Finalreportcp

Research Methodology

OBJECTIVES OF THE STUDY

1. To profile the cherry pickers.

2. To study the cherry picking sales pattern.

3. To find out whether Cherry pickers increases the basket size.

4. To find out whether cherry pickers increase the retail turnover.

RESEARCH QUESTIONS

Who are the cherry pickers?

How do these customers cherry pick products?

What are the implications on the total spending of these customers?

Do such consumers increase the retail turnover by buying more quantity for availing

the promotional schemes?

HYPOTHESIS

Ho: The amount spent more to avail the scheme is not dependent on the income of the buyer.

H1: The amount spent more to avail the scheme is dependent on the income of the buyer.

TYPE OF RESEARCH DESIGN

Descriptive research was used for the project.

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QUANTITATIVE RESEARCH

A survey of customers leaving Big Bazaar was done so that all details of the shopping trip

were fresh in their minds and hence accurate price data could be collected. The survey was

done by questionnaire which comprised of closed ended questions.

SOURCES OF DATA

Primary data was collected through survey of customers at Big Bazaar.

Secondary data was collected from previous research by various authors on this topic, retail

biz magazine and articles and reports on the internet.

METHODOLOGY

The method used for survey was structured questionnaire.

RESEARCH TOOL

Questionnaire

QUESTIONNAIRE DESIGN

The questionnaire comprised of closed ended questions.

SAMPLE DESIGN

SAMPLE SIZE: 100 samples

SAMPLING TECHNIQUE: Convenience sampling.

PILOT STUDY

A pilot survey of 5 customers at Big Bazaar had been done to ensure that the questionnaire is

correct and relevant of research objectives.

SURVEY

Once pilot study is over, actual survey will be conducted.

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DATA ANALYSIS

The researcher has used inferential statistics (through SPSS) in order to draw a conclusion.

Result of the study has been put in tables and graphs for easy understanding of the findings of

the research.

EXPECTED CONTRIBUTION OF THE STUDY

This project will help in giving a fresh insight on this topic on which research has been done

very rarely in India. It will help to understand the overall pattern of this activity and its

impact on the marketing strategies of various FMCG products. Also the profiling of this set

of consumers can help in framing the strategies accordingly.

REASON FOR TAKING UP THE PROJECT

The researcher has done his BBA and currently pursuing his MBA. This topic has not been

researched upon extensively in India and hence promises unique exposure and experience to

the researcher and hence this project has been undertaken.

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INTRODUCTION TO THE INDUSTRY

Products which have a quick turnover, and relatively low cost are known as Fast Moving

Consumer Goods (FMCG). FMCG products are those that get replaced within a year.

Examples of FMCG generally include a wide range of frequently purchased consumer

products such as toiletries, soap, cosmetics, tooth cleaning products, shaving products and

detergents, as well as other non-durables such as glassware, bulbs, batteries, paper products,

and plastic goods. FMCG may also include pharmaceuticals, consumer electronics, packaged

food products, soft drinks, tissue paper, and chocolate bars.

Indiaʹs FMCG sector is the fourth largest sector in the economy and creates employment for

more than three million people in downstream activities. Its principal constituents are

Household Care, Personal Care and Food & Beverages.

The total FMCG market is in excess of Rs. 85,000 Crores. It iscurrently growing at double

digit growth rate and is expected to maintain a high growth rate. FMCG Industry is

characterized by a well established distribution network, low penetration levels, low

operating cost, lower per capita consumption and intense competition between the organized

and unorganized segments.

The Rs 85,000-crore Indian FMCG industry is expected to register a healthy growth in the

third quarter of 2008-09 despite the economic downturn. The industry is expected to register

a 15% growth in Q3 2008-09 as compared to the corresponding period last year. Unlike other

sectors, the FMCG industry did not slow down since Q2 2008. the industry is doing pretty

well, bucking the trend. As it is meeting the every-day demands of consumers, it will

continue to grow.

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Market share movements indicate that companies such as Marico Ltd and Nestle India Ltd,

with domination in their key categories, have improved their market shares and outperformed

peers in the FMCG sector. This has been also aided by the lack of competition in the

respective categories. Single product leaders such as Colgate Palmolive India Ltd and

Britannia Industries Ltd have also witnessed strength in their respective categories, aided by

innovations and strong distribution. Strong players in the economy segment like Godrej

Consumer Products Ltd in soaps and Dabur in toothpastes have also posted market share

improvement, with revived growth in semi-urban and rural markets.

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Industry Category and Products

Household Care

Personal Wash:-

The market size of personal wash is estimated to be around Rs. 8,300 Cr. The personal wash

can be segregated into three segments: Premium, Economy and Popular. The penetration

level of soaps is ~92 per cent. It is available in 5 million retail stores, out of which, 75 per

cent are in the rural areas. HUL is the leader with market share of ~53 per cent; Godrej

occupies second position with market share of ~10 per cent. With increase in disposable

incomes, growth in rural demand is expected to increase because consumers are moving up

towards premium products. However, in the recent past there has not been much change in

the volume of premium soaps in proportion to economy soaps, because increase in prices has

led some consumers to look for cheaper substitutes.

Detergents:-

The size of the detergent market is estimated to be Rs. 12,000 Cr. Household care segment is

characterized by high degree of competition and high level of penetration. With rapid

urbanization, emergence of small pack size and sachets, the demand for the household care

products is flourishing. The demand for detergents has been growing but the regional and

small unorganized players account for a major share of the total volume of the detergent

market. In washing powder HUL is the leader with ~38 per cent of market share. Other major

players are Nirma, Henkel and Proctor & Gamble.

Personal Care

Skin Care:-

The total skin care market is estimated to be around Rs. 3,400 Cr. The skin care market is at a

primary stage in India. The penetration level of this segment in India is around 20 per cent.

With changing life styles, increase in disposable incomes, greater product choice and

availability, people are becoming aware about personal grooming. The major players in this

segment are Hindustan Unilever with a market share of ~54 per cent, fol-lowed by CavinKare

with a market share of ~12 per cent and Godrej with a market share of ~3 per cent.

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Hair Care:-

The hair care market in India is estimated at around Rs. 3,800 Cr. The hair care market can be

segmented into hair oils, shampoos, hair colorants & conditioners, and hair gels. Marico is

the leader in Hair Oil segment with market share of ~ 33 per cent; Dabur occu-pies second

position at ~17 per cent.

Shampoos:-

The Indian shampoo market is estimated to be around Rs. 2,700 Cr. It has the penetration

level of only 13 per cent in India. Sachet makes up to 40 per cent of the total shampoo sale. It

has low penetration level even in metros. Again the market is dominated by HUL with around

~47 per cent market share; P&G occupies second position with market share of around ~23

per cent. Antidandruff segment constitutes around 15 per cent of the total shampoo market.

The market is further expected to increase due to increased marketing by players and

availability of shampoos in affordable sachets.

Oral Care:-

The oral care market can be segmented into toothpaste - 60 per cent; toothpowder - 23 per

cent; toothbrushes - 17 per cent. The total toothpaste market is estimated to be around Rs.

3,500 Cr. The penetration level of toothpowder/toothpaste in urban areas is three times that of

rural areas. This segment is dominated by Colgate-Palmolive with market share of ~49 per

cent, while HUL occupies second position with market share of ~30 per cent. In

toothpowders market, Colgate and Dabur are the major players. The oral care market, es-

pecially toothpastes, remains under penetrated in India with penetration level ~50 per cent.

Food & Beverages

Food Segment :-

The foods category in FMCG is gaining popularity with a swing of launches by HUL, ITC,

Godrej, and others. This category has 18 major brands aggregating Rs. 4,600 Cr. Nestle and

Amul slug it out in the powders segment. The food category has also seen innovations like

softies in ice creams, ready to eat rice by HUL and pizzas by both GCMMF and Godrej

Pillsbury.

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Tea :-

The major share of tea market is dominated by unorganized players. More than 50 per cent of

the market share is capture by unorganized players. Leading branded tea players are HUL and

Tata Tea.

Coffee :-

The Indian beverage industry faces over supply in segments like coffee and tea. However,

more than 50 per cent of the market share is in unpacked or loose form. The major players in

this segment are Nestlé, HUL and Tata Tea.

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Growth Prospect

Large Market

India has a population of more than 1.150 Billions which is just behind China. According to

the estimates, by 2030 India population will be around 1.450 Billion and will surpass China

to become the World largest in terms of population. FMCG Industry which is directly related

to the population is expected to maintain a robust growth rate.

Spending Pattern

An increase is spending pattern has been witnessed in Indian FMCG market. There is an

upward trend in urban as well as rural market and also an increase in spending in organ-ized

retail sector. An increase in disposable income, of household mainly because of in-crease in

nuclear family where both the husband and wife are earning, has leads to growth rate in

FMCG goods.

Changing Profile and Mind Set of Consumer

People are becoming conscious about health and hygienic. There is a change in the mind set

of the Consumer and now looking at “Money for Value” rather than “Value for Money”. We

have seen willingness in consumers to move to evolved products/ brands, because of

changing lifestyles, rising disposable income etc. Consumers are switching from economy to

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premium product even we have witnessed a sharp increase in the sales of packaged water and

water purifier. Findings according to a recent survey by A. C. Nielsen shows about 71 per

cent of Indian take notice of packaged goodsʹ labels containing nutritional information

compared to two years ago which was only 59 per cent.

Sources: Naukri Hub, IBEF, Chennai Online

Sources: Statistical Outline of India (2001-02), NCAER

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Advantages To The Sector

Governmental Policy

Indian Government has enacted policies aimed at attaining international competitiveness

through lifting of the quantitative restrictions, reducing excise duties, automatic foreign in-

vestment and food laws resulting in an environment that fosters growth. 100 per cent ex-port

oriented units can be set up by government approval and use of foreign brand names is now

freely permitted.

Central & State Initiatives

Recently Government has announced a cut of 4 per cent in excise duty to fight with the

slowdown of the Economy. This announcement has a positive impact on the industry.

But the benefit from the 4 per cent reduction in excise duty is not likely to be uniform across

FMCG categories or players. The changes in excise duty do not impact cigarettes (ITC,

Godfrey Phillips), biscuits (Britannia Industries, ITC) or ready-to-eat foods, as these prod-

ucts are either subject to specific duty or are exempt from excise. Even players with manu-

facturing facilities located mainly in tax-free zones will also not see material excise duty

savings. Only large FMCG-makers may be the key ones to bet and gain on excise cut.

