Group - 3 Market Research Report

8/2/2019 Group - 3 Market Research Report

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1 Study On The Demand For Amrit Water Purifier| Group - 3

STUDY ON THE DEMAND EXISTING IN THE RURAL

MARKET FOR AMRIT WATER PURIFIER

SUBMITTED TO: Dr. P. Sathyapriya

BY GROUP - 3

Vaishnavi P

Ankur Verma

Anubhav Gupta

Ashraf Basarikatti

Ashis Ranjan


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EXECUTIVE SUMMARY___________________________

The increase in the number of people becoming conscious of the risks of

drinking contaminated water has led to the rapid rising demand for waterpurifiers. The Indian rural market with its vast size and demand potential offers

great opportunities to the marketers. Even though the rural market is large in

size and potential, marketers are not able to reap profits out of the opportunities

in the rural market because of the obstacles they are facing in the rural areas.

The problems like geographic spread and low population density and low

purchasing power posed a great challenge to the marketers in taking the productto the rural market. Apart from this the vast display of buying behaviour in rural

segment challenges the marketers in understanding the factors influencing the

buying decision of the consumers. This study seeks to understand the influence

of various factors in the buying decision of the rural consumers which would

help to study on the demand for the product AMRIT water purifier of Eureka

Forbes. This study is purely based on the primary data collected using

questionnaire. The sample size is 50, taken from the village Anekal. The

findings from the study indicate that monthly family income has greater

influence on the buying decision of the rural consumers in Anekal. The

marketing implications to increase the demand for the product is given based on

the findings.


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TABLE OF CONTENTS

Serial

Number CONTENTS Page Number

1. Executive Summary 2

2. Introduction 4

3. Literature Review 5

4. Research Problem 7

5. Research Objective 8

6. Hypothesis 8

7. ResearchMethodology 9

8. Data Analysis 9 - 17

9. Findings 17

10. Limitations 18

11. Conclusion 18

12. Appendix 19 - 21

13. References 22


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INTRODUCTION_____________________________

Pure and safe drinking water has always been a necessity. In the past few years,

Indian water purifier industry has witnessed an exponential growth of 22%

CAGR. The water purifier industry sales grew dramatically during FY09 as

compared to previous fiscals due to improving demand and expanding

production capacity. The industry saw high growth of rate 17% during FY08

due to the increasing awareness for safe drinking water. According to Research,

Indian Water Purifier industry will continue its growth trajectory and is

expected to witness a turnover growth of more than 22% CAGR during the period between FY11 and to FY14. The Indian market has tremendous

potential which is more evident from the fact that global majors such as Philips

and Hindustan Lever have stepped in and are looking to increase their share of

the market. The three principal players today are Eureka Forbes, KENT RO and

Ion Exchange (PRLog, 2010). [1]

INDIAN RURAL MARKET:

India lives in villages, close to 72 percent of Indian population lives in rural

areas. In the country we have 6.36 lakh villages out of which only 13 percent

have population above 2000. More than 50 percent of the sales FMCG and

Durable companies come from the rural areas. The McKinsey report (2007) on

the rise on consumer market in India predicts that in twenty years the rural

Indian market will be larger than the total consumer markets in countries such

as South Korea or Canada today, and almost four times the size of todays urban

Indian market and estimated the size of the rural market at $577 Billion.

According to NCAER 2002, the number of rural middle class households

at 27.4 million is very close to their urban counterpart at 29.5 million. And

between, 1981-2001 there has been tremendous improvement in the literacy

levels, poverty and rural housing in the villages of the country. Rural literacy


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levels have improved from 36 percent to 59 percent, the number of below

poverty houses have declined from close to half to 46 percent and the numbers

of well built houses have doubled from 22 percent to 41 percent. These figures

provide us with a clear picture that rural India with the increase in agricultural

income and improving standards is on the verge of becoming a large untapped

market which marketers have been aspiring for a very long period of time. Thus

the current status of rural markets makes it an attractive market for marketers

(Aithal, Mukhopadhyay). [2]

