A STUDY OF THE CONSUMER BUYING BEHAVIOUR OF CLASSMATE PEN
PROJECT REPORT Submitted in partial fulfillment of the Requirements for the award of the Degree of Master of Business Administration of Mahatma Gandhi University
By TONY JACOB Register No: 121I57
Under the Guidance of Dr. JOHNEY JOHNSON
SCHOOL OF MANAGEMENT AND BUSINESS STUDIES MAHATMA GANDHI UNIVERSITY KOTTAYAM, KERALA-686560 2011-2013
SCHOOL OF MANAGEMENT AND BUSINESS STUDIES Mahatma Gandhi University, Priyadarshini hills P.O. Kottayam, Kerala – 686 560
Certificate This is to certify that the project report titled “A STUDY OF THE CONSUMER BUYING BEHAVIOUR OF CLASSMATE PEN” is a bonafide record of the work done by Mr. Tony Jacob under the guidance of Dr.Johney Johnson and submitted in partial fulfillment of the requirements for the award of Master of Business Administration of Mahatma Gandhi University, Kottayam, Kerala.
Prof. Dr. K. Sreeranganadhan Dean and Director
Place: P D.Hills Date: 23-07-2013
SCHOOL OF MANAGEMENT AND BUSINESS STUDIES Mahatma Gandhi University, Priyadarshini hills P.O. Kottayam, Kerala – 686 560
Certificate This is to certify that this project report titled “A STUDY OF THE CONSUMER BUYING BEHAVIOUR OF CLASSMATE PEN” is based on an authentic work done by Mr. Tony Jacob under my guidance and submitted in partial fulfillment of the requirements for the award of the Degree of Master of Business Administration of Mahatma Gandhi University, Kottayam, Kerala.
Place: P D Hills Date: 23-07-2012
Dr. Johney Johnson Assistant Professor
DECLARATION I, TONY JACOB do hereby declare that the report titled “A STUDY OF THE CONSUMER BUYING BEHAVIOUR OF CLASSMATE PEN” is based on the original work done by me and submitted to the Mahatma Gandhi University in partial fulfillment of the requirements for the award of Degree of Master of Business Administration. I further declare that this work is not submitted by me for the award of any Degree, Diploma or Title earlier.
Place: Kottayam Date: 23-07-2013
Tony Jacob
ACKNOWLEDGEMENT I wish to express my deep sense of gratitude to everyone who helped me through scholarly guidance and valuable motivation for completing the project. First of all I thank the almighty God for making this task a success. I have made an earnest attempt to make this report complete and worthwhile. This project would not have come to its present shape without the able guidance, supervision and help of a number of people. I would, at the very onset, like to thank Mr. Premodh P, Assistant Manager, ESPB, ITC Limited for providing me the opportunity to perform my Summer Internship Project in the Company. I, would like to, give special thanks and gratitude to
Mr. Vikram Mohandas, for mentoring and providing the necessary data
and information as and when required throughout the project. His guidance has provided many insights and suggestions that I feel have increased the quality of information presented here. I would also like to thank all others in the Marketing Department at ITC for being extremely co-operative and guiding me throughout my project. I would like to express my sincere gratitude to Dr.K.Sreeranganadhan, Director, School Of Management and Business Studies for providing me the facility to carry out the project successfully and for his valuable suggestions and patronage of this report. I am thankful to Dr. Johney Johnson faculty, of School of Management and Business Studies for his support and timely help in the preparation and completion of my project work. I express my gratitude to my parents, friends and other family members who have supported and inspired me to complete the project.
TONY JACOB
ABSTRACT The researcher underwent a Project study at ITC Ltd to acquaint himself with the business environment for a period of two month from May 2nd, 2013 to July 2nd, 2013 as a part of the MBA curriculum at the School of Management & Business Studies Mahatma Gandhi University Kottayam. The topic for the study is on “A study of the consumer buying behavior of classmate pen”. Pen is a product, which is used by each and every person. There are various brands of pen in the market of different types Price, Color, design, Grip etc. So the pen market is full of competition where the consumer possesses vast variety of choice to select his brand which depends on his buying behavior .Of course it is very difficult to describe consumer buying behavior about pen; even though I have tried to find how the consumer purchases a particular brand? How much he searches for his brand? What factors influence he to buys the preferred brand? What are the different perceptive of retailers on pen? The technique of data collection is through questionnaire as it is less complex and easy Two methods (i.e.) Graphical method ,percentage are used as tools /techniques of analysis.
CONTENTS CHAPTER
PARTICULARS
CHAPTER 1 INTRODUCTION 1.1 Background 1.2 Scope Of The Study 1.3 Statement Of The Problem 1.4 Objective 1.5 Limitations Of The Study
CHAPTER 2 INDUSTRY & COMPANY PROFILE 2.1 Industry Profile 2.1.1 Profile of Pen industry In India
PAGE NO 1 2 3 3 3 4 5 6 6
2.1.2 Global Writing Instrument Industry
8
2.1.3 Market and Market Information
8
2.1.4 Regulatory Requirements
9
2.1.5 Changing Consumer Behavior
9
2.2 Company Profile
2.2.3 ITC‟s Product Mix
11 11 11 15
2.2.4 Vision of the Company
25
2.2.5 Mission of the Company
25
2.2.6 ITC‟s Core Values
25
2.2.7 Certifications of ITC 3.1 Consumer Buying Behavior 3.2 Stages of the Consumer Buying Process
27 30 31 31
3.3 Types of Consumer Buying Behaviors
32
3.4 Categories that Affect Consumer Buying Decision
33
2.2.1 Introduction to the Company 2.2.2 History of ITC
CHAPTER 3 REVIEW OF LITERATURE
Process
CHAPTER 4 RESEARCH METHODOLOGY
37
4.1 Research Methodology
38
4.2 Research Design
38
4.3 Statistical Tools Used
39
CHAPTER 5 DATA ANALYSIS AND INTERPRETATION
40
5.1 Consumer Buying Behavior Questionnaire Analysis 5.2 Retailer‟s Questionnaire Analysis CHAPTER 6 FINDINGS &SUGGESTIONS
42 59 75
6.1 Findings
76
6.2 Suggestions
77
CHAPTER 7 CONCLUSION
79
BIBILOGRAPHY APPENDIX
80 81
LIST OF TABLES TABLE NO. 2.1
TITLE Category Break up of Pen User
PAGE NO. 7
5.1.1
Age Group
42
51..2
Occupation Details
43
5.1.3
Types of pens using by Consumer
43
5.1.4
Most Preferred Brands
44
5.1.5
Most Selling Price Range of Pens
45
5.1.6
Places of Purchase
46
5.1.7
Factors Influencing Buying Decision
47
5.1.8
Types of Advertising Media
48
5.1.9
Effect of In-shop Advertisement
48
5.1.10
Most Influencing In-shop Advertisements
49
5.1.11
Persons Who Influencing Buying Decision
50
5.1.12
Number of Brand Loyal Customers
51
5.1.13
Brand Loyalty among different pens
52
5.1.14
Reasons for Brand Loyalty
53
5.1.15
Ratings of Brand Performance
54
5.1.16
Average no. of pen buying in a year
55
5.1.17
Number of regular refilling customers
55
5.1.18
Reasons for no-refilling of pens
56
5.1.19
No. of customers who have use classmate pens
57
5.2.1
Types of stores
59
5.2.2
Average monthly sale
59
5.2.3
Price Range of Maximum Pen Sale
60
5.2.4
Most selling Pen Types
61
5.2.5
Most Selling pen In RS 5-20 Price Range
62
5.2.6
Maximum Pen Selling Season
63
5.2.7
Brands of Pens Keeping in Each Stores
64
5.2.8
Factors Influencing Buying Decision
65
5.2.9
Retailer‟s influence towards customer in their buying decision
66
5.2.10
Retailers motivating factors to push the products
67
5.2.11
Types of stock replenishing
68
5.2.12
Influence of In-shop advertisements
69
5.2.13
Types of In-shop advertisements
69
5.2.14
Brands suggested for non-brand loyal customers
70
5.2.15
Influencing factors of retailer‟s brand suggestion
71
5.2.16
No of stores having classmate pens
72
5.2.17
Factors for improving classmate‟s sale
73
5.2.18
Number of stores interested to sell classmate pen
74
LIST OF CHARTS FIG. NO. 2.1
TITLE Ball and Gel pen Market Break-up
PAGE NO. 10
Market share of pen industry
10
5.1.1
Age Group
42
51..2
Occupation Details
43
5.1.3
Types of pens using by Consumer
44
5.1.4
Most Preferred Brands
45
2.2
5.1.5
Most Selling Price Range of Pens
46
5.1.6
Places of Purchase
46
5.1.7
Factors Influencing Buying Decision
47
5.1.8
Types of Advertising Media
48
5.1.9
Effect of In-shop Advertisement
49
5.1.10
Most Influencing In-shop Advertisements
50
5.1.11
Persons Who Influencing Buying Decision
51
5.1.12
Number of Brand Loyal Customers
51
5.1.13
Brand Loyalty among different pens
52
5.1.14
Reasons for Brand Loyalty
53
5.1.15
Ratings of Brand Performance
54
5.1.16
Average no. of pen buying in a year
55
5.1.17
Number of regular refilling customers
56
5.1.18
Reasons for no-refilling of pens
57
5.1.19
No. of customers who have use classmate pens
57
5.2.1
Types of stores
59
5.2.2
Average monthly sale
60
5.2.3
Price Range of Maximum Pen Sale
61
5.2.4
Most selling Pen Types
62
5.2.5
Most Selling pen In RS 5-20 Price Range
63
5.2.6
Maximum Pen Selling Season
64
5.2.7
Brands of Pens Keeping in Each Stores
65
5.2.8
Factors Influencing Buying Decision
66
5.2.9
67
5.2.10
Retailer‟s influence towards customer in their buying decision Retailers motivating factors to push the products
5.2.11
Types of stock replenishing
68
5.2.12
Influence of In-shop advertisements
69
5.2.13
Types of In-shop advertisements
70
5.2.14
Brands suggested for non-brand loyal customers
71
5.2.15
Influencing factors of retailer‟s brand suggestion
72
5.2.16
No of stores having classmate pens
72
67
5.2.17
Factors for improving classmate‟s sale
73
5.2.18
Number of stores interested to sell classmate pen
74
CHAPTER 1 - INTRODUCTION
INTRODUCTION 1.1 BACKGROUND
The ultimate objective of all production is consumption for the satisfaction of varied needs of man. A free market economy provides freedom to the consumers to buy and consume goods of their choice. Buying preferences of the consumers send signals to the producers to produce various commodities in required quantities. Producers, therefore, produces only those commodities which are desired by the consumers. Consumer behaviour is related to likes and dislikes and expectations of the consumers. Consumer behaviour has changed in recent years owing to enhanced awareness, information technology and more importantly governmental intervention through legislations. Thus, the manufacturers are more cautious in dealing with consumers of their respective products. In recent years, the lifestyle of a large number of consumers in India has changed dramatically and the process of change is on. The buying behaviour of the consumers is influenced by several factors such as socio-economic conditions, cultural environment, literacy level, occupation, geographical location, efforts on the part of sellers, exposure to media etc. Consumer behaviour in the market is perplexing because of a singular lack of consistency in groups which are homogeneous in parameters of demographics-Age, occupation, education and income. The study of consumer behaviour implies how & why a particular consumer reacts to the decisions of producers. It is the study of how individual make decision to spend their available resources (time, money, effort) on consumption related items. It includes the study of why they buy it, when they buy it, where they buy it, how often they buy it & how often they use it. This study focused on understanding the consumer buying behaviour of pens at retail outlets. It also focused on the issue that whether the marketing strategies are properly implemented or not. The study would be beneficial for the ITC Company to formulate the strategy for future.
DEFINITION Consumer Buying Behaviour: The collective actions, including the searching, evaluation, selection, purchasing, consuming, disposing of products, taken by consumers in determining which goods and services hold the most value for meeting their wants and needs. Marketers study consumer buying behaviour to determine the influence of psychological, sociological, demographical, and cultural factors have on buying decisions.