Foreign Direct Investment (FDI)

Automatic investment approval (including foreign technology agreements within specified

norms), up to 100 per cent foreign equity or 100 per cent for NRI and Overseas Corporate

Bodies (OCBs) investment, is allowed for most of the food processing sector except malted

food, alcoholic beverages and those reserved for small scale industries (SSI). There is a

continuous growth in net FDI Inflow. There is an increase of about 150 per cent in Net Inflow

for Vegetable Oils & Vanaspati for the year 2008.

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As their incomes and standards of living improve, Indian customers’ for FMCGs are shifting

towards higher lifestyle categories like skin care, hair care, deodorants, convenience foods,

health foods etc.

In fact, skin care, hair care, deodorants, convenience foods, and health foods are expected to

experience notably higher growth than others in the near term, spurring various types of

MNC investments to improve their lifestyle products businesses.

• For personal care lifestyle products, consumers are becoming increasingly willing to pay

premium prices for them. This trend has compelled some companies to raise prices and

even create products aimed at the premium segment.

• In fact, deodorants, hair dyes and shampoos alone helped the FMCG industry to grow by

16% in 2007-08 (April-February), and 15% in the same period in 2006-079.

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Market Opportunities

Vast Rural Market

Rural India accounts for more than 700 Million consumers, or ~70 per cent of the Indian

population and accounts for ~50 per cent of the total FMCG market. The working rural

population is approximately 400 Millions. And an average citizen in rural India has less then

half of the purchasing power as compare to his urban counterpart. Still there is an untapped

market and most of the FMCG Companies are taking different steps to capture rural market

share. The market for FMCG products in rural India is esti-mated ~ 52 per cent and is

projected to touch ~ 60 per cent within a year. Hindustan Unilever Ltd is the largest player in

the industry and has the widest market coverage.

Export - “Leveraging the Cost Advantage”

Cheap labor and quality product & services have helped India to represent as a cost ad-

vantage over other Countries. Even the Government has offered zero import duty on capital

goods and raw material for 100% export oriented units. Multi National Companies out-source

its product requirements from its Indian company to have a cost advantage. India is the

largest producer of livestock, milk, sugarcane, coconut, spices and cashew apart from being

the second largest producer of rice, wheat, fruits & vegetables. It adds a cost advantage as

well as easily available raw materials.

Sectoral Opportunities

Major Key Sectoral opportunities for Indian FMCG Sector are mentioned below:

Dairy Based Products

India is the largest milk producer in the world, yet only around 15 per cent of the milk is

processed. The organized liquid milk business is in its infancy and also has large long-term

growth potential. Even investment opportunities exist in value-added products like desserts,

puddings etc.

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Packaged Food

Only about 10-12 per cent of output is processed and consumed in packaged form, thus

highlighting the huge potential for expansion of this industry.

Oral Care

The oral care industry, especially toothpastes, remains under penetrated in India with

penetration rates around 50 per cent. With rise in per capita incomes and awareness of oral

hygiene, the growth potential is huge. Lower price and smaller packs are also likely to drive

potential up trading.

Beverages

Indian tea market is dominated by unorganized players. More than 50% of the market share is

capture by unorganized players highlighting high potential for organized players.

The Indian FMCG sector is the fourth largest sector in the economy with a total market size

in excess of US$ 13.1 billion. It has a strong MNC presence and is characterised by a

wellestablished distribution network, intense competition between the organised and

unorganised segments and low operational cost. Availability of key raw materials, cheaper

labour costs and presence across the entire value chain gives India a competitive advantage.

The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015.

Penetration level as well as per capita consumption in most product categories like jams,

toothpaste, skin care, hair wash etc in India is low indicating the untapped market

potential. Burgeoning Indian population, particularly the middle class and the rural segments,

presents an opportunity to makers of branded products to convert consumers to branded

products.

Growth is also likely to come from consumer 'upgrading' in the matured product categories.

With 200 million people expected to shift to processed and packaged food by 2010, India

needs around US$ 28 billion of investment in the food-processing industry.

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Large domestic market

India is one of the largest emerging markets, with a population of over one billion. India is

one of the largest economies in the world in terms of purchasing power and has a strong

middle class base of 300 million.

Rural and urban potential

Rural-urban profile

Population 2001-02 (mn household) 53 135

Population 2009-10 (mn household) 69 153

% Distribution (2001-02) 28 72

Market (Towns/Villages) 3,768 6,27,000

Universe of Outlets (mn) 1 3.3

Source: Statistical Outline of India (2001-02), NCAER

Around 70 per cent of the total households in India (188 million) resides in the rural areas.

The total number of rural households are expected to rise from 135 million in 2001-02 to 153

million in 2009-10. This presents the largest potential market in the world. The annual size of

the rural FMCG market was estimated at around US$ 10.5 billion in 2001-02. With growing

incomes at both the rural and the urban level, the market potential is expected to expand

further.

India - a large consumer goods spender

An average Indian spends around 40 per cent of his income on grocery and 8 per cent on

personal care products. The large share of fast moving consumer goods (FMCG) in total

individual spending along with the large population base is another factor that makes

India one of the largest FMCG markets.

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Consumption pie:

Source: KSA Technopak Consumer Outlook 2004.

Source: Euro monitor.

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Change in the Indian consumer profile:

Source: Statistical Outline of India (2002-03).

Rapid urbanisation, increased literacy and rising per capita income, have all caused rapid

growth and change in demand patterns, leading to an explosion of new opportunities. Around

45 per cent of the population in India is below 20 years of age and the young population is set

to rise further. Aspiration levels in this age group have been fuelled by greater media

exposure, unleashing a latent demand with more money and a new mindset.

Demand-supply gap

Currently, only a small percentage of the raw materials in India are processed into value

added products even as the demand for processed and convenience food is on the rise. This

demand supply gap indicates an untapped opportunity in areas such as packaged form,

convenience food and drinks, milk products etc. In the personal care segment, the low

penetration rate in both the rural and urban areas indicates a market potential.

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INDIA COMPETITIVENESS AND COMPARISON WITH THE WORLD MARKETS

Materials availability

India has a diverse agro-climatic condition due to which there exists a wide-ranging and large

raw material base suitable for food processing industries. India is the largest producer of

livestock, milk, sugarcane, coconut, spices and cashew and is the second largest producer of

rice, wheat and fruits & vegetables. India also has an ample supply of caustic soda and soda

ash, the raw materials in the production of soaps and detergents – India produced 1.6 million

tonnes of caustic soda in 2003-04. Tata Chemicals, one of the largest producers of synthetic

soda ash in the world is located in India. The availability of these raw materials gives

India the locational advantage.

Source: DIPP.

Apart from the advantage in terms of ample raw material availability, existence of low-cost

labour force also works in favour of India. Labour cost in India is amongst the lowest in

Asian countries. Easy raw material availability and low labour costs have resulted in a lower

cost of production. Many multi-nationals have set up large low cost production bases in India

to outsource for domestic as well as export markets.

Penetration and per capita consumption

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Rural - urban penetration (2002)

Source: HLL, Indian Readership Survey.

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Penetration level in most product categories like jams, tooth paste, skin care, hair wash etc in

India is low. The contrast is particularly striking between the rural and urban segments - the

average consumption by rural households is much lower than their urban counterparts. Low

penetration indicates the existence of unsaturated markets, which are likely to expand as the

income levels rise. This provides an excellent opportunity for the industry players

in the form of a vastly untapped market.

Moreover, per capita consumption in most of the FMCG categories (including the high

penetration categories) in India is low as compared to both the developed markets and other

emerging economies. A rise in per capita consumption, with improvement in incomes and

affordability and change in tastes and preferences, is further expected to boost FMCG

demand. Growth is also likely to come from consumer "upgrading", especially in the matured

product categories.

Household income distribution – 2003

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Household income distribution – 2015

Demand for FMCG products is set to boom by almost 60 per cent by 2007 and more than 100

per cent by 2015. This will be driven by the rise in share of middle class (defined as the

climbers and consuming class) from 67 per cent in 2003 to 88 per cent in 2015. The boom in

various consumer categories, further, indicates a latent demand for various product segments.

For example, the upper end of very rich and a part of the consuming class indicate a small but

rapidly growing segment for branded products. The middle segment, on the other hand,

indicates a large market for the mass end products.

The BRICs report indicates that India's per capita disposable income, currently at US$ 556

per annum, will rise to US$ 1150 by 2015 - another FMCG demand driver. Spurt in the

industrial and services sector growth is also likely to boost the urban consumption

demand.

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Rise in Indian disposable income (US$/annum)

MARKET OPPORTUNITIES FOR INVESTMENT

Source: HH Panel data

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According to estimates based on China's current per capitaconsumption, the Indian FMCG

market is set to treble fromUS$ 11.6 billion in 2003 to US$ 33.4 billion in 2015. The

dominanceof Indian markets by unbranded products, change in eating habits and the

increased affordability of the growing Indian population presents an opportunity to makers of

branded products, who can convert consumers to branded products.

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Swot Analysis

Strengths:

• Low operational costs

• Presence of established distribution networks in both urban and rural

areas

• Presence of well-known brands in FMCG sector

Weaknesses:

• Lower scope of investing in technology and achieving economies of

scale, especially in small sectors

• Low exports levels

• "Me-tooʺ products, which illegally mimic the labels of the established

brands. These products narrow the scope of FMCG products in rural

and semi-urban market.

Opportunities:

• Untapped rural market

• Rising income levels, i.e. increase in purchasing power of consumers

• Large domestic market- a population of over one billion.

• Export potential

• High consumer goods spending

Threats:

• Removal of import restrictions resulting in replacing of domestic

brands

• Slowdown in rural demand

• Tax and regulatory structure

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CONSUMER SALES PROMOTINAL ACTIVITIES

The importance of consumer sales promotion in the marketing mix of the fast moving

consumer goods (FMCG) category throughout the world has increased. Companies spend

considerable time in planning such activities. However, in order to enhance the effectiveness

of these activities, manufacturers should understand consumer and retailer interpretations of

their promotional activities. The study here pertains to consumer’s perceptions regarding

sales promotion. Some past researches have suggested that promotion itself has an effect on

the perceived value of the brand. This is because promotions provide utilitarian benefits such

as monetary savings, added value, increased quality and convenience as well as hedonic

benefits such as entertainment, exploration and self-expression.

Broadly speaking most of the companies using Marketing Mix which includes…

Price

Place (Channel of Distribution)

Product

Promotion

These are the four basic pillar of marketing mix. Most of the marketing strategies are built on

the basis of these criteria.

