Consumer Buying Behaviour of Personal Care Products A DISSERTATION REPORT SUBMITTED AS A PART OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION SUBMITTED BY Amitkumar Nandkishor Tope 11020441275 Marketing (A-47) Batch 2011-13 Under the Guidance of Mr. Komal Chopra SYMBIOSIS INSTITUTE OF MANAGEMENT STUDIES (SIMS) (CONSTITUENT OF SYMBIOSIS INTERNATIONAL UNIVERSITY) February 2013 [i]
DECLARATION I hereby declare that the project entitled Consumer Buying Behaviour of Personal Care Products submitted for the MBA Degree is my original work and the dissertation has not formed the basis for the award of any degree, associate ship, fellowship or any other similar titles. Amitkumar Nandkishor Tope Signature of the Student: Place: Pune Date: [ii]
Project guide I have been the mentor of the student Amitkumar Nandkishor Tope Roll.no 47 Section A for his dissertation on the topic Consumer Buying Behaviour of Personal Care Products. Based on the guidelines given in the dissertation schedule, I submit my observations on his Compliance or Non compliance of the activity as given below. S. no Activity Guidelines followed (Yes/No) Remarks 1. Selection & Finalization of Topic 2. Submission of synopsis 3. First Interaction with mentor 4. Second Interaction with mentor 5. Third Interaction with mentor 6. Submission and quality of report Signature of Faculty Guide [iii]
CERTIFICATE This is to certify that Mr. Amitkumar Nandkishor Tope, PRN no. 11020441275 has completed his dissertation report on the topic Consumer Buying Behaviour of Personal Care Products under my guidance. Mr. Komal Chopra Signature Date [iv]
Acknowledgement I express my deepest gratitude and warmest appreciation to the people, who have contributed directly or indirectly and inspired me to the overall success of the dissertation. I take this opportunity to thank Mr. Komal Chopra (Faculty Guide, SIMS Pune) for his support and cooperation during the entire dissertation. I would also like to show my gratitude towards all the respondents for answering patiently and bearing with me. [v]
Executive Summary The dissertation title is Consumer Buying Behaviour of Personal Care Products. The dissertation s primary objective was to study the consumer s buying behaviour of personal care products and it involved understanding the consumer mindset and their views on of personal care products. Secondary objectives were also formed as follows 1) To find out the most influencing factors while buying the personal care products and 2) To study about switching behaviour of consumers of personal care products. Similarly two hypotheses were also formed which stated that H1: Personal care products consumers are highly brand conscious and H2: Personal care products consumers have high brand loyalty. To carry out the project effectively a questionnaire was prepared. Convenient sampling was used for the purpose of survey. A survey of 100 respondents was carried out. The questionnaire included general demographic questions as well as some specific questions to study the consumer buying behaviour of personal care products consumers. The data thus collected was presented graphically in the form of Bar graphs and Pie charts and subsequently analyzed. Hypothesis testing was done in which the first hypothesis i.e. H1 was proved correct while the second hypothesis i.e. H2 was proved wrong. Suggestions were given by the respondents which were recorded in the suggestion section of the report. Based on the data analysis done conclusions were formed for the project which was successfully completed to the satisfaction of the primary and secondary objectives set at the starting of the project. Bibliography and Appendix are included at the end of this project report. A copy of questionnaire is attached in the appendix section. [vi]
TABLE OF CONTENTS Sr. No Chapter Page. No 1 Introduction 1 1.1 1.2 1.3 1.4 1.5 Competition among major companies Need of the Study Objective Hypothesis Literature Review 3 5 7 7 8 2 3 Methodology Results 9 10 3.1 3.2 Consumer Survey Hypothesis Testing 10 27 4 5 6 7 Suggestions Conclusion Bibliography Appendix 28 29 31 32 7.1 Questionnaire 32 [vii]
Sr. No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 List of Tables Table 1.1: Market Share of Major Players Table 3.1: Age in years Table 3.2: Gender Table 3.3: Occupation Table 3.4: Annual Household Income (in INR) Table 3.5: Preference of place for shopping of personal care products Table 3.6: Frequency of visit to these places to buy personal care products Table 3.7: Spending on personal care products per month (in INR) Table 3.8: Preference of branded personal care products Table 3.9: Preference of Foreign or Indian brands Table 3.10.1: Product Quality Table 3.10.2: Ease of Availability Table 3.10.3: Price Table 3.10.4: Attractive Promotion Table 3.11: Consumer s first choice of the personal care products company Table 3.12: Decision influencers while buying personal care products Table 3.13: Determining the trust worthiness of the personal care brand Table 3.14: Mediums influential in promoting personal care products Table 3.15: Switching behaviour of consumers Page. No 3 10 11 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 [viii]
