The industry is forecast to grow at a CAGR of 3.4% for the five-year period

2008–13, to reach $399.7 billion by the end of 2013.

The top 10 personal care products companies recorded revenues of $376,746.2*

million during 2008, an increase of 5.6% over 2007. The total operating profit of these

companies was $74,003.0 million during 2008, an increase of 7.2% over 2007. The net

profit was $51,296.1 million in 2008, an increase of 7.9% over 2007.

The operating margin of the top 10 companies was 19.6% in 2008, as compared to

19.3% in 2007. The net margin was 13.6% in 2008 as compared to 13.3% in 2007. Since

2004, the global personal products market has witnessed steady growth across different

geographies. The market is expected to continue its growth through to 2013 due to the

growing population and an increase in living standards.

2.2 Indian Scenario

The Indian consumer market is characterized by dynamism. Higher disposable incomes,

the development of modern urban lifestyles and an increase in consumer awareness have

affected buyer behavior — in cities, towns and even rural areas. According to a 2007

report by McKinsey & Co., India is set to grow into the fifth largest consumer market in

the world by 2025. Buying power has also expanded to new consumer segments — be it

the youth or the urban woman. It is no longer true that a premium product needs to be

expensive; and technology is a large contributor to this trend.

Although Indians are strongly attached and committed to their traditions, and

culture, the advent of television and the awareness of the western world is changing the

tastes and customs of India. The ‘morphing’ of India is subtle and the changes are not

11

visible for the first time visitor. However, the market liberalization process that began in

1991, along with the crowning of three Indians as Miss World and Miss Universe during

the preceding four years, have made Indian women conscious of their appearance.

Consequently, the cosmetic consumption patterns of Indian women have changed, and

this trend is fuelling growth in the cosmetic sector. The increasing size of the middle-

class population in India, representing a growth in disposable incomes, has led to more

consumers for the cosmetics and toiletries market. Such consumers are more inclined to

purchase higher-priced products.

Most multinationals that entered the market have however revised their estimates

of the number of consumers able to buy their products. Optimism has been tempered by a

gradual dawning of the fact that middle-class India is not as big or as active as many

marketers had believed.

The Indian cosmetics and toiletries market grew by 8.7% in current value terms in

2001, with value sales amounting to Rs126 billion. In 1999 the Indian cosmetics and

toiletries market grew 8% over 1998. Total value since 1995 was 54% in current terms,

equating to 25% in constant terms. The personal care products we use are in some

measure the signature of our lifestyles and standards of living. The personal care market

in India is estimated to be worth $ 4 billion. Personal hygiene products (including bath

and shower products, deodorants etc.), hair care, skin care, colors cosmetics and

fragrances are the key segments of the personal care market. Each of these segments

exhibits unique trends and growth patterns. The largest segment of personal hygiene

products, largely dominated by bar soaps, has grown at 5% p.a. over the last five years. In

comparison, the second largest segment of hair care products has seen a much higher

growth of 9-10% p.a. during the same period.

The sizable Indian population base with rising disposable income offers the

personal care industry a burgeoning middle class to market a large variety of consumer

products. Several social, market and industry trends signal the possibility of Indian

personal care industry realizing this huge potential in the near future. Increasing

urbanization, rising participation of women in urban work force and growing importance

12

of looks and personal grooming, not only for personal, but professional reasons, are some

of the key social drivers. Market trends like spread of organized retail to Tier II cities,

development of nontraditional segments like men’s cosmetics (with products like hair

gels and fairness creams) and development of wide range of products at different price

points are all factors, which could contribute to the growth of the domestic personal care

market. Industry trends like increasing competition with entry of large MNCs, increased

brand building and customer awareness initiatives by companies are accelerating growth.

Subject to sustained overall GDP growth rates of 8-9% p.a., the overall Indian personal

care market has the potential to grow at 15%-16% p.a. (much higher rates for select

segments like color cosmetics, skin care and deodorants) and thereby double to ~$8-bn

by 2012-13.

2.3 Major Players

Indian personal care products market is highly competitive, dominated by well-

entrenched brands from companies such as Hindustan Unilever Ltd (HUL), Procter and

Gamble Ltd, L’Oreal India Pvt. Ltd, Dabur India Ltd and Cavinkare Pvt. Ltd. The

personal care segment is dominated by HUL, whose brands, including Lux, Dove,

Sunsilk and Clinic Plus, have 52.7% market share in soaps and 46.5% in shampoos,

according to HUL. ITC has around a 2% share of the total personal-care products market.

