Decision making process for durable products: A case study of two-wheelers in Ganjam

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1 Available online at : pp. 63~70 Thomson Reuters Researcher ID: L Decision making process for durable products: A case study of two-wheelers in Ganjam Dr. Priyadarshini Padhi (Associate Prof., R.I.T, Brahampur) M.I.G.-39, Stage -2, BRIT Colony, Brahampur, Odisha,Ganjam Abstract- Buying involves parting with money, which may be part of a hard earned wage, profit of a risky investment or even the entire savings of a lifetime. As the durable products are high involvement products the consumers think much before taking a decision to purchase it. Sometimes they take consultation of others. So, it is a very important complex human behavior. It includes three important aspects of the concept - firstly, the process of buying or stages in the decision to buy; secondly, Persons concerned directly or indirectly in the making of this decision and thirdly, the factors or variables which determine the behavior of a buyer. In the era of globalisation consumers are the pivot of all marketing activities. The modern marketing management tries to solve the basic problems of consumers in the area of consumption. It involves concentrated efforts to understand the buying process and all the factors influencing it so that they can attain the objective of sustainable growth. This paper attempts to sketch out the decision making process while purchasing durable products. It also tries to identify the factors influencing brand selection. Keywords: Brand selection, consumer behaviour, Decision making, Durable product, Two-wheeler. Introduction In the modern consumer-oriented market all the marketing activity starts with the consumer and ends with the consumer. Marketing success of an enterprise depends on its core proficiency to satisfy the consumers. Comprehending consumer needs, expectations and aspirations coupled with problems is a must to exploit marketing opportunities and meeting challenges beset along with the opportunities. So, the marketing managers have to recognize all where, how, when and under what condition of consumer behavior. Study of consumer behavior explains how individuals make decisions to spend their valuable resources on consumption related items. The real problem is to learn what a consumer takes into consideration when he chooses a particular brand. It involves concentrated efforts to understand the buying process and all the factors influencing it. The consumers are very cautious with reference to purchase of consumer durables. A study of information search behavior of consumers helps the marketing managers to take decision in respect of the four p s of the marketing mix. 63

2 The two wheeler industry has witnessed a number of players with high level of sophisticated technology. Bajaj Auto Ltd, Hero Moto Corporation (formerly Hero Honda), Honda Motorcycle and Scooter India, LML Mahindra & Mahindra Limited, Royal Enfield Motor, Suzuki Motorcycle India, TVS Motor, India Yamaha Motor are some of the major players who has their own market shares in Indian market. As a leading manufacturing sector it is considered as one of the controlling valve of economic growth. During last some years a number of legal steps have been taken to take this sector to its peak position so that the economy can reach in its height. This research work will provide wide knowledge and understanding of the behavior of the customers with reference to the purchase of Motor cycle. Literature Review S. Poongavanam has tried to study the level of satisfaction and the after sales services perception of consumers and to study the relationship between age, income, education level, occupational and the two wheeler ownership. A fashionable and trendy bike which is good on fuel and speed efficiency with legend and aesthetic looks attracts the consumers. Resale value of an old two wheeler also influences the consumer choice. Omesh Chhada has tried to make SWOT analysis of some reputed brands. He concluded that a satisfied customer recommends a particular brand to others. So, the purchasing procedure is not over with the purchase of a product. H.D. Vyas has undertaken a study which focuses on factors and sources of information involved in purchase of consumer durable. According to this study authorized dealers shop, technical experts, TV and friends are the important sources of information. In his studies Naveen Rai viewed that advertisements have great influence in brand selection decision of customers. Objective 1. To understand the methods used by the consumers while selecting a brand. 2. The impact of demographic factors on the selection of a particular brand. 3. Identify the factors influencing brand selection. 4. To suggest techniques to improve sales. Methodology Both primary and secondary data are used for the analysis. The primary data collected through questionnaires administered to a sample of 110 consumers which is selected from two towns of Ganjam i.e., Berhampur and Bhanjanagar. Pretested Questionnaire is used to collect the views of the respondents. Secondary data is also collected through various publications of newspapers, magazines, books and magazines websites of different two-wheeler companies. In order to answer the researches questions and achieve the objectives of the study; the following hypotheses are advanced and will be tested in the course of this study. 64