Sr. No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 List of Figures Figure1.1: Graphical Representation of market shares Figure 3.1: Age in years Figure 3.2: Gender Figure 3.3: Occupation Figure 3.4: Annual Household Income (in INR) Figure 3.5: Preference of place for shopping of personal care products Figure 3.6: Frequency of visit to these places to buy personal care products Figure 3.7: Spending on personal care products per month (in INR) Figure 3.8: Preference of branded personal care products Figure 3.9: Preference of Foreign or Indian brands Figure 3.10.1: Product Quality Figure 3.10.2: Ease of Availability Figure 3.10.3: Price Figure 3.10.4: Attractive Promotion Figure 3.11: Consumer s first choice of the personal care products company Figure 3.12: Decision influencers while buying personal care products Figure 3.13: Determining the trust worthiness of the personal care brand Figure 3.14: Mediums influential in promoting personal care products Figure 3.15: Switching behaviour of consumers Page. No 4 10 11 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 [ix]
Chapter 1: Introduction Today world FMCG companies are growing at a great pace and have established a remarkable position in this competitive market. Fast Moving Consumer goods (FMCG) or Consumer Packaged Goods (CPG) as they are also called as, include personal care, food & beverages, plastic goods, pharmaceuticals, alcoholic drinks, paper & stationery, tobacco and cigarettes, household products etc. that people buy at regular intervals. These items are meant for daily or frequent consumption. Though per unit profit made on FMCG products is relatively small, they generally have huge volumes of sale, so the cumulative profit on such products can be huge. Some of the Biggest FMCG companies across the world are Unilever, Procter & Gamble, Colgate-Palmolive, Reckitt Benckiser, Coca-Cola, Nestle, General Mills, Johnson & Johnson, Kimberly-Clark etc. Emami Ltd. also falls under FMCG category. Personal care products come under the FMCG products. All around the world a substantial portion of the monthly budget is reserved for personal care products. The number of personal care products consumer uses is very high and so the volume of money circulated in the economy is also very high. Personal care products companies have a very intense distribution network. Large portion of the budget of a company is sent on maintaining distribution networks. Promoting brands require huge capital and therefore new entrants who wish to bring their products need to invest huge sums of money. Competition from rural unorganised sector and local players makes it more difficult for branded products and organised sector to sustain and increase their market share. Most of the product categories like hair care products, skin care products, oral care products etc. in India, have low per capita consumption and low penetration level. But the potential for growth is huge. The size of Indian FMCG industry is INR 1300 bn (around USD 30bn) which accounts for 2.2% of the GDP (growing at 9%). In the last decade, the FMCG sector grew by 11% annually. The FMCG industry is expected to grow at a base rate of at least 12% annually to become an INR 4000 bn (around USD 90bn) industry by 2020. The characteristics of Indian personal care segment are a well-established distribution network, intense competition between the organized and unorganized sectors. The fact that about 12% of the world s population lives in Indian villages does not let the personal care product market to overlook it. Better infrastructure facilities will add to the improvement of their supply chain. The unending demand for personal care products is also likely to benefit the industry. [1]
Some of the personal care products are as under: [2]
1.1 Competition among major companies There is a huge competition among the companies working with personal care segment of FMCG industry. HUL is clearly leading the market in many segments from last couple of decades. But recently it is facing a fierce competition from the other existing companies like P&G, Marico, Godrej Consumer Care Ltd., Dabur etc. Data of these companies and their market share is given in the following above table. Market Share of Major Players COMPANIES SHAMPOO (%) SOAP (%) DETERGENT (%) SKINCARE (%) TOOTHPASTE (%) HUL 44.7 47.5 34.8 47.2 28 P&G 24.3-13.2 6.4 - DABUR 6.1 - - 5.0 10 ITC 6.0 10.2 8.0 6.0 - GCPL 5.5 13.3-2.1 - EMAMI - - - 15.4 - CAVIN 5.2 5-12.5 - KARE MARICO 3.9 4.7-9.9 - COLGATE - 6 - - 50.1 OTHERS 4.3 13.3 44-11.9 Table 1.1: Market Share of Major Players [3]
Graphical Representation of market shares: Shampoo Soap 3.9% 5.5% 6.0% 6.1% 4.3% 24.3% 44.7% HUL P&G DABUR ITC GCPL CAVIN KARE MARICO 6.0% 13.3% 4.7% 5.0% 10.2% 13.3% 47.5% HUL ITC GCPL CAVIN KARE MARICO COLGATE OTHERS Detergent Skincare HUL 44.0% 34.8% HUL P&G 11.5% 8.9% 45.7% P&G DABUR ITC 8.0% 13.2% ITC OTHERS 2.1% 6.0% 5.0% 6.4% GCPL EMAMI CAVIN KARE MARICO Toothpaste 11.9% 50.1% 28.0% 10.0% HUL DABUR COLGATE OTHERS Figure 1.1: Graphical Representation of market shares [4]
1.2 Need of the Study The driving force behind personal care products has evolved considerably in India as in other parts of the world. Starting from purely health notions then moving on to fitness, the current trend is towards well-being coupled with beauty. In an effort to adapt to these changes, the industry is slowly moving from basic products such as soaps, shampoos and hair oils to functional products like cold creams and now to specialized products like sun block lotions, body exfoliating creams, skin whitening & anti ageing products. The sizable Indian population base with rising disposable income offers the industry a promising middle class to market a large variety of personal care consumer products. As compared to China, India has a fairly similar personal disposable income per household and a growing population of people in the 25-44 years of age group, the key consumer segment. However, China spends almost 10 times as much on skin care, 6 times as much on cosmetics and more than 2 times on hair care on a per capita basis. These figures indicate the huge unrealized potential of the Indian market especially for the select personal care products segments. Several market, social and