Since market liberalization, several multinational companies, such as Revlon, Coty,

Oriflame, Chambor, Avon, Yardley, Nina Ricci, Garnier Laboratories, and L'oreal, have

entered the Indian market. These companies initially cashed in on their international

brand image; however, repeat purchases were not forthcoming because the products were

not priced competitively. Consequently, these companies became price-sensitive and

most of the international brands are now priced competitively in the Indian market.

The colour cosmetic segment which has Indian players such as Lakme Lever,

Tips & Toes and Shenaz Hussain and multinational company players such as J. L.

Morrison, Ponds, Unilever and Colgate Palmolive, offers the highest competition.

Domestic players like Lakme, Tips & Toes and My Fair Lady, mainly dominate this

market.

13

Revlon has a market share of 80% in the premium market. Lakme is the overall

market leader in the colour cosmetic segment (lip care and nail enamel) with a wide

range of products and prices, both. The organised colour cosmetics market is estimated at

Rs 340 crore currently. Revlon's sales account for Rs 60 crore of that. Lakme leads the

market with sales of Rs 100 crore. Lakme, has recently joined forces with Hindustan

Lever Limited (HLL) and calls itself Lakme-Lever.

Other international brands in the sector include L'Oreal, Revlon, Maybelline,

Benckiser and Avon with a major part of the rest, some of them engaged in the multi-

level-marketing model for their products.

The most important global players are already in India (except perhaps Estee

Lauder, Mary Ann Kay, Kao and Body Shop) and are in an advanced stage of market

development. They are already exploiting prospects based on imports of active

ingredients, packaging and completely built products. In that regard, new entrants have to

contend with serious competition in India from local as well as global players.

Multinationals feel that Indian companies - Lakme, Pond's, Nivea-makers J.

L.Morrison and Tips & Toes makers Paramount Cosmetics - have not identified the

changing needs of the new Indian woman. It is therefore that Switzerland's Torstone's

Chambor, Sweden's Oriflame, USA's Avon Cosmetics, Revlon, Benckiser (Coty

Vitacare), Paris-based Escada group and Laboratories Garnier (Synergie) are ambitiously

fishing in the Indian waters. It is not coincidence that many of these MNCs entered the

Indian market in the mid-Nineties. Fired with the zeal of changing the complexion of the

cosmetics market, they are fuelling the change using satellite television, women's

magazines and beauty pageants.

Maybelline competes with Revlon and Lakme in the colour cosmetics market in

India. Revlon too has grown 65 per cent to strengthen its share to 13 per cent during the

period. As per the data, Lakme's share stands at 34 per cent, and that of Elle 18 is 25 per

cent - both of which have suffered a de-growth over the previous period. The lip and nail

colour market, at Rs 107 crore, has registered a growth of 11 per cent.

14

Mass market products account for a major share, around 70 per cent, while the

premium segment accounts only for a mere 9 per cent in lipsticks and 5 per cent in nail

enamels.

2.4 The Personal Care Products Council Consumer Commitment Code

Due to increase in information technology nowadays consumers are becoming more

aware about the various features, qualities and attributes of the products .They are

becoming more demanding and want more and more qualities and features. So, the

standardization is an unavoidable need for success of any company. The following

principles constitute the Personal Care Products Council Consumer Commitment Code:

1. A company should market cosmetic products only after ensuring that every ingredient

and finished product has been substantiated for safety.

2. When marketing a cosmetic product containing an ingredient that exceeds limits on

concentration or product type established by the Cosmetic Ingredient Review Expert

Panel, a company should possess information sufficient to substantiate the safety of the

ingredient for its intended use in such product and be willing to make that information

available for inspection by the Food and Drug Administration.

3. When marketing a cosmetic product containing an ingredient for which the Cosmetic

Ingredient Review Expert Panel has found insufficient data to determine safety, a

company should possess information sufficient to substantiate the safety of the ingredient

for its intended use in such product and be willing to make that information available for

inspection by the Food and Drug Administration.

4. A company should participate in the applicable parts of the FDA Voluntary Cosmetic

Reporting Program set forth in 21 CFR Parts 710 and 720 for products marketed in the

United States, and file timely reports regarding its manufacturing establishments and

ingredient usage.

15

5.. A company should maintain a safety information summary of ingredient and product

safety information and data regarding its cosmetic products marketed in the United States

as specified in the Council's Safety Information Summary Program Guideline, and make

any information in that safety information summary available for inspection by FDA

under the conditions specified in that program.

6. A company should maintain a safety information summary of ingredient and product

safety information and data regarding its cosmetic products marketed in the United States

as specified in the Council's Safety Information Summary Program Guideline, and make

any information in that safety information summary available for inspection by FDA

under the conditions specified in that program.

