“A study on custmers’ preference towards packaged grocery product”

“A STUDY ON CUSTMERS’ PREFERENCE TOWARDS PACKAGED GROCERY

PRODUCT”

Abstract

I have conducted a research on topic “ A study on customers’ preference towards

grocery packaged product’. For this I selected Durg and Bhilai as a target market and I started my

research from 11th of March 2014 and collected the data from these two cities. I collected data from

businessmen, students, servicemen/professionals and households. I completed my data collection

on 23/03/2014 and then I started data tabulation & finally I made data analysis 25/03/2014. In data

analysis I used One-way ANOVA Technique. I used SPSS to analyze the data. As the result, I found

that there is a significant difference between the factors of packaged grocery product in the opinion

of the customers. All factors have different impact on the preference of customers and these factors

help the marketers while developing sales strategies.

INTRODUCTION

Very early in time, food was consumed where it was found. Families and villages were self-

sufficient, making and catching what they used. When containers were needed, nature

provided gourds, shells, and leaves to use. Later, containers were fashioned from natural

materials, such as hollowed logs, woven grasses and animal organs.

Fabrics descended from furs used as primitive clothing. Fibers were matted into felts by

plaiting or weaving. These fabrics were made into garments, used to wrap products or

formed into bags. With the weaving process, grasses, and later reeds, were made into

baskets to store food surpluses. Some foods could then be saved for future meals and less

time was needed for seeking and gathering food.

As ores and compounds were discovered, metals and pottery were developed, leading to

other packaging forms. A brief review of the more popular packaging developments are

included in this fact sheet.

Sixty years ago our food was grown, farmed and processed within relatively short distances

of retail outlets. Today, foods originate all over the world. The functions of packaging have

multiplied and foods must be protected and kept in good condition during transport and

storage throughout the distribution chain. All the skill, quality, and reliability built into the

food during growing, processing, and preparation will be wasted unless proper design and

manufacture of packaging ensures 'safe delivery to the consumer in prime condition at an

economic cost'.

The Grocery sector in India is riding the wave of the retail revolution. It is a large industry

divided into organized and unorganized, small and large scale units. Rice, Atta, Sugar, Pulses

are the major products that fall in this category. Nichrome has contributed to this sector in a

big way. Kohinoor, Dawat, Pilsbury, Kargil, ITC, India Gate, Lal Quila, KBR, Deccan Sugar,

Mawana Sugar, Nilgiris....

LITERATURE REVIEW

History of food packaging

Early in history food was consumed where it was found. With the development of

agriculture, families and villages were self-sufficient, producing, making and catching what

they used. When packaging was needed, nature provided shells, gourds, animal skins etc.

In time, containers or packaging were made from natural materials such as reeds, grasses,

logs, bark and animal parts. Grasses and reeds were woven into baskets to store food. As

ores and metals were discovered, metals and pottery were developed, leading to other

packaging forms. An approximate chronology is as follows:

> 20,000 years ago – modified natural materials – grass, reeds, skins

8,000 years ago – ceramics, amphorae, - developed in the Middle East

5,000 years ago – wood, barrels, boxes, crates – wooden boxes found in Egyptian tombs

3,500 years ago – mass produced ceramics, pottery – invention of the pottery wheel

2,500 years ago – glass containers, - glass blowing developed by the Phoenicians and Syrians

2,000 years ago – paper and cellulose fibres - not true paper.

The last 1,000 years has seen many changes and advances in packaging as a result of huge

social change. The expansion of trade played a part.

In the 1970s a study of packaging systems in China found that 17.5 percent of the country’s

cement was lost during transportation; and 20 percent of all glass was damaged before it

could be used.

Similar findings came out of a study in Russia in the 1980s where it was found that lack of

packaging, distribution and storage facilities resulted in annual losses of:

45 percent of fresh vegetables – as high as 70 percent of potatoes;

55 percent of fresh fruit;

50 percent of grain;

1 million tons of meat; and

1.5 million tons of fish.

Packaging has several objectives:

Physical protection - The food enclosed in the package may require protection from, among

other things, shock, vibration, compression, temperature, etc.

Barrier protection - A barrier from oxygen, water vapor, dust, etc., is often required.

Permeation is a critical factor in design. Some packages contain desiccants or Oxygen

absorbers to help extend shelf life. Modified atmospheres or controlled atmospheres are

also maintained in some food packages. Keeping the contents clean, fresh, and safe for the

intended shelf life is a primary function.

Containment or agglomeration - Small items are typically grouped together in one package

for reasons of efficiency. powders, and granular materials need containment.