industry trends signal the possibility of Indian personal care industry realizing this huge potential in the near future. Rising participation of women in urban work force, increasing urbanization, and growing importance of looks and personal grooming not only for personal but professional reasons are some of the key social drivers. Market trends like spread of organized retail to Tier II cities, FDI in retail, development of non-traditional segments like men s grooming and cosmetics (with products like hair gels, shaving kits, fairness creams etc.) and development of a wide range of products at different price points are all factors which could contribute to the growth of the domestic personal care market. Industry trends like increasing competition with entry of large MNCs, customer awareness initiatives by companies and increased brand building are accelerating the growth. The Indian personal care products segment has witnessed rapid growth over the last couple of decades. In recent times the range of cosmetic and beauty products in India has widened tremendously. Beauty products manufacturers in India mostly cater to the great demand for cosmetics and toiletries that fall into the low or medium-price categories. This is because the greatest demand in India has always been for these economically priced products. However, in recent years in the cosmetics market India competitors have begun to manufacture products to cater to an International need. For instance, herbal cosmetics from India have a great demand in the overseas market and many cosmetic products that are manufactured in India today are supplied to international suppliers of branded cosmetics products (example The Body Shop). New facts that have been unveiled by a series of cosmetics business market analysis in India that say the industry of cosmetic products India is growing at an average rate of almost 20% annually. This increase is attributed to two main factors. The first being the increased purchasing power of the average Indian and the second being increase for the demand of Indian cost-effective products. [5]
With the introduction of satellite television and a wide array of T.V. channels as well as the internet, an average Indian consumer is constantly bombarded with advertisements and information on new personal care products which often translates into the desire to purchase them. A boom in the Indian fashion industry has also been linked to the increased awareness of Indian people about their appearances, looks and consequently contributed to an increase in the demand for the skin care products. However, even with the massive surge in the popularity of personal care products, statistics have shown that the average Indian consumer spends much lesser on them than consumers from many other parts of the world. This means that the Indian personal care industry has an even greater potential for growth than it is presently experiencing. Beauty concerns have risen among both men and women in India, and this has given a significant boost to the hair care market. According to latest researches on the Indian hair care market, segments like hair colour, hair oil, shampoo, gels etc. have witnessed an unprecedented growth in the sales. It is estimated that the hair oil market in India will cross the INR 100 billion mark in future. The reasons for the growth can be attributed to the fact that a large portion of our Indian population is using higher quality branded products. Shampoos and hair oils, including coconut oils continue to be the key components of this segment. Of the estimated INR 1300 bn (around USD 30bn) FMCG market in India, hair care products make up approximately INR 130 bn, or about 10% of the total according the Nielsen Report. The current rate of CAGR growth by value is 20% where as by volume it is 12.5%. The marketing strategy of rural distribution campaigns adopted by the hair oil manufacturers and dealers has helped to greatly expand the geographic coverage of hair oil products into the rural parts of the country. The penetration of hair oil in India is almost 98% (branded as well as unbranded oil) and the average annual per personal consumption of hair oil is 1 litre. All these factors have led to the study of the personal care segment and the consumer buying behaviour of the same. The study is done for getting the knowledge and idea about Indian personal care segment. The need or objective of the study is to know the how much importance does the consumer to branded personal care products. Whether the customers are satisfied with the products of the company they are using and how far are they loyal to their brands. Hence a comprehensive research was conducted to know all these aspects about the consumer. [6]
1.3 Objective Primary Objective: To study consumer s buying behaviour of Personal Care Products. Secondary Objectives: 1) To find out the most influencing factors while buying the personal care products. 2) To study about switching behaviour of consumers of personal care products. 1.4 Hypothesis H1: Personal care products consumers are highly brand conscious. H2: Personal care products consumers have high brand loyalty. [7]