16

3. Literature Review

According to Hassan (2008), modern customers are very deeply connected to the brands.

Some customers purchase the specific branded things just due to the brand name.

Customers believe that brand name is a symbol of quality. Brand name has a power,

which attracts the customers towards branded products. The reason is that customer gets

special connection with specific brands product and become the loyal with brand.

Brands vary in amount of power and value they have in the market place.

Distributors and retailers want brand names, because brands make the product easier to

handle, hold production to certain quality standards, strengthen buyer preferences and

make it easier to identify suppliers. Customers want brand names to help them identify

quality differences and shop more efficiently. Consistent quality is a key to successful

branding (Doyle, 1989). Jacob et.al (1971; 1977) studies indicate that consumers faced

with selection decisions find the brand name to be the most useful piece of information in

making a selection. The quality has become necessary, but not sufficient condition for

purchase.

According to Keller (1993) brand knowledge is conceptualized as having two

components (i) Brand awareness and (ii) Brand image.

Management consulting firm Booz & Company conducted a consumer spending

study in September 2008, which indicates that the vast majority of consumers across

socioeconomic classes have already made substantial cuts in spending and plan to make

even deeper cuts in the future. The survey of nearly 1,000 households suggests that to

date, consumers have focused cost-cutting on high-expenditure, less critical areas.

Consumers can achieve these cuts in spending in a variety of ways: seeking out sales,

discount-shopping online, buying in bulk, and finding less expensive substitutes for

preferred brands, deferring the purchase of large-ticket items, and/or avoiding luxury

goods and services. Respondents pointed to non-essential, luxury items as the products

and services on which they would cut their spending the most:

• Luxury apparel and shoes

17

• Home furnishings

• Personal care services

• Electronics

• Vacations

Brand identifies the seller or maker. A brand is essentially a seller's promise to

deliver a specific set of features, benefit and services consistent to the buyers. According

to Goodyear (1996), brands pass through:

Stage I: as unbranded goods

Stage 2: as Brand as reference

Stage 3: Brand as personality

Stage 4: Brand as Icon

Stage 5: Brand as company

Stage 6: Brand as policy

18

4. Research Methodology

4.1 Objectives of the Study

To identify brand as a determinant of consumer purchase decisions of personal care.

To identify the major factors in products purchase of personal care.

To identify the influence of reference group in prospect of purchase.

To identify costs vs. benefits of different brands of personal care products.

4.2 Research Methodology

The first stage of the project was to study the brands of personal care products available in the market.

The extraction of literature review was done through various websites, magazines

and journals.

In the next stage, a questionnaire was prepared and the same was distributed

amongst the group members. The final draft of the questionnaire was approved by

project guide.

The questionnaire consisted of a judicious mix of dichotomous and checklist

questions. Some questions were also deliberately designed as open ended.

Attitudinal questions were designed to be rated on a 5 point Likert Scale, where 1

represents Least Important to 5 represents Most Important.

After this, a survey was done by the group members in the city of Allahabad.

Overall 200 questionnaires were filled by the respondents in and around

Govindpur, Katra, Teliyarganj and Civil Lines areas of the city.

After collection of data, the responses were entered using SPSS version 11.5

Tools used for analysis included factor analysis, frequency polygons and cross

tabulation.

Based on the data and results from the tabulated statistics through SPSS, study

about consumer behaviour was done and the report was prepared accordingly.

5. Analysis of Data

19

5.1 Demographic Details

Age of the Respondent

Frequency Percent Valid PercentCumulative

PercentValid Less than

187 3.5 3.5 3.5

18-24 112 56.0 56.0 59.525-34 52 26.0 26.0 85.535-49 19 9.5 9.5 95.050 and above

10 5.0 5.0 100.0

Total 200 100.0 100.0

Table 1As is evident from Table 1, the majority of respondents are in the age group of 18-24

years. Though this is not deliberate, yet this age group is expected to reflect dynamism in

our study.

Gender of the Respondent


PercentValid Male 110 55.0 55.0 55.0

Female 90 45.0 45.0 100.0Total 200 100.0 100.0

Table 2Table 2 suggests that 55 percent of respondents are male, out of a total sample size of

100.

Monthly Family Income


PercentValid Upto 10000 35 17.5 17.5 17.5

10000-25000

60 30.0 30.0 47.5

25000-50000

61 30.5 30.5 78.0

More than 50000

44 22.0 22.0 100.0

Total 200 100.0 100.0

Table 3

20

From Table 3 it is clear that there is almost equal representation of consumers in the

income group of 10,000-25,000 and 25,000-50,000 in this study. This suggests that the

majority of respondents fall in the category of Middle Income Group.