1.2 SCOPE OF THE STUDY 1. This study helps to the candidates to know about the consumer buying behaviour and its influencing factors 2. This study will help the company to know about the consumer buying behaviour pattern of their products 3. This study will help the company to identify the right marketing mix for the products 4. This study helps the company to improve their strategic formulation and decision making process
1.3 STATEMENT OF THE PROBLEM To study the consumer buying behaviour and retailers perceptive of classmate pen with its competitors
1.4 OBJECTIVES OF THE STUDY
To know about the pen industry.
To study purchases and consumption pattern of pens by the consumers.
To know which factors mostly influences the consumer to buy pens.
To know which price range of pens are mostly preferred by the people. To study the impact advertisement on consumers
To know the effectiveness of In-shop advertisement retail outlet
To help the company marketing managers to design an effective marketing mix for its target customers.
1.5 LIMITATIONS OF THE STUDY: A research study is never perfect. There is always some scope of improvement in the study in the future. Thus, it becomes important to critically evaluate the results and the whole study. The present study has certain limitations that need to be taken into account when considering the study and its contributions: 1. There a number of a factor, which affects consumer‟s perception about pens and is not possible to take all of them into account. Thus, this study is limited to variable under consideration. 2. The research is based on the responses given by the respondents, which may or may not be biased. 3. The results shown are relative in nature and are not absolute. In other words, it is the perception of an average customer. 4. The research study was conducted within the limited duration of time. So a detailed and comprehensive study could not be made .
CHAPTER 2 - INDUSTRY & COMPANY PROFILE
2.1 INDUSTRY PROFILE 2.1.1 PROFILE OF PEN INDUSTRY IN INDIA There has been a need to document through the use of writing instrument since the dawn of mankind. Pen and pencils continue to be the staples of everyday life and indispensable items for everyday use. Writing instruments continue to play integral part in the life of particularly every business, school and household. The advent of computers and related technology has yet to make writing industry and instruments slow placed and obsolete. In fact the writing instrument embraces the evolution of technology by incorporating it into new products and using it to enhance business aspects and client services. India is the only country after China to have fully fledged writing instruments industry built purely on the platform of its own domestic market demand. The size of the writing instrument industry in India is estimated about Rs.1800 Crores of which organized player account for 80% of the market share and the unorganized player for the rest. The industry grew by about 15% in 2004-05 and by 13.5% in 2005-06, largely driven by the growth of organized sector, indicating that consumer are responding favorably to quality and branding. It is expected that promotion, easy availability and affordability, branded off make will accelerate and helped the organized sector eat into unorganized presence. The Indian writing instruments market today is still on the path of discovering new niches with ergonomic designed products, promotional marketing items and luxury items but in the coming years it is bound to grow tremendously not only domestically but also in its exports emerging as world leaders in Writing Instruments. India‟s writing instrument industry is reserved for the small sector with a statutory limit on the maximum investment in plant and machinery at Rs 50 crores. As a result critical pen component like refills are manufactured in house, while all non-critical components are outsourced. Most Indian companies cater to the “Value for Money” (i.e. high volume low value strategy) while international player caters to premiums segment operating through exclusive distributers. Globally writing instruments industry is estimated at Rs 50000 crores (p.a). China controls approximately 10% of the global markets while the Indian share had so far been mini scale. But given the superior quality perception that “Made in India” pens have
over the Chinese; the buying preference of major retailers has been shifting to Indian products and brands. There are over 50 brands In India‟s organized and unorganized sectors. With economic liberalization many premium international brands entered India either independently or in collaboration with Indian manufacturers and distributors. These includes Reynolds, Parker, Cross, Mont Blanc, Cartier, Pierre Cardin and other designer pens from Episode, Frazer and Haws, Christian Dior and waterman. Over the years, the market share flowed from the unbranded to the branded sector. The market is segmented according to the following target audience:
Students(many of whom depend only on pencils and ball point pens)
Frequent users(in offices across commercial and public establishments)
Occasional users(housewives and literate manual workers)
While India‟s literacy rate is a high 74%, all literates occasionally use ball or fountain pens. While pen demand among the employed is relatively stagnant, demand among students is experiencing a healthy growth as this segment is more brands conscious. The writing instrument market is dominated by ball point pens accounting for 70% of India‟s total pen demand, followed by gel pens at 20% and fountain pens at 4%. 85% of users use blue, black and red ink. Category Type
% user share
Students
55-60
Commercial 30-25 Multi-level
15-10
Source : - AC Nielsen Report (June 2012)
Table 2.1 Category Break up of Pen User
The above information regarding the writing instrument industry has been obtained from the public sources like: Business line, Economic Times, Financial Express, some companies catalog are used along with internet support.
2.1.2 GLOBAL WRITING INSTRUMENT INDUSTRY
Globally, writing instrument industry is rising at a healthy rate despite growing computerization. The global writing instrument industry is estimated at Rs 65000 crores. (p.a) where USA markets grew by 5% last year (2005-06) and is expected to grow by the same proportionate at this time too. China controls approximately 10% of the global market, due to its manufacturing process. India is becoming most preferred manufacturing destination after china. Indian product quality is among best in the world, Compared to china mass market products. Indian market is growing healthily at 15 to 20% and is expected to grow with same rate for upcoming 2 to3 years (acc CAGR), where the organize sector now controls 70% market share in 2011 as compared to 54% up to 2000.
2.1.3 MARKET AND MARKET INFORMATION (IN DETAILS)
The worldwide market size for writing industry is Rs 100000 Crores (p.a),where USA‟s market alone is $4.68 Billion Dollars (App Rs 21000 Crores).
China exports of pens are over Rs 5000 Crores (p.a).
India exports of pens are over Rs 200 Crores (p.a).
The annual turnover of the industry in India is now estimated at Rs 2000 Crores per annum and is expected to increase at an annual growth rate by 15-20% per annum.
About 80% of India‟s pen industry revenue comes from pens with a price range of up to Rs. 15.
A small percentage of pens are priced in the range of Rs. 100-300.
The market for lower price range pens (up to Rs.15) is growing at 7-8% annually; the mid-range pen market is growing faster at 8-10%.
India is viewed as a quality supplier, where as china as a cheaper and lower quality products supplier.
Germany, Japan, Taiwan & Korea were hubs for the writing instrument industry, but due to cast factor manufactured have started shifting to China and India.
Previously Switzerland was the manufacturing center for ball point tips, but now India is emerging as a major Tip manufacturer satisfying not only Domestic demand but Global demand also.
2.1.4 REGULATORY REQUIREMENTS
In India as per law, the manufacturing of writing instruments is reserved or falls under the category of SSI (Small Scale Industry Sector). Thus there is ceiling on investment in plant and machinery manufacturing process (Max Rs. 50 Crores), excluding mould making as it is highly capital intensive pert of manufacturing. Of course any EOU (Export Oriented Unit) does not fall under this purview of SSI.
2.1.5 CHANGING CONSUMER BEHAVIOUR
The purchase of a single pen used to be a considered decision until not too long ago. Today, most consumers buy multiple pens in a single purchase. Because the consumer would go out specifically to buy a pen earlier, today most buy along with a number of other things as part of their monthly provisions. Earlier there was one pen to write, now interestingly even as communication getting increasing psychological, there is different pen, ink, size of different moods, needs and situation. Gone are the days where pen were just considered as merely an item of writing. But now it is a quasi-fashion statement something that‟s aligns with your personality, of course still the pen purchase decision is considered as low involvement decision.
Market Break-up
28% Gel pens Ball pens 72%
Chart 2.1: Ball and Gel pen-Market Break-up (value)
Market share 20% Un organised 80%
Organised
Chart 2.2: Market share of pen industry
2.2 COMPANY PROFILE 2.2.1 INTRODUCTION TO THE COMPANY
ITC is one of India's foremost private sector companies with a market capitalisation of nearly US $ 30 billion and a turnover of over US $ 6.1 Billion. ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by Business World and among India's Most Valuable Companies by Business Today. ITC ranks among India's `10 Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing companies compiled by Business Week. 2.2.2 HISTORY OF ITC ITC was incorporated on August 24, 1910 under the name of 'Imperial Tobacco Company of India Limited'. A leased office on Radha Bazar Lane, Kolkata, was the centre of the Company's existence. The Company celebrated its 16th birthday on August 24, 1926, by purchasing the plot of land situated at 37, Chowringhee, (now renamed J.L. Nehru Road) Kolkata, for the sum of Rs 310,000. The Company's ownership progressively Indianised, and the name of the Company was changed to I.T.C. Limited in 1974. In recognition of the Company's multi-business portfolio encompassing a wide range of businesses - Cigarettes & Tobacco, Hotels, Information Technology, Packaging, Paperboards & Specialty Papers, AgriExports, Foods, Lifestyle Retailing and Greeting Gifting & Stationery - the full stops in the Company's name were removed effective September 18, 2001.
ITC's Packaging & Printing Business was set up in 1925 as a strategic backward integration for ITC's Cigarettes business. It is today India's most sophisticated packaging house. In 1975 the Company launched its Hotels business with the acquisition of a hotel in Chennai which was rechristened 'ITC-Welcomgroup Hotel Chola'. Since then ITC's Hotels business has grown to occupy a position of leadership, with over 70 owned and managed properties spread across India.
In 1979, ITC entered the Paperboards business by promoting ITC Bhadrachalam Paperboards Limited, which today has become the market leader in India. In 1985, ITC set up Surya Tobacco Co. in Nepal as an Indo-Nepal and British joint venture. In August 2002, Surya Tobacco became a subsidiary of ITC Limited and its name was changed to Surya Nepal Private Limited (Surya Nepal).
In 1990, ITC acquired Tribeni Tissues Limited, a Specialty paper manufacturing company and a major supplier of tissue paper to the cigarette industry. Tribeni Tissues Division was merged with the Bhadrachalam Paperboards Division to form the Paperboards & Specialty Papers Division in November 2002.
In 1990, leveraging its agri-sourcing competency ITC set up the Agri Business Division for export of agri-commodities. ITC's unique and now widely acknowledged e-Choupal initiative began in 2000 with Soya farmers in Madhya Pradesh. Now it extends to 9 states covering over 4 million farmers. ITC's first rural mall, christened 'Choupal Sagaar' was inaugurated in August 2004 at Sehore. On the rural retail front, 24 'Choupal Saagars' are now operational in the 3 states of Madhya Pradesh, Maharashtra and Uttar Pradesh. In 2000, ITC launched a line of high quality greeting cards under the brand name 'Expressions'. In 2002, the product range was enlarged with the introduction of Gift wrappers, Autograph books and Slam books. In the same year, ITC also launched 'Expressions Matrubhasha', a vernacular range of greeting cards in eight languages and 'Expressions Paperkraft', a range of premium stationery products. In 2003, the company rolled out 'Classmate', a range of notebooks in the school stationery segment.
ITC also entered the Lifestyle Retailing business with the Wills Sport range of international quality relaxed wear for men and women in 2000. The Wills Lifestyle chain of exclusive stores later expanded its range to include Wills Classic formal wear (2002) and Wills Clublife evening wear (2003). ITC also initiated a foray into the popular segment with its men's wear brand, John Players, in 2002. In 2006, Wills Lifestyle became title partner of the country's most premier fashion event - Wills Lifestyle India Fashion Week - that has gained recognition from buyers and retailers as the single largest B-2-B platform for the Fashion Design industry. In 2007, the Company introduced 'Miss Players'- a fashion brand in the popular segment for the young woman.
In 2000, ITC spun off its information technology business into a wholly owned subsidiary, ITC Infotech India Limited, to more aggressively pursue emerging opportunities in this area. ITC's foray into the Foods business is an outstanding example of successfully blending multiple internal competencies to create a new driver of business growth. It began in August 2001 with the introduction of 'Kitchens of India' ready-to-eat Indian gourmet dishes.
In 2002, ITC entered the confectionery and staples segments with the launch of the brands mint-o and Candyman confectionery and Aashirvaad atta (wheat flour). 2003 witnessed the introduction of Sunfeast as the Company entered the biscuits segment. ITC's entered the fast growing branded snacks category with Bingo! in 2007. In 2002, ITC's philosophy of contributing to enhancing the competitiveness of the entire value chain found yet another expression in the Safety Matches initiative. ITC now markets popular safety matches brands like iKno, Mangaldeep, Aim, Aim Mega and Aim Metro.