1.5 Literature Review Indian personal care products industry is one of the profitable and stable sector. There is a bright and golden opportunity in this sector. Many of the scholars, research agencies have done their research on this sector and given their own different views and suggestions. The global outlook series on Personal Care Products provides a collection of statistical anecdotes, market briefs, and concise summaries of research findings. Vinith Kumar Nair. Prakash Pillai R (2007) observed that male and female consumers generally prefer to purchase and make the brand selection of cosmetics individually. Quality is the major factor influencing the purchase decision of male consumers. It also reveals that one of the main sources of information among the females about different brands of cosmetics is friends group. A.Sudhakar and T.Suchitra Rani (2012) conducted a study and from the study it was found that family influences purchase decision of different categories of beauty soaps, fairness creams, shampoo, henna, hair oil and kajal brands. However, friends were found to be the main influencing social factors in purchase of face wash, eye liner and nail paint brand Prialatha, P.; Mathi, K. Malar conducted a study in the Coimbatore district.. The study intends to identify the level of influence of various factors on the purchase of personal care products by rural consumers. The study shows that rural consumers give more importance to the 'quality' of the personal care brands they buy. Fan Shean Cheng, Cheng Soon Ooi and Ding Hooi Ting have observed that there is a significant and positive relationship between males concern towards self-image and their consumption of male grooming products [8]
Chapter 2: Methodology Following is the Methodology used for the Consumer Survey: 1) Selection of Sample A convenient sampling was used for the purpose of survey and a questionnaire was floated among them. 2) Size of Sample A total of 100 consumers were selected for consumer buying behaviour survey. 3) Data Collection Data for the purpose of research was collected through: Primary Data Collection This was done by preparing a Questionnaire with the objective of generating response from the chosen sample. A copy of the questionnaire is attached in the Appendix. 4) Data analysis The data collected has been analyzed and presented with the help of tables, graphs and charts in results section as follows: [9]
Chapter 3: Results 3.1 Consumer Survey 1) Age (in Years) Age (in Years) Number Percentage (%) <25 37 37 26-35 54 54 36-45 9 9 46-55 0 0 >55 0 0 Table 3.1: Age in years Age (in Years) 54% 9% 0% 37% <25 26-35 36-45 46-55 >55 Figure 3.1: Age in years Discussion: It is clear from the above tabulated data and chart that most (54%) of the respondents are between 26 to 35 years of age. 37% of them are less than 25 years of age. There are no respondents in the age group of 46-55 and greater than 55 years. So, this survey represents a young population. [10]
2) Gender and 3) Occupation Gender Number Percentage (%) Male 73 73 Female 27 27 Table 3.2: Gender Occupation Number Percentage (%) Student 38 38 Professional (Private/Govt. Job) 58 58 Housewife 0 0 Businessman 4 4 Other 0 0 Table 3.3: Occupation Gender 27% 73% Male Female Figure 3.2: Gender 58% 4% 38% Occupation Student Professional (Private/Govt. Job) Housewife Businessman Other Figure 3.3: Occupation Discussion for 2: Most (73%) of the respondents were male. Females constitute 27%. Discussion for 3: From Figure 3.3 it was observed that out of the sample size of 100 respondents, 58% were professionals (Private/Government jobs), 38% were students and 4% were businessman. [11]
4) Annual Household Income (in INR) Annual Household Income (in Number Percentage (%) INR) <1,50,000 23 23 1,50,000 3,50,000 16 16 3,50,000 5,50,000 24 24 >5,50,000 37 37 Table 3.4: Annual Household Income (in INR) Annual Household Income (in INR) 23% 37% 16% <1,50,000 1,50,000 3,50,000 3,50,000 5,50,000 >5,50,000 24% Figure 3.4: Annual Household Income (in INR) Discussion: 37% of the respondents have their annual household income greater than Rs.5,50,000, and 24% of the respondents lie in between the annual income of Rs.3,50,000 to Rs.5,50,000. The least number (16%) of respondents are having their annual income in between Rs.1,50,000 to Rs.3,50,000. It can be inferred that most respondents have high annual income which shows that they have more capacity to spend on personal care products. [12]
5) Preference of place for shopping of personal care products Preference of place for shopping Number Local Kirana Stores 47 Super Markets 67 Shopping Malls 48 e-shopping 12 Table 3.5: Preference of place for shopping of personal care products Preference of place for shopping of personal care products 70 67 60 50 47 48 40 30 No. of Respondents 20 12 10 0 Local Kirana Stores Super Markets Shopping Malls e-shopping Figure 3.5: Preference of place for shopping of personal care products (People may select more than one checkbox, so percentages may add up to more than 100%) Discussion: In this age of e-commerce and e-shopping the personal care products consumers are still favouring for the physical outlets for shopping. 67 respondents said that they prefer to shop for personal care products from supermarkets. While almost an equal no. of respondents (47 and 48) said they like to shop from nearby local kirana stores or the shopping malls which have large variety and options for them. 12 respondents said that they do e-shopping for personal care products. This shows the behaviour of physically going to the shops and buying the products. [13]
6) Frequency of visit to these places to buy personal care products Frequency of visit to these places to buy Number Percentage (%) personal care products Once a month 61 61 Twice a month 25 25 Thrice a month 7 7 More than 3 times a month 7 7 Table 3.6: Frequency of visit to these places to buy personal care products Frequency of visit to these places to buy personal care products 25% 7% 7% 61% Once a month Twice a month Thrice a month More than 3 times a month Figure 3.6: Frequency of visit to these places to buy personal care products Discussion: Maximum number of respondents (61%) said that they liked to buy the personal care products for the whole month at one time. While a good 25% said that they would like to go for second time to buy the products. An equal 7% of the respondents that said that they may go 3 or more than 3 times a month to buy the personal care products i.e. as and when required. This shows a onetime (for a month) buy behaviour of the consumers when it comes to personal care products. [14]