Pl ace of purchase

35 17. 5 17. 5 17. 5

66 33. 0 33. 0 50. 5

97 48. 5 48. 5 99. 0

2 1. 0 1. 0 100. 0

200 100. 0 100. 0

Grocery out let

Super market

General merchant s

Any ot her

Tot al

ValidFrequency Percent Valid Percent

Cumulat ivePercent

Table 4

Figure 1

Pla c e o f p u rc h a s e

Any ot her

General merchant s

Super market

Grocery out let

Co

un

t

120

100

80

60

40

20

0

97

66

35

It is evident from Table 1 and Figure 1 that the most common place of purchasing a

personal care product is general merchant store, followed by super market. The results

show the growing popularity of super markets at Allahabad.

21

Preference


PercentValid Branded 157 78.5 78.5 78.5

Non branded

6 3.0 3.0 81.5

Depending upon availability

36 18.0 18.0 99.5

4 1 .5 .5 100.0Total 200 100.0 100.0

Table 5

Clear majority of respondents have opted for a branded personal care product. Refer to

Table 5, where only 18 percent of total respondents reveal that their choice depends on

availability.

Source of i nformat i on

128 64. 0 64. 0 64. 0

21 10. 5 10. 5 74. 5

5 2. 5 2. 5 77. 0

34 17. 0 17. 0 94. 0

5 2. 5 2. 5 96. 5

7 3. 5 3. 5 100. 0

200 100. 0 100. 0

TV Commercial

Newspaper ad

Radio

Fr iends and colleagues

Sales represent at ives

Shopkeepers

Tot al


Cumulat ivePercent

Table 6

Figure 2

22So u rc e o f i n fo rma tio n

Shopkeepers

Sales represent at ive

Fr iends and colleagu

Radio

Newspaper ad

TV Commercial

Co

un

t

140

120

100

80

60

40

20

0 7

34

21

128

Table 6 and Figure 2 reveal TV commercials to be the most important source of

information to consumers about personal care products. This reveals the impact of

advertisements by such consumers’ consumer buying patterns. Radio is the least popular

source and so is recommendation by a sales representative.

Gender of the Respondent * Source of Information Crosstabulation

Source of information Total

TV

Commercial Newspaper ad RadioFriends and colleagues

Sales representatives Shopkeepers

Gender of the respondent

Male73 12 2 17 3 3 110

Female 55 9 3 17 2 4 90Total 128 21 5 34 5 7 200

Table 7

Cross tabulation of gender with source of information, Table 7 reveals the following

facts:

i. Both genders have chosen TV commercial as the most frequently used source

of information for personal care products.

ii. Reference by friends and colleagues is the next most frequently used source of

information for both genders.

iii. Radio commercials seem to have very less impact on purchase decisions for

either sex.

iv. Both genders may perceive recommendation by sales representatives as less

important.

23

Sour ce of i nf or m at i on * M ont hl y f am i l y i ncom e Cr osst abul at i on

Count

20 42 40 26 128

5 9 5 2 21

2 3 0 0 5

3 4 13 14 34

1 1 2 1 5

4 1 1 1 7

35 60 61 44 200

TV Com m er cial

Newspaper ad

Radio

Fr iends and colleagues

Sales r epr esent at ives

Shopkeeper s

Sour ce ofinf or m at ion

Tot al

Upt o 10000 10000- 25000 25000- 50000M or e t han

50000

M ont hly f am ily incom e

Tot al

Table 8Cross tabulation of source of information with monthly family income (Table 8) shows:

1. TV commercials are the most popular across all income groups.

2. Commercials of radio have no impact on high income groups.

3. Income groups 25,000-50,000 and 50,000 and above seems to rely on

recommendations of friends and colleagues in buying personal care products after

TV commercials. This implies greater influence of reference groups on higher

income groups.

Effect of Brand


PercentValid Most

unimportant18 9.0 9.0 9.0

Somewhat unimportant

16 8.0 8.0 17.0

Neither important nor unimportant

16 8.0 8.0 25.0

Somewhat important

54 27.0 27.0 52.0

Most important 96 48.0 48.0 100.0Total 200 100.0 100.0

Table 9Table 9 shows that brand has an important effect on majority of consumers surveyed.

24

Gender of the Respondent * Effect of Brand Crosstabulation

Effect of brand

TotalMost

unimportantSomewhat

unimportant


Somewhat important

Most important


Male 11 5 9 33 52 110Female 7 11 7 21 44 90

Total 18 16 16 54 96 200

Table 10Effect of brand is the most important to the majority of respondents across both the

genders as shown by Table 10. Taken together, effect of brand is overall important to

both genders (33+52) and (21+44).

