behavioral pattern and problems faced by indian customers
DESCRIPTION
mba seminarTRANSCRIPT
PROFILE,BEHAVIORAL PATTERN AND PROBLEMS FACED BY INDIAN CUSTOMERS
By
A.K.ANSHUCHINDU
BasheerShamweel
Sahalsuhail
WHAT IS CONSUMER PROFILE
Outline of significant demographic and psychographic details about the user of a particular product.
Knowledge of the consumer profile is very important in the determination of a creative advertising campaign.
CONSUMER PROFILE INCLUDES
Age Category Marital Status Income level Education Occupation Sex Area of residence Purchase behavior Pattern
CONSUMER PROFILE ANSWERS FOLLOWING
Who are the countries Citizen? What are the jobs available for the
people? Who among the people earn less than
the minimum wage? Which area are the poorest and has the
inefficient way of delivering basic service to the people?
What is the crime rate of certain big City?
PROFILE OF THE INDIAN CONSUMER
One of the key reasons for the increased consumption is the impressive growth of the middle class.
Around 70 per cent of the total households in
India reside in the rural areas. The total number of rural household is
expected to rise from 135 million in 2001-02 to 153 million in 2009-10. This presents the largest
potential market in the world.
CONTD.. The Indian rural market has been growing at
3-4% per annum, adding more than 1million new consumers every year and now accounts for close to 50% of the volume consumption of fast-moving consumer goods (FMCG) in India.
The market size of the fast moving consumer goods sector is projected to be more than double to US$ 23.25 billion by 2010 from the present US$ 11.16 billion. As a result, it is becoming an important market place for fast moving consumer goods as well as consumer durables.
DEMOGRAPHICS OF INDIA
Size Of Population Population of India is around 1.15bn people
in which majority of them lived in the Rural areas.
Literacy rate Literacy and education: According to the
Census 2010, the average literacy rate is 70percent. There is a rise in growth of literacy rate since 1951 and it has increased substantially in the last decade.
DIVERSITY, THE HALLMARK
Indian consumers are not a homogeneous lot. They are marked by great diversity. It is this diversity that strikes us first when we look at Indian consumers that is diversity in religion, language, culture, tradition, social customs, and dress and food habits.
RELIGIOUS DIVERSITY
The one billion people of India belong to seven different religious groups" Hindus, Muslims, Christians, Sikhs, Buddhists, Jains and Zoroastrians. In addition, there are other persuasions and there are sects, sub-sects, castes and sub-castes. Each religion has its own hierarchic structure, concretized through centuries of practices. Each caste has its own customs established over generations.
LINGUISTIC DIVERSITY
Sixteen languages have been specified in the Constitution of India as national languages. In addition, there are hundreds of dialects. In several places, many amalgams of languages have been formed as a result of shifting populations.
DIVERSITY IN DRESS AND FOOD HABITS Almost every state, or religious
community, has its own traditional styles of dress.
Food Habits also differs from place to place and from Religion to Religion
INDIA'S INCOME CLASS
1990-00 2005-06
RICH (annual income > US$ 4,700)* Own cars, PCs
3million households 6milliion households
CONSUMING (US$ 1000-4700)* Have bulk of banded consumer goods, 70% of 2-wheelers, refrigerators, washing machines
55 million 75 million
CLIMBERS (US$500-1000)* Have atleast one major durable (mixer, sewing machine/tv)
66million 78 million
ASPIRANTS (US$350-500)* Have bicycles, radios and fans
32million 33 million
DESTITUTES (Less than US$350)* Not buying
24million 17million
Indian consumers
0 20 40 60 80 100
Very rich
Consuming class
Climbers
Aspirants
Destitutes
million households
2006-07
2001-02
1995-96
Indian consumer buying behavior to a large extent has a western influence. Foreign brands have gained wide consumer acceptance in India.
"One household, multiple products“: two cars is no longer a luxury but a practical necessity for working couples; two TVs in the house is recognition of the fact that different family members have different interests
With the availability of low-interest finance schemes, price is increasingly becoming a smaller factor in a purchase decision in a whole range of consumer durables also.
Consumers jump steps as they enter: today the line between entry-level and upgraded products is disappearing. The newer generation is willing to pay more if he/she is convinced or he/she is getting better value for the higher price.
Upgrade is part of life. Today the average life of a mobile is 12 months, that of a TV three years; cars four to five years and soon even homes will be changed more frequently. Clearly durability is no longer the most desirable value.
As Indians have grown richer, they have begun to spend more on vehicles, phones, and restaurants, this is according to recent research on consumption patterns.
SEGMENTS
India has various consuming classes The young and the restless
Teen Riches, Dudes & Dudettes(men who pays too much attention to their clothes.)
Call Centre Boomers The Bold and bountiful(liberal)
The Yeppies (Young Entrepreneurial Professionals) The Yippies (Young International Professionals) The raffles (Rural Affluent Farm-Folk):
The golden Folks in High Spirits
1) THE YOUNG & RESTLESS India has the youngest population
profile in different income segments and locations, who are influencing their parents’ spending.