Information transmission - Packages and labels communicate how to use, transport,

recycle, or dispose of the package or product. Some types of information are required by

governments.

Marketing - The packaging and labels can be used by marketers to encourage potential

buyers to purchase the product. Package design has been an important and constantly

evolving phenomenon for several decades. Marketing communications and graphic design

are applied to the surface of the package and (in many cases) the point of sale display.

Security - Packaging can play an important role in reducing the security risks of shipment.

Packages can be made with improved tamper resistance to deter tampering and also can

have tamper-evident features to help indicate tampering. Packages can be engineered to

help reduce the risks of package pilferage: Some package constructions are more resistant

to pilferage and some have pilfer indicating seals. Packages may include authentication

seals to help indicate that the package and contents are not counterfeit. Packages also can

include anti-theft devices, such as dye-packs, RFID tags, or electronic article surveillance

tags, that can be activated or detected by devices at exit points and require specialized tools

to deactivate. Using packaging in this way is a means of retail loss prevention.

Convenience - Packages can have features which add convenience in distribution, handling,

stacking, display, sale, opening, reclosing, use, and reuse.

Portion control - Single serving packaging has a precise amount of contents to control

usage. Bulk commodities (such as salt) can be divided into packages that are a more suitable

size for individual households. It is also aids the control of inventory: selling sealed one-liter-

bottles of milk, rather than having people bring their own bottles to fill themselves. =

Types of Package

Paper and Paper Products

Paper may be the oldest form of what today is referred to as "flexible

packaging." Sheets of treated mulberry bark were used by the Chinese to wrap foods as early as the

First or Second century B.C. During the next fifteen hundred years, the paper-making technique was

refined and transported to the Middle East, then Europe and finally into the United Kingdom in

1310. Eventually, the technique arrived in America in Germantown, Pennsylvania, in 1690.

Paper and paperboard packaging increased in popularity well into the 20 th

century. Then with the advent of plastics as a significant player in packaging (late 1970s and early

1980s), paper and its related products tended to fade in use. Lately that trend has halted as

designers try to respond to environmental concerns.

Glass

Although glass-making began in 7000 B.C. as an offshoot of pottery, it was first industrialized in

Egypt in 1500 B.C. Made from base materials (limestone, soda, sand and silica), which were in

plentiful supply, all ingredients were simply melted together and molded while hot. Since that early

discovery, the mixing process and the ingredients have changed very little, but the molding

techniques have progressed dramatically.

At first, ropes of molten glass were coiled into shapes and fused together. By 1200 B.C., glass

was pressed into molds to make cups and bowls.

While other packaging products, such as metals and plastics, were gaining popularity in the

1970s, packaging in glass tended to be reserved for high value products. As a type of "rigid

packaging," glass has many uses today.

Metals

Ancient boxes and cups, made from silver and gold, were much too valuable for common use.

Other metals, stronger alloys, thinner gauges and coatings were eventually developed.

The process of tin plating was discovered in Bohemia in 1200 A.D. and cans of iron, coated with

tin, were known in Bavaria as early as the 14th = century.=20 However, the plating process was a

closely guarded secret until the 1600s. In 1764, London tobacconists began selling snuff in metal

canisters, another type of today's "rigid packaging." But no one was willing to use metal = for

food=20 since it was considered poisonous.

The safe preservation of foods in metal containers was finally realized in France in the early

1800s. Since food was now safe within metal packaging, other products were made available in

metal boxes. In the 1830s, cookies and matches were sold in tins and by 1866 the first printed metal

boxes were made in the United States for cakes of Dr. Lyon's tooth powder.

Plastics

Plastic is the youngest in comparison with other packaging materials. Although discovered in

the 19th century, most plastics were reserved for military and wartime use.

Styrene was first distilled from a balsam tree in 1831. But the early products were brittle and

shattered easily. Germany refined the process in 1933 and by the 1950s foam was available

worldwide. Insulation and cushioning materials as well as foam boxes, cups and meat trays for the

food industry became popular.

. Labels and Trademarks

One rather recent development in packaging is the labeling of the product with the company

name and contents information.

In the 1660s, imports into England often cheated the public and the phrase "let the buyer

beware" became popular. Inferior quality and impure products were disguised and sold to

uninformed customers. Honest merchants, unhappy with this deception, began to mark their wares

with their identification to alert potential buyers.

Official trademarks were pioneered in 1866 by Smith Brothers for their cough drops marketed in

large glass jars. This was a new idea - using the package to "brand" a product for the benefit of the

consumer.