Age of the Respondent * Effect of Brand Crosstabulation

Effect of brand Total

Most

unimportantSomewhat

unimportant


Somewhat important

Most important

Age of the respondent

Less than 181 2 2 1 1 7

18-24 10 9 4 34 55 112 25-34 4 4 3 11 30 52 35-49 3 1 5 5 5 19 50 and above 0 0 2 3 5 10Total 18 16 16 54 96 200

Table 11Cross tab of effect of brand on age of respondent reveals that the effect is the most

pronounced in the age groups of 18-24 and 25-34 years. These are groups which are

usually affected by various available brands in the market.

Effect of Discount


PercentValid Most



19 9.5 9.5 15.0


71 35.5 35.5 50.5

Somewhat important

56 28.0 28.0 78.5


Table 12

25

Discount has a significant role in choice of a brand. Though majority of respondents are

neutral about discounts, a total of 49 percent respondents reveal discounts to be important

in their choice of brands (refer to Table 12).

Age of the Respondent * Effect of Discount CrosstabulationCount

Effect of discount Total

Most

unimportantSomewhat

unimportantNeither important nor unimportant

Somewhat important

Most important


Less than 180 0 3 1 3 7

18-24 4 10 45 29 24 112 25-34 4 5 17 15 11 52 35-49 1 3 5 7 3 19 50 and above 2 1 1 4 2 10Total 11 19 71 56 43 200

Table 13Cross tab of effect of discount and age, Table 13 shows that discounts have most

pronounced impact on age groups 18-24 and 25-34.

Gender of the Respondent * Effect of Discount Crosstabulation

Effect of discount

TotalMost

unimportantSomewhat

unimportant


Somewhat important

Most important


Male 8 12 33 33 24 110Female 3 7 38 23 19 90

Total 11 19 71 56 43 200

Table 14

More percentage of men is influenced by discounts (Refer to Table 14)..Gender of the Respondent * Effect of Family Crosstabulation

Effect of family Total

Most unimportantSomewhat

unimportant


Somewhat important

Most important


Male13 9 27 38 23 110

Female 7 8 22 32 21 90Total 20 17 49 70 44 200

Table 15

26

Family has more influence on men in their decision to buy a personal care product (Refer

to Table 15).

Effect of Brand Endorser


PercentValid Most unimportant 23 11.5 11.7 11.7


42 21.0 21.3 33.0

Neither important nor unimportant 64 32.0 32.5 65.5

Somewhat important

43 21.5 21.8 87.3


Missing System 3 1.5Total 200 100.0

Table 16Brand endorsers have overall impact on the purchase of personal care products, as is

revealed in Table 16.

Monthly Family Income * Effect of Brand Endorser Crosstabulation

Effect of brand endorser Total

Most

unimportantSomewhat


Somewhat important

Most important

Monthly family income

Upto 100007 4 11 5 6 33

10000-25000 7 10 20 13 10 60 25000-50000 5 21 21 11 3 61 More than 50000 4 7 12 14 6 43Total 23 42 64 43 25 197

Table 17Cross tabulation of monthly income with effect of brand endorser shows that brand

endorsers have least influence on consumers with monthly income up to Rs.10,000. We

may conclude that these people have lesser exposure to commercials on TV etc.

27

Effect of Packaging


PercentValid Most



32 16.0 16.0 24.0


71 35.5 35.5 59.5

Somewhat important

52 26.0 26.0 85.5


Table 18

Table 18 shows that effect of package is overall important for personal care product.

Age of the Respondent * Effect of Packaging Crosstabulation

Effect of packaging Total

Most

unimportantSomewhat


Somewhat important

Most important


Less than 182 1 2 2 0 7

18-24 8 16 45 32 11 112 25-34 1 9 14 14 14 52 35-49 3 6 5 2 3 19 50 and above 2 0 5 2 1 10Total 16 32 71 52 29 200

Table 19

Cross tabulation of effect of packaging on age (Table 19) reveals that age group of 18-24

years is the most affected by the package of the products in making purchase decision.

This is followed by the age group 25-34 years.

How frequent brand swi tchi ng

24 12. 0 12. 0 12. 0

23 11. 5 11. 5 23. 5

28 14. 0 14. 0 37. 5

46 23. 0 23. 0 60. 5

57 28. 5 28. 5 89. 0

22 11. 0 11. 0 100. 0

200 100. 0 100. 0

On every purchase

Every mont h

Every 3 mont hs

Every 6 mont hs

Every year

Never

Tot al


Cumulat ivePercent

Table 20

28

Table 20 shows that consumers surveyed mostly change brands of personal care products

once in 6months or once ever year. Only 11 percent has shown to be loyal to the brand

used.