ITC forayed into the marketing of agarbattis (incense sticks) in 2003 marked the manifestation of its partnership with the cottage sector. ITC's popular agarbattis brands include Spriha and Mangaldeep across a range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Sambrani and Nagchampa.
ITC introduced Essenza Di Wills, an exclusive range of fine fragrances and bath & body care products for men and women in July 2005. Inizio, the signature range under Essenza Di Wills provides a comprehensive grooming regimen with distinct lines for men (Inizio Homme) and women (Inizio Femme). Continuing with its tradition of bringing world class products to Indian consumers the Company launched 'Fiama Di Wills', a premium range of Shampoos, Shower Gels and Soaps in September, October and December 2007 respectively. The Company also launched the 'Superia' range of Soaps and Shampoos in the mass-market segment at select markets in October 2007 and Vivel De Wills & Vivel range of soaps in February and Vivel range of shampoos in June 2008.
ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels,
Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery. As one of India's most valuable and respected corporations, ITC is widely perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar calls this source of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value. ITC practices this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India. ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade). The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet. This transformational strategy, which has already become the subject matter of a case study at Harvard Business School, is expected to progressively create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach. ITC's wholly owned Information Technology subsidiary, ITC Infotech India Limited, is aggressively pursuing emerging opportunities in providing end-to-end IT solutions, including e-enabled services and business process outsourcing. ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to voluntarily seek a corporate governance rating. ITC employs over 26,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalising environment to consistently reward more than 3,75,000 shareholders, fulfill the aspirations of
its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder." 2.2.3 ITC’s Product Mix Cigarettes
ITC is the market leader in cigarettes in India. With its wide range of invaluable brands, it has a leadership position in every segment of the market. It's highly popular portfolio of brands includes Insignia, India Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake.
The Company has been able to build on its leadership position because of its single minded focus on value creation for the consumer through significant investments in product design, innovation, manufacturing technology, quality, marketing and distribution.
All initiatives are therefore worked upon with the intent to fortify market standing in the long term. This in turns aids in designing products which are contemporary and relevant to the changing attitudes and evolving socio economic profile of the country. This strategic focus on the consumer has paid ITC handsome dividends.
ITC's pursuit of international competitiveness is reflected in its initiatives in the overseas markets. In the extremely competitive US market, ITC offers high-quality, value-priced cigarettes and Roll-your-own solutions. In West Asia, ITC has become a key player in the GCC markets through growing volumes of its brands.
ITC's cigarettes are produced in its state-of-the-art factories at Bengaluru, Munger, Saharanpur and Kolkata. These factories are known for their high levels of quality, contemporary technology and work environment.
FMCG Foods
ITC made its entry into the branded & packaged Foods business in August 2001 with the launch of the Kitchens of India brand. A more broad-based entry has been made since June 2002 with brand launches in the Confectionery, Staples and Snack Foods segments.
The packaged foods business is an ideal avenue to leverage ITC's proven strengths in the areas of hospitality and branded cuisine, contemporary packaging and sourcing of
agricultural commodities. ITC's world famous restaurants like the Bukhara and the Dum Pukht, nurtured by the Company's Hotels business, demonstrate that ITC has a deep understanding of the Indian palate and the expertise required to translate this knowledge into delightful dining experiences for the consumer. ITC has stood for quality products for over 98 years to the Indian consumer and several of its brands are today internationally benchmarked for quality.
The Foods business carries forward this proud tradition to deliver quality food products to the consumer. All products of ITC's Foods business available in the market today have been crafted based on consumer insights developed through extensive market research. Apart from the current portfolio of products, several new and innovative products are under development in ITC's state-of-the-art Product Development facility located at Bengaluru.
Leadership in the Foods business requires a keen understanding of the supply chain for agricultural produce. ITC has over the last 98 years established a very close business relationship with the farming community in India and is currently in the process of enhancing the Indian farmer's ability to link to global markets, through the e-Choupal initiative, and produce the quality demanded by its customers. This longstanding relationship is being leveraged in sourcing best quality agricultural produce for ITC's Foods business.
The Foods business is today represented in 4 categories in the market. These are:
Ready To Eat Foods
Staples
Confectionery
Snack Foods
In order to assure consumers of the highest standards of food safety and hygiene, ITC is engaged in assisting outsourced manufacturers in implementing world-class hygiene standards through HACCP certification. The unwavering commitment to internationally benchmarked quality standards enabled ITC to rapidly gain market standing in all its 6 brands:
Kitchens of India
Aashirvaad
Sunfeast
mint-o
Candyman
Bingo!
Lifestyle Retailing
ITC‟s Lifestyle Retailing Business Division has established a nationwide retailing presence through its Wills Lifestyle chain of exclusive specialty stores. Wills Lifestyle, the fashion destination, offers a tempting choice of Wills Classic work wear, Wills Sport relaxed wear, Wills Clublife evening wear, fashion accessories and Essenza Di Wills – an exclusive range of fine fragrances and bath & body care products and Fiama Di Wills - a range of premium shampoos and shower gels. Wills Lifestyle has also introduced Wills Signature designer wear, designed by the leading designers of the country.
With a distinctive presence across segments at the premium end, ITC has also established John Players as a brand that offers a complete fashion wardrobe to the male youth of today. The recent launch of Miss Players with its range of trendy fashion wear for young women has been a successful addition to the youthful offering. With its brands, ITC is committed to build a dominant presence in the apparel market through a robust portfolio of offerings.
At Wills Lifestyle, customers can browse at leisure, and shop in a relaxed and pleasing atmosphere. The use of space is refreshing, which is reflected even in the spacious changing rooms. Every store offers an international retailing ambience with the extensive use of glass, steel and granite, reflecting the most contemporary trends in store design, thereby creating a splendid backdrop for the premium offerings.
Wills Lifestyle was named Superbrand 2009 by the Superbrands Council of India recently. Wills Lifestyle has been twice declared 'The Most Admired
Exclusive Brand Retail Chain of the Year' at the Images Fashion Awards in 2001 & 2003 as well as 'Most Admired Fashion Brand of the year - Fashion Forward' in 2009.
Personal Care
In line with ITC's aspiration to be India's premier FMCG company, recognised for its world-class quality and enduring consumer trust, ITC forayed into the Personal Care business in July 2005. In the short period since its entry, ITC has already launched an array of brands, each of which offers a unique and superior value proposition to
discerning consumers. Anchored on extensive consumer research and product development, ITC's personal care portfolio brings world-class products with clearly differentiated benefits to quality-seeking consumers.
ITC's Personal Care portfolio under the 'Essenza Di Wills', 'Fiama Di Wills', 'Vivel Di Wills' 'Vivel UltraPro', 'Vivel' and 'Superia' brands has received encouraging consumer response and is being progressively extended nationally.
ITC's state-of-the-art manufacturing facility meets stringent requirements of hygiene and benchmarked manufacturing practices. Contemporary technology and the latest manufacturing processes have combined to produce distinctly superior products which rank high on quality and consumer appeal.
Extensive insights gained by ITC through its numerous consumer engagements have provided the platform for its R&D and Product Development teams to develop superior, differentiated products that meet the consumer's stated and innate needs. The product formulations use internationally recognised safe ingredients, subjected to the highest standards of safety and performance.
Education & Stationary products
ITC made its entry into the stationery business in the year 2002 with its premium range of notebooks, followed in the year 2003 with the more popular range to augment its offering.
Today, ITC continues to blend its core capabilities to market a growing range of education and stationery products. These capabilities include, a.
Manufacturer of India‟s first Ozone treated environment friendly Elemental
Chlorine Free (ECF) pulp, paper and paperboard. b.
Knowledge of image processing, printing & conversion garnered from its
Packaging& c.
Printin Business.
Brand Building & Trade Marketing & Distribution strengths resident in its
FMCG Business.
ITC‟s stationery Brands are marketed as “Classmate” and “Paperkraft”, with Classmate addressing the needs of students and Paperkraft targeted towards college students and executives.
Classmate - India’s truly largest National brand, reaching 65,000 outlets across the country, has over 300 variants in its range which comprises notebooks, long books, practical books, drawing books, scrap books, reminder pads etc.
The Classmate Fun N Learn range of children books targeting pre school learners, comprising categories like Pre School Learner, Active Minds and Read Aloud Tales with features like Wipe n Use again, Trace & Color and Puzzles ensure that a child's first lessons are truly enjoyable.
Classmate Invento Geometry Boxes, launched for school students comprise a worldclass precision compass and high quality plastic instruments coupled with interesting trivia and useful information, to make geometry more fascinating for students.
Aesthetically designed, Classmate pens offer the consumer a smoother and more comfortable writing experience through use of ergonomic design, reducing the effort required for writing. The initial launch comprises ball pens - Classmate Safari and Classmate Ilet - and gel pens - Classmate Glider and Classmate Octane.
A new entry to the Classmate portfolio is its range of HB Jet Black pencils. Designed attractively for school kids, the pencils offer a unique advantage of lesser lead wear out and thus, “Stay Sharper for Longer”.
The Classmate Notebook range builds in regional preferences and caters to the requirements of All India & State Education Boards. Every Classmate notebook carries ITC's Corporate Social Responsibility message on its back. For every four Classmate Notebooks, ITC contributes Re. 1 to its rural development initiative that supports, among other projects, primary education in villages.
Classmate has successfully run the “Classmate Young Author & Artist Contest” for 5 years. The contest is a national level event going across 34 cities and getting participation from 5000 schools.
The Paperkraft range consists of premium stationery with a wide variety for executives to choose from. The assortment consists of notepads & multi subject notebooks in hard, soft covers & multiple binding formats including spirals, wiros etc.
The Paperkraft brand recently launched premium business paper – an environment friendly multipurpose paper for office and home use. The paper has been crafted by ITC‟s Bhadrachalam unit using a pioneering technology, called “Ozone Treated Elemental Chlorine Free technology”. Paperkraft business paper is the whitest and
brightest 75 & 70 GSM papers manufactured in India and provides consumers an opportunity to “Go Green”.
Safety Matches
As part of its strategic initiative to create multiple drivers of growth in the FMCG sector, ITC commenced marketing safety matches sourced from the small-scale sector. The Matches business leverages the core strengths of ITC in marketing and distribution, brand building, supply chain management and paperboard & packaging to offer Indian consumers high quality safety matches.
ITC‟s range of Safety matches include popular brands like i Kno, Mangaldeep, Aim, Aim Mega and Aim Metro. With differentiated product features and innovative value additions, these brands effectively address the needs of different consumer segments. The Aim brand is the largest selling brand of Safety Matches in India. ITC also exports regular and premium safety matches brands to markets such as Middle East, Africa and the USA. The successful acquisition of Wimco Ltd. by Russell Credit Ltd., a wholly owned subsidiary of ITC has consolidated the market standing of the Company's Matches business through synergy benefits derived through combined portfolio of offerings, improved servicing of proximal markets and freight optimization. Through its participation, ITC aims to enhance the competitiveness of the small and medium scale sectors through its complementary R&D based product development and marketing strengths, especially the breadth and depth of the Company's trade marketing and distribution.
Agarbattis As part of ITC's business strategy of creating multiple drivers of growth in the FMCG sector, the Company commenced marketing Agarbattis (incense sticks) sourced from small-scale and cottage units in 2003. This business leverages the core strengths of ITC in nation-wide distribution and marketing, brand building, supply chain management, manufacture of high quality paperboards and the creation of innovative packaging solutions to offer Indian consumers high quality Agarbattis. With its participation in the business, ITC aims to enhance the competitiveness of the small and medium scale sectors through its complementary R&D based product development and strengths in trade marketing and distribution.
Mangaldeep Agarbattis are available in a wide range of fragrances like Rose, Jasmine, Bouquet, Sandalwood, Madhur, Durbar, Tarangini, Anushri, Ananth and Mogra.