Promotion is one of the important elements of marketing mix. There are so many elements of

promotion such as …

Advertising

Direct Marketing

Public Relations

Sales Promotion

Traditionally, sales Promotions have been used by marketer to increase sales in the short

term. However, in the last few decades this communication tool has evolved and now is

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considered from a strategic point of view. For this reason, it is necessary to realize new

studies in this area and study how consumers evaluate sales promotions.

Sales promotions have grown in both importance and frequency over the past few decades.

Although an accurate estimate for total sales promotions expenditures does not exist, we can

be sure that the trend is up.

Sales promotion serves three essential roles: It informs, persuades and reminds prospective

customers about a company and its products. Even the most useful product or brand will be a

failure if no one knows that it is available. As we know, channels of distribution take more

time in creating awareness because a product has to pass through many hands between a

producer and consumers.

Therefore, a producer has to inform channel members as well as ultimate consumers about

the attributes and availability of his products. The second purpose of promotion is persuasion.

The cut throat competition among different products puts tremendous pressure on their

manufacturers and they are compelled to undertake sales promotion activities. The third

purpose of promotion is reminding consumers about products availability and its potential to

satisfy their needs.

From these elements Sales Promotion is the element which is in the focus of this project.

Further Sales Promotion is quite broad term it includes …

Trade Oriented Sales Promotion

Consumer Oriented Sales Promotion

Trade Oriented Sales Promotion:

Trade Oriented Sales Promotion aimed to motivate channel member of the company

and to encourage them to push company’s product. Trade Oriented Sales Promotion includes

dealer contest and incentives, trade allowances. Point-of-purchase displays, sales training

programs, trade shows, cooperative advertising, and other programs designed to motivate

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distributors and retailers to carry a product and make an extra effort to push it to their

customers

Consumer Oriented Sales Promotion:

Consumer Oriented Sales Promotion is the main topic of this project. Here emphasize

is given to motivate consumer to increase sales. Consumer Oriented Sales Promotion includes

Sampling, Couponing, Premiums, Contest, Refunds, Rebates, Bonus Pack’s, Price-off, Event

marketing etc.

Definition:

For the purpose of this study, following definitions of sales promotion were kept in mind.

Kotler defines sales promotion as: “Sales promotion consists of a diverse collection of

incentive tools, mostly short-term designed to stimulate quicker and/or greater purchase of

particular products/services by consumers or the trade.”

Roger Strang has given a more simplistic definition i.e. “sales promotions are short-term

incentives to encourage purchase or sales of a product or service.”

Hence, any forms of incentives (price cut or value added nature) offered for short period

either to trade or consumers are considered as sales promotion activities.

Marketer’s uses consumer oriented sales promotion tools for the following reasons:

To increase short term sales

To induce trial

To reduce inventory

To establish a brand name

To make cross selling

To cope up with competition

To avoid advertising clutter

Tools of Consumer Oriented Sales Promotion:

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There are so many tools or technique available to the marketers for achieving objective of

sales promotion. These tools should be used considering all other factors affecting such as

cost, time, competitors, availability of goods etc. These tools are as under…

1. Sampling

2. Couponing

3. Price-Off

4. Premium

5. Contest

6. Bonus Pack

Let’s have look at each tool…

1. Sampling:

Sampling is an important and very frequently used sales promotion tool. In sampling

consumers are given some quantity of a product for no charge to induce trial. Sampling is the

most effective way to generate trial, at the same time it is most expensive tools. Sampling is

also used for established product. Marketers of packaged-goods products such as food, health

care items, cosmetics, and toiletries are heavy users of sampling.

Benefits of Sampling:

From the consumers point of view Sampling is risk free way to try new

product.

With the help of sampling scheme consumer can experience directly which is

not possible in any kind of advertisement.

Sampling is best way to induce trial when product feature are very difficult to

describe through advertisement.

Limitation of Sampling:

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The main drawback of sampling is of cost. While giving free sample it

requires financial soundness because otherwise company can’t afford it.

While giving free sample it is necessary that brand have some unique quality.

There is some product which requires long time to show result due to that it is

possible that the sampling scheme may not give benefit as expected. E.g. Skin

cream requires time to show result in this case it is possible that customer

might not respond when there is no such scheme.

Distribution of Samples:

Door-to-door sampling: Here product is directly delivered to the prospects

residence. This distribution method is very expensive because of labour cost.

But it can be cost effective if marketer has exact information of target market.

Sampling through the mail: This method can be used when product is

comparable small, lightweight, and nonperishable. In this method marketer

has control over where and when the product will be distributed. The main

drawback is of postal restrictions and increasing postal rates.

In-store sampling: This method requires great support from retailers. This

method is more used in product like food, perfume, etc. Here table or booth

set-up in the store. In this method consumer can directly taste and than can

purchase.

On-package sampling: In this method free sample is attached to another

product. This is cost effective method but it is also not free from drawback as

it is distributed only to consumers who purchase the item to which it is

attached the sample will not reach nonusers of the carrier brand.

Other Methods: To distribute free sample, methods like newspaper,

magazine are used. Send sample to those who call tall free number. Thorough

internet free sample can be distributed like film clip.

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2. Couponing:

Couponing is the oldest and most widely used way of sales promotion. Coupons have been

used since 1895. It is mostly used by packaged goods. It is worthwhile to use coupon as a

promotion tool because data shows that market for packaged goods increased from 16 billion

in 1968 to 310 billion in 1994. To boost up the sales not only manufacturer but retailers

personally can also used.

Benefits of Couponing:

Couponing leads to price reductions so as to encourage price sensitive

customers.

Non users can try a product which may leads to regular sales.

Reduction in price reduces the consumer’s perceived risk associated with new

product such as financial risk, social risk, psychological risk etc.

Coupons can be used not only for newly launched product but it can also use

for already established brand.

Limitations of Couponing:

It is very difficult to estimate number of buyers.

Cost of coupon and reduction given as per scheme leads to reduction in

over all profit of the firm.

It may to target towards actual buyers, some other may got benefit of it

who are actually not interested.

It can be manipulated by retailers and company may not get the result

expected.

Distribution of coupons:

The use of newspaper and magazine as a vehicle for distributing coupon was

used quite freely. Newspaper and magazine gives advantage of market

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selectivity, shorter lead time and cost efficiency. But now a day these media is

not so much effective.

Very widely used method for distributing coupon is placing coupons either

inside or on the outside of the package.

Distribution through newspaper ‘freestanding inserts’ is by far the most

popular method for delivering coupons to consumers.

3. Price-off:

A price-off is simply a reduction in the price of the product to increase sales and is very often

used when introduction a new product. A reduction in price always increases sales but the use

of this technique should be carefully considered in the current market situation.

Price-off is the most preferred sales promotion technique because consumers response very

positively to this scheme. Not only that but it also cause large increase in sales volume. Price-

off reductions are typically offered tight on the package through specially marked price

packs. E.g. Krack Jack offers 30% Price-off.

Generally Price-offs given from 10 to 50 percent of the regular price. Here reduction is

coming out from manufacturer’s profit margin, and not the retailer’s.

Benefits of Price-off:

Since marketers bare the probable reduction in price at cost of his own profit

so he can control over the price-off scheme.

Price-off can be a strong influence at the point of purchase when price

comparisons are being made.

Price-off promotion can also encourage consumers to purchase larger

quantities.

Limitation of Price-off:

Retailers may create pricing and inventory problems because retailers will not

accept packages with a specific price shown.

To the company it is very expensive tool of sales promotion

Page | 31

4. Premium:

Premium is an offer of an item either free or at a low price .With consumer spending more,

companies will look to incentive programs as a way to maintain customer loyalty and capture

a greater share of the market. Creative and will-constructed premium promotions are known

delivering brand enhancing and sales building results.

Currently marketers ask themselves how to select a premium. There are some guidelines for

choosing a premium: Offer a brand that enhances your brand, and capitalize on the equity of

the brands logo by incorporating it into the premium item.

Two basic type of premium:

1. Free Premium: Free premiums are small gifts included in the product

package or sent to consumers who mail in a request along with a proof or

purchase. Free Premium includes toys, balls, trading card or other items. Free

premium have high impulse value and can provide an extra incentive to buy

the product. Even though it is also facing some problems like cost factor,

which results from the premium itself as well as from extra packaging that

may be needed. Again retailers can manipulate with customer and with the

free premium scheme.

2. Self-Liquidating Premiums: In Self-Liquidating Premiums consumers are

requires to pay some or all of the cost of the premium plus handling and

mailing costs. This tool is more useful to the retailers to gain extra profit as he

can purchase from manufacturer and than can sale it to final user at lower cost.

Here the aim is not to make profit on the premium item but rather just to cover

costs and offer a value to the consumer. Offering values to consumers through

the premium products can create interest in the brand and goodwill that

enhances the brands image.

Page | 32

Self-Liquidating Premiums also has some limitation. It has very low

redemption rate. Consumers are not always responds to this type of sales

promotion scheme.

5. Contest:

A contest is a promotion where consumers compete for prizes or money on the basis of skills

or ability. To the customers contest is more attractive because they have mentality that they

can win big prizes being offered. Contest usually provide

a purchase incentive by requiring a proof of purchase to enter or an entry form that is

available from a dealer or advertisement; some contest require consumers to read an ad or

package or visit a store display to gather information needed to enter. Marketers must be

careful not to make their contests too difficult to enter, as doing so might discourage

participation among key prospects in the targets audience.

There is another term called “Sweepstakes” which is promotion where winners are

determined purely by chance; it does not require a proof of purchase as condition for entry.

Entrants need only submit their names for the prize drawing. It is easier to enter that’s why

sweepstakes more customers than contest.

Benefits of Contest:

Contest and sweepstakes can get the customers involved with a brand by

making the promotion product relevant.

Marketers can use contests and sweepstakes to build brand equity by

connecting the prizes to the lifestyle, needs or interests of the target audience.

Consumers can know more about the product as well as about company as

direct involvement increases.

Limitation of Contest:

Page | 33

In contest and sweepstakes winners are given prizes randomly so customers

reluctant to pay more attention towards it.

Marketers have cut back the uses of these promotional tools due to its lower

effectiveness and fears that consumers might become dependent on them.

A major problem in contest and sweepstakes is that of participation by

professionals or hobbyists who submit many entries but have no intention of

purchasing the product.