In 1870, the first registered U.S. trademark was awarded to the Eagle-Arwill Chemical Paint

Company. Today, there are nearly three-quarters of a million (750,000) registered trademarks in the

United States alone. Labels now contain a great deal of information intended to protect and instruct

the public.

A Review

From containers provided by nature to the use of complex materials and processes, packaging

has certainly changed. Various factors contributed to this growth: the needs and concerns of

people, competition in the marketplace, unusual events (such as wars), shifting lifestyles, as well as

discoveries and inventions. Just as no single cause influenced past development, a variety of forces

will be required to create the packages of the future.

Major Competitors of packaged product

Reliance Fresh: To cover 70 cities, 784 urban towns and 6,000 - odd rural mandis

Future Group: 500 Spencer's Fresh, Daily, Super and Hyper

Wadhawan Group: 1,500 Spinach / S-Mart / Sabka Bazaar outlets in 100 cities

Subhiksha : 2,500 neighbourhood outlets across the nation

Other major players firming up Pan-India plans include Bharti-Walmart,

AV Birla Group (Trinethra/More), Heritage Foods (Fresh @, Hypercity, Dairy Farm, (Foodworld),

Nilgiris, Radhakrishna Foodland, Influx, Landmark Group (Spar), Mother Dairy and Safal & region

specific expansion by Jubilant Group (Jumbo Saver & Monday 2 Sunday), Hopcoms and Margin Free

in South, Adanis and Arambagh Foodmart in East India among others

Opportunity in grocery and food

The Urban Middle Class continues to grow by 20-25 million annually. The population is

young, better exposed to modern lifestyles, and has a preference for packaged food and

beverages. This growing Indian Middle Class, especially the employed youth in the ITES,

BPO and other Service sectors, have higher propensity to consume, fuelled by easy

availability of credit due to popularization of plastic cards.

More than 1,000 Food and Grocery outlets operational across tier-I and tier-II cities and

Retail space of over 3 million sq. ft. have come up for F&G supermarkets, department stores

and hypermarkets. 25 major F&G Retailers emerged in less than a year and Retail sales in

this segment grew by nearly 150 per cent over 2006.

RESEARCH METHODOLOGY

Research Objectives

1) To find out the preference level of packaged grocery product.

2) To identify the factors of packaged grocery factors.

3) To find out the significant/differences/similarities between the factors.

Customers’ preference

Availability of product Quality of product

Feasibility of collection

Purification of product

Separation of product

Packaged size of product

Brand Name

ConvenientTime Saving

Research Model

Questionnaire Design

In questionnaire, I have used Likert’s measurement scale to identify the preference level of the

customers’ preference towards packaged grocery product. Here 1 to 5 scales are used to be marked

their preference level , where ‘1 stands for Do not consider’, ‘2 stands for just consider’ , ‘3 stands

for little consider’, ‘4 stands for highly consider’ and ‘5 stands for more highly consider’. This

questionnaire includes 9 factors, which measures customers’ preference for packaged grocery

product. I decided 9 factors for measuring the preference level of customers like availability , quality

of product, feasibility of collection, separation, packaged size, purification of product & convenient,

brand name & time saving.

This questionnaire also consists personal details including Name, Gender, Age Group,

Occupation and Monthly Income.

SAMPLING UNIT

Sampling/Unit is the total number of samples differed in different classess.

S.No. Classes No.of Classes

1. Student 40

2. Service class 20

3. Business Class 25

4. Household 15

Total 100

Data have been collected through the survey method while surveys have

been conducted in two city:

i) Bhilai

ii) Durg

All the data are primary in the nature as they had been collected first and

personally. All the area had segmented according the population of this area.

I have considered 100 as sample size.

Research Plan

Research Design : Descriptive Research

Data Source : Primary Data

Research Instrument : Questionnaire

Measurement scale : Likert’s Scale

Sample Plan

Sampling Design : Simple Random Design

Sample Size : 100

Sample Location : Bhilai & Durg

Sample Element : STUDENT – 40

SERVICE CLASS – 20

BUSINESS CLASS – 25

HOUSEHOLD – 15

DATA ANALYSIS AND RESULTS

H0 There is no significant different between factors from each other

H1 There is significant different between factors from each other

Technique For Data Analysis

In this research, One – Way ANOVA has been adopted as technique for data anlysis

ANOVA: ANOVA is essentially a procedure for testing the difference among the different

groups of data for homogeneity. The essence of ANOVA is that the total amount of variation in a set

of data is broken down into two types, that can be attributed to chance and that amount which can

be attributed to specified causes.