Mangaldeep Yantra is a special offering from ITC and this specially created fragrance evokes the ambience of a temple. The premium range from ITC, Mangaldeep Spriha has two offerings, Pratiti and Sarvatra and are specially hand rolled by Cottage Industries, Sri Aurobindo Ashram, Puducherry. Cottage Industries, Puducherry, has recently been accredited with IFAT certification, which is an internationally recognized benchmark for fair trade practices.
Mangaldeep is also available in 3-in-1 and 5-in-1 packs giving the consumer a choice of multiple fragrances in a single pack. Mangaldeep appeals to a cross-section of consumers with offerings at various price points. These agarbattis are available in innovative 'Fragrance-Locked' packaging. 'Fragrance locking' is a unique concept of packaging which retains the fragrance for a longer period and helps in "Completing the Purity of Prayer". Mangaldeep is fast emerging as the only national brand in an industry dominated by multiple local brands.
In line with ITC's Triple Bottom Line philosophy of every business contributing to the nation's economic, environmental and social capital, Mangaldeep agarbattis are manufactured by small scale and cottage units, providing livelihood opportunities for more than 5000 people. Seven out of 10 Mangaldeep Agarbatti manufacturing units are ISO 9000 certified. Mangaldeep ASHA (Assistance in Social Habilitation through Agarbattis) is an ITC initiative to improve the quality of raw agarbatti production and provide better value realization for women rollers. Under the project, ITC has extended support to NGOs in states and like Bihar, Tripura, Tamil Nadu, who are setting up agarbatti units, training village women in rolling agarbattis and employing them in these units.
Expressions Aromatic Candles o Leveraging its deep consumer insight, ITC's Agarbatti business recently launched "Expressions" Premium Range of Aromatic Candles in India through Wills Lifestyle Stores. Research on usage and attitude reveals a strong linkage of candles to attributes like Romance, Decoration and Wellness (Aromatherapy).
o The Expressions range of Aromatic candles comprises Amour - the Romance Series, Adora - the Decor Series and Nirvana - the Spa Series. The basis of segmentation is colour and fragrance - Red for romance, Purple for décor and Green for wellness. The fragrance of the candles have been specially selected are made from the finest perfumes and oils. Each candle's fragrance, shape and design are carefully chosen with a distinct sensation and ambience in mind. Ideal for gifting, Expressions Aromatic Candles promise to soothe, uplift and transform.
Hotels
ITC entered the hotels business in 1975 with the acquisition of a hotel in Chennai, which was then rechristened ITC Chola. Since then the ITC-Welcomgroup brand has become synonymous with Indian hospitality. With over 100 hotels in more than 80 destinations, ITC-Welcomgroup has set new standards of excellence in the hotel industry in Accommodation, Cuisine, Environment and Guest Safety. ITC's Hotels business is one of India's finest and fastest growing hospitality chains. ITC Hotels' commitment to delivering globally benchmarked services, embedded in a culture deeply rooted in India's rich tradition of hospitality, gives it a unique and distinct identity.
A leader in the premium hospitality segment, ITC Hotels have had the privilege of hosting world leaders, Heads of State and discerning guests from across the world and within.
ITC-Welcomgroup pioneered the holistic concept of 'branded accommodation' in the hospitality industry. It was the first to launch the idea of a 'Hotel within a Hotel' by segmenting, customizing and branding hotel services like 'ITC One', 'Towers' and the 'Executive Club'. Each of these caters to specialized needs of the global business traveller with unmatched quality and a range of custom-made services.
Paperboard and Specialty papers
ITC‟s Paperboards and Specialty Papers Division is India‟s largest and most technologically advanced paper and paperboards business. ITC caters to a wide spectrum of packaging, graphic, communication, writing, printing and specialty paper requirements through its four world-class mills in India. Having pioneered many speciality applications like cigarette tissues, packaging boards, aseptic cartons and gypsum liners, ITC‟s Paperboards and Specialty papers business enjoys market leadership in the value-added paperboards segment, and also has a significant share of the Indian paperboards market. It is also the largest Indian exporter of coated boards.
Packaging
ITC's Packaging & Printing Business is the country's largest convertor of paperboard into packaging. It converts over 50,000 tonnes of paper and paperboard per annum into a variety of value-added packaging solutions for the food & beverage, personal products, cigarette, liquor, cellular phone and IT packaging industries. It has also entered the Flexibles and Corrugated Cartons business.
The Division, which was set up in 1925 as a strategic backward integration for ITC's Cigarettes business, is today India's most sophisticated packaging house. State-of-theart technology, world-class quality and a highly skilled and dedicated team have combined to position ITC as the first-choice supplier of high value added packaging.
The Division supplies value-added packaging to the Company's Cigarettes business. Its client list includes several well-known national and international companies like British American Tobacco, Philip Morris International, Surya Nepal Private Limited, VST Industries, UB Group, Nokia, Flextronics, Foxconn, FMC India Pvt Ltd., Pernod Ricard, Allied Domecq, Whyte & Mackay, Hindustan Lever, Tata Tetley, Nestle and Reckitt Benkiser India Limited, etc.
With all the three factories at Tiruvottiyur near Chennai, Munger in Bihar and Haridwar in Uttarakhand certified to ISO 9001, ISO 14001 and OHSAS 18001, the Company offers a comprehensive product range in packaging:
Flip-top boxes Display outers Shells and Slides Soft cup and strap Labels Bundle Wraps Flap boxes Inner Frames Coupon Inserts Folding Cartons
Fluted Cartons
Shoulder Boxes
Pre-printed cork tipping
Flexibles
Packaging
ITC occupies a leadership position in cigarette and liquor packaging in India. It supplies packaging to cover 70 billion cigarettes a year domestically, and supplies packaging for 15 billion cigarette sticks a year for the export market. It is the largest supplier of liquor mono cartons in the country.
ITC has enhanced the value of some of the most favoured brands with superior lookand-feel packaging, using the best raw materials and process combinations, and an inhouse pre-press Design Centre.
A Product Introduction Process team pioneers packaging innovations. The team uses a unique process to pilot the client's packaging through its manufacturing system. Specifications are evolved based on clients' needs. Corresponding to the specifications, a variety of packaging solutions is then generated. The efficacy of the packaging is tested simulating the client's factory conditions.
2.2.4 VISION OF THE COMPANY Sustain ITC's position as one of India's most valuable corporations through world class performance, creating growing value for the Indian economy and the Company‟s stakeholders. 2.2.5 MISSION OF THE COMPANY To enhance the wealth generating capability of the enterprise in a globalising environment, delivering superior and sustainable stakeholder value. 2.2.6 ITC’s CORE VALUES ITC's Core Values are aimed at developing a customer-focused, high-performance organisation which creates value for all its stakeholders: Trusteeship As professional managers, we are conscious that ITC has been given to us in "trust" by all their stakeholders. ITC actualise stakeholder value and interest on a long-term sustainable basis. Customer Focus ITC is always customer focused and will deliver what the customer needs in terms of value, quality and satisfaction.
Respect For People ITC is result oriented, setting high performance standards as individuals and teams. ITC simultaneously respect and value people and uphold humanness and human dignity. ITC acknowledge every individual brings different perspectives and capabilities to the team and that a strong team is founded on a variety of perspectives. ITC want individuals to dream, value differences, create and experiment in pursuit of opportunities and achieve leadership through teamwork. Excellence ITC do what is right, do it well and win. ITC will strive for excellence in whatever they do. Innovation ITC will constantly pursue newer and better processes, products, services and management practices. Nation Orientation ITC is aware of their responsibility to generate economic value for the Nation. In pursuit of their goals, ITC will make no compromise in complying with applicable laws and regulations at all levels. ITC’s Philosophy ITC believes in practicing ethical behaviour among the corporate citizen. The company follows an HR policy that is regulated by Teamwork, Trust, Collaboration, Mutuality, Meritocracy, Objectivity, Collaboration, Self-respect and Human-dignity. It is also deeply committed to make the company a gender friendly place for each individual while also ensuring enhancement of equal opportunities for men and women, preventing sexual harassment of any form and the adherence to good employment practices. It is ensured that the interest of the company is foremost and in this context acceptance of any kind of gifts or payments from suppliers or customers is viewed as a serious breach of company discipline. And such acts are also considered as damaging to the reputation of the company. High standards of house keeping and hygiene are followed to ensure excellent physical working conditions. It is understood that all the directors, senior management and employees shall conduct themselves in an honest manner and avoid any conflict of interest.
The top officials and employees of ITC believe that ITC provides them freedom at work and resources to experiment. Employees take pride in working for ITC for its work culture, environment, and the way people are treated. They are consulted before a new project\system is introduced and their concerns and suggestions addressed. ITC also gives a lot of input to develop their skill and career. They give utmost importance to equal opportunities, better work environment.
2.2.7 CERTIFICATION OF ITC
ITC constantly endeavors to benchmark its products, services and processes to global standards. The Company's pursuit of excellence has earned it national and international honors. ITC is one of the eight Indian companies to figure in Forbes A-List for 2004, featuring 400 of "the world's best big companies". Forbes has also named ITC among Asia's'Fab 50' and the World's Most Reputable Companies ITC is the first Indian company and the second in the world to win the prestigious Development Gateway Award. It won the $100,000 Award for the year 2005 for its trailblazing ITC e-Choupal initiative which has achieved the scale of a movement in rural India. The Development Gateway Award recognizes ITC's e-Choupal as the most exemplary contribution in the field of Information and Communication Technologies (ICT) for development during the last 10 years. ITC e-Choupal won the Award for the importance of its contribution to development priorities like poverty reduction, its scale and replicability, sustainability and transparency. ITC has won the inaugural 'World Business Award', the worldwide business award recognizing companies who have made significant efforts to create sustainable livelihood opportunities and enduring wealth in developing countries. The award has been instituted jointly by the United Nations Development Programme (UNDP), International Chamber of Commerce (ICC) and the HRH Prince of Wales International Business Leaders Forum (IBLF). ITC is the first Corporate to receive the Annual FICCI Outstanding Vision Corporate Triple Impact Award in 2007 for its invaluable contribution to the triple bottom line benchmarks of building economic, social and natural capital for the nation.
ITC has won the Golden Peacock Awards for 'Corporate Social Responsibility (Asia)' in 2007, the Award for „CSR in Emerging Economies 2005‟ and „Excellence in Corporate Governance' in the same year. These Awards have been instituted by the Institute of Directors, New Delhi, in association with the World Council for Corporate Governance and Centre for Corporate Governance ITC's cigarette factory in Kolkata is the first such unit in India to get ISO 9000 quality certification and the first among cigarette factories in the world to be awarded the ISO 14001 certification ITC Maurya in New Delhi is the first hotel in India to get the coveted ISO 14001 Environment Management Systems certification. ITC Filtrona is the first cigarette filter company in the world to obtain ISO 14001 ITC Infotech finds pride of place among a select group of SEI CMM Level 5 companies in the world. ITC's Green Leaf Threshing plant in Chirala is the first in India and among the first 10 units in the world to bag the Social Accountability (SA 8000) certification ITC Chairman Y C Deveshwar has received several honors over the years. Notable among them are: Year
Award
2007
SAM/SPG Sustainability Leadership Award conferred at the International Sustainability Leadership Symposium, Zurich.
2006
Business Person of the Year from UK Trade & Investment, the UK Government organisation that supports overseas businesses in that country.
2006
Inducted into the `Hall of Pride' by the 93rd Indian Science Congress
2005
Honoured with the Teacher's Lifetime Achievement Award
2001
Manager Entrepreneur of the Year from Ernst & Young Retail
Visionary of the Year from Images, India's only fashion and retail trade magazine 1998
Honorary Fellowship from the All India Management Association
1996
Distinguished Alumni Award from IIT, Delhi
1994
Marketing Man of the Year from A&M, the leading marketing magazine
1986
Meridien Hotelier of the Year
ITC has won the 'Enterprise Business Transformation Award' for Asia Pacific (Apac), instituted by Infosys Technologies and Wharton School of the University of Pennsylvania for its celebrated e-Choupal initiative. ITC is the only Indian FMCG Company to have featured in the Forbes 2000 list. The Forbes 2000 is a comprehensive ranking of the world's biggest companies, measured by a composite of sales, profits, assets and market value. The list spans 51 countries and 27 industries. ITC continues its dominance of The Economic Times' Brand Equity listing of India's 100 Biggest FMCG Brands, with three brands from its stable making it to the top five. Gold Flake remains India's biggest FMCG brand in terms of sales. Navy Cut ranks at No. 4. ITC's Scissors brand ranks at No 5 and is the only new entrant into the top 10. Restaurant magazine has chosen Bukhara at the ITC Maurya, New Delhi as the best Indian restaurant in the world and the best restaurant in Asia. Bukhara has also been adjudged one of the top 50 restaurants in the world by the London based magazine 'The Good Food Guide'. Bukhara is the only South Asian restaurant to figure in the list. ITC's Lifestyle Retailing Business Division (LRBD) has won the "Best Supply Chain Practices Award" for time-effective and cost-efficient Logistics Management in Organized Retail. The awards were organized by Retailers Association of India (RAI) in association with ITW Signode - the International leaders in packaging solutions.