Further, for marketers it increases so many other activities like managing all

the entries and selecting winner from them and delivering prize to them which

also requires so many time and it also increase cost.

6. Bonus Pack:

Bonus packs offer the consumer an extra amount of a product at the regular price by

providing larger containers or extra units. Bonus is also frequently used sales promotion tool

because consumer response towards bonus pack is very positive. The additional value of a

bonus pack is generally obvious to the consumer and can have a strong impact on the

purchase decision at the time of purchase.

Benefits from Bonus Pack:

It gives a direct way to provide extra value without having to get involved

with complicated coupons or refund offers.

Bonus can be a good answer to competitor’s promotion or introduction of a

new brand.

Bonus packs result in larger purchase orders and favorable display space in the

store if the relationships with retailers are good.

Limitation of Bonus Pack:

It requires additional space so retailers or distributors may create problem if

the relation with distributors are not good as it does not give any extra benefit

to them.

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Another problem is that bonus packs may appeal primarily to current users

who probably would have purchase the brand anyway or to promotion

sensitive consumers who may not become loyal to the brand.

A common limitation is of cost. As marketers giving extra quantity it makes

cost to the company.

These are the main consumer oriented sales promotion tools Marketers use any of them or

more then one at a time depending on the sales promotion strategy. There are some other

sales promotion tools like Refunds and Rebates, Frequency Programs, Event Marketing etc to

name a few, but these tools are used very less compared to earlier noted main tools.

The evaluation of sales promotion tools is measured in terms of their ability to accomplish

specific objectives and consider whether the impact of the promotion will be immediate or

delayed.

Factors Influencing Consumer Oriented sales promotion:

Mainly four factors should be taken into account while determining the sales promotion

programme.

> Target market

> Nature of product

> Stage of product life cycle

> Budget available for promotion

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1. Target Market:

While doing sales promotion, marketer must know who their target market is,

otherwise there is no use of all effort because it leads to no where. A target market can be in

any of the stages of buying hierarchy i.e. awareness, knowledge, liking, preferences,

conviction and purchase. Each stage defines a possible goal of promotion.

2. Nature of the product:

There are various product attributes which influence sales promotional strategy. When

the unit price is low the manufacturer as well as the customer has low risk but he can get the

benefit of mass marketing. Therefore, mass marketing requires mass sales promotion

schemes. Sales promotion scheme differ for products like its durability, perishable goods etc.

3. Stage of product Life Cycle:

Sales promotion strategies are influenced by the life cycle of a product. When a new

product introduced, prospective buyers must be informed about its existence and its benefits

and middlemen must be convinced to stock it. Later, if a product becomes successful,

competition intensifies and more emphasis is placed on sales promotion to increase its sales.

4. Budget Available for Promotion:

The funds available for promotion are the ultimate determinant of the promotional

programme. A business with ample funds can make more effective use of sales promotion

programme than a firm with limited financial resources. The budget for sales promotion can

be prepared by the following methods…

Percentage of Sales

Fixed funds available for sales promotion

Following the competition, and

Budgeting by objective.

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Why do Sales promotion schemes affect sales?

There are three mechanisms behind these facts. It is Purchase quantity, Brand switching and

Category expansion.

First, consumer can increase the quantity they buy just because the product is on sale.

Second, consumers are inducing to purchase another brand different from the one they would

have purchased when there is no promotional incentive.

Finally, consumer’s total consumption of the product category is increased by the promotion.

However, in the long term this positive effect may be diluted because a promotional

campaign has no permanent effect in the sales of the firm

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Sales Promotion Strategy:

Sales are the lifeblood of a business, without sales there would be no business in the first

place; therefore it is very important that if a business wants to succeed, it should have a sales

promotion strategy in mind. The primary objective of a sales promotion is to improve a

company’s sales by predicting and modifying your target customer’s purchasing behavior and

patterns.

Sales promotion is very important as it not only helps to boost sales but it also helps a

business to draw new customers while at the same time retaining older ones. There are a

variety of sales promotional strategies that a business can use to increase their sales, however

it is important that we first understand what a sales promotion strategy actually is and why it

is so important.

A sales promotion strategy is an activity that is designed to help boost the sales of a product

or service. This can be done through an advertising campaign, public relation activities, a free

sampling campaign, a free gift campaign, a trading stamps campaign, through demonstrations

and exhibitions, through prize giving competitions, through temporary price cuts, and through

door-to-door sales, telemarketing, personal sales letters, and emails.

The importance of a sales promotion strategy cannot be underestimated. This is because a

sales promotion strategy is important to a business boosting its sales.

When developing a sales promotion strategy for your business, it is important that you keep

the following points in mind.

Consumer attitudes and buying patterns

Your brand strategy

Your competitive strategy

Your advertising strategy

Other external factors that can influence products availability and pricing.

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There are three types of sales promotion strategies:

A push strategy

A pull strategy or

A combination of the two

A Push Strategy:

A ‘push’ sales promotion strategy involves ‘pushing’ distributors and retailers to sell your

products and services to the consumer by offering various kinds of promotions and personal

selling efforts. What happens here is that a company promotes their product/services to a

reseller who in turn promotes it to another reseller or to the consumer. The basic objective of

this strategy is to persuade retailers, wholesalers and distributors to carry your brand, give it

shelf space, promote it by advertising, and ultimately ‘push’ it forward to the consumer.

Typical push sales promotion strategies include; buy-back guarantees, free trials, contests,

discounts, and specialty advertising items.

A Pull Strategy:

A ‘pull’ sales promotion strategy focuses more on the consumer instead of the reseller or

distributor. This strategy involves getting the consumer to ‘pull’ or purchase the

product/services directly from the company itself. This strategy targets its marketing efforts

directly on the consumers with the hope that it will stimulate interest and demand for the

product. This pull strategy is often used when distributors are reluctant to carry or distribute a

product. Typical pull sales promotion strategies include; samples, coupons, cash refunds or

rebates, loyalty programs and rewards, contests, sweepstakes, games, and point-of-purchase

displays.

A Combination of Two Strategies:

A ‘combination’ sales promotion strategy is just that; it is a combination of a push and a pull

strategy. It focuses both on the distributor as well as the consumers, targeting both parties

directly. It offers consumer incentives side by side with dealer discounts.

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Sales Promotion and different theories:

There are certain theories which can be considered by the marketers while deciding sales

promotion strategies. It should be noted that these theories are not final conclusion but it

helps in making better decisions. Here I will try to elaborate on two theory i.e. theory of

attitude and theory of prospects.

Sales Promotion and theory of Attitude:

Multi attribute models of attitude (Fishbein and Ajzen, 1975) depict the consumer’s decision

to perform a specific behavior as the logical consequence of beliefs, attitudes and intentions

with regard to the behavior. As per this model, a consumer’s intention to buy a brand may be

based on positive/negative attitudes towards a promotion.

Attitude Model:

Behavior → Reward or → Purchase

Punishment → Not Purchase

It is found that the impact of three attitudinal dimensions – price consciousness, time value

and satisfaction/pride – on consumers’ decision to use coupons. Results of their study showed

that there was a positive relationship between coupon usage and consumer price

consciousness. There was a significant

negative relationship between coupon usage and perceived value of time indicating that the

more a consumer valued his or her time, the lesser was the tendency to use coupons. The

authors found that coupon usage increased when the consumer perceived higher satisfaction

and pride with the use of coupons.

Some marketers applied the theory of reasoned action to understand consumer’s decision to

use coupons. As per the model, behavior towards coupons would be influenced by consumer

intentions to use coupons. Consumers’ intention to use coupons would be determined by their

attitudes and subjective norms. Consumers’ attitudes would be formed through their beliefs in

Page | 40

the rewards and costs of using coupons while subjective norms would be formed through

consumers’ perception of whether important others think they should expend the effort to

clip, save and use coupons. It is found that beliefs in the rewards of using coupons had high

positive correlation with attitude while inconveniences and encumbrances had weak negative

correlation with attitude

Although attitude models provide important insights into the consumer decision-making

process, researchers have found discrepancies between stated attitudes and actual behavior. in

several studies (Perry and Gillespie, 1976; Keesling and Kaynama, 2003). Studies in different

contexts have shown that attitudes are actually poor predictors of behavior. This possibly

accounts for the limited application of attitude models to examine consumer response to sales

promotions.

Sales Promotion and Prospect Theory:

This theory proposes that people perceive outcomes of a choice as perceived ‘losses’ and

‘Gains’ relative to a subjective reference point/price.

As per this theory of sales promotions it is stated that consumer’s perception of promotion as

a ‘loss’ or ‘gain’ is a function of the type of the promotion. They proposed that non price

promotions such as premium offers which segregate the

promotional gain from the purchase price will be viewed as gains. On the other hand, price

promotions such as price off, which integrate the promotional gain with the purchase price

will be viewed as reduced losses.

The impact of price versus non price promotions on a consumer’s reference price reasoned

that price promotions would be integrated with the purchase price of the product and lead to a

reduction of internal reference price. While non price promotions would be segregated from

the purchase price of a product and not lead to a reduction of internal reference price. Results

showed that price promotions led to a lower internal reference price while non price

promotions did not affect internal reference price.

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As per prospect theory to predict that price promotions would be viewed as reduced losses

and chosen less often than non price promotion which would be viewed as gains. However it

is shown that an almost equal number of subjects chose the non price promotion (a premium

offer) as compared to the price promotion (a price discount). The reasoning that price

promotions would be viewed as reduced losses and preferred less as compared to non price

promotions which would be viewed as gains was not supported by the results of the study.

Prospect theory based prediction that consumers will perceive non-price promotions as

‘gains’ and price promotions as ‘reduced losses’ is not based on a precise application of the

theory. Contrary predictions can be derived from the theory. It can be argued that consumers

will perceive a price promotion as a gain as the price reduction offered reduces the ‘loss’

experienced by the purchase price.

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Sales promotion from the retailer’s point of view:

Perceptions on Scheme Preference

It was found that retailer perceived price offs as a better form of sales promotion

activity. Price offs in their opinion had relatively a greater impact compared to any other form

of sales promotion activity like Bonus packs, Premium, Contests etc. Retailers preferred price

offs the most, then bonus pack, premium, contests, in order of importance.

Perceptions about Buying Roles

Retailers viewed that the person who came to the shop (who may be a maid, son,

daughter, daughter-in-law and child) was the decider of a toilet soap brand and not the

Income provider (e.g. head of the family). It could be inferred that visibility of information

about the sales promotion activity at the point of purchase could result into the purchase of a

promoted brand.