LITERATURE REVIEW____________________________

Rural markets in India constitute a wide and untapped market for many products

and services which are being marketed for the urban masses. The rural market

provides vast potential as many new products have already made their entry into

the rural consumer basket. In spite of its large size and high potential, many

marketing firms are not able to avail the opportunities in rural market because of

problems in selling the goods in rural areas (Rao, 2002). This posed manychallenges to the marketers; the first is posed by the geographic spread and low

population density in the villages in the country. The second challenge is from

the low purchasing power and limited disposable incomes in these parts of the

country. But this has been changing in the last few decades. [3]

The current scenario is that about 70% of Indias population lives in rural

areas. Consumers in this segment have displayed vast differences in their

purchase decisions and the product use. Understanding the consumer behaviour

is vital while marketing the product in the rural segment. (Loya,). [4] In recent

years, the rural consumers are discerning and the rural market is more vibrant.

Considering the rate of growth in these markets, it will soon become more

successful than the urban market. (Adi, Godrej)


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The factors influencing the rural consumer behaviour are:

1. socio-economic environment of the consumer2.

education/literacy level

3. occupation4. exposure to urban lifestyles and media5. involvement of others in the purchase decision6. marketers effort to reach out the rural markets (Rao, 2008)

Socio-economic environment of the consumer influences the buying decision to

a greater extent. The income level and the standard of living have a major role

to play. Rural segments are ignored by few companies because of the low

income level and the conservative attitude of the people in rural areas.

Literacy level of the consumers in the rural market in turn explains the

awareness of the consumers on health issues. Educated people tend to be more

health conscious. Consumers with low-literacy level might want the product if

proper awareness is given about water borne diseases and the importance of

purified water.

Consumers in rural market might be self-employed or employed in other firms.

Consumers depending on monthly income will be more conservative. Their

perceptions and the buying decisions might be influenced by the occupation

factor.

Rural consumers prefer to stay in the village rather visiting nearby towns except

for markets. They may not have exposure to the urbanized life. This might

influence their acceptance for a product. Also, the exposure to media influence

on the perceptions and the buying decision of the rural consumers.


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Involvement of others in the purchase decision is yet another factor in this

regard. There has been a change in the recent years. In the past, the head of the

family used to make the purchase decision all by himself. In contrast, the

involvement of the other members of the family has been growing in recent

years. An increase in literacy coupled with greater access to information has

resulted in this development.

The consumers in the rural segments are ignored by most of the companies

because of the infrastructure and the cost of reaching out. It is marketers

responsibility to find the selling practice which would make the consumers

comfortable and get awareness about the product. The method of selling might

influence the buying decision of the consumer. [5]

RESEARCH PROBLEM____________________________

In view of the above discussion, this study cites the problem whether Amrit

water purifier of Eureka Forbes will be accepted by the rural consumers in

Anekal. The rural consumers have been displaying vast buying behaviour. The

factors influencing the buying decision in rural segments differ from place to

place. This study attempts to study on the consumer behaviour in Anekal market

where Eureka Forbes intends to penetrate.


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RESEARCH OBJECTIVE__________________________

The objective is to make a study on the demand for the product Amrit water

purifier of Eureka Forbes in the rural market Anekal. In order to make a study

on the demand for the product, the marketer should understand the factors

influencing the buying behaviour of the rural consumers in Anekal. We consider

the factors mentioned in the previous study on the consumer behaviour in the

rural market and determine the factor which has most significant influence on

the demand for the product in Anekal market.

HYPOTHESIS_____________________________________

The null hypothesis for the influencing factors considered:

H1: there is no significant influence of the socio-economic factor on the demand

for the product

H2: there is no significant influence of the educational factor on the demand for

the product

H3: there is no significant influence of the occupation factor on the demand for

the product

H4: there is no significant influence of the exposure to urban lifestyles and

media on the demand for the product

H5: there is no significant influence of the involvement of others in the purchase

decision on the demand for the product

H6: there is no significant influence of the marketers effort to reach out the

rural markets on the demand for the product


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RESEARCH METHODOLOGY_____________________

In order to understand the perceptions and the buying behaviour of the

consumers in Anekal, a descriptive research has been carried out to describe the

data and the characteristics about the observations, seeking better understanding

about the buying behaviour of the rural consumers. This study is based upon the

primary data collected from the sample population in Anekal.