7) Spending on personal care products per month (in INR) Spending on personal care products per month Number Percentage (%) (in INR) < 200 10 10 200-500 40 40 500-700 28 28 700-1500 14 14 > 1500 8 8 Table 3.7: Spending on personal care products per month (in INR) Spending on personal care products per month (in INR) 8% 10% 14% 28% 40% < 200 200-500 500-700 700-1500 > 1500 Figure 3.7: Spending on personal care products per month (in INR) Discussion: The above figure and table shows that most (40%) of the respondents spend between Rs.200 to Rs.500 while another 28% spend between Rs.500 to Rs.700. Only 8% said that they spend over Rs.1500 on personal care products per month. If we compare it with the annual household income, on an average an individual spends around 2% of his household income. And if we consider an average household consists of 4 members than the spending will come around 8% per household per month. [15]
8) Preference of branded personal care products Preference of branded personal care products Number Percentage (%) Yes 71 71 No 8 8 Neutral 21 21 Table 3.8: Preference of branded personal care products Preference of branded personal care products 21% 8% 71% Yes No Neutral Figure 3.8: Preference of branded personal care products Discussion: When asked if they are brand conscious while buying personal care products, 71% of the respondents said that they liked to buy the branded products, while only 8% said they would go with unbranded ones. A considerable 21% said that they are neutral in buying branded or unbranded personal care products. This also proves the Hypothesis H1 that the personal care products consumers are highly brand conscious correct. [16]
9) Preference of Foreign or Indian brands Preference of Foreign brands over Indian brands Number Percentage (%) Foreign Brands 30 30 Indian Brands 17 17 Neutral 53 53 Table 3.9: Preference of Foreign or Indian brands Preference of Foreign or Indian brands 30% 53% 17% Foreign Brands Indian Brands Neutral Figure 3.9: Preference of Foreign or Indian brands Discussion: When it came to selecting a foreign brand or an Indian brand, most (53%) of the respondents were neutral in their selection. They didn t have a hard and fast preference of foreign or Indian brands. Though a 30% of them said they preferred foreign brands and a 17% responded that they preferred Indian brands. This shows that there is a tough competition between Indian and foreign brands. Foreign brands can still do better in India. [17]
10) Rating for the following factors while purchasing personal care products (Rate on the scale of 1 to 5) (1-very important and 5-least important) 10.1) Product Quality Rating Number Percentage (%) 1 69 69 2 7 7 3 3 3 4 4 4 5 17 17 Table 3.10.1: Product Quality Product Quality 5 17 4 4 3 3 No. of Respondents 2 7 1 69 0 10 20 30 40 50 60 70 Figure 3.10.1: Product Quality Discussion: As seen from the above table and graph, product quality is considered as most important factor by 76% (rating 1 and 2) of the respondents. This shows that the personal care products consumers believe that quality is the topmost thing that the product must possess and rest things comes secondary. As the comments show, many believed that if the product itself is of lower quality it won t sell whatever be the promotion strategy or pricing strategy for it. [18]
10.2) Ease of Availability Rating Number Percentage (%) 1 20 20 2 36 36 3 16 16 4 21 21 5 7 7 Table 3.10.2: Ease of Availability Ease of Availability 5 7 4 21 3 16 No. of Respondents 2 36 1 20 0 10 20 30 40 Figure 3.10.2: Ease of Availability Discussion: It is clear from the above table and graph, ease of availability is considered as most important factor by 56% (rating 1 and 2) of the respondents. This shows that ease of availability of the personal care products is the second important factor as considered by the consumers. Therefore place from the 4 P s of marketing becomes very important while launching a product in the market. [19]
10.3) Price Rating Number Percentage (%) 1 20 20 2 29 29 3 31 31 4 13 13 5 7 7 Table 3.10.3: Price Price 5 7 4 13 3 31 No. of Respondents 2 29 1 20 0 5 10 15 20 25 30 35 Discussion: Figure 3.10.3: Price It is seen from the above table and graph, price is considered as important factor as well as not so important factor by equal no. of respondents. This shows that after product quality and ease of availability comes the price factor for the personal care products consumers. This also shows that consumers are ready to pay the premium if they get the right quality product at right places at the right time. [20]
10.4) Attractive Promotion Rating Number Percentage (%) 1 7 7 2 17 17 3 33 33 4 32 32 5 11 11 Table 3.10.4: Attractive Promotion Attractive Promotion 5 11 4 32 3 33 No. of Respondents 2 17 1 7 0 5 10 15 20 25 30 35 Figure 3.10.4: Attractive Promotion Discussion: It is evident from the above table and graph that attractive promotion is given the least importance by 76% of the respondents (ratings 3, 4 and 5) as compared to other factors like product quality, ease of availability and price. If every other factor is in place for a product then promotion helps to sell the product in better way by increasing awareness and visibility among the consumers. With respect to the one of the secondary objectives this shows that product quality is the most important factors when we consider product, place, price and promotion. [21]