Perceptions about their role in decision-making

Retailer had relatively very low influence in affecting choice. It could be inferred that

visibility and awareness about the scheme were the critical success factors so that pull could

be created.

Perceptions about Response to Sales Promotion Offers

They believed that younger age-groups were more experimental in nature, amenable

to trying new brands, and sought/looked for or asked whether there were any) sales

promotion schemes running on any toilet soap at the time of purchase.

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Perceptions about Communications of Sales Promotion Schemes

Retailers perceived that role of word of mouth and television advertising played an

important part in providing information inputs to consumers regarding sales promotion

activities.

Variations in Information Flow

Smaller (non-supermarket, small format store) retailers received relatively less

support compared to supermarkets in terms of servicing, margins, information about sales

promotion activities from the dealers. Many a times small retailers were only informed

verbally about sales promotion schemes by the dealer salesmen during the scheduled weekly

visits.

Dealer-Retailer Dynamics

At the time of sales promotion activities, dealers had tendency to push unwanted

stocks onto the smaller retailers. In fact these retailers preferred to stock variety of brands and

wanted payment for shelf and window display to increase traffic into their store. However,

supermarkets and big retailers were pampered and given special services and given better

margins and better allowances.

Margins

It was found that in sales promotion schemes margins varied from 6 to15% depending

of the size of the retail outlet, bargaining power of a retailer, quantity ordered by him etc.

Mostly margins were linked to size of the volumes that were ordered.

Perceptions about terms and conditions

Retailers were not found to be happy with sales promotion schemes where their

margins were cut on the pretext of just fast movement of inventory of the brand being

promoted. Also if additional incentive was offered it was subject to minimum performance

requirement.

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Nature of POP

Retailers indicated that most of the POP (Point of Purchase) materials were meant for

brand advertisement and not for giving information regarding the schemes. Thus it could be

inferred that company’s follow up was not adequate.

Servicing during duration of Scheme

In stock-out situation during the running of the sales promotion schemes, smaller

retailers had to wait for replenishment of stocks till the next scheduled weekly visit by the

dealer salesman but big retailers were serviced on telephonic request for replenishment of

stocks. This clearly indicated the disparity in treatment.

Problem of left-over

A leftover stock at the end of any scheme was required to be sold by the retailers

before they ordered fresh stocks. In case of bonus packs scheme, leftover stock was often

dismantled (cut open buy one get one free) and sold them individually as a regular soap. This

approach of the company leads to misappropriation which in turn could result in adverse

brand image.

Gifts for Retailer motivation

Companies at times were rewarding retailers by giving free gifts like thermos flasks

or clocks if they sold more than certain quantity in a given period. Companies were making a

half-hearted effort to motivate retailers.

Perceptions about mass media announcements

Retailers viewed that whenever sales promotion scheme was announced on TV, it

created pull and they were more than willing to stock such brands. For example Medimix and

Dettol contest was not advertised on TV, hence there was very little awareness leading to

unsold stock till 6 months. While Lux Gold Star which was heavily promoted on T.V. is

recalled even today.

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Post Promotion Behaviour

Retailers observed that in most cases sales promotion scheme on a brand might

encourage a buyer to switch a brand temporarily but he would revert back to original brand

after promotion.

Handling Problems

Many a time’s retailers had to handle various sales promotion offers simultaneously in

a category and also across categories and there was no formal communication planning either

from the dealer or the company. Remembering each offer and handling was a problem

especially for a small retailer which was often an as one-man show.

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Sales Promotion from the Consumers point of view:

Willingness to buy on sales promotion offer

Sixty per cent of the sample did not show willingness to buy a brand due to promotion

while 30% showed willingness and 10% were not sure. This indicates that when 30% showed

willingness and 10% consumers who were not sure, these groups might be lured through

innovative and lucrative sales promotion offer.

Ability to induce trial

Forty per cent of the respondents had said that sales promotion had the ability to

induce trial which reinforces the above inference.

Long-term impact

In order to understand ability of the promotions to increase long-term sales,

respondents were asked about continuity of purchase of a brand after the withdrawal of

promotion. Eighty per cent of the respondents indicated that they would not continue. But

20% said they would. Thus, it could be inferred that promotions in this category (low

involvement products) might encourage trial and brand switching but not long term loyalty.

Preference of Schemes:

Price off was the most preferred type of scheme. Maximum customers’ ranked price-

offs as number one or two.

Perceived Quality:

Majority of respondents had a perception that the quality of the promoted brands

remained the same during promotion, while some of them felt that it was inferior than before.

It can be inferred that promotions were not leading to negative brand quality perceptions. It is

found that some customer strongly preferred to buy their regular brand and said that sales

promotion would not weaken their loyalty towards the brand.

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Perceptions regarding underlying company motivations

On tapping perceptions’ regarding underlying company motivations for sales

promotion, “to increase sales” was ranked highest followed by “to attract switchers” and “to

sell excess stocks”. While providing value to customers” and

“to reinforce company image” were ranked lowest. This indicates that consumers believed

that companies were undertaking such activities only for their own benefit and not for the

benefit of consumers.

Findings from retailer and consumer perception studies, it is evident that there was a

matching of perceptions regarding nature of scheme (price offs as most preferred type of

scheme mentioned by consumers and retailers’ perceptions about consumer preferences).

Since retailers observe consumers in store behaviour were frequently and directly, their

perceptions regarding providing consumer behaviour are likely to be accurate. Such inputs

from the retailers would be useful to companies.

The retailers had the perception that those schemes which were announced through mass

media had better response. This was reinforced by the consumer survey which showed that

recall in case of heavily promoted schemes on TV was found to be very high.

Retailers’ prediction of companies’ motivation for offering sales promotion were matching

with the consumer perception regarding the same. Thus both viewed that companies were

using sales promotion activities mainly to increase short term sales or encourage switching or

selling excess stock and not really to give value benefit or enhance/reinforce brand/company

image.

Page | 48

Cherry Picking

Merriam-Webster Dictionary defines cherry picking as “selecting the best or most desirable”

or to describe one idiom with another “taking the pick of the litter.” The term cherry picking

is used to describe the behavior of both sellers and buyers in a variety of settings. Sometimes

the phrase is used to describe a seller who is selective about which customers they wish to

serve.

For example, Southwest Airlines cherry picks price sensitive travelers who place little

premium on standard airline perks and Dell Computer cherry picks customers who are

capable of buying over the Internet and are savvy enough to make the necessary

customization choices without much hand holding. Both of these firms choose not to serve

other customers with a higher willingness to pay because it would require significant changes

to efficient operating models.

The Cambridge International Dictionary of Idioms defines cherry picking as choosing “only

the best people or things in a way that is not fair”, as when financial institutions and

insurance companies are vilified because they refuse to serve high-risk populations. The term

also describes behavior of buyers who are selective about which products or services they

purchase at what locations and prices. In both the seller and buyer contexts, the essential

meaning of cherry picking is the same— take the best and leave the rest.

“Instead of going to the same outlet each week, every week, to complete their grocery

shopping, price-conscious consumers often visit more than one store in search of special

prices – a bargain-hunting practice known in the industry as ‘cherry-picking.’”

(Mogelonsky 1994)

Consumer Reports recommends that smart shoppers “scrutinize the food-day ads and

‘cherry pick’ the specials,” noting that 20% of its readers show little loyalty among

supermarkets (Consumer Reports 1988)

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BUYER SIDE CHERRY PICKING

WITHIN STORE

Levy and Witz (2004) define cherry pickers who visit the store and only buy

merchandise sold at big discounts.

BETWEEN STORES

The typical shopper visits the supermarkets 2.2 times per week but shops 3-4 different

chains on a regular basis, creating plenty of opportunities to cherry pick.

CHERRY PICKING STRATEGIES

SWITCH STORES ACROSS WEEKS

Dominick’s one week jewel the next

SWITCH STORES WITHIN A DAY OR WEEK

Dominick’s and jewel the same day or week

OUR OPERATIONALIZATION

Visit two or more stores on the same shopping day Reduces the likelihood of confusing true cherry picking with fill in trips

Page | 50

Classification of Shopper Types

REF: Research paper on cherry picking by Edward Cox and Stephen Hoch

Page | 51

KEY FINDINGS

Page | 52

Q.1 Do you purchase the same brand every time?

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 80 60 45 35 30 65

Missing 22 42 57 67 72 37

Frequency Table

SOAP

Frequency Percent Valid Percent

Cumulative

Percent

Valid yes 20 19.6 25.0 25.0

no 60 58.8 75.0 100.0

Total 80 78.4 100.0

Missing .00 20 19.6

System 2 2.0

Total 22 21.6

Total 102 100.0

TOOTHPASTE


Cumulative

Percent

Valid yes 35 34.3 58.3 58.3

no 25 24.5 41.7 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

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PACKED MASALA


Cumulative

Percent

Valid yes 20 19.6 44.4 44.4

no 25 24.5 55.6 100.0

Total 45 44.1 100.0

Missing .00 55 53.9

System 2 2.0

Total 57 55.9

Total 102 100.0

PICKLE


Cumulative

Percent

Valid yes 20 20.0 57.1 57.1

no 15 15.0 42.9 100.0

Total 35 35.0 100.0

Missing .00 65 65.0

Total 100 100.0

MOSQUITO REPELLENT


Cumulative

Percent

Valid yes 25 24.5 83.3 83.3

no 5 4.9 16.7 100.0

Total 30 29.4 100.0

Missing .00 70 68.6

System 2 2.0

Total 72 70.6

Total 102 100.0

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HOUSE CLEANING PRODUCTS


Cumulative

Percent

Valid yes 30 29.4 46.2 46.2

no 35 34.3 53.8 100.0

Total 65 63.7 100.0

Missing .00 35 34.3

System 2 2.0

Total 37 36.3

Total 102 100.0

48%52%

YESNO

INTERPRETATION:

Page | 55

DO YOU PURCHASE THE SAME BRAND EVERY TIME?

Soap: 75% of the respondents said that they do not purchase the same brand every time while

25 % said that they do purchase the same brand every time.

Toothpaste: 41.7% of the respondents said that they do not purchase the same brand every

time while 58.3 % said that they do purchase the same brand every time.

Packed Masala: 55.1% of the respondents said that they do not purchase the same brand

every time while 44.9 % said that they do purchase the same brand every time.

Pickle: 42.9% of the respondents said that they do not purchase the same brand every time

while 57.1 % said that they do purchase the same brand every time.