CHAPTER -3 REVIEW OF LITERATURE
3.1Consumer Buying Behaviour Definition of Buying Behaviour: Buying Behaviour is the decision processes and acts of people involved in buying and using products. Consumer Buying Behaviour refers to the buying behaviour of the ultimate consumer. A firm needs to analyze buying behaviour for:
Buyer‟s reactions to a firms marketing strategy has a great impact on the firm‟s success.
The marketing concept stresses that a firm should create a Marketing Mix (MM) that satisfies (gives utility to) customers, therefore need to analyze the what, where, when and how consumers buy.
Marketers can better predict how consumers will respond to marketing strategies.
3.2 Stages of the Consumer Buying Process Six Stages to the Consumer Buying Decision Process (For complex decisions). Actual purchasing is only one stage of the process. Not all decision processes lead to a purchase. All consumer decisions do not always include all 6 stages, determined by the degree of complexity The 6 stages are: 1. Problem Recognition(awareness of need)--difference between the desired state and the actual condition. Deficit in assortment of products. Hunger--Food. Hunger stimulates your need to eat.. 2. Information search-o
Internal search, memory.
o
External search if you need more information. Friends and relatives (word of mouth). Marketer dominated sources; comparison shopping; public sources etc.
A successful information search leaves a buyer with possible alternatives, the evoked set. 3. Evaluation of Alternatives--need to establish criteria for evaluation, features the buyer wants or does not want. Rank/weight alternatives or resume search.. Information from different sources may be treated differently. Marketers try to influence by "framing" alternatives. 4. Purchase decision--Choose buying alternative, includes product, package, store, method of purchase etc. 5. Purchase--May differ from decision, time lapse between 4 & 5, product availability.
6. Post-Purchase Evaluation--outcome: Satisfaction or Dissatisfaction. Cognitive Dissonance, have you made the right decision. This can be reduced by warranties, after sales communication etc.
3.3 Types of Consumer Buying Behaviours Types of consumer buying behaviour are determined by:
Level of Involvement in purchase decision. Importance and intensity of interest in a product in a particular situation.
Buyers level of involvement determines why he/she is motivated to seek information about a certain products and brands but virtually ignores others.
High involvement purchases--Honda Motorbike, high priced goods, products visible to others, and the higher the risk the higher the involvement. Types of risk:
Personal risk
Social risk
Economic risk
The four type of consumer buying behaviour are:
Routine Response/Programmed Behaviour--buying low involvement frequently purchased low cost items; need very little search and decision effort; purchased almost automatically. Examples include soft drinks, snack foods, milk etc.
Limited Decision Making--buying product occasionally. When you need to obtain information about unfamiliar brand in a familiar product category, perhaps. Requires a moderate amount of time for information gathering. Examples include Clothes-know product class but not the brand.
Extensive Decision Making/Complex high involvement, unfamiliar, expensive and/or infrequently bought products. High degree of economic/performance/psychological risk. Examples include cars, homes, computers, education. Spend a lot of time seeking information and deciding.
Impulse buying, no conscious planning.
3.4 Categories that Affect the Consumer Buying Decision Process A consumer, making a purchase decision will be affected by the following three factors: 1. Personal 2. Psychological 3. Social Personal Unique to a particular person. Demographic Factors. Sex, Race, Age etc.Who in the family is responsible for the decision making. Young people purchase things for different reasons than older people. Psychological factors Psychological factors include:
Motives--A motive is an internal energizing force that orients a person's activities toward satisfying a need or achieving a goal. Actions are effected by a set of motives, not just one. If marketers can identify motives then they can better develop a marketing mix. Physiological o
Safety
o
o
Love and Belonging
o
Esteem
Self-Actualization Need to determine what level of the hierarchy the consumers are at to determine what motivates their purchases.
Perception- Perception is the process of selecting, organizing and interpreting information inputs to produce meaning. Information inputs are the sensations received through sight, taste, hearing, smell and touch.
Ability and Knowledge-Need to understand individuals capacity to learn. Learning, changes in a person's behaviour caused by information and experience. Therefore to change consumers' behaviour about your product, need to give them new information about the product...free sample etc.
Attitudes-Knowledge and positive and negative feelings about an object or activitymaybe tangible or intangible, living or non- living...Attitudes and attitude change are influenced by consumers personality and lifestyle. Consumers screen information that conflicts with their attitudes. Distort information to make it consistent and selectively retain information that reinforces our attitudes. There is a difference between attitude and intention to buy (ability to buy).
Personality-all the internal traits and behaviours that make a person unique, uniqueness arrives from a person's heredity and personal experience Traits effect the way people behave. Marketers try to match the store image to the perceived image of their customers. There is a weak association between personality and Buying Behaviour, this may be due to unreliable measures. Nike ads. Consumers buy products that are consistent with their self-concept.
Lifestyles-Lifestyles are the consistent patterns people follow in their lives.
Social Factors Consumer wants, learning, motives etc. are influenced by opinion leaders, person's family, reference groups, social class and culture.
Opinion leaders-Spokespeople etc. Marketers try to attract opinion leaders...they actually use (pay) spokespeople to market their products. Michael Jordon (Nike, McDonalds, Gatorade etc.)
Roles and Family Influences-Role...things you should do based on the expectations of you from your position within a group. People have many roles. Husband, father, employer/ee. Individuals role are continuing to change therefore marketers must continue to update information.
Reference Groups-Individual identifies with the group to the extent that he takes on many of the values, attitudes or behaviours of the group members.Families, friends, sororities, civic and professional organizations.Any group that has a positive or negative influence on a persons attitude and behaviour.The degree to which a reference group will affect a purchase decision depends on an individuals susceptibility to reference group influence and the strength of his/her involvement with the group.
Social Class-An open group of individuals who have similar social rank. US is not a classless society. US criteria; occupation, education, income, wealth, race, ethnic groups and possessions. Social class determines to some extent, the types, quality, quantity of products that a person buys or uses. Lower class people tend to stay close to home when shopping, do not engage in much prepurchase information gathering. Stores project definite class images.Family, reference groups and social classes are all social influences on consumer behaviour. All operate within a larger culture.
Culture and Sub-culture-Culture refers to the set of values, ideas, and attitudes that are accepted by a homogenous group of people and transmitted to the next generation.Culture also determines what is acceptable with product advertising. Culture determines what people wear, eat, reside and travel. Cultural values in the US are good health, education, individualism and freedom. In american culture time scarcity is a growing problem. IE change in meals. Big impact on international marketing.Different society, different levels of needs, different cultural values. Culture can be divided into subcultures: o
geographic regions
o
human characteristics such as age and ethnic background.
Culture effects what people buy, how they buy and when they buy.
CHAPTER 4 RESEARCH METHODOLOGY
RESEARCH Research is a process in which the researcher wishes to find out the end result for a given problem and thus the solution helps in future course of action. The research has been defined as “A careful investigation or enquiry especially through search for new fact in any branch of knowledge”.
4.1 RESEARCH METHODOLOGY The procedure using, which researchers go about their work of describing, explaining and predicting phenomena, is called Methodology. Methods compromise the procedures used for generating, collecting, and evaluating data. Methods are the ways of obtaining information useful for assessing explanation.
4.2 RESEARCH DESIGN Research design is the specification of the method and procedure for acquiring the information needed to solve the problem. Degree of research question: Exploratory study is done for the study of consumer buying behaviour Time Dimension: The study was done using Cross Sectional method(As the Study is done only once in the pre specified period of 8 weeks, longitudinal study was not possible). Research Instrument: Questionnaire is the research instrument used here.The researcher has effectively used both open ended and close ended questions Method of Data Collection The data has been collected in two ways.
Primary Data: Primary data are those, which are collected for the first time, and they are original in character. A suitable combination of Questionnaire techniques, & discussion with the respondents was used to collect the required primary data. Primary data gives higher accuracy and facts, which is very helpful for any research and its findings. The researcher has collected primary data from questionnaire (i.e.) personal interview.
Secondary Data: - The secondary data are those, which are already collected by someone for some purpose and are available for the present study. Secondary data was collected from the magazines, websites, and other such sources.
Sampled Population A population is a group of individuals, object or items from which samples are taken for measurement. All items in any field of enquiry constitute the universe. Here population refers to the number of consumers and retailers who are using and selling various pens. The sample population includes people from various categories like Business Person, Service Person, Student, Housewife's Etc. Sampling Area Is the place where the sample is drowned. Here the researchers take samples from various parts of Kottayam districts in Kerala Sample Size The number of sampling unit selected from the Population is called the size of the sample. The sample size selected was 100 for consumer‟s survey and 50 for retailer‟s survey Sampling technique Here the researcher uses probability sampling method.ie simple random sampling is used as the sampling technique. 4.3 STATISTICAL TOOLS USED
PERCENTAGE METHOD In this project percentage method test and used. The following are the formula
Percentage of Respondent =
No. of Respondent Total no. of Respondent
x 100
CHAPTER- 5 DATA ANALYSIS AND INTERPRETATION
DATA ANALYSIS AND INTERPRETATION The Analysis of data involves identifying the relations of quantified information to the research problem in hand. Here percentage analysis is the tool for analyzing the data and establishing a relationship between the information gathered and the research problem.
INTERPRETATION The process of drawing inferences from the analyzed data in a research process is called as interpretation. It refers to the technique of drawing inference from the collected facts and explaining the significance of those inferences after an analytical and experimental study. It is a search for broader and more abstract means of the research findings.
5.1 CONSUMER BUYING BEHAVIOUR QUESTIONNAIRE ANALYSIS SAMPLE SIZE DETAILS: Sample Population: Business Person, Service Person, Student, Housewife's Etc. Sample Size: 100 Consumers Age Group:
Sl. No.
Age Group
Number
1 2 3 4 5
15-20 20-25 25-35 35-50 Above 50
52 31 9 5 3
Source: - Field survey
Table 5.1.1 Age group
25-35 9%
35-50 5%
Above 50 3%
20-25 31%
Chart 5.1.1 Age group
Occupation:
15-20 52%
Sl. No. 1 2 3 4
Category Student Business Person Regular Employee Others
Number 76 12 8 4
Source: - Field survey
Table 5.1.2 Occupation details
Business Person 12%
Regular Employee 8%
Others 4%
Student 76%
Chart 5.1.2 Occupation details
Q 1). Which type of Pen do you currently use? Sl. No.
Category
Number
Ball Pen
84
Gel Pen
12
3
Ink Pen
2
4
Premium pen
2
1 2
Source: - Field survey
Table 5.1.3 Types of pen using by consumer
Gel Pen 12%
Ink Pen 2%
Premium pen 2%
Ball Pen 84%
Chart 5.1.3 Type of pen using by consumer Findings: - Almost 84% of the respondents say that they use Ball Pen. And the next best usage is of Gel Pen by 12%, Ink & Premium Pen are least preferred by the consumers in the modern or present market condition Inference: - Majority of the consumers prefers and uses Ball Pen than any other type of pens
Q 2). Which Brand Of Ball Pen do prefer to write? Purpose: - Main purpose behind this question is to know the most preferred brand in the current market situation Sl. No. 1 2 3 4 5 6 7
Brands Classmate Reynolds Cello Lexi Linc Italia Others
Number 9 12 46 25 3 2 3
Source: - Field survey
Table 5.1.4 Most preferred brands
Linc 3%
Italia 2%
Others 3%
Classmate 9%
Lexi 25%
Reynolds 12%
Cello 46%
Chart 5.1.4 Most preferred brands Findings: - From the above chart it has been analysed that majority of the consumers (i.e.) 46% of them prefer Cello as a brand to be used which is followed by Reynolds & Lexi by 12% & 25% responses whereas classmate pen are used by 9% only.