11) Consumer s first choice of the personal care products company Consumer s first choice of the personal care Number Percentage (%) products company HUL 38 38 ITC 10 10 P&G 31 31 Dabur 8 8 Emami 1 1 Godrej Consumer Care 7 7 Other 5 5 Table 3.11: Consumer s first choice of the personal care products company Consumer s first choice of the personal care products company 8 1 7 5 38 HUL ITC P&G Dabur Emami 31 10 Godrej Consumer Care Other Discussion: Figure 3.11: Consumer s first choice of the personal care products company The above table and chart shows that why HUL and P&G are amongst the top FMCG companies in India. 38% consumers say they will buy HUL s personal care products if given a choice and 31% say they will buy P&G s personal care products. ITC, Dabur and Godrej Consumer Care follow with 10%, 8% and 7% responses going in their favour. This is in tandem with the fact that HUL is the market leader in personal care products market in India and overall FMCG products. [22]
12) Decision influencers while buying personal care products Decision influencers while buying personal care products Number Brand Ambassadors 9 Friends 59 Family 41 Advertisements 48 Others 8 Table 3.12: Decision influencers while buying personal care products 70 60 50 40 30 20 10 0 Decision influencers while buying personal care products 9 59 41 48 8 No. of Respondents Figure 3.12: Decision influencers while buying personal care products (People may select more than one checkbox, so percentages may add up to more than 100%) Discussion: The above graph shows that friends are the biggest influencers (59 respondents say this) while making a decision to buy personal care products. The respondents are young population so friendship affects the decisions as they are constantly in touch through social media, mobile phones etc. Advertisements come next as they innovatively and creatively try to influence the individuals. 41 respondents feel that family play important role in making decisions regarding purchase of the personal care products. With respect to the one of the secondary objectives this shows that friends and advertisements are amongst the most influential factors when we consider the buying decision of personal care products. [23]
13) Determining the trust worthiness of the personal care brand Determining the trust worthiness of the personal Number Percentage (%) care brand Brand Image 41 41 Awards received 3 3 Expert Recommendations 18 18 Doctor s recommendation 19 19 Other 19 19 Table 3.13: Determining the trust worthiness of the personal care brand Determining the trust worthiness of the personal care brand 19% 19% 18% 41% Brand Image Awards received Expert Recommendations Doctor s recommendation Other 3% Figure 3.13: Determining the trust worthiness of the personal care brand Discussion: When asked about how the consumers will determine the trustworthiness of the personal care brand most (41%) of them responded that the image of the brand in their mind makes them trust the brand. They have been using the products of the brand from long time and have formed the image in their minds that of a trustful brand. Expert Recommendations, Doctor s recommendation and other reasons got an equal number of responses from the respondents. [24]
14) Mediums influential in promoting personal care products Mediums influential in promoting personal care products Number Television 79 Newspapers 29 Internet 36 Hoardings/Posters 11 Word of Mouth 54 Other 0 Table 3.14: Mediums influential in promoting personal care products Mediums influential in promoting personal care products 80 70 60 50 40 30 20 10 0 79 29 36 11 54 0 No. of Respondents Figure 3.14: Mediums influential in promoting personal care products (People may select more than one checkbox, so percentages may add up to more than 100%) Discussion: Most (79) of the respondents feel that Television is the most influential medium in promoting the personal care brand while word of mouth comes second as 54 of them said that it is also an influential medium of promotion as people share their own experiences with others. Internet and newspapers are next in line as promotion mediums. Television plays an important role in promotion as the advertisements played on TV are more creative and impactful. That s why we see a rise in advertisements related to personal care products. [25]
15) Switching behaviour of consumers Switching behaviour of consumers Number Percentage (%) Discounts 18 18 Free Gifts 7 7 Extra Quantity 13 13 Your brand raises price 12 12 Other reason 25 25 No I won t switch whatever may be reason 25 25 Table 3.15: Switching behaviour of consumers Switching behaviour of consumers Discounts 25% 18% Free Gifts 7% Extra Quantity Your brand raises price 25% 12% 13% Other reason No I won t switch whatever may be reason Figure 3.15: Switching behaviour of consumers Discussion: This question was asked to test the loyalty of personal care products consumers. To which only 25% of the respondents said that they won t change or switch over to other brand whatever be the reason. Another 25% said they would switch to other brands if they find a better one that theirs. 18% said they may switch to other personal care brand if they get attractive discounts. Another 12% said that they may switch due to increase in the prices by their brand. Extra quantity and free gifts were other reasons for the switchover. This also satisfies another secondary objective of the project i.e. to study the switching behaviour of consumers of personal care products. It is clear that there is less brand loyalty in case of the personal care products and the consumers may switch to other brands due to various attractive offers made by the competitors. [26]