How f r equent br and sw i t chi ng * Age of t he r espondent Cr osst abul at i on

Count

0 10 8 3 3 24

1 11 7 3 1 23

1 20 4 3 0 28

1 34 8 2 1 46

4 31 15 5 2 57

0 6 10 3 3 22

7 112 52 19 10 200

O n ever y pur chase

Ever y m ont h

Ever y 3 m ont hs

Ever y 6 m ont hs

Ever y year

Never

How f r equentbr andswit ching

Tot al

Less t han 18 18- 24 25- 34 35- 49 50 and above

Age of t he r espondent

Tot al

Table 21Cross tabulating frequency of brand switching with age reveals that the age group 18-24

years shows the greatest volatility in brand switching. Brand loyal respondents fall in the

age of 25 and above.

Reason to change brand

17 8. 5 8. 5 8. 5

52 26. 0 26. 0 34. 5

60 30. 0 30. 0 64. 5

33 16. 5 16. 5 81. 0

23 11. 5 11. 5 92. 5

2 1. 0 1. 0 93. 5

5 2. 5 2. 5 96. 0

8 4. 0 4. 0 100. 0

200 100. 0 100. 0

Every t ime you see anew brand

I f bored wit h using t hesame brand

A bet t er product bycompet it or

Same product at lesserpr ice by compet it or

Lack of var iet y

Promot ion by ot herbrands

Any ot her

Never

Tot al


Cumulat ivePercent

Table 22From Table 22, we can infer that promotion by other brands is the least important reason

behind changing the existing brand of personal care product. However, a better product

by a competitor is found to be the most important reason. Respondents seem to be overall

29

satisfied with the variety of the existing product as, only 11.5 percent has reveled lack of

variety to be the reason.

Reason t o change br and * Age of t he r espondent Cr osst abul at i on

Count

2 11 2 2 0 17

3 29 13 5 2 52

1 32 19 4 4 60

1 21 6 2 3 33

0 14 6 3 0 23

0 0 1 1 0 2

0 2 2 0 1 5

0 3 3 2 0 8

7 112 52 19 10 200

Ever y t im e you see anew br and

I f bor ed wit h using t hesam e br and

A bet t er pr oduct bycom pet it or

Sam e pr oduct at lesserpr ice by com pet it or

Lack of var iet y

Pr om ot ion by ot herbr ands

Any ot her

Never

Reasont ochangebr and

Tot al

Less t han 18 18- 24 25- 34 35- 49 50 and above

Age of t he r espondent

Tot al

Table 23Reason behind changing brand when cross tabulate with age show greater impact of

boredom with same brand to be the most important reason cited by 18-24 group. 25-34

years reveals better product by competitor as the reason. Promotion by other brands is the

least popular reason across all age groups.

30

Re a s o n to c h a ng e b ra n d * Ge n d e r o f th e re s p on d e n t Cro s s ta bu la tio n

Co u n t

7 1 0 1 7

2 8 2 4 5 2

3 1 2 9 6 0

2 2 11 3 3

11 1 2 2 3

1 1 2

3 2 5

7 1 8

11 0 9 0 2 0 0

Ev e ry t i me y o u s e e an e w b ra n d

If b o re d wi th u s i n g th es a me b ra n d

A b e t te r p ro d u c t b yc o mp e ti to r

Sa me p ro d u c t a t l e s s e rp ri c e b y c o mp e ti to r

L a c k o f v a ri e ty

Pro mo t i o n b y o th e rb ra n d s

An y o th e r

Ne v e r

Re a s o ntoc h a n g eb ra n d

T o ta l

Ma l e F e ma l e

Ge n d e r o f th ere s p o n d e n t

T o ta l

Table 24

Cross tabulation of reason with gender shows boredom with same brand, better product

by any rival brand and same product at lesser price by competitor to be the most

important reason cited by male respondents. Female replies also matched, except same

product at lesser price by competitor, which is replaced by lack of variety. Female

respondents are more allured by any new brand that is available.