Inference:- Cello is the most preferred brand among consumers than its competitors
Q 3). What is the price range in which you generally used to buy a pen? Sl. No. 1
Price Range
Number
Below RS 5
20
2
Beteen RS 5 -Rs 10
60
3
Between RS 10-Rs15
12
4
Between RS 15-Rs20
5
Avove 20
3
5
Source: - Field survey
Table 5.1.5 Most selling price range of pens
Between RS 10Rs15 12%
Avove 20 3%
Between RS 15- Below RS 5 Rs20 20% 5%
Beteen RS 5 -Rs 10 60%
Chart 5.1.5 Most selling price range of pens Findings: - It can be analyzed from the above graph that out of the total responses 60% prefer pen in Rs 15 – 20 price range. Whereas the next most preferred price range is Below Rs 5. The high price range ranging from Rs 15 – 20 & above that is least prefer by the consumers. Inference:- Consumer mostly favors and prefer their pen (either Ball or Gel) in the price range of Rs 5-10
Q 4).From where do you prefer to buy pen? Sl. No. 1 2 3 4
Type Stationary shops Super market Shopping malls Others
Number 81 8 9 2
Source: - Field survey
Table 5.1.6 Places of purchase
Shopping malls 9%
Others 2%
Super market 8%
Chart 5.1.6 Places of purchase
Stationary shops 81%
Findings: - It can be analysed from the above graph that out of the total responses, 81% prefer stationary shops as their place of purchase
Inference: - Consumer mostly prefers to buy their pen from stationary shops.
Q 5). Which Characteristics of Pen Influence your Buying Decision? Sl. No. 1 2 3 4 5
Characteristic Smoothly writing Grip Price Long-Life Brand Name
Number 68 10 8 6 8
Source: - Field survey
Table 5.1.7 Factors influencing buying decision
Price 8%
Long-Life 6%
Brand Name 8%
Grip 10%
Smoothly writing 68%
Chart5.1.7 Factors influencing buying decision Findings: - From the above graph that it can be identified that 68% of consumer‟s buying decisions are influenced by smoothly writing. The grip and brand name of pen have 10% and 8% influence on buying decision. Inference: - Majority of consumer‟s buying decisions are influenced by smoothly writing
Q 6). Which Advertising Media Influences You The Most? Sl. No. 1 2 3
Media Type TV Advertisements Banners & hoarding Newspapers & Magazines
Number 61 5 19
4
Internet
15
Source: - Field survey
Table 5.1.8 Types of advertising media Internet 15% Newspapers & Magazines 19% Banners & hoarding 5%
TV Advertisem ents 61%
Chart 5.1.8 Types of advertising media Findings: - From the chart it can be concluded that having almost 61% of the responses are influenced by TV Advertisements. The next most influencing media is Newspaper impacting the buying decision. Banners & hoarding is the least influencing among all media. Inference: - TV Ads are the most influencing Ad impacting the buying decision of different consumer segments
Q 7). Is your buying decision influence In-Shop advertisements? Sl. No. 1 2
Response
Number
Yes
29
No
71
Source: - Field survey
Table 5.1.9 Effect of In-shop advertisement
Yes 29% No 71%
Chart 5.1.9 Effect of In-shop advertisement
Findings: - From the chart it can be concluded that 71% of respondent‟s buying decision are not influenced by in shop advertisement. Only 29 % of respondents believes that their buying decision are influenced by In shop ads Inference:-Majority respondent‟s buying decision are not influenced by in shop advertisement
If Yes, Which influences the most? Sl. No. 1 2 3 4 5
Type Posters Hoardings Pen Stands Stickers Others
Number 10 1 12 5 1
Source: - Field survey
Table 5.1.10 Most influencing In-shop advertisements Stickers 17%
Others 3% Posters 35%
Pen Stands 41% Hoardings 4%
Chart 5.1.10 Most influencing In-shop advertisements Findings: - From the chart it can be concluded that Pen stands are the most influencing In shop Ad impacting the buying decision of different consumer segments having almost 41% of the responses. Hoarding is the least influencing among all media Inference:- Pen stands are the most influencing In shop Ad impacting the buying decision of different consumer segments
Q 8). Who influence your buying decision most? Sl. No.
Type of Respondents
Number
1
Parents
18
2
Friends
64
3
Colleagues
9
4
Sales person
8
5
Others
1
Source: - Field survey
Table 5.1.11 Persons who influencing buying decision sales person 8% colleagues 9%
others 1%
Parents 18%
friends 64%
Chart 5.1.11 Persons who influencing buying decision Findings: - 64% of the respondents buying decision are influenced by friends. The next most influencers are parents. Inference: - Friends are the most influencing group in the buying decision of different consumer segments
Q 9). Do You Choose Only One Brand? Sl. No. 1 2
Response
Number
Yes
60
No
40
Source: - Field survey
Table 5.1.12 Number of brand loyal customers
No 40%
Yes 60%
Chart 5.1.12 Number of brand loyal customers Findings: - From the above chart it is analysed that 60% of responses are loyal to any brand where as 40% of respondents are do not loyal and stick to only 1 brand. Inference: - Majority of the respondents stick or are loyal to particular one brand
If Yes, Which brand? Sl. No. 1 2 3 4 5 6 7
Brand Classmate Reynolds Cello Lexi Linc Italia Others
Number 6 10 29 14 2 1 1
Source: - Field survey
Table 5.1.13Brand loyalty among different pens Linc 3%
Italia 2%
Others 2%
Classmate 9% Reynolds 16%
Lexi 22%
Cello 46%
Chart 5.1.13 Brand loyalty among different pens Findings: - From the above chart it is analysed that brand loyalty is highest in cello ie.46% followed by Lexi and Reynolds .Linc and Italia have the least no of brand loyal customers. Inference:- Cello has the maximum brand loyal customer‟s among different brands
Q10) Why do you purchase the same brand?
Sl. No. 1 2 3 4 5
Category High Quality Brand Image Easy Availability Value for money Others
Number 46 11 24 16 3
Source: - Field survey
Table 5.1.14 Reasons for brand loyalty
Others 3%
Value for money 16%
Easy Availability 24%
High Quality 46%
Brand Image 11%
Source: - Field survey
Chart 5.1.14 Reasons for brand loyalty Findings: - From the above chart it is visualized that 46 % of respondent‟s reason for brand loyalty is high quality. Easy availability and value for money are the next reasons
Inference:- The main reason for brand loyalty in consumers is high quality of pen.
Q11). Rank the brands of pens according to your preference from 1-5? Sl. No. 1 2 3 4 5
Brand
1ST
2ND
3RD
4TH
5TH
Classmates
12
14
22
27
25
Cello
42
27
9
10
12
Reynolds
24
24
27
14
11
Lexi
17
25
14
26
18
Italia
5
10
28
23
34
Table 5.1.15 Ratings of brand performance 45 40 No of respondents
35 30
1ST
25
2ND
20
3RD
15
4TH
10
5TH
5 0 Classmates
Cello
Reynolds
Lexi
Italia
Brand name
Chart 5.1.15 Ratings of brand performance Findings: - From the above chart it is visualized that 42 respondents has given first rank and 27 gave 2nd rank to Cello. Italia brand is the least preferred brand among consumers. Inference: - Cello has got the highest average rating followed by Lexi and Reynolds.
Q 12) Number of pen usually buy in a year?
Number of Respondents
Sl. No. 1 2
Number of Pen Less than 2 2 to 5
3 4
5 to 10 More than 10
9 18 25 48
Source: - Field survey
Table 5.1.16 Average no. of pen buying in a year Less than 2 9% More than 10 48%
2 to 5 18%
5 to 10 25%
Chart 5.1.16 Average no. of pen buying in a year Findings: - It can be analysed from the above graph that out of the total responses 48%, purchase more than 10 pens in a year. Only 9% of respondents buy less than 2 pen in a year. Inference:- Most of the consumer purchase more than 10 pens in a year
Q 13). Do You Refill Your Pen regularly? Sl. No. 1 2
Response
Number
Yes
37
No
63
Source: - Field survey
Table 5.1.17 Number of regular refilling customers
Yes 37%
No 63%
Chart 5.1.17 Number of regular refilling customers Findings: - From the chart it can be concluded that 63% of respondents do not refill their pen and only 37 % refill their pen. Inference: - Majority of respondents do not refill their pen
If No, Why Sl. No. 1 2 3 4
Response Pen Cost Is Negligible Replacement results into Poor Performance Refill Is Unavailable Others
Source: - Field survey
Table 5.1.18 Reasons for non- refilling of pens Refill Is Unavailable 14%
Others 2%
Pen Cost Is Negligible 65% Replacement results into Poor Performance 19%
Number 42 12 9 1.2
Chart 5.1.18 Reasons of non- refilling of pens Findings: - From the chart it can be concluded that 65% of customers do not refill their pen because of pen cost is negligible. For 19 % the reason is that replacement results into poor performance. Inference: - From the chart it can be concluded that most of customers do not refill their pen because of pen cost is negligible.
Q14) Have you purchased classmate pen? Sl. No. 1 2
Response Number Yes 39 No 61
Source: - Field survey
Table 5.1.19 Number of customers who have used classmate pens
Yes 39% No 61%
Chart 5.1.19 Number of customers has used classmate pens Findings: - From the chart it can be concluded that 39% of respondents have used classmate pens n and 61 % of respondents never used classmate pen. Inference:-Majority of respondents has never used classmate pen
RETAILR’S QUESTIONNAIRE ANALYSIS a) Type of store Sl. No. 1 2 3 4
Category Stationary store Department store Supermarket Malls
5
Others
Number 30 9 6 3 2
Source: - Field survey
Table 5.2.1 Types of stores
Supermarket 12%
Others 4%
Malls 6%
Stationary store 60% Department store 18%
Source: - Field survey
Chart 5.2.1 Types of stores
B) Average monthly Sales: Sl. No. 1 2 3 4 5
Monthly Sale Less than 1 lakh 1-3lakh 3-5lakh 5-10lakh Above 10 lakhs
Source: - Field survey
Table 5.2.2 Average monthly sale
Number 28 11 5 2 4
5-10lakh 3-5lakh 4%
Above 10 lakhs 8%
10%
Less than 1 lakh 56%
1-3lakh 22%
Chart 5.2.2 Average monthly sale
Q1) In which price range you sell maximum pens? Sl. No.
Price Range
Number
1
Less than 7Rs
26
2
7 to 10 10 to 15 15 t023
21 3 0
Above 25
0
3 4 5
Source: - Field survey
Table 5.2.3 Price range of maximum pen sale
10 to 15 6%
7 to 10 42%
Less than 7Rs 52%
Chart 5.2.3 Price range of maximum pen sales
Findings: - From the above chart it is visualized that 52 of respondents use pen in less than 7 Rs and 42% uses in the price range of 7-12 Inference: - Majority of the retailer’s maximum sell pens in the price range of less than 7Rs
Q 2) Which type of pen you sell the most? Sl. No.
Type of Pen
Number
1
Ball Pen
48
2
Gel Pen
2
3
Ink Pen
0
4
Premium pen
0
Source: - Field survey
Table 5.2.4 Most selling pen types
Gel Pen 4%
Ball Pen 96%
Chart 5.2.4 Most selling pen types
Findings: - From the above chart it is visualized that almost 96% of the respondents say that they sell Ball Pen more. Inference: - Majority of the retailers sells Ball Pen more than others
Q3) Maximum sales under the price range between Rs5-Rs.20 are for which brand of pens?