Mosquito Repellent: 16.7% of the respondents said that they do not purchase the same brand

every time while 83.3 % said that they do purchase the same brand every time.

House Cleaning Products: 53.8% of the respondents said that they do not purchase the same

brand every time while 46.2 % said that they do purchase the same brand every time.

Overall: 52% of the respondents said that they do not purchase the same brand every time

while 48 % said that they do purchase the same brand every time.

The consumer behaviour related to brand switching varies a lot across different products with

75 % of consumers in the soap category agreeing that they switch brands regularly while only

Page | 56

16.7% of consumers in the mosquito repellent category agreed that they switch brands

regularly. Overall, to get a fair idea an average of these responses show that 52% of the

consumers switch brands for one or the other reasons while 48% of the consumers stick to the

same brand.

Page | 57

Q.2 Why do you change your brand?

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

Why change soap * income 75 73.5% 25 26.5% 100 100.0%

Why change toothpaste *

income

60 58.8% 40 41.2% 100 100.0%

Why change packed masala *

income

46 45.1% 54 54.9% 100 100.0%

Why change pickle * income 35 34.3% 65 65.7% 100 100.0%

Why change mosquito repellent

* income

30 29.4% 70 70.6% 100 100.0%

Why change cleaning products *

income

65 63.7% 35 36.3% 100 100.0%

Page | 58

Why change soap * income Cross tabulation

Count

income

Totalless than 25000 26000-50000 51000-75000 more than 75000

Why change soap schemes 10 10 4 5 29

trial 0 0 0 0 5

better quality 10 15 11 10 41

Total 20 25 15 15 75

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Why change toothpaste * income Cross tabulation

income

Totalless than 25000 26000-50000 51000-75000

more than

75000

whychangetoothpaste schemes 6 18 1 0 25

trial 0 3 3 0 6

better

quality

4 4 11 10 29

Total 10 25 15 10 60

Page | 60

Page | 61

PACKED MASALA * income Cross tabulation

Count

income


PACKED MASALA schemes 11 3 4 0 18

trial 7 0 0 5 12


Total 20 6 10 10 46

PICKLE * income Crosstabulation

Count

income


PICKLE schemes 10 5 1 0 16

trial 3 0 0 0 3


Total 15 10 5 5 35

Page | 62

Why change mosquito repellent * income Cross tabulation

Count

income

Totalless than 25000 26000-50000 51000-75000

whychangemosquito trial 5 0 0 5

better quality 10 10 5 25

Total 15 10 5 30

Page | 63

Why change cleaning * income Cross tabulation

Count

income


whychangecleaning schemes 10 5 15 0 30

trial 10 0 0 5 15


Total 25 10 15 15 65

Page | 64

INTERPRETATION:

Soap: The cross tabulation of the reason of changing a brand with the income of the

respondent in the soap category shows that there is a change in the reason with increasing

income of the respondent. 6 out of 10 respondents of income less than 25,000 say the they

change brand due to the promotional schemes while only 5 out of 15 respondents of more

than 75,000 category claim so.

Toothpaste: The cross tabulation of the reason of changing a brand with the income of the

respondent in the toothpaste category shows that there is a change in the reason with

increasing income of the respondent. 6 out of 10 respondents of income less than 25,000

say the they change brand due to the promotional schemes while only 0 out of 10

respondents of more than 75,000 category claim so.

Packed Masala: The cross tabulation of the reason of changing a brand with the income of

the respondent in the packed masala category shows that there is a change in the reason

with increasing income of the respondent. 11 out of 20 respondents of income less than

25,000 say the they change brand due to the promotional schemes while only 0 out of 10

respondents of more than 75,000 category claim so.

Pickle: The cross tabulation of the reason of changing a brand with the income of the

respondent in the pickle category shows that there is a change in the reason with increasing

income of the respondent. 10 out of 15 respondents of income less than 25,000 say the they

Page | 65

change brand due to the promotional schemes while only 0 out of 5 respondents of more

than 75,000 category claim so.

Mosquito Repellent: The cross tabulation of the reason of changing a brand with the

income of the respondent in the mosquito repellent category shows that there is a change

in the reason with increasing income of the respondent. 10 out of 15 respondents of income

less than 25,000 say the they change brand due to the better quality while all 5 respondents

of more than 75,000 category claim so.

House Cleaning Products: The cross tabulation of the reason of changing a brand with the

income of the respondent in the house cleaning products category shows that there is a

change in the reason with increasing income of the respondent. 10 out of 25 respondents of

income less than 25,000 say the they change brand due to the promotional schemes while

only 0 out of 15 respondents of more than 75,000 category claim so.

Hence, a gradual shift towards better quality rather than promotional schemes as a

reason for changing a brand is seen as the income slab increases. Though the shift varies

from product to product but a general trend towards better quality is seen as income

increases.

Page | 66

Q.3 Was there any promotional scheme with this brand?

Frequencies

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 80 60 45 35 30 65

Missing 22 42 57 67 72 37

Frequency Table

SOAP


Cumulative

Percent

Valid yes 60 58.8 75.0 75.0

no 20 19.6 25.0 100.0

Total 80 78.4 100.0

Missing .00 20 19.6

System 2 2.0

Total 22 21.6

Total 102 100.0

TOOTHPASTE


Cumulative

Percent

Valid yes 60 58.8 100.0 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

Page | 67

PACKED MASALA


Cumulative

Percent

Valid yes 30 29.4 66.7 66.7

no 15 14.7 33.3 100.0

Total 45 44.1 100.0

Missing .00 55 53.9

System 2 2.0

Total 57 55.9

Total 102 100.0

PICKLE


Cumulative

Percent

Valid yes 20 19.6 57.1 57.1

no 15 14.7 42.9 100.0

Total 35 34.3 100.0

Missing .00 65 63.7

System 2 2.0

Total 67 65.7

Total 102 100.0

MOSQUITO REPELLENT


Cumulative

Percent

Valid yes 15 14.7 50.0 50.0

no 15 14.7 50.0 100.0

Total 30 29.4 100.0

Missing .00 70 68.6

System 2 2.0

Total 72 70.6

Total 102 100.0

Page | 68



Cumulative

Percent

Valid yes 60 58.8 92.3 92.3

no 5 4.9 7.7 100.0

Total 65 63.7 100.0

Missing .00 35 34.3

System 2 2.0

Total 37 36.3

Total 102 100.0

78%

22%

YESNO

Page | 69

WAS THERE A PROMOTIONAL SCHEME?

INTERPRETATION:

Soap: 75% of the respondents agreed that there was a promotional scheme for the brand they

bought while 25 % of the respondents did not.

Toothpaste: 100% of the respondents agreed that there was a promotional scheme for the

brand they bought.

Packed Masala: 66.7 % of the respondents agreed that there was a promotional scheme for

the brand they bought while 33.3 % of the respondents did not.

Pickle: 57.1% of the respondents agreed that there was a promotional scheme for the brand

they bought while 42.9 % of the respondents did not.

Mosquito Repellent: 50% of the respondents agreed that there was a promotional scheme for

the brand they bought while 50 % of the respondents did not.

House Cleaning Products: 92.3% of the respondents agreed that there was a promotional

scheme for the brand they bought while 7.7 % of the respondents did not.

Overall: 78 % of the respondents agreed that there was a promotional scheme for the brand

they bought while 22 % of the respondents did not.

From this analysis it can be understood that 78 % of the respondents availed some or the

other scheme from the 6 selected products and save some money by cherry picking these

Page | 70

products.

Page | 71

Q.4 If, yes which one?

Frequencies

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 60 60 30 20 15 60

Missing 42 42 72 82 87 42

Frequency Table

SOAP


Cumulative

Percent

Valid price promotion 60 58.8 100.0 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

TOOTHPASTE


Cumulative

Percent


free gifts 20 19.6 33.3 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

Page | 72

PACKED MASALA


Cumulative

Percent


Missing .00 70 68.6

System 2 2.0

Total 72 70.6

Total 102 100.0

PICKLE


Cumulative

Percent


Missing .00 80 78.4

System 2 2.0

Total 82 80.4

Total 102 100.0

MOSQUITO REPELLENT


Cumulative

Percent


Missing .00 85 83.3

System 2 2.0

Total 87 85.3

Total 102 100.0

Page | 73



Cumulative

Percent


Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

94%

6%

PRICE PROMOTIONCOUPONSFREE GIFTSREFUNDSLOYALTY INCENTIVE

Page | 74

WHICH PROMOTIONAL BRAND WAS OFFERED?

INTERPRETATION:

Soap: 100 % of the respondents bought the brand with which there was a price promotion

scheme.

Toothpaste: 66.7 % of the respondents bought the brand with which there was a price

promotion scheme while 33.3 % of the respondents bought the brand which had free gifts

scheme.

Packed Masala: 100 % of the respondents bought the brand with which there was a price

promotion scheme.

Pickle: 100 % of the respondents bought the brand with which there was a price promotion

scheme.

Mosquito Repellent: 100 % of the respondents bought the brand with which there was a price

promotion scheme.

House Cleaning Products: 100 % of the respondents bought the brand with which there was a

price promotion scheme.

Overall: 94 % of the respondents bought the brand with which there was a price promotion

scheme while 6 % of the respondents bought the brand which had free gifts scheme.

Q.5 How much did you save by availing this scheme?

Page | 75

Frequencies

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 60 60 30 20 20 60

Missing 42 42 72 82 82 42

Frequency Table

SOAP


Cumulative

Percent

Valid 10-15 10 9.8 16.7 16.7

more than20 50 49.0 83.3 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

TOOTHPASTE


Cumulative

Percent

Valid 10-15 50 49.0 83.3 83.3

more than20 10 9.8 16.7 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

Page | 76

PACKED MASALA


Cumulative

Percent

Valid 15-20 10 9.8 33.3 33.3

more than20 20 19.6 66.7 100.0

Total 30 29.4 100.0

Missing .00 70 68.6

System 2 2.0

Total 72 70.6

Total 102 100.0

PICKLE


Cumulative

Percent

Valid 15-20 10 9.8 50.0 50.0

more than20 10 9.8 50.0 100.0

Total 20 19.6 100.0

Missing .00 80 78.4

System 2 2.0

Total 82 80.4

Total 102 100.0

MOSQUITO REPELLENT


Cumulative

Percent

Valid 0-5 5 4.9 25.0 25.0

15-20 5 4.9 25.0 50.0

more than20 10 9.8 50.0 100.0

Total 20 19.6 100.0

Missing .00 80 78.4

System 2 2.0

Total 82 80.4

Total 102 100.0

Page | 77



Cumulative

Percent

Valid 5-10 5 4.9 8.3 8.3

10-15 10 9.8 16.7 25.0

15-20 5 4.9 8.3 33.3

more than20 40 39.2 66.7 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

2% 2%

27%

12%

56%

RS 0-5RS 5-10RS 10-15RS 15-20MORE THAN 20

AMOUNT SAVED (IN RS)

NO OF RESPONSES

RS 0-5 5RS 5-10 5RS 10-15 67RS 15-20 30MORE THAN 20 138

INTERPRETATION:

Page | 78

AMOUNTS SAVED BY AVAILING SCHEMES

Soap: 16.7 % of the respondents said that they saved Rs.10-15 by availing the scheme with

the product while 83.3 % of the respondents said that they save more that Rs.20 by availing

the scheme.