How you trust a brand

165 82. 5 82. 5 82. 5

24 12. 0 12. 0 94. 5

6 3. 0 3. 0 97. 5

5 2. 5 2. 5 100. 0

200 100. 0 100. 0

By using

Recommendat ionof f amily/ f r iends

Advert isement

Survey repor t s

Tot al


Cumulat ivePercent

Table 25

31

Expectat i on from product

51 25. 5 25. 5 25. 5

145 72. 5 72. 5 98. 0

4 2. 0 2. 0 100. 0

200 100. 0 100. 0

High cost high value

Low cost high value

Low cost low value

Tot al


Cumulat ivePercent

Table 26

Expect at i on f r om pr oduct * M ont hl y f am i l y i ncom e Cr osst abul at i on

Count

9 16 15 11 51

23 43 46 33 145

3 1 0 0 4

35 60 61 44 200

High cost high value

Low cost high value

Low cost low value

Expect at ionf r om pr oduct

Tot al

Upt o 10000 10000- 25000 25000- 50000M or e t han

50000

M ont hly f am ily incom e

Tot al

Table 27

Factor Analysis

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .813

Bartlett's Test of Sphericity

Approx. Chi-Square 1065.680

df 105Sig. .000

KMO and Bartlett's TestKaiser-Meyer-Olkin Measure of Sampling Adequacy. .813

Bartlett's Test of Sphericity

Approx. Chi-Square 1065.680

df 105Sig. .000

32

Total Variance ExplainedComponent Initial Eigenvalues Extraction Sums of Squared Loadings

Rotation Sums of Squared Loadings

Total% of

VarianceCumulative

% Total% of

Variance Cumulative % Total% of

VarianceCumulati

ve %1 4.345 28.969 28.969 4.345 28.969 28.969 2.961 19.743 19.7432 2.537 16.914 45.883 2.537 16.914 45.883 2.945 19.634 39.3773 1.771 11.806 57.688 1.771 11.806 57.688 2.747 18.312 57.6884 .973 6.487 64.1755 .821 5.472 69.6476 .781 5.206 74.8537 .594 3.958 78.8118 .562 3.748 82.5599 .489 3.259 85.81810 .450 3.003 88.82011 .392 2.616 91.43612 .378 2.519 93.95413 .357 2.381 96.33514 .281 1.873 98.20815 .269 1.792 100.000

Extraction Method: Principal Component Analysis.

33

Component Matrix(a)

Component

1 2 3Effect of brand .549 -.596 .153Effect of price .637 -.256 -.480Effect of features .725 -.441 .009Effect of packaging .461 -.028 .539Effect of discount .557 .219 -.462Effect of ease of availability .607 -.142 -.416

Effect of brand endorser .194 .341 .597Effect of free trial packs .454 .493 .044Effect of family .549 .115 -.215Effect of friends and colleagues .606 .013 .121

Effect of variety offered by brand .729 -.251 .249

Effect of status .609 -.107 .514Effect of sales representative .217 .783 .177

Effect of shopkeepers .330 .704 -.093Effect of gifts .501 .545 -.234

Extraction Method: Principal Component Analysis.a 3 components extracted.

Rotated Component Matrix(a)

Component

1 2 3Effect of brand .393 .624 -.370Effect of price .823 .148 -.035Effect of features .578 .599 -.168Effect of packaging -.067 .691 .143Effect of discount .650 -.014 .385Effect of ease of availability .733 .144 .065

Effect of brand endorser -.370 .462 .400Effect of free trial packs .161 .204 .619Effect of family .493 .182 .290Effect of friends and colleagues .316 .482 .221

Effect of variety offered by brand .368 .722 .018

Effect of status .068 .793 .118Effect of sales representative -.157 .067 .814

Effect of shopkeepers .128 -.028 .772Effect of gifts .378 .026 .677

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization.a Rotation converged in 6 iterations.

34

Bartlett’s test of sphericity and Kaiser-Meyer Olkin (KMO) measure of sampling

adequacy were used to examine the appropriateness of factor analysis. The approximate

chi-square statistic is 1065.680 with 105 degrees of freedom, which is significant at 0.05

level. The KMO statistic (.813) is also significant (greater than 0.5). 15 statements

converted to 3 factors:

i. Variety and Status: Includes factors like effect of brand, effect of variety on

brand, and effect of status.

ii. Price and Convenience: Includes effect of price and ease of availability.

iii. Consultation and Promotion: Includes effect of sales representatives, effect of

shopkeepers, effect of gifts, and effect of free trial packs.

35

6. Conclusions

Brands not only represent the symbol of the company or product but to a larger extent define the general life of a person.

Consumer decisions are more based on consumer’s budget constraints.

Consumption pattern is based on cultural factors, social factors and income of the consumers.

Consumers also tend to satisfy his/her need depending upon the Maslow’s hierarchy.

The Indian consumer market is characterized by dynamism, higher disposable incomes, the development of modern urban lifestyles and an increase in consumer awareness.