The population of this study is taken from Anekal, a rural area quite far from

the city zone. The sample size is 50 using simple random sampling out of the

whole population available in Anekal. The data was collected using

questionnaire comprising of the consumers demographic profile and questions

probing the factors influencing the buying behaviour will be developed as

follows;

What is your occupation? What is your income level? Do you think purifying water will avoid health issues to some extent? What method would you prefer to purify the water? How often you visit cities? Who makes the buying decision in your family? Have you heard about the product amrit water purifier? Would you like to prefer Amrit water purifier?


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DATA ANALYSIS_________________________________

In this study the dependent variable is the demand for the product in Anekal and

the influencing factors are the independent variables. The influencing factors

considered in this study might not have a significant relationship with the

dependent variable because it varies from place to place.

Correlation test will be conducted to verify if there exist a significantrelationship between the dependent and the independent variables.

ANOVA will be conducted to validate and get the values for regressionmodel

Regression analysis will be done to determine the coefficients ofcorrelation in order to understand to what extent each factor influences

the dependent variable demand for the product.

STATISTICAL REPRESENTATION OF MARKET SURVEY :

CORRELATION:

Educa

tion

level

Occ

upati

on

Mont

hly

Inco

me

Buyin

g

Decisi

on

Visit

to

city

Exposu

re to

media

Type

of

selling

Dem

and

Educationlevel

PearsonCorrela

tion

1 -.175

.372

**

.237 .296

*

.224 -.146 -.156

Sig. (2-

tailed)

.224 .008 .098 .037 .118 .313 .279

N 50 50 50 50 50 50 50 50


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Occupation Pearson

Correla

tion

-.175 1 -.159 -.160 .073 -.131 .328* .088

Sig. (2-

tailed)

.224 .269 .268 .615 .366 .020 .545

N 50 50 50 50 50 50 50 50

Monthly

Income

Pearson

Correla

tion

.372** -

.159

1 .297* .382** .259 -.114 -

.598*

*

Sig. (2-

tailed)

.008 .269 .036 .006 .069 .431 .000

N 50 50 50 50 50 50 50 50

Buying

Decision

Pearson

Correla

tion

.237 -

.160

.297* 1 .276 .288* .041 -

.298*

Sig. (2-

tailed)

.098 .268 .036 .052 .043 .776 .036

N 50 50 50 50 50 50 50 50

Visit to city Pearson

Correla

tion

.296* .073 .382** .276 1 .209 .072 -.252

Sig. (2-

tailed)

.037 .615 .006 .052 .146 .618 .077

N 50 50 50 50 50 50 50 50

Exposure to

media

Pearson

Correla

tion

.224 -

.131

.259 .288* .209 1 .182 -.181


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Sig. (2-

tailed)

.118 .366 .069 .043 .146 .205 .210

N 50 50 50 50 50 50 50 50

Type of selling Pearson

Correla

tion

-.146 .328* -.114 .041 .072 .182 1 .020

Sig. (2-

tailed)

.313 .020 .431 .776 .618 .205 .892

N 50 50 50 50 50 50 50 50

Demand Pearson

Correla

tion

-.156 .088 -

.598**

-.298* -.252 -.181 .020 1

Sig. (2-

tailed)

.279 .545 .000 .036 .077 .210 .892

N 50 50 50 50 50 50 50 50

**. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

FINDINGS:

There is a significant relationship between the following variables.

Educational level and Monthly Income.

Educational level and Visit to city. Occupation and Type of selling. Monthly Income and Buying Decision. Monthly Income and Visit to city. Monthly Income and Demand. Buying Decision and Exposure to media.

Buying Decision and Demand.


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REGRESSION:

Variables Entered/Removed

Model

Variables

Entered

Variable

s

Remove

d

Metho

d

1 Type of

selling,

Buying

Decision,

Visit to city,

Exposure to

media,

Education

level,

Occupation,

Monthly

Income

. Enter

a. All requested variables entered.

b. Dependent Variable: Demand


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FINDINGS:

R2 value shows that the independent variables are related to an extent of 38.3%.

