ASSIGNMENT OF RESEARCH METHODOLOGY (MGT-516)

RESEARCH TOPIC

BARND PREFERENCE FACTORS OF PASSENGER CARS: AN EMPIRICAL ASSESSMENT

SUBMITTED TO:

Mr. Lokesh Jasrai

SUBMITTED BY:-

ABHISHEK KUMAR

ROLL NO- B 57

SECTION- R1003

MBA- 3501

D.O.S – 27-Jan-2011

BRAND PREFERENCE FACTORS OF PASSENGER CARS: AN EXPERIMENTAL ASSESSMENT

CONTENTS :-

INTRODUCTION RESEARCH OBJECTIVE REVIEW OF LITERATURE RESEARCH DESIGN RESEARCH METHODOLOGY CONCLUSION REFERENCES

INTRODUCTION:

In India, liberalization has payed the way for people to possess luxury items such as television, refrigerator, home appliances and car. Motorcar is one of the commonly used conveyances by the upper and middle-class people.Two decades ago, only a few industrialists and rich people owned cars. There was a time when one had to wait for weeks, months or even years to buy a car in India. The option of cars was limited to a few models. But , after liberalization, the earning capacity of middle-class people increased. These days, Motorcar is not only bought for social status, but has become a necessity.

Moreover, every middle or upper middle-class person` wants to have a car today.Taking the above into consideration,the I study the level of perception of the factors influencing the purchase of a car. I also make an attempt to capture the dimensions reflecting brand preference of passenger cars.

RESEARCH OBJECTIVES:

The aim of the study is to identify, describe and analyze the factors that have an impact on brand preference.

To identify the factors underlying brand preference of passenger cars. To analyze the level of contribution of factors identified on brand preference

of passenger car.

REVIEW OF LITERATURE:

The literature review is done to clarify the underlying concepts in brand preference and to discover the factors that have been found to affect the brand preference.In spite of the significant role that the car industry plays in the nation’s economy, there is an acute scarcity of literature on the car industry, particularly on the passenger car industry.This is one of the serious limitations the researchers had to encounter during the course of the study.

The American Marketing Association (2009) defines a brand as “an intangible asset,striving to increase the performance of a product or service through a set of psychological associations”. The primary function of a brand is to provide

convenience and clarity in decision making, providing a guarantee of performance and communicating a set of expectations,thereby offering certainty and facilitating the buying process.

Smita .(2006),in her study , pointed out the importance of celebrity support in advertisement and concluded that advertisers use endorsers to add excitement and glamor to their brands.Basically,celebrity endorsements give a brand a touch of glamor in the minds of people,and the hope that a famous face will provide added appeal and recognition in a crowded market.

Suresh and Raja. (2006) made an attempt to measure the customer satisfaction level of small cars. In this study,the customer satisfaction was measured by using the variable attributes,like-after-sales service, ability to understand customer needs,behavior and knowledge of the mechanics,warranty,prompt delivery,24- hour customer care,information about the cars,horsepower,engine capacity,power steering,technology,fuel capacity,acceleration,easy finance,convenience and accessibility,ground clearance,easy processing and documentation,price,discount and rebates,fuel efficiency and maintenance cost.

Abdul et al.(2006),in their study,noted that consumer behavior is influenced strongly by cultural,social,personal and psychological factors.Cultural factors include the set of basic values,perceptions,wants and behavior learned by a member of society from the family and other important institutions.The social factors include consumer’s family,small group,social roles and status.A person’s buying choices are further influenced by four major psychological factors:Motivation,Perception,Learning,Beliefs and Attitudes.

Karjaluoto et al.(2005) investigated the consumer choice in the context of the car industry in Finland.They assessed the consumer motivations in car’s brand choice.The various factors influencing car’s brand choice,according to them,were innovative services, design,brand,basic facilities,outside influence and price.

Jaspreet.(2005),in his study,suggested that price,brand image,product,performance,new model launches,distribution network,after-sales support and availability of value-added after sales services are the factors that determine competition in the Indian passenger car industry.

Sumit and Abhishek.(2005),in his study, suggested that demand for cars depends on a number of factors.The key factors affecting demand for passenger cars in India are fuel costs,prices of cars,per capita income,introduction of new models,incidence of duties and taxes,the quality of road infrastructure and availability and cost of consumer financing.

Ravichandran and Narayanarajan.(2004) studied factors determining the brand preference of consumer durables.They concluded that the study with brand preference of consumer durables is largely influenced by a number of factors such as advertisement,price,quality,performance,availability of spares,and after-sales service.Moreover, these factors play a vital role in the decision-making process and in the brand preference.