3 Hypothesis 1 Null Hypothesis H0: Age of the respondents and the factors considered for brand selection are Hypothesis - 2 Null Hypothesis H0: Income of the respondents and the factors considered for brand selection are Hypothesis - 3 Null Hypothesis H0: Qualification of the respondents and the factors considered for brand Hypothesis - 4 Null Hypothesis H0: Profession of the respondents and the factors considered for brand selection are Hypothesis - 5 Null Hypothesis H0: marital status of the respondents and the factors considered for brand Hypothesis - 6 Null Hypothesis H0: The degree of involvement of all the family members is equal for brand selection while purchasing a bike. Table 1 Demographic profile of the respondents Age > >50 21 Income < > Qualifications UG 48 PG 36 Professional 26 Occupation Serviceman 39 Businessman 24 Professional 30 Marital status Married 68 Unmarried 42 Source-Questionnaire 65

4 Table 2 Reasons leading to the selection of a brand Factors considered for selection of a brand Respondents percentage External factors 29 Technical factors 33 Cost factors 24 Service factors 14 Source-Questionnaire According to 29% of the respondents external factors like brand name of the company, colour and style are the important factors to be considered for selection of a particular brand whereas 14% give importance to the after sales service and credit facilities arranged by the local dealers. They considered these service factors as key elements which affect brand selection. Another 33% of the respondents choose a particular brand due to the technical factors. On the other hand for 24% of the respondents cost of the bike is the most important factor to be considered before purchasing it. Analysis and Interpretation Hypothesis 1 Null Hypothesis H0: Age of the respondents and the factors considered for brand selection are H1: Age of the respondents influences the factors considered for brand selection. Table-3 Age and factors considered for brand selection Age Factors considered for brand selection > > The calculated value of Chi-square is 8.28and the table value of Chi-square for 6 degree of freedom at 5 % level of significance is 12.6.As the calculated value is less than the table value the null hypothesis is accepted. Age of the respondents and the factors considered for brand selection are Hypothesis 2 Null Hypothesis H0: Income of the respondents and the factors considered for brand selection are H1: Income of the respondents influences the factors considered for brand selection. 66

5 Table-4 Income and factors considered for brand selection Income Factors considered for brand selection > > The calculated value of Chi-square is 7.06 and the table value of Chi-square for 6 degree of freedom at 5 % level of significance is 12.6.As the calculated value is less than the table value the null hypothesis is accepted. Income of the respondents and the factors considered for brand selection are Hypothesis 3 Null Hypothesis H0: qualification of the respondents and the factors considered for brand H1: qualification of the respondents influences the factors considered for brand selection. Table- 5 Qualification and factors considered for brand selection Qualification Factors considered for brand selection UG PG Professional The calculated value of Chi-square is 7.58 and the table value of Chi-square for 6 degree of freedom at 5 % level of significance is 12.6.As the calculated value is less than the table value the null hypothesis is accepted. Qualification of the respondents and the factors considered for brand Hypothesis 4 Null Hypothesis H0: Occupation of the respondents and the factors considered for brand selection are H1: Occupation of the respondents influences the factors considered for brand selection. Table-6 Occupation and factors considered for brand selection Occupation Factors considered for brand selection Serviceman Businessman Professional The calculated value of Chi-square is 8.55and the table value of Chi-square for 6 degree of freedom at 5 % level of significance is 12.6.As the calculated value is less than the table value the null 67