Model Summary

Mod

el R

R

Square

Adjusted R

Square

Std. Error

of the

Estimate

1 .619a .383 .280 .519

a. Predictors: (Constant), Type of selling, Buying

Decision, Visit to city, Exposure to media,

Education level, Occupation, Monthly Income

ANOVAb

Model

Sum of

Squares Df

Mean

Square F Sig.

1 Regressio

n

7.010 7 1.001 3.719 .003a

Residual 11.310 42 .269

Total 18.320 49

a. Predictors: (Constant), Type of selling, Buying Decision, Visit to

city, Exposure to media, Education level, Occupation, Monthly

Income

b. Dependent Variable: Demand


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Coefficientsa

Model

Unstandardized

Coefficients

Standardize

d

Coefficient

s

t Sig.B Std. Error Beta

1 (Constant) 2.418 .406 5.952 .000

Education

level

.083 .116 .097 .710 .481

Occupation -.002 .117 -.003 -.019 .985

Monthly

Income

-.453 .109 -.590 -4.140 .000

Buying

Decision

-.090 .086 -.140 -1.047 .301

Visit to city -.012 .108 -.015 -.106 .916

Exposure to

media

-.001 .119 -.002 -.012 .991

Type of selling -.033 .173 -.025 -.189 .851

a. Dependent Variable: Demand

**. Coefficient is significant at the 0.01 level .

*. Coefficient is significant at the 0.05 level .

FINDINGS:

There is a significant impact of Monthly Income on Demand of the product with

less than 1% significant level.


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INDEPENDENT VARAIBLE :1. Educational Level2. Occupation.3. Monthly Income.4. Buying Decision5. Visit to City.6. Exposure to Media.7. Type of Selling.

DEPENDENT VARIABLEDemand for the product. HYPOTHESIS :

H0: There is no significant influence of Educational level,

Occupation, Monthly Income, Buying Decision, Visit to City,

Exposure to Media and Type of Selling on Demand of the product.

REGRESSION LINE:

Y = ^

+ ^x1+ ^x2+ ^x3+ ^x4+ ^x5+ ^x6+ ^x7

Where,

Y= 2.418 - 0.453 x (Monthly Income)

^

= constant value of the dependent variable.

^= Beta value of the variables.

X1-X7 = independent variables.


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ANOVA TEST :

Since the Significance value is less than 1%(0.01) we reject the Null

hypothesis (H0) , which states that there is a significance influence of

Educational level, Occupation, Monthly Income, Buying Decision, Visit

to City, Exposure to Media and Type of Selling on Demand of the

product.

RESULT :

Monthly Income has a significance level of impact on Demand for the

product with less than 1% (0.01) level of significant, but the Beta value of

Monthly Income is negative which means that if Monthly Income

increases the Demand of the product will decrease.

FINDINGS________________________________________

The study on the demand for Amrit water purifier gives a brief idea about

the market scenario of the rural market Anekal. The study shows how different

factors influence the buying behaviour of the consumers in the rural market.

These factors change with demographics and geographies which show huge

diversity of buying behaviour in rural and urban market. The finding which wegot from the study is that the Monthly Income has a great influence on the

demand of the product, as the income level rises the demand of the product goes

down and vice versa.


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LIMITATIONS____________________________________

Although all the efforts have been made to make the results as accurate as

possible, yet the survey suffers from some limitations. Following are some ofthe limitations of the study. The purpose of mentioning these limitations is not

to dilute or decrease the quality of results rather to enable the reader to judge the

validity of the result regarding the study. Following are some limitation of the

study.

Sample size is limited due to cost constraint.Geographical area is limited to Anekal area Bangalore.Most of the users don't know about water purifier so they might

assume the answers.

Many respondents were not interested to give the required time to fillthe questionnaire.

CONCLUSION____________________________________

This study revealed the insights about the factors influencing the buying

behaviour of the rural consumers. The findings are made by using the responses

provided by 50 rural consumers. This study suggests the marketers to focus on

the promotional activities since the result of the test indicates that the monthly

family income factor influences the buying decision to a greater extent

compared to the other factors.


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APPENDIX_______________________________________

The questionnaire used for collecting the primary data.

CUSTOMER QUESTIONNAIRE

Dear respondent,

We, students of Alliance University would like you to fill up this

questionnaire which would help us to make study on the demand for the

product- AMRIT water purifier of EUREKA FORBES.