Kotler and Fullberg.(2003),in his study, stated thatconsumer surveys often reveal that quality is one of the important, if not the most important, decision-making factors for consumers and product quality stands for the ability of a product to perform its functions.

Tan. (2003),conducted a study to find the factors affecting adoption of new product innovations in the consumer. By using factor analysis ,he find that these factors were relative advantage,perceive risk complexity,compatibility,observability,image and trialability.

Doyle. (2002),in his study, pointed out that the important product decisions in any marketing context are product, variety, product performance, product features,product design, product presentation, sizes, etc.

Keller. (2002),in his study,said that the brand is the sum total of all elements of the marketing mix. Brands can also be explained based on their elements-“…those trademarkable devices that serve to identify and differentiate the brand(e.g.-brand names , logos, symbols, characters, slogans, jingles and packages)”.

Dorsch et al. (2000) studied consumer choice behavior using the five-step process (need, information search, evaluation of alternatives, purchase and, and post-purchase evaluation) problem solving paradigm or through the progression of consumer choice from a product class to brand choice.

Park et al. (1996),in their paper, stated that the marketplace associates symbolic and functional attributes with the brand. Symbolic attributes are those that satisfy internally generated needs for self-enhancement , role position , group membership or ego identification. Whereas functional brand attributes solve an externally generated consumption related problem.

Ambler and Styles . (1996) describe two different views of defining a brand.The first is the product plus view, where the brand is seen as an addition to the product. In this view , a brand is also called an identifier. The second is the holistic view that communicates the focus on the brand itself that is considered to be much more than just the product.

Rogers. (1995) and Mason. (1990) , in their study, explained how consumers form preferences for various goods and services using theory of adoption. If any brand attracts them, they fell comfortable about that and they prefer it.

Tickwell et al. (1993), in his study, investigated the implications of loyal and non-loyal brands and found that a significant difference exits between loyal and non-loyal brands and also a high correlation exist between self image and product user rating.

Thomas.Kotta (1992), in his study , investigated the influence of extrinsic cause, e.g., price, reputation of the product and advertising, in a main experimental setting using multi-item measures.

Phillips. (1988), in his study, stated that a brand can be described as a “trademark that communicates a promise”.

Broadbent and Cooper. (1987), in his study, noted that if the brand is to be successful , images and symbols must relate to and indeed exploit the needs, values and lifestyle of consumers in such a way that the meaning involved give added values and differentiate the brand from other brands.

RESEARCH METHODOLOGY:-

This research, attempting to review the brand preference factors, is exploratory in nature. The data for the study, primary as well as secondary in nature, has been collected using questionnaires from 712 customers/car owners in the area of Coimbatore city, from April 2005 to April 2009, yielding a response rate of 77.65%. In the first stage of sample selection, stratified random sampling techniques were used to stratify the regions of Coimbatore city, and in the second stage of sampling, the simple random sampling technique was used to set of respondents.

For this we have used different Tools-

1. Factor analysis2. Customer behavior analysis

Factor analysis has been defined as a tool which attempts to identify the underlying variables or factors that explain the pattern of correlations within a set of observed variables.

RESEARCH DESIGN:In the initial phases ,we collected information about the passenger car industry from various secondary sources such as already existing research journals and surveys, business magazines,internet, etc. We refereed to the annual reports of brands to understand how they view the industry.This study provided us the following:

The factors which affect consumer’s brand preference. Various players in the market and the respective brands Market share and relative positioning of different brands Consumer perspective and expectations Brand prefernce and attribute dependencies

Apart from this we also referred literature about consumer purchasing decision in high involvement product like cars. This provide us knowledge about how information search takes place in this category

and what are the important attributes that customer look for while chosing a good brand.

CONCLUSION:-

Before buying a particular product or service , a customer may have a number of questions in his mind regarding the product and its services. This research made a systematic effort at studying the consumer’s brand preference for passenger cars in India by analyzing the factors that influence the brand preference of the customers and addressed the beginning issues related to the selection of a brand. It is indeed obvious from the study that the product performance factors of the passenger car brands dominate the preference of the customers, based on their economic status. The marketing communication strategies loosed by manufacturers and dealers also have a fair say on the total decision of the customer preference. Overall, the all-round ability of the car brands such as reliability , safety, technology, value for money, high resale value, high mileage, maintenance cost, quality, comforts, durability, etc., is the crucial factor in brand preference.

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THANK YOU SIR !!