Toothpaste: 83.3 % of the respondents said that they saved Rs.10-15 by availing the scheme

with the product while 16.7 % of the respondents said that they save more that Rs.20 by

availing the scheme.

Packed Masala: 33.3 % of the respondents said that they saved Rs.15-20 by availing the

scheme with the product while 66.7% of the respondents said that they save more that Rs.20

by availing the scheme.

Pickle: 50 % of the respondents said that they saved Rs.15-20 by availing the scheme with

the product while 50 % of the respondents said that they save more that Rs.20 by availing the

scheme.

Mosquito Repellent: 25% of the respondents said that they saved Rs.0-5, 25 % of the

respondents said that they saved Rs.15-20 by availing the scheme with the product while 50

% of the respondents said that they save more that Rs.20 by availing the scheme.

House Cleaning Products: 8.3 % of the respondents said that they saved Rs.5-10, 16.7 % of

the respondents said that they saved Rs.10-15 by availing the scheme with the product while

8.3 % of the respondents said that they save more that Rs.15-20 by availing the scheme.66.7

% of the respondents said that they save more than Rs.20 by availing he scheme.

Page | 79

Overall: 2 % of the respondents said that they saved Rs.0-5, 2 % of the respondents said that

they saved Rs.5-10, 28 % of the respondents said that they saved Rs.10-15 by availing the

scheme with the product while 12 % of the respondents said that they save more that Rs.15-

20 by availing the scheme.56 % of the respondents said that they save more than Rs.20 by

availing he scheme.

Page | 80

Q.6 Did you have to buy more qty than intended to avail the scheme?

Frequencies

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 55 65 30 15 15 65

Missing 47 37 72 87 87 37

Frequency Table

SOAP


Cumulative

Percent

Valid yes 55 53.9 100.0 100.0

Missing .00 45 44.1

System 2 2.0

Total 47 46.1

Total 102 100.0

TOOTHPASTE


Cumulative

Percent

Valid yes 20 19.6 30.8 30.8

no 45 44.1 69.2 100.0

Total 65 63.7 100.0

Missing .00 35 34.3

System 2 2.0

Total 37 36.3

Total 102 100.0

Page | 81

PACKED MASALA


Cumulative

Percent

Valid yes 5 4.9 16.7 16.7

no 25 24.5 83.3 100.0

Total 30 29.4 100.0

Missing .00 70 68.6

System 2 2.0

Total 72 70.6

Total 102 100.0

PICKLE


Cumulative

Percent

Valid no 15 14.7 100.0 100.0

Missing .00 85 83.3

System 2 2.0

Total 87 85.3

Total 102 100.0

MOSQUITO REPELLENT


Cumulative

Percent

Valid no 15 14.7 100.0 100.0

Missing .00 85 83.3

System 2 2.0

Total 87 85.3

Total 102 100.0

Page | 82



Cumulative

Percent

Valid yes 5 4.9 7.7 7.7

no 60 58.8 92.3 100.0

Total 65 63.7 100.0

Missing .00 35 34.3

System 2 2.0

Total 37 36.3

Total 102 100.0

34%

66%

YESNO

INTERPRETATION:

Page | 83

HAD TO BUY MORE THAN INTENDED ?

Soap: 100 % of the respondents said that they had to buy more than intended to avail the

scheme.

Toothpaste: 30.8 % of the respondents said that they has to buy more than intended to avail

the scheme while 69.2% of the respondents said that they did not have to buy more to avail

the scheme.

Packed Masala: 16.7 % of the respondents said that they has to buy more than intended to

avail the scheme while 83.3% of the respondents said that they did not have to buy more to

avail the scheme.

Pickle: 100 % of the respondents said that they had to buy more than intended to avail the

scheme.

Mosquito Repellent: 100 % of the respondents said that they had to buy more than intended

to avail the scheme.

House Cleaning Products: 7.7 % of the respondents said that they has to buy more than

intended to avail the scheme while 92.3% of the respondents said that they did not have to

buy more to avail the scheme.

Overall: 34 % of the respondents said that they has to buy more than intended to avail the

scheme while 66% of the respondents said that they did not have to buy more to avail the

scheme.

Page | 84

Q.7 Did you spend more than intended to avail the scheme?

Frequencies

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 55 60 35 15 15 60

Missing 47 42 67 87 87 42

Frequency Table

SOAP


Cumulative

Percent

Valid yes 55 53.9 100.0 100.0

Missing .00 45 44.1

System 2 2.0

Total 47 46.1

Total 102 100.0

TOOTHPASTE


Cumulative

Percent

Valid yes 20 19.6 33.3 33.3

no 40 39.2 66.7 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

Page | 85

PACKED MASALA


Cumulative

Percent

Valid yes 5 4.9 14.3 14.3

no 30 29.4 85.7 100.0

Total 35 34.3 100.0

Missing .00 65 63.7

System 2 2.0

Total 67 65.7

Total 102 100.0

PICKLE


Cumulative

Percent

Valid no 15 14.7 100.0 100.0

Missing .00 85 83.3

System 2 2.0

Total 87 85.3

Total 102 100.0

MOSQUITO REPELLENT


Cumulative

Percent

Valid no 15 14.7 100.0 100.0

Missing .00 85 83.3

System 2 2.0

Total 87 85.3

Total 102 100.0

Page | 86



Cumulative

Percent

Valid no 60 58.8 100.0 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

33%

67%

YESNO

Page | 87

HAD TO SPEND MORE THAN INTENDED ?

INTERPRETATION:

Soap: 100 % of the respondents said that they had to spend more than intended to avail the

scheme.

Toothpaste: 33.3 % of the respondents said that they had to spend more than intended to

avail the scheme while rest 66.7 % said that they did not have to spend more than intended to

avail the scheme.

Packed Masala: 14.3 % of the respondents said that they had to spend more than intended to

avail the scheme while rest 85.7 % said that they did not have to spend more than intended to

avail the scheme.

Pickle: 100 % of the respondents said that they had to spend more than intended to avail the

scheme.

Mosquito Repellent: 100 % of the respondents said that they had to spend more than intended

to avail the scheme.

House Cleaning Products: 100 % of the respondents said that they had to spend more than

intended to avail the scheme.

Overall: 33 % of the respondents said that they had to spend more than intended to avail the

scheme while rest 67 % said that they did not have to spend more than intended to avail the

scheme.

Page | 88

Q.8 If yes how much?

Frequencies

Statistics

SOAP TOOTHPASTE

PACKED

MASALA PICKLE

MOSQUITO

REPELLENT

HOUSE

CLEANING

PRODUCTS

N Valid 60 20 5 0 0 0

Missing 42 82 97 102 102 102

Frequency Table

SOAP


Cumulative

Percent

Valid 15-20 10 9.8 16.7 16.7

more than20 50 49.0 83.3 100.0

Total 60 58.8 100.0

Missing .00 40 39.2

System 2 2.0

Total 42 41.2

Total 102 100.0

TOOTHPASTE


Cumulative

Percent

Valid more than20 20 19.6 100.0 100.0

Missing .00 80 78.4

System 2 2.0

Total 82 80.4

Total 102 100.0

Page | 89

PACKED MASALA


Cumulative

Percent

Valid more than20 5 4.9 100.0 100.0

Missing .00 95 93.1

System 2 2.0

Total 97 95.1

Total 102 100.0

PICKLE

Frequency Percent

Missing .00 100 100.0

Total 100 100.0

MOSQUITO REPELLENT

Frequency Percent

Missing .00 100 100.0

Total 100 100.0


Frequency Percent

Missing .00 100 100.0

Total 100 100.0

Page | 90

12%

88%

RS 0-5RS 5-10RS 10-15RS 15-20MORE THAN 20

AMOUNT SPENT MORE NO OF RESPONSESRS 0-5 0RS 5-10 0RS 10-15 0RS 15-20 10MORE THAN 20 73

Page | 91

AMOUNT SPENT MORE TO AVAIL SCHEMES

INTERPRETATION:

Soap: 16.7 % of the respondents said that they had to spend Rs.15-20 to availing the scheme

with the product while 83.3 % of the respondents said that they had to spend Rs.20 more to


Toothpaste: 100% of the respondents said that they had to spend Rs.20 more to availing the

scheme.

Packed Masala: 100% of the respondents said that they had to spend Rs.20 more to availing

the scheme.

Pickle: 100% of the respondents said that they had to spend Rs.0 more to availing the

scheme.

Mosquito Repellent: 100% of the respondents said that they had to spend Rs.0 more to


House Cleaning Products: 100% of the respondents said that they had to spend Rs.0 more to


Overall: 12 % of the respondents said that they had to spend Rs.15-20 to availing the scheme

with the product while 88 % of the respondents said that they had to spend Rs.20 more to


Page | 92

Q.9 which promotional activities do you prefer?

Descriptive Statistics

N Minimum Maximum Mean Std. Deviation

pricepromotion 100 1.00 3.00 1.4500 .67232

Valid N (listwise) 100



coupons 90 2.00 4.00 3.3889 .75987




freegifts 100 1.00 33.00 3.5500 6.85694




refunds 95 2.00 4.00 3.0526 .76309




loyaltyincentive 15 3.00 4.00 3.6667 .48795


Page | 93

INTERPRETATION:

Page | 94

PRICE PROMOTIONLOYALTY

INCENTIVEFREE GIFTS

COUPONS

REFUNDS

HEIRARCHY OF PREFERENCE OF BUYERS

HYPOTHESIS

Ho: The amount spent more to avail the scheme is not dependent on the income of the buyer.