We request you to fill in the questionnaire with at most accuracy. The

information provided by you will be used only for the academic purpose.

1. Name :_________________________________2. Gender : a) Male b) Female3. Education :

a) Nil b) High school c) Graduated) Post graduate

4. occupation : a) Business b) Employee c) Others__________5. Monthly family Income :

a) Upto Rs 10,000 b) Rs 10,000- Rs 25,000

c) Above Rs 25,0006. How many members are there in your family?

a) 2 b) 2-4 c) >47. Who makes the buying decision in your family?

a) Man b) woman c) consult with everyone


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8. How often you visit city in a month?a) 1-2 b) 2-5 c) more than 5 times

9. What level of importance do you give for purified water in your daily life?Very high High Medium Low Very low

10.Do you agree that purifying water will help in avoiding health issues tosome extent?

a) Yes b) No11.How do you purify your water?

a) Cloth b) Boil c)Water purifiers d) Others_______12.Do you think water purifier is important?

a) Yes b) No13.What do you expect in a water purifier?

a) Ease of use b) Durability c) Qualityd) Others ____________

14.What kind of water purifier would you prefer?a) Electrical b) Non-electrical

15.How much would you spend on Water purifier?a) Rs 1000 b) Rs 1000Rs 1500 c) Rs 1500- Rs 2000

16.Have you heard of the product AMRIT EUREKA FORBES?a) Yes b) No

17. If yes, how did you come to know about the product?

a) TV b) Newspaper Ad c) Local magazine

d) Friends


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18. If from friends, what feedback you have received about the product?

a) Bad b) Good c) Very good d) Excellent

19. Do you think AMRIT is affordable for you?

a) Yes b) No

20. What type of selling makes it comfortable for you to buy?

a) Personal selling b) Retailers c) self-groups

21. Would you prefer to buy AMRIT water purifier?

a) Yes b) No

22. Your expectations from a water purifier?

.

.

.

THANK YOU FOR YOUR COOPERATION. . .


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REFERENCES____________________________________

[1] PRLog(press release) - Oct 2010 India water purifier market outlook 2014

http://www.prlog.org/10978400-india-water-purifier-market-has-tremendous-growth-potential.html

[2] Rajesh k Aithal and Arunabha Mukhopadhyay

http://www.csi-sigegov.org/3/32_319_3.pdf

[3] Consumer behaviour in rural market http://books.google.co.in/books

[4] Prof. Arpit Loya consumerbehaviour and rural marketing

http://www.sapientindore.org/sm/mba/semiv/405m/rural%20consumer%20beha

vior.pdf

[5] V S Rama Rao, Feb 2008http://www.citeman.com/2777-buying-behavior-

of-rural-consumers/
http://www.prlog.org/10978400-india-water-purifier-market-has-tremendous-growth-potential.htmlhttp://www.prlog.org/10978400-india-water-purifier-market-has-tremendous-growth-potential.htmlhttp://www.csi-sigegov.org/3/32_319_3.pdfhttp://www.sapientindore.org/sm/mba/semiv/405M/Rural%20Consumer%20Behavior.pdfhttp://www.sapientindore.org/sm/mba/semiv/405M/Rural%20Consumer%20Behavior.pdfhttp://www.citeman.com/2777-buying-behavior-of-rural-consumers/http://www.citeman.com/2777-buying-behavior-of-rural-consumers/http://www.citeman.com/2777-buying-behavior-of-rural-consumers/http://www.citeman.com/2777-buying-behavior-of-rural-consumers/http://www.citeman.com/2777-buying-behavior-of-rural-consumers/http://www.citeman.com/2777-buying-behavior-of-rural-consumers/http://www.sapientindore.org/sm/mba/semiv/405M/Rural%20Consumer%20Behavior.pdfhttp://www.sapientindore.org/sm/mba/semiv/405M/Rural%20Consumer%20Behavior.pdfhttp://www.csi-sigegov.org/3/32_319_3.pdfhttp://www.prlog.org/10978400-india-water-purifier-market-has-tremendous-growth-potential.htmlhttp://www.prlog.org/10978400-india-water-purifier-market-has-tremendous-growth-potential.html

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