Sl. No. 1
Brands
Number
Cello
38
2
Lexi
9
3
Reynolds
3
4
Classmate
0
5
Linc
0
6
Flair
0
7
Others
0
Source: - Field survey
Table 5.2.5 Most selling pen in Rs 5-20 price range
Cello
Lexi
Reynolds
Classmate 0%
0%
Linc 0%
Flair
Others
0%
6% 18%
76%
Chart 5.2.5 Most selling pen in Rs 5-20 price range
Findings: - From the above chart it has been analysed that majority of the retailers (i.e.) 76% of them sells Cello which is followed by Lexi & Reynolds by 18% & 6% maximum Inference:-Most of the retailers have the stock of cello in their store.
Q4)-Sales of pens between the ranges of Rs5-Rs.20 is high during which period of time? Sl. No. Number Time 1 High during exams 15 2 Stable throughout the year 6 3 When new Schemes are introduced 0
4
School opening time
29
Source: - Field survey
Table 5.2.6 Maximum pen selling season High during exams 30%
School opening time 58% Stable throughout the year 12%
Chart 5.2.6 Maximum pen selling season Findings: - From the above chart it has been analysed that 58% retailers pen sale happens during school opening time followed by exam time by 30% . Inference:- Majority of the pen sale happens during school opening time
Q5)-Please tick the brands of pen you keep in your store Sl. No. 1 2 3 4 5 6 7 8 9
Name of Brands Classmate Reynolds Cello Lexi Linc Flair Italia Lexor Win
Number 12 42 48 37 10 18 11 8 23
Source: - Field survey
Table 5.2.7 Brands of pen keeping in each store
60
No of respondents
50 40 30 20
Series 1
10 0
Brand name
Chart 5.2.7 Brands of pen keeps in each store Findings: - Among various respondents 48 stores have the stock of cello pen and 42 have Reynolds in their shop Inference:- From the above chart it has been analysed that majority of the stores have the stocks of Cello and Reynolds pens .Lexor and Linc are the least stocking pens in the stores.
Q6)-When people buy pens what among the following options do they prefer?
Sl. No.
Characteristic
Number
1
Smoothly writing
28
2
Grip
2
3
Price
5
4
Long-Life
2
5
Brand Name
13
6
Looks
0
Source: - Field survey
Table 5.2.8 Factors influencing buying decision
Brand Name 26%
Smoothly writing 56%
Long-Life 4% Price 10%
Grip 4%
Chart 5.2.8 Factors influencing buying decision Findings: -56% respondents buying decision are influenced by smoothly writing and grip influence only 4%
Inference:- It can be concluded that smoothie writing is the most influencing factor in the buying decision of different consumer segments is smoothly writing.
Q7 ) Retailer’s influence towards customer in their buying decision?
Sl. No.
Response
Number
1
High
1
2
Average
9
3
Low
31
4
Nil
9
Source: - Field survey
Table 5.2.9 Retailer’s influence towards customer in their buying decision Nil 18%
High 2%
Average 18%
Low 62%
Chart 5.2.9 Retailer’s influence towards customer in their buying decision
Findings: - From the above graph that it can be identified that in most of the consumer buying decision process the influence of sales people is low. ie .(62%) Inference:- For most of the consumer buying decision process the influence of sales people is low
Q8) What motivate retailer’s to push the products more to customers? Sl. No. 1
Characteristic High margin
Number 41
2
Schemes
3
3
Quality of products
6
4
Others
0
Source: - Field survey
Table 5.2.10 Retailers motivating factors to push the products
Quality of products 12%
Schemes 6%
High margin 82%
Chart 5.2.10 Retailers motivating factors to push the products
Findings: - From the above graph that it can be identified that for 82 % of respondents high margin is the pushing factor for retailers to sell more. Inference:- High margin is the main pushing factor for retailers to sell more.
Q9) How often retailers replenish their stocks?
Sl. No. 1 2
Time Duration
Number
Every week
9
Once in two week
27
3
Once in a month Others
4
11 3
Source: - Field survey
Table 5.2.11 Types of stock replenishing Once in a Others 6% month 22%
Every week 18%
Once in two week 54%
Chart 5.2.11 Types of stock replenishing Findings: - From the above graph that it can be identified that most of (54%) of retailers replenish their stocks once in two weeks and 22% of respondents replenish once in a month. Inference:- Most of of retailers replenish their stocks once in two weeks
Q10) Do you think buying decision are influenced by In-Shop advertisements? Sl. No.
Response
Number
Yes
23
No
27
1 2
Source: - Field survey
Table 5.2.12 Influence of In-shop advertisements
No 54%
Yes 46%
Chart 5.2.12 Influence of In-shop advertisements
Findings: - From the above chart it is analyzed that, only 46% think that In-shop advertisement has an influence on customer buying decision. Inference:- Majority of the respondents don’t think that in-shop advertisement influence consumer buying decision
If Yes, Which influences the most?
Sl. No.
Type
Number
1
Posters
18
2
Hoardings
4
3
Pen Stands
14
4
Stickers
12
5
Others
2
Source: - Field survey
Table 5.2.13 Types of In-shop advertisements
Others 4% Stickers 24%
Posters 36%
Pen Stands 28% Hoardings 8%
Chart 5.2.13 Types of In-shop advertisements Findings: - From the chart it can be concluded that for 36 % of respondents Posters are the influencing in shop advertisement. The next most influencing is pen stands with 28%. Hoarding & others are the least influencing among all. Inference:- Posters are the most influencing in shop advertisement.
Q11) For non-brand loyal customers, which brand you suggest most?
Sl. No. 1
Brand
Number
Classmate
2
2
Reynolds
10
3
Cello
14
4
Lexi
23
5
Linc
0
6
Flair
1
Source: - Field survey
Table 5.2.14 Brands suggested for non-brand loyal customers Flair 2%
Classmate 4% Reynolds 20%
Lexi 46%
Cello 28%
Chart 5.2.14 Brands suggested for non-brand loyal customers Findings: - 46% of retailers suggest Lexi for non-brand loyal customers while only 4% suggests classmate pen Inference:- For non-brand loyal customers most of retailers suggest Lexi followed by Cello and Reynolds
Q12) What make you to do so?
Sl. No. 1 2 3
Characteristic
Number
High margin
43
Schemes
4
Quality of products
3
4
Brand image
0
Others
0
5
Source: - Field survey
Table 5.2.15 Influencing factors of retailer’s brand suggestion High margin
Schemes
Brand image
Others
Quality of products
6% 2%
8%
84%
Chart 5.2.15 Influencing factors of retailer’s brand suggestion Findings: - From the above chart it is analysed that for 84 % of respondents high margin is the main reason for suggesting a particular brand to non-brand loyal customers by the retailers Inference:- High margin is the main reason for suggesting a particular brand to nonbrand loyal customers by the retailers
Q13)Do you have classmate pen in your store?
Sl. No. 1 2
Response
Number
Yes
12
No
38
Source: - Field survey
Table 5.2.16 No of stores having classmate pens
Yes 24% No 76%
Chart 5.2.16 No of stores having classmate pens Findings: - From the chart it can be concluded that 76% of respondents have classmate pens in their store while 24 % of respondents doesn’t have. Inference:-Majority of the stores doesn‟t have classmate pen in their store
If Yes, What makes classmates to sell more? Sl. No. 1 2 3 4 5
Characteristic Improve quality Better margin More advertisement Better availability Others
Number 1 1 5 6 0
Source: - Field survey
Table 5.2.17 Factors for improving classmate’s sale Improve quality 8% Better availabilit y 50% More advertise ment 42%
Chart 5.2.17 Factors for improving classmate’s sale Findings: - From the chart it can be concluded that 50% of retailers think that better availability will helps classmate to sell more. For 42 % more advertisement results into better sales.
Inference: - Most of respondents believe that better availability & advertisement results into better sales
If No, Are you interested to sell classmate pen?
Sl. No. 1 2
Response Number Yes No
32 6
Source: - Field survey
Table 5.2.18 Number of stores interested to sell classmate pen
No 16%
Yes 84%
Chart 5.2.18 Number of stores interested to sell classmate pen Findings: - From the chart it can be concluded that 84% of respondents are classmate interested to sell classmate pens and 16 % of respondents are not interested.
Inference:-Majority of respondents who are not selling classmate pen are willing to sell classmate pen
CHAPTER 6 –FINDINGS & SUGGESTIONS
6.1 FINDINGS Amongst different types of Pen, Ball pen is preferred by most of the consumers Cello Brand enjoys the market leader position and it is also preferred by the majority of the consumers for writing among the different brands of Pen available in the market. Among the various price of pens available in the market, between Rs 5-10 price level is the most popular level. Most of the consumers are prefer to buy pen from stationary shops. Smooth writing is the most influencing pen characteristic in the consumer buying process of pen TV advertisement is the most influencing media for customers to buy pen. Though the effect of In-shop advertisement towards customer is minimum, among the various mediums pen stands influences the most. Friends are most influencing category of people in consumer buying decision of pen. Though there is no strong brand loyalty towards any brands, high quality can make brand loyal customers. Most of the customers buy more than 10 pen in a year on an average basis Customers are less inclined to refill their pen because the pen cost is negligibly small Among the surveyed customers only 39% has used classmate pens. Maximum sale of pen happens during the school opening time. High margin is the main pushing factor for retailers to sell more products Most of the retailers replenish their stocks once in two weeks Among the surveyed retailers only 24% have classmate pen in their store In retailer‟s opinion by improving the availability of classmate pen, the sales can be improved.
6.2. SUGGESTIONS The Suggestions given are based on the consumer and retailer survey and its analysis and studying the Companies Own Marketing Mix at ITC Ltd and as per my knowledge regarding the concerned subject.
Cello Company is regarded as No 1 market leader due to its product verities mainly in the Price range ranging from Rs 5 – 20 .In this Low Price Segment where majority of consumers prefer to buy their pen. At the same price range Classmate have very less products which can satisfy consumer need. So hereby I suggest that Classmate should Come up with more products in Effective Price range Of Rs 5 – 20, targeted to different consumer segments.
The practice of “Use and Throw” is more visible in consumers, so classmate should bring some models in below 5 Rs price level.
Company should strongly take care of availability of pens at rural retail outlets. As Classmate is relatively new to the market consumers are not that much aware about the product, so company should focus more on promotional activities
Compare to other brands classmates have limited or minimum In-shop advertisement objects, by increasing this brand awareness can be improved.
From the survey it is clear that different variable/features influence buying decision of consumer in different segments. Thus Company should not have a common Positioning for all Target Markets. The companies should try to focus on a target group by focusing on various characteristics that affect their buying decision
Thus if the Company uses all the above mentioned features for specific target market and makes the product, fixes the Price and positioned properly and effectively than it can definitely outperform it competitors in Different Segments.
CHAPTER 7–CONCLUSION
CONCLUSION
The project entitled “A Study of the Consumer Buying Behaviour of Classmate Pen” has helped in studying the various aspects of consumer behaviour especially towards pens. The study also helped in understanding and analyzing customer satisfaction about services and products offered to customers. Every player in the pen industry is trying to cover more market share than the other. So the company must be more alert providing high quality service and awareness to customers. The researcher hope the company will find his findings relevant and sincerely hope it uses his suggestions enlisted, which he hopes will take them miles ahead of competition. In short, the researcher would like to say that the very act of the concerned management at ITC Ltd in giving him the job of critically examining consumer buying behaviour towards pen of the company.