Some of them are also beginning to earn money through part-time for full-time jobs, arising out of opportunities that did not exist earlier. Some of these segments include
TEEN RICHES, DUDES & DUDETTES
This group mainly comprises young people who are from relatively affluent families. Eating out, movies and occasional clubbing are an integral part of their lifestyle. Dress is invariably modern, and attire must be changed frequently
CALL CENTRE BOOMERS
Formerly located mainly in the IT-savvy cities, call centers and other IT-Enabled Service centers are spreading to other cities and towns as well. Populated largely by youngsters out of school or college, drawing in their first incomes, and at levels unheard of earlier
THE BOLD AND THE BOUNTIFUL
The Yeppies (Young Entrepreneurial Professionals): entrepreneurs who have made it after the good
liberalization The Yippies (Young International Professionals):
work with multi-national companies, who are based in India but travel extensively
The raffles (Rural Affluent Farm-Folk): the farmer with tax-free income spend on a wider
choice of products
THE GOLDEN FOLKS IN HIGH SPIRITS
The retired folk, with kids who are married and living in their nuclear families, or even out of the country
Several of them have led fairly good lifestyles, and have the means to continue to do so
BEHAVIOURAL PATTERN OF INDIAN CONSUMERS
Consumer behavior is the study of how people buy, what
they buy, when they buy and why they buy.
It attempts to understand the buyer decision making
process, both individually and in groups.
It studies characteristics of individual consumers such as
demographics, psychographics and behavioral variables
in an attempt to understand people's wants.
TYPES OF CONSUMER BUYING BEHAVIOR
There are four types of consumer buying
behavior, they are
Routine Response/Programmed Behavior
Limited Decision Making
Extensive Decision Making
Impulse buying
ROUTINE RESPONSE/PROGRAMMED
BEHAVIOUR Buying low involvement, frequently
purchased, low cost items. Examples : Soft drinks, snack foods, milk etc.
LIMITED DECISION MAKING
Buying product occasionally.
That is when you need to obtain information about unfamiliar brand in a familiar product category.
Example: Clothes--know product class but not
the brand.
EXTENSIVE DECISION MAKING
Complex high involvement, unfamiliar, expensive and infrequently bought products.
Spend a lot of time seeking information and deciding. High degree of risk.
Example: Cars, homes, computers, education.
IMPULSE BUYING
No conscious planning.
The purchase of the same product does not always elicit the
same Buying Behavior. Product can shift from one category to the
next.
For example:
Going out for dinner for one person may be extensive decision
making (for someone that does not go out often at all), but limited
decision making for someone else. The reason for the dinner,
whether it is an anniversary celebration, or a meal with a couple
of friends will also determine the extent of the decision making.
INDIAN CONSUMER BEHAVIOURAL PATTERN
The world’s economic centre of gravity is
shifting-away from the established, wealthy
economies of Europe, Japan, and North
America and towards the Asia Pacific
India is one of the fastest-growing large
economies in the world.
The Indian Consumer Is Rapidly Transforming
Outlook– From Traditional to Modernized Traditional
Sudden Shift in almost all aspects of life
Change in lifestyle
From Functional to Lifestyle
Eating habitsFrom traditional meals to “McDonalds Happy Meal”
AVAILABILITY OF FINANCE AND SCHEMES
With the availability of low-interest finance schemes,
price is increasingly becoming a smaller factor in a
purchase decision in a whole range of consumer durables
also.
Consumers jump steps as they enter: today the line
between entry-level and upgraded products is
disappearing. The newer generation is willing to pay more
if he is convinced he is getting better value for the higher
price.
IMPORTANCE OF DURABILITY
Upgrade is part of life. Today the average life of a mobile is 12 months, that of a TV three years; cars four to five years and soon even homes will be changed more frequently. Clearly durability is no longer the most desirable value.
BUYING TV
Early ninetiesOne, availability; two, price; and, three, picture quality
Mid-nineties, the efficacy of an exchange scheme and the number of
channels a company offered
Todaysophistication -one of the fastest growing segments of
the market is high-end flat 3D LEDTVs
BUYING AIR CONDITIONER
In the early nineties, air-conditioner manufacturers focused on
institutional sales, leaving the dodgy unorganized sector, with its
dirt-cheap and poor quality offerings, to service households
By the late nineties, sales to households boomed.
In place of the clunky box that simply
cooled the room came sleek plastic shapes
offering such features as a dust-free
environment, split-room cooling, 5 star rating
and so on.
DRIVERS TO BEHAVIOURAL PATTERN
Demographics
Increased global exposure
Increased discretionary incomes across wider
spectrum of population, across wider geography
PURCHASING POWER OF INDIAN CONSUMERS
India’s GDP (Gross Domestic Product) has touched US$1.25
trillion.
The per capita figures do not reflect the realistic picture of
purchasing abilities of consumer households and market
potential for a foreign business enterprise because of
significant differences in purchase power parities of various
currencies
As a result, India ranks fourth richest nation in the world, on
purchase power parity terms, despite being having low per
capita national income
From just 3 malls in 2000, India is all set to have more than 2000 malls. According to consultancy firm (Technopak), the industry will see $20bn of fresh investments (excluding investments in real estate) and 2,000 hypermarkets coming up within the next five years
PROBLEMS FACED INDIAN CONSUMERS
Adulteration Under weighing and under measurement. High prices. Hoarding Selling sub-standard goods to consumers. False and duplicate items sold. Selling goods, which have reached expiry
date. False or incomplete information. Skipping away from the offers promised.
CONTD…
Rough behaviour from the shopkeepers.
Poor or inadequate after sale service.
Globalization and neo-colonialism.