3.2 Hypothesis Testing: H 1) It is very clear from the figure 3.8 that the consumers are highly brand conscious while buying personal care products. Whopping 71% of the respondents said that they liked to buy the branded products, while only 8% said they would go with unbranded ones. A considerable 21% said that they are neutral in buying branded or unbranded personal care products. This proves that the hypothesis H1 formed is correct. H 2) If we observe the figure 3.15, we can infer that personal care consumers are less loyal to their brand as only 25% said that they will not switch to other personal care product brand whatever may the reason. Other 75% of the respondents said they may switch to other brands on account of following reasons: Discounts, Free Gifts, Extra Quantity, their brand raises price and some other reasons. So the second hypothesis i.e. H2 stands wrong as it could not be proved correct on the basis of the data collected. [27]
Chapter 4: Suggestions Consumers were asked about the suggestions they wanted to give to the personal care products companies. Maximum respondents suggested that the personal care players in the market should concentrate most on the quality of the product. Price, convenience of buying, the attractive offers will come later on. Consumers today are ready to pay the premium for the quality they want. Once the producers take the care of quality of the product, promotions will take them to new heights. One suggestion was that of increasing ayurvedic / herbal products in the portfolio of personal care products. The demand was because the herbal products are mostly skin friendly and nonallergic to human body and provide the benefits naturally. The only problems with them is that they are little costly. Efforts should be made to make them available at affordable prices. Another suggestion was to take care of the safety and health of the consumers who uses the personal care products. This can be done by having strict quality measures while manufacturing the products. Products need to make balance between high results as well as not being allergic for maximum number of consumers. Customization and having more SKUs was another point made by the respondents. Today the consumers want to have more options and variety. They want to customize the product as suited for them and interestingly companies are also understanding their demands and providing them what they want. Speedy consumer complaints redressal is another thing that consumers want. Promotion of the personal care brands is one of the very important factors. To capture consumers mind and pocket it is very essential to create awareness of the brand or product among them. For that T.V. advertisements, promotional schemes, print ads, PR activities etc. need to take place. There should be perfect balance between the spending on marketing of the products and the sales or revenues generated from them. [28]
Chapter 5: Conclusion The project was related to find out the consumer buying behaviour of the personal care products. Respondent were asked the questions related to their buying behaviour. First to see about the general information, most of the respondents were male and falling into young category of less than 35 years. Another feature of the sample group was most of them were working professionals having either private job or government job and after them came the students. Most of the respondents had their annual income more than Rs. 3,50,000. So they were fairly high income people. When asked about the shopping place for personal care products most preferred to actually go to the shops and buy the products for themselves. This shows the behaviour of physically going to the shops and buying the products and not buying them online. So there is still a lot of scope in e-shopping area related to personal care products. They mostly like to shop for 1 or 2 times a month i.e. personal care products consumers are monthly planners and do not like to visit the stores too frequently. If we see the spending pattern we can observe that most of the respondents spend below Rs. 700 a month which very low consumption of the personal care products. As compared, China spends almost 10 times as much on skin care, 6 times as much on cosmetics and more than 2 times on hair care on a per capita basis. There is a lot of scope in Indian personal care market. As the disposable income is increasing the spending is surely increasing. Also seen was that the respondents are highly brand conscious while buying the personal care products. Though there are some who may prefer some local or regional products but slowly people are moving towards branded products. When asked about the preference of Indian or foreign brands most respondents were neutral about the preference. This shows that if consumers get quality products the origin of the product doesn t matter much to them. Among the 4P s of marketing the consumers preferred most to the product quality. They were of the view that if they get quality product they were ready to the pay premium for it. But I think the necessary promotion along with the quality is quite important in today s competitive market. The manufacturer needs to make the consumers aware of the his brand/product to the target market then only his product will sell. HUL shows again that why it is the no. 1 FMCG player in the market. When given a choice respondents chose HUL s personal care products at the top. HUL has varied portfolio of products and its distribution network is phenomenal. So it rules the market in India by having products for almost every segment of the society. Friends, family and advertisements were found to be the decision influencers while buying the personal care products. This is because the respondents are young population and are constantly in touch through workplace, social media, mobile phones etc. so they have lot of influence on each other while buying the personal care products particularly cosmetics, hair care and beauty related products. This finds the answer to our first secondary objective of [29]