BIBLIOGRAPHY ITC India Ltd -Annual Report (2012). Kothari, C.R.( 1982). Research methodology. New Delhi: Tata Mc Graw-Hill Ltd. Das ,Bhagaban & Das ,Debadutta (2006) .Consumer Buying Behaviour In India: New Delhi: Tata Mc Graw-Hill Ltd Solomon,R,Michael(2010). Consumer Behaviour - Buying, Having, And Being, Prentice Hall PTR Ali ,S.S,. Thakur,A.K,.Madhavan,K,.Palat(2009)-Models in Consumer Buying Behaviour. Deep & Deep Publication
WEB SITE http://www.itcportal.com/about-itc/shareholder-value/annual-reports/itc-annualreport-2013/content.aspx ( June,2013) http://www.citehr.com/29099-hr-issues-retailing-business-plan.html (June,2013) http://www.scribd.com/doc/82186216/Indian-Pen-Industry-Project (”n.d”)
APPENDIX
Consumer Buying Behaviour Questionnaire Name
-----------------------------
Age Group: (a ) 15-20 [ (d) 35-50
]
(b)20-25 [
[ ]
]
(c) 25-35 [
]
(e) Above 50 [ ]
Place______________________ Occupation: Student [
]
Business Person [
Regular Employee [
]
]
Others [ ] _____________
Q 1). Which type of Pen do you currently use? a)
Ball Pen [
]
b)
Gel Pen [
]
c)
Ink Pen [
]
d)
Premium pen [
]
Q 2). Which Brand Of Ball Pen do prefer to write? a) Classmate[
]
b) Reynolds
d) Lexi[ ]
e) Linc [
[
]
]
c)
Cello[ ]
f) Italia [
]
g) others____________ Q 3). What is the price range in which you generally used to buy a pen? ( a) Below Rs 5
[
]
(c) Between Rs 10-Rs 15 [ (d) Above 20[
(b) Between Rs 5-Rs 10 [ ] ]
(d) Between Rs 15-Rs 20 [
]
]
Q 4).From where do you prefer to buy pen? (a) Stationary shops [
]
(c) Shopping malls [
]
(b) Super market [
]
(d) Others____________
Q 5). Which Characteristics of Pen Influence your Buying Decision? a )Smoothly writing [ d)Long-Life
[
]
b)Grip[
]
]
c) Price[
e)Brand Name [
]
]
Q 6). Which Advertising Media Influences You The Most? a)
TV Advertisements[
]
c)
Newspapers & Magazines[
]
b)
Banners & hoarding[
d)
Internet[
Q 7). Is your buying decision influence In-Shop advertisements? a)
Yes [ ]
b)
No[
]
If Yes, Which influences the most? a)Posters [
] b) Hoardings[
]c)Pen Stands[
] d)Stickers
]
]
Others__________________ Q 8). Who influence your buying decision most? a) Parents[
] b)friends[
] c) colleagues[
] d)sales person[
] e) others [
Q 9). Do You Choose Only One Brand? a)
Yes [ ]
b)
No[
]
If Yes, Which brand? a) Classmate[
]
b) Reynolds
d) Lexi[ ]
e) Linc [
[
]
]
c) f) Italia [
Cello[ ] ]
Q10) Why do you purchase the same brand? a) High Quality[
]
d)Value for money[
b) Brand Image[ ]
] c) Easy Availability [
]
e)others____________
Q 11).Rank the brands of pens according to your preference from 1-5? Classmates[
] Cello[
], Reynolds[
], Lexi[ ], Linc[
], Italia[
Q 12) Number of pen usually buy in a year? a)less than 2[
] b) 2-5 [ ] c)5-10 [
] d)more than 10[
]
Q 13). Do You Refill Your Pen regularly? a)
Yes
b)
No
If No, Why a)
Pen Cost Is Negligible
b)
Replacement results into Poor
Refill Is Unavailable d)
Specify If Others,______________
Performance c)
Q14) Have you purchased classmate pen? a)
Yes [ ]
b)
No[
]
]
]
Retailers Questionnaire Name of the store: ___________________________ Location:_______________________________ Contact No:_____________________________ Type of store a) Stationary store [ d) Malls [
] b) Department store[
]
] c) Supermarket [
]
e) others______________
Average monthly Sales: a) less than 1 lakh[ d) 5-10lakh[
]
b)1-3lakh [
]
] c)3-5lakh [
e) above 10 lakhs[
]
]
Q1) In which price range you sell maximum pens? a) Less than 7Rs[ d)15-25 [
]
b)7-10 [
] e)Above 25[
] c)10-15[
]
]
Q 2) Which type of pen you sell the most? a)
Ball Pen [
]
b)
Gel Pen [
]
c)
Ink Pen [
]
d)
Premium pen [
]
Q3) Maximum sales under the price range between Rs5-Rs.20 are for which brand of pens? (Rank in order of sales) (a) Classmate [ (c) Cello[
]
(b) Reynolds[
] (d) Lexi [
(g) Others[
]
] e)Linc [
]
f)Flair[
]
] (please specify)___________
Q4)-Sales of pens between the ranges of Rs5-Rs.20 is high during which period of time? (a) High during exams [
] (b) Stable throughout the year [
Schemes are introduced[
]. (d) School opening time[
] (c) When new
]
Q5)-Please tick the brands of pen you keep in your store a) Classmate [ e) Linc [
] b) Reynolds[
]
f)Flair[
]
]
c) Cello[
g) Italia[
] d) Lexi [
]
h)Lexor [
]
]
i)Win[
Q6)-When people buy pens what among the following options do they prefer? a )Smoothly writing [ d)Long-Life
[
]
]
b)Grip[
]
c)Price[
e)Brand Name [
]
]
d)Looks[
]
Q7 ) Your influence towards customer in their buying decision? a)High
b)Average
c)Low
d)Nil
Q8) What motivate you to push the products more to customers? a) High margin [
]
b)Schemes[
]
c)Quality of products [
]
]
d) Others__________ Q9) How often you replenish your stocks? a)every week[
]
b)once in two week[
]
c) once in a month [
]
d)more_________ Q10)Do you think buying decision are influenced by In-Shop advertisements? a)
Yes [ ]
b)
No[
]
If Yes, Which influences the most? a)Posters [
] b) Hoardings[
]c)Pen Stands[
] d)Stickers
Others__________________ Q11) For non-brand loyal customers, which brand you suggest most? a) Classmate [ (c) Cello[
]
(b) Reynolds[
] (d) Lexi [
]
] e)Linc [
]
f)Flair[
]
Q12) What make you to do so? a)High margin[ d)Brand image [
]
b)Schemes[ ]
others[
] ]
c)Quality of products[ ____________
Q13)Do you have classmate pen in your store? a)
Yes [ ]
b)
No[
]
If Yes What makes classmates to sell more? a) Improve quality b) better margin c) more advertisement d) Better availability e) others_____________ If No Are you interested to sell classmate pen? a)
Yes [ ]
b)
No[
]
]
PORTFOLIO MIX OF CLASSMATE PEN AND ITS COMPETIOTORS 1) CLASSMATE Type Ball Pen
Gel Pen
Premium Pens
Model B First B Qwick B Neat B Speed B Fine B Positive Octo Flo UVO Radeon Crypton Genghis Geloneat Gelo Fun Gelowiz Octane Attila Deimos Galactic Trojan Beethoven Archimedes Chopin
2)
CELLO
TYPE Ball Pen
MODEL Jolly Faster Nice Trimate Uno Easy Write Tip Top Delta Nova Crown Retra Fashion
Price 5 5 5 5 6 9 10 10 10 10 15 5 5 5 10 15 20 20 25 90 130 150
PRICE 3 5 5 5 5 5 5 5 5 5 5
Teenz Quick Merit-GL Speed Swift Finegrip Zippy Ball Gripper Technotip Point 5 Maxwriter pin point Technotip XS Super Fine Melody Glider XS Colour Joy Soft Feel Flow Mate Superglide DX Butterflow Top Ball Click Soft Write X-Presso Spectra Aero Piont 2X Maxriter XS Pinpoint XS Liquiball Topball Fun Glitter Pepersoft Power Ball Jotdot Steel-O Paper soft premier Zero pressure X-Caliber Power Max Power Metal 5X Cutie Gel Saphire Bold Writer
5 5 5 5 5 6.5 7.5 7.5 8 8 9 9 9 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 10 15 15 15 15 20 20 20 20 20 25 25 30 30
Gel pen
Roller Pen
Metal Pens
Benz Jetset Duke
35 45 49
Rs 5/ Gel pen My Gel Class Gel Bunny Magna Liquiball Wow Butter Gel Flo Gel Zoom Colour Gel Colour Mate I-Zone Jingle Pin Trendy Melody Glide Pointec Gel Accutek Sign Roller Jelflow Aviator Express R Gel X-Pert Gel
5 5 5 5 5 6 6 10 10 10 10 10 10 10 10 10 10 15 15 25 25 25 30 30 35
Rolly Benz
40 55
4 colour Arion Smart Jet Black Jack Gold Benz Jetset Sky Writer Jet Ace Enigma Classic Accugrip
30 30 30 35 40 40 49 49 49 55
Fire Prime Venice Executive
3)
TYPE Ball Pen
75 75 75 75
REYNOLDS
MODEL Champ Brite Buero 040 Bold Fusion Fusion Bold 045 fine carbure Eurolism Officerite 045 Student Energi Zetpoint Liquiflo Electro Liquiflo Student Retractable Ezio Pen Jetter regular Revo Jetter Grip Jetter Aerosoft Jetter Designer Jetter Aviator Jetter Youth Jetter Glitz Jetter Metallica Jetter Chroma- DX Jetter Aviator -MX Trimax Jetter Metalica FX Premier Gold Jetter Numatic Premier
PRICE 5 5 5 5 5 5 6 6 6 6.5 8 10 10 10 10 10 15 15 15 20 20 20 20 20 25 25 30 35 40 50 60 90
Gel Pen
Mera Gel Jeffi Gel Mera Gel I Mera Gel II Razor Active Razor Gel I&II Force Gel Eterno Gel V-Max Gel Trimax
5 5 6 6 10 10 10 15 20 35
4)
LINC
TYPE Ball Pen
MODEL
PRICE
Glycer Thrill Retract Crazy Smart Executive Ball Glitter Meeting Seramic Joy Classic Class Swift Signature Gold
5 5 5 5 5
Uni Ball
Gel Pen
10 10 15 25 35 35 40 70 85
Jestry 101 Uni Ball Uni 120
20 25 25
Linc 070 Linc 070 gel Ocean
5 6 6
5)CLARO PEN
NOVA SWIFT GENIUS BRIO COOL LUCKY X CEL SONIC C-999 BIG BENN 100 C-100 ROCK 200 SMOOTHFLO
Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen
Price Per Piece MRP. 3 3 5 5 5 5 6 6 6 7 7 10
Ball Pen
10
ANGEL ARIA ULTIMA(NEW) IVY(NEW) JAZZ(NEW) VISION CR-54 CL-108 IRIS DURO BOSS CR-45 CL-333 RICO EXPERT(NEW)
Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen Ball Pen
10 10 10 10 10 10 10 10 10 15 15 15 15 15 90
CENTURY(NEW)
Ball Pen
110
SOLITAIRE(NEW) ACCENT(NEW)
Ball Pen
130
Ball Pen
150
Gel Pen
5
Gel Pen
5
Name of the Product
W
LUCKY 7(NEW) RIO
Ball Pen/ Gel Pen.
TEEN MASTER SX-5 MACK CHAMP SONIC CG-999 CG-109 HONEY SUPER HERO FUN(NEW) FUNK(NEW) MILTON 10X SIGMA CG-110 ELITE JETTA(NEW) SIGMA ANGEL ROCK 200 IRIS REVA(NEW) BOSS
6)
FLAIR
TYPE Ball Pen
MODEL FX Max FX Dark Easy Click Jackpot Marathon
Gel Pen Gel Pen Gel Pen Gel Pen Gel Pen Gel Pen Gel Pen Gel Pen Gel pen Gel Pen Gel Pen Gel Pen Gel Pen Gel Pen Gel pen Gel Pen Ball +Gel Pen Ball +Gel Pen Ball +Gel Pen Ball +Gel Pen Ball +Gel Pen Retractable +Ball Pen Ball +Gel Pen
PRICE 5 5 5 5 5 10
5 5 5 5 5 6 6 10 10 10 10 10 10 10 15 20 15 25 25 25 25 30 35
Striker Liqui touch
10 10
Ion Digital Sunn(4 color) High way Spectrum
10 15 20 40 70
Gel Pen Hydra
5
Phinix Matrix Fashion Gel Glitter
5 10 10 10
WIN Bee Gel Guide Titium Olivia Dezire
ITALIA 5 10 30 40 40
Trivo Club Gel Petra Stella Weather Flow Tivoli Docker Safari Revo
LEXI
ROTOMAC
Ball Pen
Maxima Boss Gel Forever
Get speed 5N Fine Point
5 5
3 5 5 5 10 10 30 125
5 5 12
10
MONTEX Mega Top
10