Note: Following result has been calculated by using the SPSS Statistics 17.0 software.

Method to calculate one-way ANOVA in SPSS Statistics 17.0 as follows:

Tabulate the data in Excel.

Open the Excel file in SPSS Statistics

Go to “Analyze to Compare means to one-way ANOVA then select variables from list &

transfer to factors box and select the value & transfer to Dependent box

Finally click ok to get out put

ANOVA

Factor

Sum of

Squares Df Mean Square F Sig.

Between

Groups

91.929 8 11.491 8.368 .000

Within Groups 1223.520 891 1.373

Total 1315.449 899

Percentage wise result of each factors are as follows:

Factors X1 X2 X3 X4 X5 X6 X7 X8 X9

Average 3.9 4.4 3.6 3.9 4.09 3.2 3.7 3.8 4.1

Average

0

1

2

3

4

5

X1 X2 X3 X4 X5 X6 X7 X8 X9

factors

Per

cen

tag

e

Average

Where X1 = Availability of product

X2 = Quality of product

X3 = Feasibility of collection

X4 = Separation of product

X5 = Purification of product

X6 = Packaged size of Product

X7 = Brand name of product

X8 = Convenient

X9 = Time saving

INTERPRETATION OF FINDINGS

1) F > sig. (8.368 >1.948778)

So; Null hypothesis is rejected.

That means there is significant difference between the factors

from each other.

Likert’s measurement scale

Do not Little Just Highly More Highly

1 2 3 4 5

X1) Preference level of customers in terms of price while purchasing packaged grocery product:

X1

Frequency Percent Valid Percent Cumulative Percent

Valid 1 6 5.9 6.0 6.0

2 12 11.9 12.0 18.0

3 16 15.8 16.0 34.0

4 23 22.8 23.0 57.0

5 43 42.6 43.0 100.0

Total 100 99.0 100.0

Missing System 1 1.0

Total 101 100.0

As the above graph X1 explains that 43% people more highly

prefer availability of product and 23%, 16%, 12%, 6% people highly, just, little, do not prefer

availability of product respectively.

X2) Preference level of customers in terms of quality of product while purchasing packaged

grocery product:

X2


Valid 1 4 4.0 4.0 4.0

2 3 3.0 3.0 7.0

3 6 5.9 6.0 13.0

4 24 23.8 24.0 37.0

5 63 62.4 63.0 100.0

Total 100 99.0 100.0


Total 101 100.0

As the above graph X1 explains that 63% people more highly prefer quality of

product and 24%, 6%, 3%, 4% people highly, just, little, do not prefer quality of product

respectively.

X3) Preference level of customers in terms of feasibility of collection while purchasing

packaged grocery product:

X3


Valid 1 7 6.9 7.0 7.0

2 10 9.9 10.0 17.0

3 29 28.7 29.0 46.0

4 23 22.8 23.0 69.0

5 31 30.7 31.0 100.0

Total 100 99.0 100.0


Total 101 100.0


prefer feasibility of collection and 23%, 29%, 10%, 7% people highly, just, little, do not

prefer feasibility of collection respectively.

X4) Preference level of customers in terms of separation of product while purchasing


X4


Valid 1 1 1.0 1.0 1.0

2 8 7.9 8.0 9.0

3 32 31.7 32.0 41.0

4 22 21.8 22.0 63.0

5 37 36.6 37.0 100.0

Total 100 99.0 100.0


Total 101 100

As the above graph X1 explains that 37% people more highly prefer separation of

product and 22%, 32%, 8%, 1% people highly, just, little, do not prefer separation of product

respectively.

X5) Preference level of customers in terms of purification of product while purchasing


X5


Valid 1 7 6.9 7.0 7.0

2 7 6.9 7.0 14.0

3 13 12.9 13.0 27.0

4 16 15.8 16.0 43.0

5 57 56.4 57.0 100.0

Total 100 99.0 100.0


Total 101 100.0

As the above graph X1 explains that 56% people more

highly preferpurification of product and 16%, 13%, 7%, 7% people highly, just, little, do not

prefer purification of product respectively.

X6) Preference level of customers in terms of packaged size of product while purchasing


X6


Valid 1 8 7.9 8.0 8.0

2 24 23.8 24.0 32.0

3 27 26.7 27.0 59.0

4 22 21.8 22.0 81.0

5 19 18.8 19.0 100.0

Total 100 99.0 100.0


Total 101 100.0

As the above graph X1 explains that 19% people more highly packaged size of

product and 22%, 27%, 24%, 8% people highly, just, little, do not prefer packaged size of

product respectively.