H1: The amount spent more to avail the scheme is dependent on the income of the buyer.

Crosstabs

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

SOAP * income 55 55.0% 45 45.0% 100 100.0%

TOOTHPASTE * income 60 60.0% 40 40.0% 100 100.0%

PACKED MASALA * income 35 35.0% 65 65.0% 100 100.0%

PICKLE * income 16 16.0% 84 84.0% 100 100.0%

MOSQUITO REPELLENT *

income

15 15.0% 85 85.0% 100 100.0%

HOUSE CLEANING

PRODUCTS * income

61 61.0% 39 39.0% 100 100.0%

Page | 95

SOAP * income

Crosstab

Count

income


SOAP yes 9 17 12 10 48

no 1 3 3 0 7

Total 10 20 15 10 55

Chi-Square Tests

Value df

Asymp. Sig. (2-

sided)

Pearson Chi-Square 2.333a 3 .506

Likelihood Ratio 3.507 3 .320

Linear-by-Linear Association .230 1 .631

N of Valid Cases 55

a. 4 cells (50.0%) have expected count less than 5. The minimum

expected count is 1.27.

Page | 96

TOOTHPASTE * income

Crosstab

Count

income


TOOTHPASTE Yes 5 10 5 0 20

no 5 15 10 10 40

Total 10 25 15 10 60

Chi-Square Tests

Value Df

Asymp. Sig. (2-

sided)



Linear-by-Linear Association 5.630 1 .018

N of Valid Cases 60



Page | 97

PACKED MASALA * income

Crosstab

Count

income

Totalless than 25000 51000-75000 more than 75000

PACKED MASALA Yes 2 4 5 11

no 13 6 5 24

Total 15 10 10 35

Chi-Square Tests

Value df

Asymp. Sig. (2-

sided)




N of Valid Cases 35



Page | 98

PICKLE * income

Crosstab

Count

income

Totalless than 25000 26000-50000 51000-75000

PICKLE yes 2 1 4 7

no 4 4 1 9

Total 6 5 5 16

Chi-Square Tests

Value df

Asymp. Sig. (2-

sided)




N of Valid Cases 16



Page | 99

MOSQUITO REPELLENT * income

Crosstab

Count

income

Totalless than 25000 26000-50000 51000-75000

MOSQUITO REPELLENT yes 3 1 3 7

no 2 4 2 8

Total 5 5 5 15

Chi-Square Tests

Value df

Asymp. Sig. (2-

sided)



Linear-by-Linear Association .000 1 1.000

N of Valid Cases 15



Page | 100

HOUSE CLEANING PRODUCTS * income

Crosstab

Count

Income


HOUSE CLEANING

PRODUCTS

yes 2 2 4 3 11

no 23 8 11 8 50

Total 25 10 15 11 61

Chi-Square Tests

Value Df

Asymp. Sig. (2-

sided)




N of Valid Cases 61



Page | 101

INTERPRETATION:

Soap: The significance level for the soap category for chi square test when cross tabulated

with the income of the buyer is 0.306. Thus it can be inferred that there is association

between the amounts spent more to avail the scheme and the income of the buyer.

Toothpaste: The significance level for the soap category for chi square test when cross

tabulated with the income of the buyer is 0.80. Thus it can be inferred that there is association


Packed Masala: The significance level for the soap category for chi square test when cross

tabulated with the income of the buyer is 0.121. Thus it can be inferred that there is

association between the amounts spent more to avail the scheme and the income of the buyer.

Pickle: The significance level for the soap category for chi square test when cross tabulated

with the income of the buyer is 0.130. Thus it can be inferred that there is association


Mosquito Repellent: The significance level for the soap category for chi square test when

cross tabulated with the income of the buyer is 0.343. Thus it can be inferred that there is

association between the amounts spent more to avail the scheme and the income of the buyer.

House Cleaning Products: The significance level for the soap category for chi square test

when cross tabulated with the income of the buyer is 0.373. Thus it can be inferred that there

is association between the amounts spent more to avail the scheme and the income of the

buyer.

Page | 102

Overall: Hence it can be inferred that the amount spent more to avail the scheme has

association with the income of the buyer. We can conclude from this that the buyer spends

more in accordance to his income rather than attractiveness of the scheme.

Hence Ho is rejected.

Hence the amount spent more to avail the scheme is dependent on the income of the

buyer.

Page | 103

CONCLUSIONS

Page | 104

More than half of the population of consumers switch brands of FMCG products due

to some reason or the other. (52% of the consumers agreed that they switch brands

regularly.)

The percentage of consumers switching brands varies across different FMCG

products. (75% of respondents under soap category agreed that they switch brands

regularly while only 16.7% of respondents under mosquito repellent category agreed

to it.)

The reason of switching brands varies with the income of the buyer. The reason of

switching brand tends towards better quality as the income of the individual increases.

The reason with lower income groups being schemes and with higher income groups

being better quality of the product. Though the shift varies from product to product

but a general trend towards better quality is seen as income increases.

Schemes giving instant cash benefit are preferred by the consumers. Most of the

buyers purchase products with price promotion schemes with 94 % of the buyers

bought products with price promotion.

The buyers save big amounts by availing the scheme. 56% of the buyers save more

than Rs. 20 on a single product during a single shopping trip, 28% saved Rs.10-15 on

a single product while 12% save Rs.15-20 on a single product.

Page | 105

The buyers in return have to buy more quantity of the product to avail the scheme and

save the above mentioned amounts. 34 % of the respondents said that they had to buy

more than intended to avail the scheme.

Again the quantity need to bought more to avail the scheme varies across products

and the scheme offered by the brand.100% of respondents under soap category agreed

that they had to buy more than intended to avail the scheme but only 7% of the

respondents under house cleaning products agreed to it.

So it can be concluded that the buyer increase the basket size in the process to avail

the promotional schemes and get value for money.

As the buyer needs to buy more to avail the scheme it directly affects the total amount

they spent to buy the product. 88% of the buyers agreed that they had to spend more

than Rs.20 to avail the scheme.

The most preferred promotional activity by the consumers is price promotion

followed by loyalty incentive, free gifts, coupons and refunds being the least preferred

promotional activity.

The amount spent more to avail the scheme has association with the income of the

buyer. We can conclude from this that the buyer spends more in accordance to his

income rather than attractiveness of the scheme.

Hence the amount spent more to avail the scheme is dependent on the income of the

buyer.

Page | 106

RECOMMENDATIONS

Page | 107

The brands should come up with promotional activities which give instant cash

benefit to the consumers as such promotions are preferred by them.

The consumers do not mind buying more quantity to avail the offers hence the brands

can come up with schemes wherein the consumers need to buy more quantity to avail

the schemes offered.

The amount spent more to avail schemes with FMCG has association with the income

of the buyer and hence the target set of consumers should be studied before coming

up with the promotions.

The reason of switching brands does tend towards better quality but even higher

income groups indulge into cherry picking and hence the scope should not be limited

to lower income groups.

The retailers can come up with their own promotion schemes if not offered by brands.

Such schemes will increase foot falls at the store and hence the retailer’s sales.

Page | 108

ANNEXURE

Page | 109

Page | 110

PERSONALCARE PACKED FOOD HOUSEHOLD PRODUCTS

QUESTIONS PARTICULARS SOAPTOOTH PASTE

PACKED MASALA PICKLE

MOSQUITOREPELLENT


Which of these products did you buy today? -

Which brand did you buy today?

Do you purchase the same brand every time? YES

NO

Why do you change your brand? SCHEMES TRIAL

BETTER QUALITY

LOWER PRICE

Was there any promotional scheme with this brand? YES

NO

If , yes which one ?

Price Promotion

Coupons

Free Gifts

Refunds Loyalty Incentive

Q B No.

I No. Date D D M M Y Y

Hello Sir/Madam, The student of GLS – NRIBM is doing a Survey. It would be appreciated if you could kindly spend few minutes of your valuable time and help us in filling up the questionnaire. The data collected through this survey is purely for academic purpose only and will be kept completely confidential and not divulged to any organization for commercial use.

How much did you save by availing this scheme ? 0-5 Rs. ( IN RS.) 5-10 Rs. 10-15 Rs. 15-20 Rs.

MORE THAN 20

Did you have to buy more qty than intended to avail the scheme? YES

NO Did you spend more than intended to avail the scheme? YES

NO

If yes how much ? 0-5 Rs. (IN RS.) 5-10 Rs. 10-15 Rs. 15-20 Rs.

MORE THAN 20

Which promotional activities Price

Promotion do you prefer ? (Rank the top 4 preferred activities - Coupons Rank 1 for the most preferred and 4 for least preferred) Free Gifts Refunds

Loyalty

Incentive

Page | 111

PERSONAL INFORMATION:

OCCUPATION : House Wife Employed Self Employed Retired

No. of members in the family: …………………………………

MONTHLY INCOME: < 25,000 26,000-50,000 51,000-75,000 > 75,000

Shopping Days : MON TUE WED THU FRI SAT SUN

Page | 112

BIBLIOGRAPHY

Page | 113

http://www.inbics.co.kr/english/reference/Final_Reports/INBICS_FMCG_Report.pdf

http://www.assocham.org/arb/afp/2009/

AFP_Oct2009_Prospects_in_the_FMCG_sector.pdf

http://www.indiainbusiness.nic.in/business-news/news-bulletin/oct13-19%20_09.pdf

http://www.moneycontrol.com/news_html_files/news_attachment/2008/FMCG

%20Sector%20Report1.pdf

http://www.fddiindia.com/publications/newsletter/2009/007/July/

FDDINL_215_17.07.2009.pdf

Page | 114

http://www.moneycontrol.com/news_html_files/news_attachment/2008/FMCG%20Sector%20Report1.pdf

http://www.moneycontrol.com/news_html_files/news_attachment/2008/FMCG%20Sector%20Report1.pdf

http://www.indiainbusiness.nic.in/business-news/news-bulletin/oct13-19%20_09.pdf

http://www.assocham.org/arb/afp/2009/AFP_Oct2009_Prospects_in_the_FMCG_sector.pdf

http://www.assocham.org/arb/afp/2009/AFP_Oct2009_Prospects_in_the_FMCG_sector.pdf

http://www.inbics.co.kr/english/reference/Final_Reports/INBICS_FMCG_Report.pdf

Finalreportcp

Lifestyle

total fmcg market

examples of fmcg

paper products

customers cherry pick

previous research

research questionswho

research methodologyobjectives

indias fmcg sector