The increasing size of the middle-class population in India, representing a growth in disposable incomes, has led to more consumers for the cosmetics and toiletries market. Such consumers are more inclined to purchase higher-priced products.

Increasing urbanization, rising participation of women in urban work force and growing importance of looks and personal grooming, not only for personal, but professional reasons, are some of the key social drivers.

Majority of respondents are in the age group of 18-24 years and there is almost equal representation of consumers in the income group of 10,000-25,000 and 25,000-50,000 in this study.

The most common place of purchasing a personal care product is general merchant store, followed by super market.

Though majority of respondents are neutral about discounts, a total of 49% respondents reveal discounts to be important in their choice of brands.

Consumers surveyed mostly change brands of personal care products once in 6months or once ever year.

In all age groups, the major information source is T.V commercial. Main source of

information is same in all the income groups that are through TV commercials, and

36

then followed by information provided by their friends and colleagues. Maximum

male respondents get information from the TV commercials followed by information

provided by their friends and colleagues. Female respondents’ source of information is

TV commercial followed by friends and colleagues.

People in the age group of less than 18 -24 are the one who switch the brand very

frequently. Brand switching is done every 6 months closely followed by every year.

Main reason that respondents gave of switching the brand was is a better product

offered by the competitors followed by another reason that is getting bored with the

product.

The reasons of brand switching age group wise are as follows:

In the age group of less than 18 years, main reason of switching the brand

is getting bored with the same brand

In the age groups 18-24 years and also in the age group 25-34 the main

reason observed is a better product offered by the competitors.

In the age group 35-49 years the main reason is getting bored by the same

product closely followed by a better product offered by the competitor.

In the age group 50 and above main reason found is again a better product

offered by the competitor.

The reasons of brand switching gender wise are as follows:

Main reason for switching a brand observed in the males is that a better

product offered by the competitor.

Main reason with female respondents is also the same that is a better

product offered by the competitors.

The respondents build trust in a brand by using it. This reason is same both in the case

of male and female respondents. Main reason of trusting a brand is based on the

recommendation of family or friends. This was the main reason given by all the

income groups.

All the income groups have the expectation of low cost and high value from the

product.

37

The most preferred place of buying personal care products is from General

Merchants both by male and female customers. Its frequency is more in the case of

male customers as compared to female customers.

38

7. Limitations of the Study

Given the complexity and multi-dimensional nature of consumer buying process,

a study of factors influencing buying behavior of consumers in only one city may

not yield results that can be generalized. Interesting insights can be obtained if

more such cities are considered in a further study.

There was lack of awareness among consumers about the branded products,

especially in age group of 40-50 years.

Data was collected mainly during weekends mainly because it was convenient for

the researchers to conduct the survey on weekends. Data collected at different

days of the week and different times of the day can surely improve randomness in

the study and yield better results.

Most of the respondents were in the age group of 18-24 years. There were

relatively lesser number of respondents in the age group of 50 years and above.

We also didn’t find many respondents in the higher income groups.

People surveyed have been found to be more inclined towards herbal products

like Multani Mitti, etc .

39

References

Booz & Company [September 2008], ‘Consumer spending in a recession’

Cliff Alen, ‘One To One Web Marketing, Consumers’ Purchase/ Decision Criteria’

Dr. P.T. Raveendran, ‘Compulsive buying behaviors in Indian Consumers and its impact on credit default- An emerging paradigm’

Erez Manhaimer , ‘Does the Perceived Quality of the Product Influence the Customer Loyalty’.

Jacob et.al (1977), ‘Effect of Brand name and Price on Consumer Brand Loyalty’

Jordan a Stier [February 22, 2009], ‘Effects Of Chemicals n personal care products’

Rajgopal, ‘Influence of brand name in variety seeking behavior of consumers: an empirical analysis’

Riona [December 16, 2008],’ Influence of Emotions on Purchase Decisions’.

Tanveer Hasan[2008],’ Influence of Brand Name on Consumer Decision’Websiteshttp://www.researchandmarkets.com/reports/688193/www.learnmanagement2.comhttp://www.essortment.com/all/brandloyalty_pqk.htmhttp://www.fashionproducts.com/personal-care-overviewhttp://seekingalpha.com http://www.indiastudychannel.com/projects/2761-Marketing-Changes-Consumer-Buying-Behaviour-Indian-Scenario.aspx http://buyerbehaviour.blogspot.com/2007/05/india-fifth-largest-consumer-market-by.html

40

http://bizcovering.com/marketing-and-advertising/influence-of-emotions-on-purchase-decisions/

http://www.triond.com/users/riona

Documents

minor_report