X7) Preference level of customers in terms of brand name of product while purchasing


X7


Valid 1 7 6.9 7.0 7.0

2 10 9.9 10.0 17.0

3 21 20.8 21.0 38.0

4 26 25.7 26.0 64.0

5 36 35.6 36.0 100.0

Total 100 99.0 100.0


Total 101 100.0

As the above graph X1 explains that 36% people more highly brand

name and 26%, 21%, 10%, 7% people highly, just, little, do not prefer brand name

respectively.

X8) Preference level of customers in terms of convenient while purchasing packaged grocery

product:

X8


Valid 1 4 4.0 4.0 4.0

2 9 8.9 9.0 13.0

3 26 25.7 26.0 39.0

4 27 26.7 27.0 66.0

5 34 33.7 34.0 100.0

Total 100 99.0 100.0


Total 101 100.0

As the above graph X1 explains that 34%

people more highly covenient and 27%, 26%, 9%, 7% people highly, just, little, do not

prefer convenient respectively.

X9) Preference level of customers in terms of times saving while purchasing packaged grocery

product:

X9 = Time Saving


Valid

1 2 2.0 2.0 2.0

2 9 8.9 9.0 11.0

3 14 13.9 14.0 25.0

4 25 24.8 25.0 50.0

5 50 49.5 50.0 100.0

Total 100 99.0 100.0


Total 101 100.0


time saving and 25%, 14%, 9%, 2% people highly, just, little, do not prefer time saving

respectively.

CONCLUSIONS

In conclusion, it can be said that there should be highly availability of packaged

grocery product. Most of the factors which influence the customers to purchase it are quality,

purification, brand name, convenient and time saving and these are helpful to increase the sales of

this.

Business class people, service/professional, student as well as unmarried people are

the customers who highly require this product as the time saving is concerned. It may bring a bright

day for this grocery product sector if these are taken on the right hand & right way because as this

age is concerned, every one needs convenient, time saving in everything whatever they can be

availed.

REFERENCES

1) shopping habits and brand loyalty ,Radhika Chadha by

[email protected], Financial Daily from THE HINDU group of

publications, Business Line.

2) Xavier Drèze,Stephen J. Hoch,Mary E. Purk,Graduate School of Business,The

University of Chicago,Last Revision November 1994.

3) Retail-shelf universal sign-holder pouch ,Document Type and Number:

United States Patent 6651369 .

mailto:[email protected]?subject=%22Of%20shopping%20habits%20and%20brand%20loyalty...%22

APPENDICES

1) Questionnaire

QUESTIONNAIRE

I am student of Shri Shankaracharya Institute of Management & Technology and as a part of my

curriculum I am conducting project on CUSTOMERS’ PREFERENCE TOWARDS PACKAGED GROCERY PRODUCT.

I would be grateful to you for providing candid response. Your response would be kept strictly confidential &

will be used only for data analysis.

Q) . How much do you consider / prefer following factors of Packaged Grocery Product while purchasing

it?

Please rank your preference ranking between 1 to 5, where 1 stands for highly disagreed and 5

stands for highly agreed . Mark ( √ ) in the concerned column.

S.

No.

factor

Do not

consider/ not

significant/

not important/

not prefer

1

Little

consider/

significant/

important/

prefer

2

Just

consider/

significant/

important/

prefer

3

Highly

consider/

significant/

important/

prefer

4

More

highly

consider/

significant/

important/

prefer

5

1.

How much do you

prefer availability of

product?

2.

How much do you

prefer quality of product?

3.

How much do you

prefer feasibility of

collection?

4.

How much do you

prefer separation of

product?

5.

How much do you

consider purification of

product?

6.

How much do consider

package size of product?

7.

How much do you

consider brand loyalty?

8.

How much do you

consider convenient?

9.

How much do you

consider Time saving?

10) Your suggestion ( if any ): ………………………………………......................

………………………………………………………

Personal Details:

Name: ………………………………………………………..

Gender: Male Female

Age group (in year): a) <=15 b) 16 – 25

c) 26 – 35 d) >35

Marital Status: Married Unmarried

Occupation: a) Student b) Service Person/ professional

c) House Hold d) Businessman

Monthly Income: a) 0000 – 9999 b) 10000 – 19999

c) 20000 – 29999 d) 30000 – above

“A study on custmers’ preference towards packaged grocery product”

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Transcript of “A study on custmers’ preference towards packaged grocery product”