6 hypothesis is accepted. Occupation of the respondents and the factors considered for brand Hypothesis 5 Null Hypothesis H0: marital status of the respondents and the factors considered for brand H1: Marital status of the respondents influences the factors considered for brand selection. Table- 7 marital status and factors considered for brand selection Marital status Factors considered for brand selection Married Unmarried The calculated value of Chi-square is 9.05 and the table value of Chi-square for 3 degree of freedom at 5 % level of significance is As the calculated value is less than the table value the null hypothesis is accepted. Marital status of the respondents influences the factors considered for brand selection. Hypothesis - 6 Null Hypothesis H0: The degree of involvement of all the family members is equal for brand selection while purchasing a bike. H1: the degree of involvement of all the family members for brand selection while purchasing a bike varies significantly. Table- 8 Degree of involvement shown by different family members (in percent) Rank Husband Wife Children Others Very low Low Reasonable High Very high Mean score Source: Questionnaire All the family members are involved in the purchase of a durable product. Bike is a product used by all the family members. So accordingly there is a high degree of involvement of family members in the purchase decision. The difference in degree of involvement by the different family members is exhibited in the following table. As a primary decision maker husband has a very high influence on the decision. Nature of the product is an important factor which decides the role of the family members. Bike is a product which is used by husband but the whole family enjoys the riding. So, 68

7 housewife and children are also highly involved in the purchasing decision. The adolescent children are more involved in the purchasing decision. The mean score involvement of wife and children in purchasing a durable like two wheelers is calculated which is 3.37 & 3.97 respectively. When a young earning member of a family makes a purchasing decision, the parents have an influence in the decision making process. Peers and neighbors also have some influence on the purchase process. The mean response score of such influence is So, the degree of involvement of all the family members for brand selection while purchasing a bike varies significantly. Conclusion The two-wheeler industry is one of the fastest growing industries. Around 75% of the market share of automobile industry is grabbed by the two-wheeler manufacturers. India is the second largest producer of two-wheelers in the whole world. In the era of globalisation consumers are given many options to decide. Automobile sector is no exception. The customer preferences have changed in favour of motor cycles and gearless scooters with higher technology, fuel economy and aesthetic appeal. Study of consumer perceptions and behavior of motor cycle owners provides important feedback to have innovative marketing strategies and effective sales promotion. Before purchasing a durable product, the consumers prepare an evoked set. The actual brand selection is done on the basis of this. External information search activity is carried on before a particular brand is selected. The determinants of consumer behavior can be categorized as cultural, socio-economic, personal and psychological factors. But from the analysis we observed that the major demographic factors like age, education, profession and qualification etc do not have considerable effect on the factors considered for brand selection. This may be due to the fact that bike is a product used by all the family members. So accordingly there is a high degree of involvement of family members in the purchase decision. The main earning male member is generally highly involved in the brand selection process. But other members like the wife and children are also highly involved in the brand selection process. Other persons like friends and relatives are also somehow involved to some extent. Effective sales promotion is inevitable to ensure that a product is shortlisted in the evoked list. Goodwill of the brand, after sales service, availability of easy finance, updated technology with reasonable price are some of the factors which increase the chances of a brand being selected for purchasing. So, the marketers should consistently work to strengthen these areas. Reference 1. Chundawat D.S., Gupta Seema (2003) Family Roles and Social Influences in Buying Decision-making, The IUP Journal of Marketing Management, Vol. Aug a study on consumer buying behaviour towards home appliances in salem city by GEETHANJALI and Dr. S. ASSOK KUMAR (IJEMR October 2011-Vol1 Issue 5 - ISSN ) 3. Janaki P., A study on consumer involvement in purchase of Home Appliance ( IJMT,vol 2, issue I,ISSN ,p ) 69

8 4. A study on consumer buying behaviour towards home appliances in salem city by GEETHANJALI and Dr. S. ASSOK KUMAR (IJEMR October 2011-Vol1 Issue 5 - ISSN ) 5. Nelson James E. (1979) s survey, Children As Information Sources In The Family Decision To Eat Out, Advances in Consumer Research, Vol.06, pp Omesh Chadha, STUDY OF CONSUMER BUYING BEHAVIOR TOWARDS BIKES,IJRFM Volume 1, Issue 2 (June, 2011) (ISSN ) 7. S. Poongavanam, A study on satisfaction levels and after sales service (with reference to two wheelers consumers) 3 Asia Pacific Journal of Research in Business Management Volume 3, Issue 3 (March, 2012) ISSN ) 70