finding out the most influential factors while buying personal care products. They are product quality, friends/family s suggestions and advertisements. Television and word of mouth emerged to be the most influential in promoting the personal care brands. As we see a lot of commercial advertisements on T.V. these days, they are bound to influence the youth and other members of the society as well. As we saw that friends help each other find their suitable brands this shows that how much important is word of mouth in case of promotion of personal care products. At last when the switching behaviour of the personal care products consumer was examined it turned out that they may switch their brand in hope of getting certain discounts, extra quantity, freebies etc. this finds the answer to the second secondary objective that personal care products consumer is not that loyal to their brand and may switch according to his/her convenience. So to conclude consumer buying behaviour is very important while considering the personal care products segment. As it is an important factor to forecast the sales of any type of product. Toady consumer wants quality product, good services, easy availability of product and better benefits from the product. People are becoming more brands conscious and they are not satisfied with the range of products available. So it is up to the players in the market to provide multiple options and at the same time maintain a perfect balance between the quality and price of the personal care products. [30]
Chapter 6: Bibliography Kotler, P. (2011). Marketing Management. Noida: Dorling Kindersley (India) Pvt. Ltd. FMCG sector (n.d.). Retrieved Nov 15, 2012, from about-fmcg.com: http://www.about-fmcg.com Business Standard (n.d.). Retrieved Dec 11, 2012, from Business-Standard.com: http://www.business-standard.com Ebsco (n.d.). Retrieved Dec 20, 2012, from ehis.ebscohost.com: http://ehis.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=b7cbcade-9d6e-4655-be53- de430b985386%40sessionmgr14&vid=2&hid=6 Ebsco (n.d.). Retrieved Dec 23, 2012, from indianresearchjournals.com: http://indianresearchjournals.com/pdf/ijmfsmr/2012/november/7.pdf dnaindia.(n.d.). Retrieved Dec 27, 2012, from dnaindia.com http://www.dnaindia.com/money/report_hul-seen-regaining-market-share-in-keybusiness_1563881 managementexplorer.(n.d.). Retrieved Jan 02, 2013, from managementexplorer.com http://managementexplorer.com/2011/08/17/market-share-of-various-companies-in-soapindustry/ [31]
Chapter 7: Appendix Questionnaire Questionnaire to elicit information on Consumer Buying Behaviour of Personal Care Products Dear Respondent, I, Amitkumar Tope a student of Symbiosis International University, Pune am conducting a research on Consumer Buying Behaviour of Personal Care Products. I seek your cooperation in filling the questions given below. I assure you that the information provided by you will be kept strictly confidential and used for academic purpose only. GENERAL INFORMATION Personal Care Products includes: Skin/Beauty Care (Soaps, Body Lotions, Deodorants, Fairness Creams etc.) ; Hair Care (Shampoos, Hair Oil, Conditioners, Hair dyes etc.), Oral Care (Toothpaste, Toothbrush etc.) Male Grooming products (Shaving Cream, Razors, Aftershaves etc.) 1) Age (in years): <25 ( ) 26-35 ( ) 36-45 ( ) 46-55 ( ) >55 ( ) 2) Gender: Male ( ) Female ( ) 3) Occupation: a) Student b) Professional (Private/Govt. Job) c) Housewife d) Businessman e) Other 4) Annual Household Income (in INR): <1,50,000 ( ) 1,50,000 3,50,000 ( ) 3,50,000 5,50,000 ( ) >5,50,000 ( ) [32]
SPECIFIC INFORMATION 5) Where do you like to shop for personal care products? a) Local Kirana Stores b) Super Markets c) Shopping Malls d) e-shopping 6) Generally how many times you visit to these places to buy personal care products? a) Once a month b) Twice a month c) Thrice a month d) More than 3 times a month 7) On an average how much do you spend on personal care products per month (in INR)? a) < 200 b) 200-500 c) 500-700 d) 700-1500 e) > 1500 8) Are you brand conscious while buying personal care products? a) Yes b) No c) Neutral 9) What is your preference in buying personal care products? a) Foreign Brands b) Indian Brands c) Neutral 10) How will you rate the following factors while purchasing personal care products? (Rate on the scale of 1 to 5 where 1 being very important and 5 being least important) a) Product Quality b) Ease of Availability c) Price d) Attractive Promotion 11) Given a choice you would prefer the personal care products of this company: a) HUL b) ITC c) P&G d) Dabur e) Emami f) Godrej Cosumer Care g) Other (Please mention) 12) Who influences your decision while buying personal care products? a) Brand Ambassadors b) Friends c) Family d) Advertisements e) Others [33]
13) How do you determine the trust worthiness of the personal care brand you are using? a) Brand Image b) Awards received c) Expert Recommendations d) Doctor s recommendation e) Other 14) What medium do you think are more influential in promoting personal care products? a) Television b) Newspapers c) Internet d) Hoardings/Posters d) Word of Mouth e) Other 15) For which of the following offers by competitors you may switch to other brand? a) Discounts b) Free Gifts c) Extra Quantity d) Your brand raises price e) Other reason f) No I won t switch whatever may be reason 16) Any Suggestions/Remarks to Personal Care Product players in the market? [34]